May 21, 2010 - U.S. cigarette makers, led by Altria Group and Reynolds American (RAI), have racked up a dismal record in Florida courts, where smokers and their families won 14 of the last 15 trials and were awarded more than $200 million in damages. But plenty of battles remain. That's because there are still more than 9,000 claims left to be tried. The industry's string of 14 losses, followed by one victory on May 19, are among the first cases to be heard on behalf of sick and dead smokers since the Florida Supreme Court threw out a huge class action aiming to represent 700,000 smokers in 2006.
Background: In December 2006 the Florida Supreme Court breathed new life into a case against the tobacco industry that had worked its way through the courts since 1994. The case is known as the Engle case (landmark 1994 lawsuit filed by Dr. Howard Engle that produced a $145 billion judgment against cigarette makers six years later). On July 6, 2006, the Florida Supreme Court cleared the path for hundreds of thousands of Florida residents to file individual lawsuits against the nation's largest tobacco manufacturers for injuries sustained from smoking cigarettes. The Court set a strict deadline for injured persons to file a lawsuit: July 6, 2007; which is one year from the date the Court issued its opinion. The Court ruled that individual plaintiffs can use previous jury findings against the tobacco industry in the newly filed lawsuits. (Cigarette Makers Face Thousands of New Florida Lawsuits..; Dr. Howard A. Engle, the veteran pediatrician who lent his name to a landmark class action suit against Big Tobacco, dies..)
Just yesterday, Thursday, May 20th a Broward County jury, Florida handed down a $29.1 million verdict to a widow who said her husband started smoking as a teenager. Connie Buonomo, 77, of Hollywood, said the decision to sue had little to do with recouping losses. She wants to punish and send a message to R.J. Reynolds Tobacco Company, the corporation she blames for her husband's illness and death. "Certainly we're disappointed," David Howard, a spokesman for R.J. Reynolds, said Thursday night. "We are going to appeal." (Tobacco trial jury awards Hollywood widow $29 million Husband could barely breathe for 13 years, woman said by Sofia Santana, Sun-Sentinel.com, 5/20/2010)
Edward Sweda, senior staff attorney for the Tobacco Products Liability Project, an antismoking group, says he thinks the Florida trial procedures are fair, and that the 9,000-plus people bringing claims now are a fraction of the estimated 700,000 Engle class plaintiffs. Both sides agree it could take decades for the cases to wind their way through Florida's legal system.
"Collectively, these cases are the single greatest litigation threat facing the industry," says Morgan Stanley (MS) analyst David Adelman.
Lawyers for Florida smokers say they hope the early verdicts will spur tobacco companies to settle remaining claims. Defense lawyers, however, argue the losing streak shows that the ground rules applied in the trials make it impossible for the companies to get a fair hearing.
Altria Group Inc.'s top executive Michael E. Szymanczyk, the company's chairman and chief executive office expressed confidence yesterday, May 20th (at the 2010 Annual Meeting of Shareholders) that the nation's largest tobacco company can defend itself against a wave of smoker lawsuits in Florida. Altria (parent of Philip Morris USA) is "bullish" that it can successfully fight thousands of lawsuits filed in Florida against cigarette companies, Michael E. Szymanczyk, the company's chairman and chief executive officer, said at the company's annual meeting yesterday.
"Litigation is part of this business," Szymanczyk said after one shareholder, lawyer and tobacco-control advocate Edward L. Sweda Jr., asked whether the company would reconsider its practice of refusing to settle lawsuits, considering the scope of the cases in Florida. Lawsuits against the company "remain a challenge," Szymanczyk said. "But if you look at the past decade, the company has had success defending its shareholders' interests."
Back in July 2009 Murray Garnick, a senior vice president and associate general counsel at Altria Group: "We continued to see a decline in the number of traditional smoking and health cases in 2008. In fact, last year no [health-related] tobacco case was tried to verdict against any U.S. cigarette manufacturer." (Philip Morris USA sees decline in health lawsuits..)
References: Big Tobacco's Many Days in Court Facing thousands of lawsuits in Florida, cigarette makers are crying foul by Bob Van Voris, Bloomberg Businessweek, 5/20/2010; Altria “bullish” on lawsuit outlook, CEO says, JOHN REID BLACKWELL RICHMOND TIMES-DISPATCH STAFF WRITER, 5/21/2010.
Some related news briefs in Florida:
Florida - big tobacco loses another case..;
Florida - jury awards $26.6 million to smoker's widow..;
Florida - 9 year old case, appeals court upholds $24.8 million award..;
Florida - $300 million jury award to former smoker overturned..;
Florida - jury awards $300 million in ex-smoker's suit..;
Florida - tobacco companies ask court to block ruling..;
Florida - plaintiff drops case to avoid paying legal fees for Philip Morris USA..;
R.J. Reynolds to appeal plaintiff's award of $30 million..;
R.J. Reynolds loses Florida court trial - widow gets $30 million..;
Broward County Florida jury awards widow of smoker $1.5 million..