Media Backgrounder & Commentary:

 Consumer Protection Lawsuit against Philip Morris
Results in $10.1 Billion Award for
Fraudulent and Misleading Sales Practices
for Marlboro Lights and Cambridge Lights

Boston
March 21, 2003  

Contact:  Richard Daynard
Edward L. Sweda, Jr. or
Mark A. Gottlieb
617-373-2026
media@tplp.org

IN THE CIRCUIT COURT
THIRD JUDICIAL CIRCUIT
MADISON COUNTY, ILLINOIS

  SUSAN MILES, et al.,
Plaintiff,

 v.

 PHILIP MORRIS COMPANIES, INC., et al.,
Defendant.

 Case No. 00 L 0112

                  While the result, a multi-billion judgment against Philip Morris, is not new, this trial is the first of a new round of cases that seek to hold tobacco companies liable for deceiving consumers rather than for the personal injuries suffered by consumers.  About a month and a half after the trial began, and nearly two weeks after final arguments were heard, Judge Nicholas Byron ordered Philip Morris, Inc. to pay $7.1 billion in compensatory damages and another $3 billion in punitive damages.  Compensatory damages will be used to refund Marlboro Light and Cambridge Light smokers while the punitive damages will be retained by the State of Illinois.  See the decision.

CASE BACKGROUND

            Susan Miles, et al. v. Philip Morris Cos, Inc., presided over by the Hon. Nicholas Byron in the Third Judicial Circuit Court, a state court in Edwardsville, Illinois, is a landmark consumer fraud class action case, which was filed in 2000.  The plaintiffs proved to Judge Byron's satisfaction that the nation's largest cigarette manufacturer intentionally manipulated the design of its so-called "light" cigarettes to produce test results on cigarette machines that show lower tar and nicotine yields than what real people receive when they smoke them.  The "light" cigarettes allow natural air to flow through small holes (ventilation bands) in the cigarette and dilute the tobacco smoke, resulting in lower tar and nicotine yields "consumed" by the machine.  However, in actual usage by smokers, ventilation bands are at least partially blocked by smokers' fingers and lips, reducing the natural air flow and increasing smokers' ingestion of tar and nicotine.

            The plaintiffs also successfully argued that, by placing the words "lowered tar and nicotine" on every pack of Marlboro Lights cigarettes, Philip Morris effectively committed fraud each time a consumer purchased them.  There is a widespread belief that "light" means a product contains less of an unhealthy ingredient.  In this case, smokers bought Marlboro Lights because they thought -- erroneously, as it turns out -- those cigarettes contain less tar and nicotine.  Philip Morris contended that smokers bought "light" cigarettes because of their lighter taste and that it was the federal government and public health officials -- not Philip Morris -- that spread the message that "light" cigarettes were healthier for smokers than were regular cigarettes..

            Plaintiffs' attorney Stephen Tillery, of the Belleville, Illinois firm of Carr Korein Tillery, has told the court that he is seeking $7.1 billion in compensation from Philip Morris and $14.2 billion in punitive damages on behalf of about 1.1 million Illinois purchasers of Marlboro Lights or Cambridge Lights. Judge Byron awarded all of the compensatory damages and $3 billion of the $14.2 billion sought by Mr. Tillery.

            The trial began on January 21.  On February 11, economist Jeffrey Harris, a professor at Massachusetts Institute of Technology, said that monetary damages for Illinois smokers of Marlboro Lights and Cambridge Lights could be as high as $7.1 billion.   Closing arguments in the case were held on March 10.   

            In November 2001 a report by the U.S. National Cancer Institute concluded that "light" cigarettes do not reduce a smoker's chances of getting smoking-caused diseases.

            This case is a class-action, consumer fraud case, not a traditional product liability case on behalf of an injured party.  Thus, it does not involve medical claims.

            Meanwhile, a bill to put an artificial $25 million cap on appeal bonds has passed the Illinois House of Representatives and awaits action before the Senate.  Philip Morris attorney John Mulderig has admitted that his company is pushing for the legislation.

COMMENTARY

Richard Daynard, a professor at Northeastern University School of Law and Chair of the Tobacco Products Liability Project noted that, "consumer protection litigation against tobacco companies is a very sensible approach to protect the buying public from the sort of inherently deceptive tactics that are this industry's stock and trade. There are consumer protection statutes that are tailor-made for these cases in most states."

Edward L. Sweda, Jr., Senior Attorney for the Tobacco Products Liability Project said that "this decision upholds the principle that corporate wrongdoers must be punished for their actions.  Perhaps Philip Morris will now realize that the time has come for the lies to end."   

Mark Gottlieb, another attorney for the Tobacco Products Liability Project said that "Philip Morris and, one has to assume, R.J. Reynolds, is in for a rough ride.  Similar class actions have been certified in Florida and Massachusetts and are awaiting trial while such cases have been filed in eight other states  There is little controversy whether the tobacco companies' conduct in selling "light" cigarettes has been deceptive and it seems very probable that they will have to pay back consumers in several states." 

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