By Jon Hood
ConsumerAffairs.com
June 2, 2009
A Florida jury yesterday ordered R.J. Reynolds to pay $30 million to the widow of a lung cancer victim, who sued the leading tobacco manufacturer pursuant to a 2006 ruling barring class actions against cigarette companies but allowing individual suits to proceed.
The three-person jury in Pensacola awarded $5 million in compensation last week, and yesterday tacked on $25 million punitive damages.
Martin's suit was brought individually because of a previous ruling barring similar suits brought as class actions. That case, Engle v. Liggett, was filed in 1994 on behalf of "all United States citizens and residents, and their survivors, who have suffered, presently suffer or who have died from diseases and medical conditions caused by their addiction to cigarettes that contain nicotine"; the class was later whittled down to only smokers from Florida. In 2000, a jury awarded $145 billion in punitive damages to the class.
In 2006, however, the Florida Supreme Court vacated the award and decertified the class, but said that individual class members could file suits on their own behalf.The Florida Supreme Court did, however, uphold a series of factual findings that would apply in individual suits. Specifically, the court found that tobacco products are addictive and dangerous, and that they are responsible for 16 different diseases. The court held that tobacco companies could be held liable for fraud, conspiracy, and negligence.
Monday's ruling follows a string of consumer victories in tobacco-related lawsuits. Last month, the California Supreme Court gave consumers the green light to sue tobacco manufacturers for running misleading ads that hide the harmful consequences of smoking. In February, a Florida jury awarded $8 million to Elaine Hess, the widow of a smoker who died of lung cancer at age 55. Additionally, last month a jury in Fort Lauderdale ordered the Liggett Group to pay $700,000 to the family of a trucker who smoked for 55 years. He also died of lung cancer, at age 81.
R.J. Reynolds's lawyer, Mark Belasic of Jones Day in Cleveland, called the Martin jury verdict an "outlier" and said that no other individual lawsuits had netted such a large award. Belasic argued that the jury award was unconstitutional and insisted it could not stand.
R.J. Reynolds is the second-largest tobacco manufacturer in the United States, second only to the Altria Group, previously known as Philip Morris. R.J. Reynolds manufactures many popular brands of cigarettes, including Camel, Winston, Kool, and Doral.
The recent string of consumer victories is likely to lead to more litigation, and more headaches for the nation's tobacco manufacturers. Meanwhile, the economic crisis has spurred some states to drastically increase taxes on cigarettes, leading consumers to think twice before buying a pack.
Recently, New York raised cigarette taxes by $1.25 per pack, predicting that the increase would generate $265 million in additional revenue every year. The increases are leading to a drop in cigarette sales, and also threaten items that consumers tend to buy simultaneously, such as lottery tickets.
