Mon, Jul 21, 2014 - Page 1 News List

US jury hits tobacco firm with US$23.6bn penalty


A Florida jury has slammed RJ Reynolds Tobacco Co — the No. 2 cigarette maker in the US — with US$23.6 billion in punitive damages in a lawsuit filed by the widow of a longtime smoker who died of lung cancer in 1996.

The case is one of thousands filed in Florida after the state Supreme Court in 2006 overturned a US$145 billion class-action verdict. That ruling also said smokers and their families need only prove addiction and that smoking caused their illnesses or deaths.

Last year, Florida’s highest court reaffirmed that decision, which made it easier for sick smokers or their survivors to pursue lawsuits against tobacco companies without having to prove to the court again that Big Tobacco knowingly sold dangerous products and hid the hazards of cigarette smoking.

The damages a Pensacola jury awarded on Friday to Cynthia Robinson after a four-week trial come in addition to US$16.8 million in compensatory damages.

Robinson individually sued Reynolds in 2008 on behalf of her late husband, Michael Johnson Sr. Her attorneys said the punitive damages are the largest of any individual case stemming from the original class-action lawsuit.

“The jury wanted to send a statement that Big Tobacco cannot continue to lie to the American people and the American government about the addictiveness of and the deadly chemicals in their cigarettes,” said one of the woman’s attorneys, Christopher Chestnut.

Reynolds vice president and assistant general counsel J. Jeffery Raborn called the damages in Robinson’s case “grossly excessive and impermissible under state and constitutional law.”

“This verdict goes far beyond the realm of reasonableness and fairness and is completely inconsistent with the evidence presented,” Raborn said in a statement.

“We plan to file post-trial motions with the trial court promptly, and are confident that the court will follow the law and not allow this runaway verdict to stand,” the statement said.

The lawsuit’s goal was to stop tobacco companies from targeting children and young people with their advertising, said Willie Gary, another attorney representing Robinson.

“If we don’t get a dime, that’s OK, if we can make a difference and save some lives,” Gary said.

The verdict came in the same week that Reynolds American Inc, which owns RJ Reynolds Tobacco Co, announced it was purchasing Lorillard Tobacco Co, the country’s No. 3 cigarette maker, in a US$25 billion deal.

That would create a tobacco company second in the US only to Marlboro maker Altria Group Inc, which owns Philip Morris USA Inc.

The deal is expected to close in the first half of next year and likely will face regulatory scrutiny.

Last month, the US Supreme Court turned away cigarette manufacturers’ appeals of more than US$70 million in court judgements to Florida smokers. Reynolds, Philip Morris and Lorillard had wanted the court to review cases in which smokers won large damage awards without having to prove that the companies sold a defective and dangerous product or hid the risks of smoking.

The Supreme Court refused to hear another of the companies’ appeals last year, wanting the court to consider overturning a US$2.5 million Tampa jury verdict in the death of a smoker.

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