Dismissal of Tobacco Verdict Stands

A Florida appeals court declined to reconsider its dismissal of a $145-billion class-action verdict against Philip Morris USA, R.J. Reynolds Tobacco Holdings Inc. and other U.S. cigarette makers.

In May, a three-judge panel of Florida’s 3rd District Court of Appeals in Miami decertified the class of 700,000 Florida smokers and threw out the record jury award. Lawyers for the smokers then asked the appeals court to reconsider that ruling.

On Monday, the judges denied that request with a one-paragraph order.

The smokers can now appeal to Florida’s Supreme Court in Tallahassee.

The appeals court ruled in May that the Florida smokers must bring their claims individually and not as a group. The court denounced the $145-billion verdict in the so-called Engle trial as “grossly excessive” and said it would put the companies out of business.

Stanley Rosenblatt, the attorney for the smokers, said he had not seen the ruling and declined to comment.

In December 1999, in response to a tobacco industry request, Florida’s Supreme Court declined to intervene in the case, allowing the trial and class certification to proceed. The trial, in state court in Miami, resulted in a $145-billion judgment in July 2000.

Besides R.J. Reynolds and Altria Group Inc.’s Philip Morris, defendants in the case include Loews Corp.’s Lorillard Tobacco Co., British American Tobacco’s Brown & Williamson Tobacco Corp. and Vector Group Ltd.’s Liggett Group Inc.

Philip Morris’ share of the verdict would have been $74 billion; R.J. Reynolds’, $36.3 billion; Brown & Williamson’s, $17.6 billion; Lorillard’s, $16.3 billion; and Liggett’s, $790 million.

Altria shares rose 2 cents to $44.50, R.J. Reynolds rose 15 cents to $39.47, Loews rose 8 cents to $41.95, and Vector rose 42 cents to $15.34. All trade on the New York Stock Exchange. British American Tobacco’s shares rose 46 cents to $21.55 on the American Stock Exchange.