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From Products Liability Law Daily, June 13, 2013

Florida Court of Appeal Rules Award Excessive in Tobacco Case

By Susan Lasser, J.D.

In a wrongful death action against three tobacco companies arising out of the death of a smoker, loss of consortium damage awards for the smoker’s adult children as part of the jury verdict were excessive compared to those in similar cases, a Florida court of appeal held (Philip Morris USA Inc. v. Putney, June 12, 2013, Conner, J.). The appellate court also ruled that the trial court erred in striking the tobacco companies’ statute of repose defense. The court found that the trial court’s entry of summary judgment on the statute of repose defense deprived the tobacco companies of their right to defend on that issue and have the jury make the determination.

Background. Sharon Putney, the daughter and personal representative of the estate of Margot Putney (the deceased smoker), brought suit against the tobacco companies—Philip Morris USA, Inc., R.J. Reynolds Tobacco Company, and Liggett Group LLC—for the wrongful death of her mother. In her second amended complaint, the daughter alleged that her mother’s death was the result of small cell carcinoma of the lung and alleged claims of strict liability, negligence, fraud by concealment, and conspiracy to commit fraud by concealment. She also sought recovery for the estate and for loss of consortium for herself and her two adult siblings; and she sought punitive damages.

Prior to trial, the trial court granted the daughter’s motion for summary judgment and determined that all of the tobacco companies’ affirmative defenses, including the statute of repose, were not viable based on the preclusive findings of Engle v. Liggett Group, Inc., 945 So.2d 1246 (Fla. 2006). The Engle decision allowed certain jury findings from the class action against the tobacco companies to have res judicata effect in subsequent lawsuits by individual class members seeking damages from the tobacco companies.

The jury returned a verdict finding for the decedent’s estate on negligence, strict liability, and conspiracy to commit fraud by concealment; but it found for the tobacco companies on the fraud by concealment claim. The jury also found R.J. Reynolds 30 percent responsible for the decedent’s death, Philip Morris 15 percent responsible, Liggett 20 percent responsible, and found the decedent 35 percent responsible. The jury awarded the estate $86,688.96 for medical and funeral expenses and five million dollars to each of the decedent’s three surviving children for loss of consortium. Further, the jury found punitive damages were warranted against R.J. Reynolds and Philip Morris, but not Liggett, on the conspiracy claim and assessed $2.5 million against each of them. After the trial, the trial court denied the tobacco companies’ motion for a judgment in their favor on the conspiracy count, and it denied their motion for remittitur on the consortium award by the jury.

Remittitur on consortium damages. The tobacco companies argued that the trial court abused its discretion in not granting their motion for remittitur on the five million dollar awards to each of the three surviving children for loss of consortium. The companies claimed that the awards were excessive compared to those in similar cases and were “improperly motivated by passion and prejudice.” The standard of review was for an abuse of discretion by the trial court, and remittitur could not be granted unless the damages amount was so excessive that it “shock[ed] the judicial conscience and indicate[d] that the jury ha[d] been influenced by passion or prejudice.” Moreover, Florida law required that an award of non-economic damages be reasonably related “to the philosophy and general trend of prior decisions in such cases.”

The estate argued that the verdict was not excessive, and cited other cases and some unpublished jury verdicts, including an eight million dollar compensatory damages verdict awarded to the surviving daughter of a smoker. However, that case was appealed and the verdict was found excessive. The appellate court in that case wrote approvingly of similarly large awards for the younger children of decedents. As the tobacco companies noted, all of the children of the decedent smoker in the current case were adults at the time of her diagnosis and death, and none of them testified that they lived with her or relied on her for support, the court of appeal observed. The court of appeal also stated that the appellate decisions having upheld large consortium awards in tobacco cases involved “much closer relationships between the parties and the decedents during the decedent’s illness.”

In spite of the estate’s argument that there was sufficient evidence presented at trial of such a close relationship between the adult children and their mother, the Florida Court of Appeal deemed it not enough to support the award the children received in the lower court proceedings. The court said that while the testimony by the children regarding their close relation to their mother while she was ill and dying could establish that the adult children were entitled to a consortium award, it agreed with the tobacco companies that the loss of consortium awards were excessive compared to those in similar cases and that the awards “shock[ed] the judicial conscience” because none of the children testified that they lived with their mother or relied on her for support. Therefore, the appellate court concluded that the trial court erred in failing to grant remittitur.

Statute of repose defense. The tobacco companies also argued that the trial court erred in striking the companies’ statute of repose defense based on the generalized Engle Phase I findings. The court of appeal had held previously that the statute of repose was an individualized defense that could be adjudicated only based on the particular circumstances of an individual plaintiff. According to the court, the trial court’s entry of a partial summary judgment on the companies’ statute of repose defense deprived them of their right to defend on that issue and have the jury make the determination.

Conspiracy award despite no liability for fraudulent concealment. The tobacco companies also argued that the trial court erred in denying their post-trial motion for judgment on the conspiracy to commit fraudulent concealment claim because the estate failed to provide sufficient evidence to support the claim. The companies contended that because the jury found for them on the fraudulent concealment claim, the conspiracy to commit fraudulent concealment claim also should fall. Moreover, they asserted that the estate failed to prove that the decedent smoker relied on any statements made by any of the co-conspirators.

The court of appeal determined, however, that the findings of the Engle court preclusively established that the tobacco companies engaged in a conspiracy to conceal or omit information regarding the health effects of cigarettes and their addictive nature with the intention that smokers and the public would rely on the information to their detriment. The court also stated that the Engle findings also established that there were other companies besides the tobacco companies involved in the current case that were “coconspirators.” The court concluded that given the number of co-conspirators (and “involving the major players in the tobacco industry”), the breadth of the conspiracy, and the addictive nature of cigarettes, the conspiracy underlying the decedent’s claim in the case was an independent tort of conspiracy “where mere force of numbers acting in unison or other exceptional circumstances may make a wrong.” Thus, the court ruled that the “unified actions of the conspirators, coupled with the addictive nature of cigarettes, resulted in the conspirators exerting a ‘peculiar power of coercion’” over the decedent.

As for the assertion that the estate failed to prove that the decedent relied on statements made by the co-conspirators, the court determined that the record in the case contained sufficient evidence from which the jury could decide that the decedent relied (1) on pervasive misleading advertising campaigns for cigarettes in general and (2) on the false controversy created by the tobacco industry during the years she smoked (aimed at creating doubt among smokers that cigarettes were hazardous to health) without the necessity of proving that the decedent relied on any specific statement from a specific co-conspirator. Therefore, the court held that the trial court did not err in denying the tobacco companies’ motion for judgment in their favor on the conspiracy claim.

Finally, the court of appeal reversed the punitive damages award because it was based on the conspiracy claim. However, the court stated that the punitive damage award was not excessive, so the court would allow the award to stand if on re-trial the estate prevailed on the statute of repose issue. The court remanded the case for further proceedings consistent with its opinion.

The case numbers are 4D10-3606 and 4D10-5244.

Attorneys: Gary L. Sasso (Carlton Fields) and Stephen N. Zack (Boies, Schiller & Flexner LLP) for Philip Morris USA Inc.; John P. Wiederhold (Wiederhold & Moses, P.A.), and Gregory G. Katsas (Jones Day) for R.J. Reynolds Tobacco Co.; Karen H. Curtis (Clarke Silverglate, P.A.) and Kelly Anne Luther (Kasowitz, Benson, Torres) for Liggett Group LLC; and Lincoln J. Connolly (Rossman, Baumberger, Reboso, Spier & Connolly, P.A.) for Sharon Putney.

Companies: Philip Morris USA, Inc., R.J. Reynolds Tobacco Company, and Liggett Group LLC

MainStory: TopStory DamagesNews TobaccoProductsNews FloridaNews

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