Bloomberg News

Altria Light-Cigarette Marketing Trial Ends in Jury Deadlock

October 25, 2011

(Updates with Philip Morris comment in fourth paragraph.)

Oct. 25 (Bloomberg) -- A judge hearing claims that Altria Group Inc.’s Philip Morris unit deceived Missouri smokers in marketing Marlboro Lights declared a mistrial after jurors said they couldn’t reach a decision.

The plaintiffs said Philip Morris falsely claimed that the brand was lower in tar and nicotine, in violation of state merchandising law. The smokers, who didn’t claim any personal injuries, said Philip Morris improperly touted Marlboro Lights as safer than other brands.

The plaintiffs were seeking $700 million in the St. Louis trial. Philip Morris denied there was any deception and disputed damages. The 12 jurors, who began deliberations Oct. 17, said today they were one vote shy of the nine members needed for a verdict. The vote was 8-4 for the plaintiffs, jurors said after the trial ended.

“Today’s mistrial shows that the plaintiffs failed to convince a jury of their claims,” Murray Garnick, an Altria vice president and associate general counsel, said today in a statement. “We continue to believe that these claims are baseless.”

The lawsuit will be tried again at a date to be determined, smokers’ lawyer Stephen Swedlow said in an interview.

“We were only one vote short,” Swedlow said. “We’ll make strategies to pick up that one vote the next time.”

Sued in 2000

The lawsuit was filed in 2000 on behalf of all buyers of Marlboro Lights in Missouri. The group includes as many as 400,000 current and former Marlboro Lights smokers. The trial began with opening statements last month.

The smokers claimed that Philip Morris “willfully deceived consumers regarding the nature and effect of Marlboro Lights,” according to the complaint.

Philip Morris convinced the plaintiffs that it was better for their health to smoke Marlboro Lights than other cigarettes, Swedlow, the smokers’ attorney, told the jury Oct. 17 in closing arguments.

Philip Morris “fraudulently represented” that there was less tar and nicotine in Marlboro Lights, Swedlow said. The smokers didn’t get what they were promised, making their purchases worth less than what they paid, he said.

“There was no deception on our part,” Beth Wilkinson, a Philip Morris lawyer, said in her closing arguments.

Missouri smokers suffered no damages, George Lombardi, another attorney for Richmond, Virginia-based Altria’s Philip Morris unit, said in his closing Oct. 17.

No Loss

“Nobody in this class paid a penny more for Marlboro Lights than Marlboro Reds or any other cigarette,” he told the jury. “There was no ascertainable loss.”

Eight jurors agreed that Philip Morris was deceptive in marketing Marlboro Lights, said juror Genise Lay, 41, of University City, Missouri.

“There wasn’t any consistency in the nicotine and tar delivered,” she said. The label on the package “indicated that it was consistent,” she said.

Jurors voting for the defense “felt very strongly that it was a matter of choice for the consumer,” she said.

The class covers all purchasers of Marlboro Lights in Missouri from 1995 through 2003. Philip Morris sold $1.9 billion worth of the cigarettes to the class members, Swedlow said.

The smokers should never have been certified as a class, Garnick said.

Individual Issues

“All federal courts and seven state courts have refused to certify these types of cases as class actions, recognizing that there are too many individual issues,” he said.

This is the second lawsuit to go to trial in Missouri this year against the tobacco industry over marketing practices. Missouri hospitals lost a jury verdict in April in their claim that Philip Morris, R.J. Reynolds Tobacco Co., Lorillard Tobacco Co. and other cigarette makers manipulated the nicotine content in cigarettes and misrepresented the health effects of smoking.

The hospitals, which were seeking more than $455 million in damages, claimed the industry’s actions boosted spending for unreimbursed and uncompensated tobacco-related health care.

The companies denied any responsibility for patient-care costs at the hospitals or any financial losses by the hospitals. A state-court jury in St. Louis sided with the cigarette makers.

The case is Larsen v. Philip Morris Cos., 002-00406-02, Circuit Court, City of St. Louis, Missouri.

--Editors: Andrew Dunn, Charles Carter

To contact the reporters on this story: Margaret Cronin Fisk in Southfield, Michigan, at mcfisk@bloomberg.net; Joe Whittington in St. Louis at joethewhitt@sbcglobal.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


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