Nik Modi, tobacco analyst with UBS: Supreme Court Case "was a coin flip.."

December 16, 2008 - Nik Modi, tobacco analyst with UBS Investment Research, New York, said in a research note that heading in, the Good case "was a coin flip." He added that "the FTC argument (that because the FTC authorized 'lights' phrases, the industry is not liable) was not the strongest argument and that the decision was close to a 50/50 probability either way."

He said, "However, today's U.S. Supreme Court decision did not affect the industry's primary argument against class-action lawsuits: that no two smokers within a class are truly alike in terms of how they interpreted cigarette labeling or marketing or its health impact. This argument has worked for the industry in de-certifying the overwhelming majority of lights class action cases, and worked in the Engle and Price class actions.... While the headlines on the decision would lead one to expect a slew of new class-action lawsuits against the industry, we note that class actions against tobacco are not substantially more attractive today due to: 1.) the primary argument that no two smokers are truly alike, and 2.) the limitations set from past precedents on punitive damage awards."

Three Maine residents sued Altria Group Inc. and its Philip Morris USA Inc. subsidiary under the state's law against unfair marketing practices. The class-action claim represents all smokers of Marlboro Lights or Cambridge Lights cigarettes, both made by PM USA. The lawsuit argues that the company knew for decades that smokers of light cigarettes compensate for the lower levels of tar and nicotine by taking longer puffs and compensating in other ways.

A federal district court threw out the lawsuit, but the 1st U.S. Circuit Court of Appeals said it could go forward.

Reference: SCOTUS (Supreme Court of the United States) Greenlights 'Light' Suits PM USA: "We continue to view these cases as manageable" , CSP Daily News, 12/16/2008.

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