Tobacco.org

• Altria Records Charges and Interest of $119 Million for Tobacco and Health Judgments Related to the Williams and Bullock Cases  

Altria Group, Inc. (Altria) (NYSE: MO) today announced that its operating subsidiary, Philip Morris USA Inc. (PM USA) is recording a fourth- quarter pre-tax charge of $62 million related to tobacco and health judgments in the Williams and Bullock cases as well as incurring approximately $57 million in interest costs related to those two cases. . . .

Altria revises its 2011 full-year guidance for reported diluted EPS from a range of $1.60 to $1.66 to a range of $1.58 to $1.64, primarily due to 2011 fourth-quarter charges of four cents per share associated with the tobacco and health judgments related to the Williams and Bullock cases, partially offset by favorability related to tax items.

In connection with its decision to redefine adjusted diluted EPS as described above, Altria forecasts that 2011 full-year adjusted diluted EPS, as redefined to exclude special items listed below in Table 1, will be in the range of $2.01 to $2.07. This represents a growth rate of 6% to 9% from a 2010 adjusted base of $1.90 per share, which was not impacted by tobacco and health judgment charges.

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Ore. Supreme Court Overturns Lower Court's Decision in Williams Case  

Philip Morris USA Inc. said the Oregon Supreme Court has held that the company is required to pay the state 60% of a $79.5 million punitive damages award plus interest in a 14-year old individual smoking and health case.

The decision resulted in the Williams case, where in 1999 an Oregon jury awarded compensatory and punitive damages to an individual smoker. Under Oregon law, the state is entitled to 60% of any punitive damages award. PM USA argued that the state released any right to collect the award when it signed the Master Settlement Agreement (MSA) with tobacco companies in 1998.

"We believe that the Oregon Supreme Court misapplied the law and reached an erroneous result," said Murray Garnick, Altria Client Services senior vice president and associate general counsel, speaking on behalf of PM USA. "As the lower court recognized, the state released its claims to any punitive damages when it signed the [MSA]."

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• Jim Porter: Marlboro Man dies slow death  

If you have ever wondered whether the makers of Marlboros and Benson and Hedges knew or strongly suspected their cigarettes caused lung cancer, while they were telling smokers their cigarettes were safe, read Bullock v. Phillip Morris, a significant new Second District Court of Appeal ruling. . . .

The Court of Appeal reviewed the history of Phillip Morris' cigarette advertising, public pronouncements, press releases and even company executive's testimony before Congress.

In a 1954 full-page announcement in newspapers entitled "A Frank Statement to Cigarette Smokers," Phillip Morris stated there was "no proof that cigarette smoking caused cancer." The industry's Tobacco Industry Research Committee disseminated that message for years by every means possible with statements like "The industry does not know the causes of the diseases in question" and "The views that smoking causes cancer is a subject of much disagreement in the scientific world." The Tobacco Institute issued a report in 1979 entitled "Smoking and Health 1969-1979: The Continuing Controversy," stating, "Scientists have not proven that cigarette smoke or any of the thousands of its constituents as found in cigarette smoke cause human disease," following that with a similar report in 1984 calling for more research.

Phillip Morris knew

Contrary to its repeated public pronouncements, Phillip Morris privately acknowledged, as the evidence revealed, the link between cigarette smoking and lung cancer. One scientist testified at the trial that Phillip Morris knew cigarette smoking caused cancer and had a campaign of hiding its own test results, performed in secret in Germany. . . .

As to Phillip Morris' reprehensibility, read the Court's blistering opinion: "Phillip Morris knew that the consensus among scientific and medical professionals was that cigarette smoking caused lung cancer and other serious diseases, that its cigarettes contained many carcinogens, and that smokers suffered lung cancer and other serious diseases at rates far greater than nonsmokers. Despite that knowledge, Phillip Morris and other cigarette manufacturers for many years conducted a public campaign designed to obscure and deny the truth. Phillip Morris falsely asserted that there was no consensus in the scientific and medical community concerning the adverse health effects of smoking and that the relationship between smoking and health was unknown. Phillip Morris repeatedly asserted that more research was needed and that it was silently pursuing that research, but avoided sponsoring any research that would reveal the hazards of smoking and went to great lengths to avoid disclosing its own toxicological data. Rather than remove nicotine from its cigarettes as it had the ability to do, Phillip Morris added urea to its cigarettes to enhance the effect of nicotine so as to further exploit its customers' addiction and gain new customers. Its customers included individuals such as Bullock who first began to smoke as youths before July 1, 1969, attracted in part by an aggressive advertising campaign in television, print and other media that was particularly appealing to youths." . . .

Normally I would rail against such a high punitive damage award, but given the evidence presented in Court and the overwhelming documentation of how cigarettes cause lung cancer -- throughout the world -- while Phillip Morris and other manufacturers continue cranking out their addictive and damaging product, I can't say I disagree with this Court. This case will make it to the California Supreme Court.

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WARRINER: In the Tobacco Wars -- One More for the Good Guys 

It appears Betty Bullock may finally receive the justice she so richly deserves. Unfortunately, she's dead and won't be able to enjoy it. Betty started smoking cigarettes during smoking's golden years. She took up the habit in 1956 when she was 17. The Philip Morris cigarettes she smoked caused her to develop lung cancer at age 59.

In 2001 she sued Philip Morris. . . .

This case once again highlights the pain, suffering and morbidity Big Tobacco has foisted upon the very customers from whom they accepted billions and billions of dollars. An entire generation of Americans, some say the "Greatest Generation" was lured into Big Tobacco's trap, as teens, during a time when it was glamorous to smoke. No one knew smoking caused any harm. . . .

After killing her, Philip Morris Betty Bullock and her family through ten years of court battles attempting to avoid accepting any responsibility for Mrs. Bullock's death. . . .

It's ironic but telling that this decision was handed down almost to the day from the filing of Big Tobacco's law suit against the United States Government claiming that the new warnings required on cigarettes are unconstitutional.

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California Court Approves 16:1 Punitive Damage Award  

The Supreme Court has ruled that excessively high punitive damage awards, designed to punish defendants for particularly egregious behavior, can violate the Due Process clause. . . .

But in a smoking case against Philip Morris, a California appellate court yesterday signed off on punitive damages that were 16 times higher than compensatory damages. . . .

But the appeals court ruled that $850,000 in compensation is not a "substantial" award against a multibillion-dollar corporation, and further that the 9-1 limit doesn't apply to defendants whose conduct is egregious, according to the Chronicle.

Steve Callahan, a Philip Morris spokesman, told the Law Blog that the company is considering whether to appeal. "We believe the damage amount is unconstitutionally excessive," he said. "We agree with the dissenting judge's opinion that the award violates due process."

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• BULLOCK v. PHILIP MORRIS USA, INC. - Filed August 17, 2011. 

Philip Morris USA, Inc. (Philip Morris), appeals a judgment awarding Jodie Bullock $13.8 million in punitive damages after a jury trial. A jury previously had awarded $850,000 in compensatory damages. Philip Morris contends the punitive damages award is barred by res judicata as a result of the settlement of an action by the California Attorney General against Philip Morris and other cigarette manufacturers, and the award is unconstitutionally excessive. Philip Morris also challenges the award of prejudgment interest from the date of the verdict. We conclude that each of these contentions is without merit. . . .

g. Conclusion

We believe that the extreme reprehensibility of Philip Morris's misconduct, including the vast scale and profitability of its course of misconduct, and its financial condition justify the $13.8 million punitive damages award against Philip Morris. Our conclusion is the same regardless of whether the ratio of 16 to one can be said to significantly exceed a single-digit ratio, so we need not decide that question.18 We do not mean to suggest that 16 to one would be an appropriate ratio in another case involving extreme reprehensibility or to establish any kind of presumption, but merely conclude, based on the facts in this case, that the $13.8 million punitive damages award is reasonable, not arbitrary, and does not offend due process. . . .

DISPOSITION

The judgment and order awarding prejudgment interest are affirmed. Bullock is entitled to recover her costs on appeal.

KLEIN, P. J., concur.

• Tobacco: Court upholds big award in smoker's case 

• Jury awards punitive damages to smoker's daughter 

A jury on Monday recommended that cigarette maker Philip Morris USA should pay $13.8 million in punitive damages to the daughter of a longtime smoker who died of lung cancer.

The panel voted 9-3 in favor of Bullock's daughter Jodie Bullock, who is now the plaintiff in the case. Betty Bullock died of lung cancer in February 2003. She had sued Philip Morris in April 2001, accusing the company of fraud and product liability. A jury in 2002 recommended Philip Morris pay a record $28 billion in punitive damages to Bullock, but a judge later reduced the award to $28 million.

In 2008, the 2nd District Court of Appeal reversed the jury's decision and remanded the case for a new trial over the punitive damages. Philip Morris said the $28 million remained excessive.

However, the original jury recommended the tobacco company pay Bullock $750,000 in damages and $100,000 for pain and suffering, a verdict that still stands.

In a statement, Richmond, Virginia-based Altria Group Inc., which owns Philip Morris, said any amount given to Bullock's daughter is unwarranted. . . .

Plaintiff's attorney Michael Piuze said the jury's verdict amounted to a "slap on the wrist for Philip Morris."

"I liked it better when it was $28 billion," said Piuze, who represented Betty Bullock after she filed the lawsuit. "She wanted me to beat the crap out of Philip Morris, and we did it once."

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• The Bloom Is Off the Rose for Tobacco Claims 

Last month, a Los Angeles jury awarded $13.8 million in punitive damages to the daughter of Betty Bullock, a smoker who had sued Philip Morris USA Inc. before she died of cancer. It was a huge loss -- for the plaintiff.

Just seven years before, a different jury in the same case had awarded a record $28 billion in punitives. Philip Morris appealed that blow, and eventually a California appellate court ordered a retrial, leading to the much diminished result of Aug. 24.

What happened between 2002 and last month? Bullock's lawyer, Los Angeles solo practitioner Michael Piuze, did not return calls seeking comment. But Charles Tauman, president of the plaintiff-friendly Tobacco Trial Lawyers' Association, said he had spoken to Piuze, who "felt that the jury that he had was of a different character than the one ... in the original Bullock case. He felt they were harsher and less willing to be sympathetic."

Lawyers on both sides of smoker cases say Piuze's experience is unique only in the magnitude of the lost award. Hard statistics on recent personal injury lawsuits against tobacco companies are difficult to come by, but the anecdotal evidence about punitive damages is growing. Jurors today are less willing to impose severe punishment than jurors just a decade ago.

Lawyers point to changed practices and fading memories, as well as limits on punitives imposed by the U.S. Supreme Court. The major tobacco companies altered their marketing practices following the 1998 master settlement agreement with most states. Younger jurors never knew or retain only dim memories of an era when cigarette packages didn't feature dire health warnings and tobacco executives played down the dangers of their products.

"They're not the evil empire anymore," said Madelyn Chaber . . .

By the time Chaber retried that case in 2007, she found herself in what she called "an entirely different world." Jurors voted for just $250,000 in punitive damages against R.J. Reynolds and rejected punitives against Philip Morris.

"The jury was basically: 'This is old news -- we've heard this and everybody knows it's dangerous,' " Chaber said.

Also, Philip Morris (now part of Altria Group Inc.) is a "changed company," said Murray Garnick

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Daughter of lung cancer victim wins $13.8m from U.S. tobacco company Philip Morris  

Betty Bullock started smoking Marlboros when she was just 17 and died of lung cancer aged 64

A U.S. jury has ordered cigarette maker Philip Morris to pay $13.8million (�8.4m) to the daughter of a long term smoker who died of lung cancer.

The jury in Los Angeles voted in favour of Jodie Bullock, the daughter of Betty Bullock who died of lung cancer in 2003 aged 64.

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Tobacco Company Dodges $28 Billion Bullet, Slapped With $13 Million in Punitive Damages 

A Los Angeles jury awarded $13.8 million in punitive damages against Philip Morris USA on Monday in the retrial of a case that originally netted a record $28 billion to a lifetime smoker.

"After hearing weeks of improper arguments and evidence that violated state and federal law on punitive damages, the jury still managed to reject plaintiff's patently unreasonable request," said Murray Garnick, senior vice president and associate general counsel at Altria Group Inc., parent corporation of Philip Morris. The company released a statement soon after the verdict: "California jury rejects request for billions in damages."

"Even so," Garnick continued, "we believe that any punitive damages award is unwarranted based on the facts in this case and that this award is unconstitutionally excessive."

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Turia welcomes decision to prosecute tobacco firm 

Tariana Turia has described the daughter of a long-time smoker as “courageous” for winning a case against a tobacco giant.

This week, a federal jury in the United States decided cigarette maker Philip Morris USA should pay US$13.8 million in punitive damages to Jodie Bullock whose mother Betty Bullock died of lung cancer in 2003.

“My hat goes off to Jodie – she’s absolutely courageous and it’s about time tobacco companies were forced to acknowledge that their products not only affect those who smoke them, but also their children.”

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REZAEE: Smokers need to take responsibility for their own habitat 

The daughter of a deceased smoker just earned some easy money after a jury in Los Angeles decided that Philip Morris owes her $13.8 million in punitive damages. . . .

These frivolous cases has at times allowed one freeloader to mooch off a major industry and a dying relative. In this age every one is aware of the harmful effects of smoking. The only excuse one person could have is their inability to read the warning, hence they should be ashamed of themselves.

Half these moronic claims state that it was the tobacco industries fault for having them smoke in the first place. One problem in the anti-smoking debate is their is no personal responsibility, its always scapegoating the industry.

I'm a smoker (Lucky Strike), I have smoked one pack a week since I was 17, I'm aware of the effects it has on my health, I avoid smoking in areas were children are present, and I could read the label that says "Surgeon General Warning: smoking will give you cancer and it will kill you".

If I die it would be my fault for smoking not the tobacco company.

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Altria Must Pay $13.8 Million in Smoker Lawsuit, Jury Says  

Altria Group Inc., parent company of Philip Morris USA, the Marlboro cigarette maker, must pay $13.8 million in punitive damages to the daughter of a lifelong smoker who died of lung cancer in 2003, a jury found.

The verdict for Jodie Bullock, daughter of Betty Bullock, who smoked Marlboro and Benson & Hedges cigarettes for 45 years, was reached yesterday in Los Angeles. An earlier award of $28 billion from a 2002 trial had been first reduced by the trial judge and then canceled by an appeals court that ordered a new trial on punitive damages.

Bullock’s lawyer, Michael Piuze, told jurors Philip Morris misrepresented the risks of smoking for 50 years. He asked for “billions” in punitive damages, saying that anything less wouldn’t punish the company. Altria, the largest U.S. cigarette maker, reported 2008 sales of $19.4 billion.

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• Jury awards punitive damages to smoker's daughter 

A jury on Monday recommended that cigarette maker Philip Morris USA should pay $13.8 million in punitive damages to the daughter of a longtime smoker who died of lung cancer.

The panel voted 9-3 in favor of Bullock's daughter Jodie Bullock, who is now the plaintiff in the case. Betty Bullock died of lung cancer in February 2003.

She had sued Philip Morris in April 2001, accusing the company of fraud and product liability. A jury in 2002 recommended Philip Morris pay a record $28 billion in punitive damages to Bullock, but a judge later reduced the award to $28 million.

In 2008, the 2nd U.S. District Court of Appeal reversed the jury's decision and remanded the case for a new trial over the punitive damages. Philip Morris said the $28 million remained excessive.

However, the original jury recommended the tobacco company pay Bullock $750,000 in damages and $100,000 for pain and suffering, a verdict that still stands. . . .

"After hearing weeks of improper arguments and evidence that violated state and federal law on punitive damages, the jury still managed to reject plaintiff's patently unreasonable request," said Murray Garnick, Altria Client Services senior vice president, speaking on behalf of Philip Morris. "Even so, we believe that any punitive damages award is unwarranted based on the facts in this case and that this award is unconstitutionally excessive."

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After hearing weeks of improper arguments and evidence that violated state and federal law on punitive damages, the jury still managed to reject plaintiff's patently unreasonable request. Even so, we believe that any punitive damages award is unwarranted based on the facts in this case and that this award is unconstitutionally excessive.
Murray Garnick, Altria Client Services senior vice president, speaking on behalf of Philip Morris, on the $13.8 M Bullock judgment.

Some of us looked at it as an opportunity to deter this behavior. I don't find $13.8 million to be much of a deterrent.
Matt Reed, 37, of Burbank one of the three dissenting Bullock jurors, who believed Philip Morris should pay a higher amount than the verdict.