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October 6, 2003
US Supreme Court Sends Oregon Tobacco Case Back
Background and Commentary on the SCOTUS Order
MAYOLA WILLIAMS, Appellant - Cross-Respondent, v. PHILIP MORRIS INCORPORATED, Respondent - Cross-Appellant, and
RJ REYNOLDS TOBACCO COMPANY, Defendants. The U.S. Supreme Court has granted review of a $79.5 million punitive damages award against Philip Morris on issued on March 30, 1999 in a wrongful death trial held in Oregon. The lawsuit was brought by the family of Jesse Williams, who smoked Marlboro cigarettes for 47 years, and resulted in a jury finding that Mr. Williams and Philip Morris were equally at fault for the fatal lung cancer suffered by Mr. Williams. The jury awarded the family $800,000 in compensatory damages. In addition, the jury found that Philip Morris was guilty of common law fraud for its 50 years of lies and awarded $79.5 million in punitive damages, much of which, under Oregon law, is directed to special state funds to benefit victims of crime. The trial judge reduced the punitive damages to $32 million and both Philip Morris and The Estate of Jesse Williams appealed.
The Oregon Court of Appeals rejected Philip Morris’ appeal but reinstated the $79.5 million punitive damages award on June 5, 2002. Philip Morris appealed to the Oregon Supreme Court, but was again rebuffed. Then the company appealed to the U.S. Supreme Court which had issued a decision earlier this year that can restrict awards of punitive damages that greatly exceed the underlying compensatory damages award (State Farm Insurance Co. v. Campbell).
Today’s decision by the nation’s high court simply sends the case back to the Oregon Court of Appeals so that it can reconsider its decision to restore the full punitive damages award in light of the State Farm decision and nullifies its restoration of the $79.5 million award stemming from last year’s decision. What this will likely mean is that the final punitive damages award is at risk of being reduced. What this does not mean is that the underlying jury verdict that found Philip Morris partially liable for the death of Jesse Williams is at substantial risk of being reviewed or affected in any way. The Oregon Court of Appeals already rejected Philip Morris’s arguments for a mistrial and the U.S. Supreme Court ruling has no legal effect on the Appeals Court’s decision beyond the issue of punitive damages. Mark Gottlieb, an attorney for the Tobacco Products Liability Project at Northeastern University School of Law states that, “If today’s Order results in a substantial reduction in the punitive damages award, then the effect of the State Farm decision might well be that, regardless of how reprehensible the conduct of a defendant and the scope of harm caused by its misconduct, the trial court and jury’s ability to deter future bad acts is limited by the amount of compensatory damages awarded. Such a result would be unfortunate because it undermines the purpose of punitive damages as a deterrent.” Mr. Gottlieb added that, “even if punitive damage awards in tobacco cases were limited to $5 or $10 million per individual case, attorneys would continue to file such cases in increasing numbers as their odds for success continues to increase. The State Farm decision does not get the tobacco companies off the hook in the courtroom by any means.”
(ORDER LIST: 540 U.S.) MONDAY, OCTOBER 6, 2003 CERTIORARI --SUMMARY DISPOSITIONS 02-1553 PHILIP MORRIS USA INC. V. WILLIAMS, MAYOLA, ETC. The petition for a writ of certiorari is granted. The judgment is vacated and the case is remanded to the Court of Appeals of Oregon for further consideration in light of State Farm Mut. Automobile Ins. Co. v. Campbell, 538 U. S. ___ (2003).
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