Philip Morris battles hard to stamp out 'lights' suits
By By Ameet Sachdev
Mar 17, 2004 | 12:00 AM
Anti-smoking advocates predicted it would be the ruling that would open a new front in the war against tobacco.
But a year after an Illinois judge issued a $10.1 billion verdict against tobacco giant Philip Morris USA, concluding that the company misled smokers by suggesting that "light" cigarettes delivered less tar and nicotine than full-tar cigarettes, the case remains under appeal while the momentum of similar cases is slowing.
Since the ruling, Philip Morris, the nation's largest tobacco company, has won pretrial judgments in three states, stopping those class-action suits in their tracks. More than a dozen nearly identical cases are pending across the country.
The company's recent victories place even greater significance on the Illinois class-action case, originating in Madison County, which Philip Morris has appealed to the Illinois Supreme Court.
The case, accepted by the high court in September, remains the only light cigarette class action to go to trial, providing a road map to other trial lawyers on how to win such suits.
A reversal would be a setback not only for Illinois plaintiffs but for others in other states.
"If the Supreme Court reverses the decision, it can seriously affect what other courts do," said Stephen A. Sheller, a Philadelphia lawyer who is participating in several light lawsuits around the country. "It could create a steam-roll effect, and that's what the tobacco industry wants."
One of Philip Morris' key arguments in its appeal is that the judge erred in allowing the case to go to trial as a class action--a type of lawsuit used when a large number of people suffer from the same problem.
Philip Morris, a unit of Altria Group Inc., and its two nearest rivals, R.J. Reynolds Tobacco Co. and Brown & Williamson Tobacco Corp., argue that there are too many individual questions of fact to treat the smokers as a class.
Using this rationale, among others, all three companies are fighting to prevent future light cigarette cases from becoming class actions.
In the Madison County lawsuit, known as the Price case after lead defendant Sharon Price, plaintiffs' lawyers asserted that the tobacco industry was engaged in a massive scam. Firms marketed cigarettes like Marlboro Lights by falsely claiming that they delivered less tar and nicotine than regular cigarettes, when research shows they do not, the lawyers said.
Light cigarettes are designed with microscopic holes in the filter that dilute cigarette smoke.
When measured by a government testing device, the amount of tar and nicotine in a light cigarette is lower than a regular one. But scientific research indicates that smokers of lights usually compensate by smoking more and inhaling deeper to get their full nicotine dose, thus negating any benefits.
The deception, plaintiffs' lawyers contend, violated state consumer protection laws, which allow recovery of economic damages. The suit sought repayment for every pack of cigarettes every smoker bought since Philip Morris began selling light cigarettes in 1971.
Individually, the damages may amount to several thousand dollars--a settlement consumers would not see if they filed individually. The legal costs of taking on a tobacco company would be prohibitive.
"You can't try such a case without a class," Sheller said. "The defendant will make it so expensive that an individual claim is not worth it."
But in a statewide class, sums can be enormous. The Madison County ruling is a case in point.
The judge ordered Philip Morris to pay $7.1 billion in compensatory damages--nearly $7,000 apiece--to 1.1 million Illinois consumers who purchased Marlboro Lights and Cambridge Lights in recent decades.
He also ordered the company to pay $3 billion in punitive damages to Illinois and earmarked $1.75 billion for attorneys' fees.
In its appeal, Philip Morris argues that tar and nicotine intake depends on how people smoke. And habits vary from person to person, from how they hold cigarettes to how frequently they inhale.
The company contends that substantial numbers of Marlboro Lights smokers "were not deceived at all" because they got exactly what they paid for--less tar and nicotine.
A Minnesota trial court judge found the argument persuasive in January when he denied the plaintiffs' motion to certify a class.
"Determining the manner in which each class member smoked Marlboro Lights, and hence determining whether they received less tar and nicotine, presents an individual issue unique to each class member," wrote District Judge Allen Oleisky.
The company asserts that plaintiffs also have to prove that every member of the class relied upon the alleged false representations to buy light cigarettes.
That is nearly impossible to prove, Philip Morris argues, because studies show there are many reasons why smokers choose or switch to light cigarettes. Chief among them: Many smokers simply prefer the taste of light cigarettes to regulars.
However, the element of reliance in the context of consumer fraud is not required in some states. Missouri is one of those states, ruled Judge Michael P. David.
David, though, is the only judge in the past year to allow a statewide class action in a light cigarette case. An Ohio judge in September limited the class to six counties. Philip Morris appealed the order.
Meanwhile, appellate judges in Florida and Massachusetts overturned rulings for class certification by lower-court judges. The Massachusetts Supreme Judicial Court has agreed to review the lower court's order. Plaintiffs in Florida have asked for another hearing on class certification.
While the decisions are not binding on the Illinois court, they can be influential, said William S. Ohlemeyer, Philip Morris associate general counsel.
Stephen Tillery, the lead plaintiffs' attorney in the Price case, says he's not worried about the effect public attention on other cases will have on his case. "I think the Illinois judges will make a decision in the context of this specific case and the Illinois rules."
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