Bloomberg News

R.J. Reynolds Loses Bid to Fight Smoker’s Verdict in High Court

March 26, 2012

The U.S. Supreme Court won’t review a $28.3 million wrongful death verdict against R.J. Reynolds Tobacco Co., declining to consider legal questions that may affect thousands of similar cases by smokers and their families.

The court today left intact the verdict in a case filed in the wake of a 2006 Florida Supreme Court decision that lets plaintiffs in cigarette-liability suits use factual findings by a jury in an earlier case to prove their claims. Reynolds, Altria Group Inc. and other U.S. cigarette makers claim Florida trial judges are applying the findings too broadly, depriving them of their right to defend themselves in court.

“The Florida state courts are engaged in serial due- process violations that threaten the defendants with literally billions of dollars of liability,” Reynolds said in a brief seeking review by the U.S. Supreme Court.

In its 2006 ruling, Florida’s highest court decertified a statewide class action and threw out a $145 billion punitive damage verdict against the industry. At the same time, the court endorsed many jury findings in the case, including that the companies were negligent, conspired to hide information about the dangers of smoking and sold defective products.

The ruling is known as the Engle decision, after Howard Engle, the lead plaintiff in the case filed in 1994 on behalf of Florida smokers addicted to nicotine who developed cancer, heart disease and other illnesses. Engle, a Florida pediatrician, died in 2009.

Pensacola Jury

Reynolds, a unit of Winston Salem, North Carolina-based Reynolds American Inc. (RAI), is the second-biggest U.S. tobacco company. It asked the U.S. Supreme Court to review a case in which a Pensacola jury in 2009 awarded $3.3 million in compensatory damages and $25 million in punitive damages to Mathilde Martin, whose husband, Benny, died of lung cancer at age 66 after smoking Camel and Lucky Strike cigarettes for most of his life. An intermediate Florida appeals court upheld the verdict and the state Supreme Court declined to hear the case.

“Mrs. Martin’s independent evidence proved her husband died as a result of addiction to RJR’s Lucky Strikes and Camels, her husband’s reliance on RJR’s and its co-conspirators’ extensive 50-year misinformation campaign, and RJR’s liability for punitive damages,” her lawyers said in a brief opposing Supreme Court review of the case.

About 8,000 post-Engle cases claiming death and injury from smoking are pending against Reynolds, Altria Group Inc. (MO) and other U.S. cigarette makers in Florida state and federal courts.

State Court Trials

As of last month, plaintiffs, aided by the Engle jury findings, had won 40 of 58 verdicts in state court trials, according to Edward L. Sweda Jr., senior attorney for the Tobacco Products Liability Project, which tracks the suits. Defendants have won the first two post-Engle trials in federal court after the cases were delayed by pretrial appeals.

Defendants have lost $375 million in post-Engle judgments, Reynolds said in its brief. They face 75 more trials this year, the company said.

Several groups, including the Washington Legal Foundation and the U.S. Chamber of Commerce, filed briefs supporting Reynolds’s request for review of the Martin case by the U.S. Supreme Court.

Altria, the Richmond, Virginia-based maker of Marlboro cigarettes, is the biggest U.S. tobacco company.

The case is R.J. Reynolds Tobacco Co. v. Martin, 11-741, U.S. Supreme Court (Washington).

To contact the reporter on this story: Bob Van Voris in New York at rvanvoris@bloomberg.net

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


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