Cigarette Makers Ask to Block Ruling in 4,000 Cases

Altria Group Inc.’s Philip Morris USA unit and other U.S. cigarette makers asked a federal appeals court to block federal trial courts from applying a 2006 Florida decision they claim would deprive them of a fair trial in thousands of death and injury suits in the state.
The companies argue that a series of factual findings endorsed by the Florida Supreme Court in a 2006 decision - including that the companies sold defective products, that they conspired to hide information about the health effects of smoking and that they made false statements about their products - can’t fairly be applied in any of 4,000 cases against them in Florida federal court.
The companies claim that applying the 2006 ruling, which came in the Florida’s “Engle” tobacco class action, ‘would compromise an arbitrary deprivation of the defendants’ federal due process rights,” as a lower judge ruled in August 2008.
The plaintiffs, smokers and their families who are suing the cigarette makers individually, claim the findings are based on ample evidence. They argue that the federal courts are required to apply state law in the cases and can’t review the state supreme court’s decision. A decision in the smokers’ favor would make it easier for smokers to win verdicts in the cases.
In Florida state courts, which instruct jurors on the factual findings endorsed by the state Supreme Court, smokers have won several of the post-Engle cases that have gone to trial. These include a $30 million verdict against Reynolds and an $8 million verdict against Philip Morris. The cases are being appealed.
Florida Smoker
The Engle case was filed in 1994 and named after a Florida smoker named Howard Engle who was the lead plaintiff. After more than a decade of litigation in the Florida courts, the Florida Supreme Court in 2006 rejected a $145 billion punitive damage verdict in the case and ruled that it couldn’t continue as a class action on behalf of smokers statewide who were addicted to nicotine and developed cancer or other smoking-related illnesses.
At the same time, Florida’s high court upheld a series of factual findings made by a Miami jury in the case, and said they would apply in all of the individual suits filed by smokers who had been part of the Engle class. The U.S. Supreme Court declined to review the case.
Specify the Defects
In the appeal today in Atlanta federal court, the companies aren’t challenging findings by the Engle jury, upheld by the Florida Supreme Court, that smoking is addictive and that it can cause illnesses including cancer, emphysema and heart disease.
“The complaints allege that the defendants were negligent and that they sold defective cigarettes,” said Andrew Frey, a lawyer for the cigarette makers. “Our position is that you have to specify the particular respect in which the product was defective, the particular respect in which the defendant was negligent.” Samuel Issacharoff, who argued the smokers’ case, told the judges that the Florida federal courts should follow the state supreme court and permit the findings to be used as they apply in individual cases. “Some of them may be useless,” said Issacharoff. “Some of them may simply streamline the cases.”
The three judges on the panel questioned the lawyers about the extent to which the Engle findings can be used by federal courts trying the cases. Each of the judges suggested the findings may be used to some extent.
Reynolds, Lorillard
“I promise you, you’re not going to get an opinion that says ‘the district court opinion is affirmed for the reasons set out in the opinion below,’” said Circuit Judge Ed Carnes.
The judges didn’t say when they will rule in the case.
In addition to Richmond, Virginia-based Phillip Morris, the biggest U.S. cigarette maker, the companies in the case include No. 2 R.J. Reynolds Tobacco Co., a unit of Reynolds American Inc. and No. 3 Lorillard Tobacco, a unit of Lorillard Inc.
The 4,000 cases, along with about 4,000 in Florida state courts, were filed after the 2006 ruling. In August, U.S. District Judge Harvey Schlesinger in Jacksonville, Florida, ruled that the factual findings can’t be used in the federal trials and certified the case for immediate appeal.