L.A. Jury Awards $3 Billion to Smoker
A Los Angeles jury Wednesday ordered cigarette maker Philip Morris Inc. to pay more than $3 billion in damages to a cancer-stricken Marlboro smoker in one of the largest jury awards in history and the tobacco industry’s worst defeat at the hands of an individual plaintiff.
The award to Richard Boeken, 56, who suffers from lung cancer that has spread to his brain, came in the first smoking-and-health case ever tried in Los Angeles County.
It extended the once-invincible industry’s West Coast losing streak to four cases, including a pair of multimillion-dollar losses in San Francisco and another in Portland, Ore. In the last couple of years, California has become a major legal stumbling block for the tobacco industry.
Capping a more-than-two-month trial, the Los Angeles Superior Court jury deliberated seven days before awarding Boeken, a Topanga-area resident, nearly $5.54 million in compensatory and $3 billion in punitive damages. On votes ranging from 9-3 to 12-0, the jury found Philip Morris, the country’s biggest cigarette maker, guilty on all eight of Boeken’s claims, including negligence, misrepresentation, fraud and selling a defective product.
Such gargantuan awards are often reduced by the trial judge or overturned on appeal. William S. Ohlemeyer, vice president and associate general counsel for Philip Morris, called the verdict “outrageous” and “wildly out of line.”
“For the jury to return a verdict in this case for Mr. Boeken . . . they have to believe that he wasn’t aware of the risks of smoking,” Ohlemeyer said. He said Philip Morris will ask Judge Charles W. McCoy Jr. to set aside the verdict and failing that will file an appeal.
Philip Morris shares swooned on news of the verdict in after-hours trading, falling to $48.25 from a regular-session close of $50 on the New York Stock Exchange.
The tobacco industry’s worst courtroom loss was a $144.8-billion punitive damages award in July in a giant Florida class action, which is under appeal. But the Boeken verdict far exceeds any prior jury award to a single smoker and is one of the largest jury awards against any corporate defendant.
“We got to that figure [$3 billion] because we thought that figure would hurt them,” said juror Ann Anderson, who works as a court clerk supervisor at the Superior Court’s Central Civil West Courthouse, the building where the trial was held.
Juror Denise Key, a government worker from Los Angeles, said, “We want them to be responsible for their product. . . . We want them to put on their product: ‘It kills.’ ”
Richard Daynard, head of the anti-industry Tobacco Products Liability Project in Boston, said the verdict “shows what happens when a jury tries to figure out how to punish companies that are responsible for killing hundreds of thousands of their customers each year. . . . I mean, what is the proper punishment for that behavior?”
The verdict reflects the impact of California lawmakers’ repeal of a longtime ban on product liability suits against cigarette makers. Three cases have been tried since the ban was extinguished in September 1997, with plaintiffs winning all three.
In 1999, a San Francisco jury ordered Philip Morris to pay lung cancer victim and former Marlboro smoker Patricia Henley $51.5 million, later reduced by the trial judge to $26.5 million. And last year, another San Francisco jury ordered Philip Morris and R.J. Reynolds Tobacco to pay $21.7 million in another lung cancer case.
In March, shortly before the start of the Boeken trial, an industry representative, who would not speak for attribution, conceded the industry had not “figured out how to win on the West Coast yet”--although, he joked, it had “retained every social scientist west of the Mississippi to figure it out.”
Given the trend of losses in California, the focus will shift to the state Supreme Court, which has agreed to consider industry appeals of the two San Francisco verdicts. Among other things, cigarette makers are arguing that the trial courts erred in allowing internal documents from the 1950s to the 1980s to be admitted into evidence. Because suits against the industry were banned by state law until 1998, the industry says that earlier evidence should be excluded.
If the Supreme Court agrees, more than just the three plaintiffs’ victories will be reversed: Because the incriminating industry documents are crucial to any plaintiff’s case, a pro-industry ruling could shut off the litigation for good.
Otherwise, say experts, the cigarette makers could be deluged with cases in California, where there is no shortage of potential plaintiffs--only of lawyers willing to invest the time and money to take their cases.
Boeken was represented by Michael Piuze, a veteran plaintiffs’ lawyer with no prior experience in tobacco litigation.
“I feel grateful to the jury for its verdict,” Piuze said late Wednesday.
Testimony began in early April in the case at Central Civil West at 6th Street and Commonwealth Avenue. Among local attorneys, the courthouse’s nickname is “the bank” because of the frequency and size of plaintiffs’ victories. It was there that a record $4.9-billion verdict was returned against General Motors in a 1999 vehicle-fire case. (The trial judge later reduced the award, and the case is on appeal.)
Martin Feldman, a tobacco analyst with Solomon Smith Barney, said he expects Judge McCoy to reduce the Boeken award significantly. Even so, the verdict “indicates that the tobacco industry still has to make serious improvements to its strategy for dealing with litigation in California.”
Boeken, a self-employed dealer in oil and gas securities, smoked for 40 years before being diagnosed with lung cancer in 1999. He briefly kicked the habit but, according to testimony, bought a pack of Marlboros late last year after being told the disease had spread to his brain and his prognosis was hopeless.
Jurors in the case were shown dozens of internal documents, as Piuze sought to prove that Philip Morris and its rivals had lied for decades about the risks and addictiveness of smoking, thus lulling Boeken and other addicted smokers into rationalizing their habit.
Juror Key said after the verdict that “there were too many things that they tried to cover up instead of being honest. They created doubt.”
Defense lawyers countered that nothing Philip Morris did caused Boeken to smoke or kept him from quitting.
“I’m obviously disappointed in the verdict,” said Maurice Leiter of Arnold & Porter, lead defense lawyer.
“I recognize that this is an unpopular company that makes a dangerous product . . . but both the verdict and the size of the damages are simply not supported by the evidence.”
