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10/31/06   |   By

Tobacco company deceit and fraud: Punitive damages, US Supreme Court | DC Metro Area Personal Injury Law Blog

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This morning, October 31, the U. S. Supreme Court heard argument in a critical case which will determine whether tobacco companies can be held accountable for punitive damages for egregious conduct in deceiving consumers for more than 50 years.  The plaintiff, Jesse Williams, believed the industry fraudulent propaganda that cigarette smoking does not cause cancer.  The case of  Philip Morris v. Williams has been touted as the most important business case in front of the most pro-business Supreme Court in years and has already been the subject of a news blitz.

The case involves punitive damages awarded against the cigarette company for the death of Jesse Williams, who believed Philip Morris’s false claim that cigarette smoking does not cause cancer.  Williams was diagnosed with inoperable lung cancer in 1996 and died within six months.  An Oregon jury awarded his wife Mayola $821,485.50 in compensatory damages (reduced to $521,485.80 under Oregon’s cap on wrongful death damages) and $79.5 million in punitive damages, the equivalent of two-and-a-half weeks profit for Philip Morris. The Oregon Court of Appeals twice upheld the verdict, and, in February, the Oregon Supreme Court upheld it, reasoning that it was justified by the high level of Philip Morris’s reprehensibility over a nearly five-decade period of time, when it denied smoking caused cancer and that nicotine was addictive despite knowing that these were lies, and all in pursuit of profit.

Now, Philip Morris contends that Oregon violated its constitutional rights by considering the harm to others in the state in determining the size of the punitive damages, which it says should be only zero to four times the compensatory damages.  Philip Morris is ignoring U.S. Supreme Court’s precedents, which, even according to Philip Morris, bar juries from awarding punitive damages more than 10 times the compensatory damages.  Philip Morris also claims that punitive damages cannot be used to punish defendants for harm to anyone other than the individual plaintiff.

The argument on behalf of Mr. Williams’ estate is that Oregon properly considered the scope of the misconduct, which was designed to reach a broad audience and was wildly successful.  If the state cannot assess punitive damages in amounts like this, then it has no ability to deter such misconduct in the future.

Regan Zambri Long
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