Supreme Court to Hear Arguments Oct. 31 in Philip Morris Case
By DONNA HIGGINS, Andrews Publications Staff Writer
The U.S. Supreme Court will hear oral arguments Oct. 31 in Philip Morris USA's challenge to what it calls an excessive $79.5 million punitive damage award to the family of a deceased smoker. The high court has received a dozen amicus curiae briefs supporting Philip Morris' argument that the award, if allowed to stand, will impermissibly punish the company for harm to individuals beyond those who are parties to the lawsuit, namely other smokers.
The briefs are from trade associations and advocacy groups, including the American Tort Reform Association, the Product Liability Advisory Council, the U.S. Chamber of Commerce, the Washington Legal Foundation, the National Association of Manufacturers and a group of Oregon businesses. The case originated in Oregon state court and went to the U.S. Supreme Court after Oregon's highest court affirmed the punitive award. The amici argue that if the high court allows the award to stand, businesses will suffer harm from excessive and unjustified punitive damages awards. The family of longtime smoker Jesse Williams has until Sept. 15 to file its brief on the merits. Philip Morris is challenging the punitive damages award made to Williams' family in the lawsuit filed in Oregon's Multnomah County Circuit Court. Williams allegedly smoked Marlboro cigarettes for 40 years before dying of lung cancer in 1997. The plaintiffs claimed Philip Morris should be liable for selling an unreasonably dangerous and defective product. They also alleged the company misrepresented the health effects of smoking and conspired to hide information about its hazards. The jury awarded $800,000 in economic damages and $79.5 million in punitive damages. Although the trial court reduced the punitive damages, a state appeals court restored them to the original amount. Philip Morris lodged its petition to the U.S. Supreme Court after the Oregon Supreme Court found the punitive damages award was not excessive. In agreeing to review the decision the U.S. Supreme Court said it would look at two questions Philip Morris raised: • In reviewing a jury's award of punitive damages, can an appellate court's conclusion that a defendant's conduct was highly reprehensible and analogous to a crime "override" the constitutional requirement that punitive damages be reasonably related to the plaintiff's harm? and• Does due process permit a jury to punish a defendant for the effects of its conduct on nonparties?Citing State Farm Mutual Automobile Insurance Co. v. Campbell, 538 U.S. 408 (2003), the cigarette maker says the jury impermissibly used this individual lawsuit as the means to punish the company for alleged harm to other smokers. In State Farm the high court said punitive damages should, in most cases, not be any more than nine times higher than the amount of compensatory damages. Philip Morris also takes issue with the Oregon Supreme Court's holding that any constitutional concern about the 97-to-1 ratio of punitive to compensatory damages was overridden by the possibility the jury found Philip Morris had engaged in "extraordinarily reprehensible" conduct that met the statutory definition of manslaughter. Under long-established practice and U.S. Supreme Court precedent, the constitutional maximum punishment is between zero and four times the amount of compensatory damages, Philip Morris says.
Philip Morris USA Inc. v. Williams, No. 05-1256, argument date set (U.S. Aug. 14, 2006).
Tobacco Industry Litigation Reporter
Volume 21, Issue 26
08/30/2006
Copyright 2006
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