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Tobacco Company Burned in a $46.5 Million Settlement

A settlement of $46.5 million is what a Fort Lauderdale couple just received from a Broward Circuit Court jury after they sued R.J. Reynolds Tobacco Co. for developing chronic obstructive pulmonary disease after Tom Ryan smoked for years. The verdict broke down as such: $25 million in punitive damages and $21.5 million in compensatory damages ($16.5 million to Ryan and $5 million to his wife). I expect the Ryans were quite surprised with the verdict as the Ryans' attorneys requested $20 million in compensatory damages in closing argument. 

Jurors deliberated for 3½ hours Friday and 1½ hours Tuesday.

Ryan began smoking in 1955 at 13 long before cigarette packs contained health warnings. He became heavily addicted to nicotine, smoking up to four packs a day for more than 40 years. Ryan switched to filtered and low-tar cigarettes, thinking they were safer, and tried to quit for years, using nicotine patches and Nicorette gum. In 1997 after medications designed to curb smoking addiction such as Zyban were approved by the Food and Drug Administration, Ryan obtained a prescription and was able to finally quit smoking.

"Unfortunately, it was too late," Paige said. "He had developed COPD and now can barely walk to his mailbox. He now relies on nearly full-time supplemental oxygen to help him breathe."

Now, it will be interesting to see if the Ryans can collect on this or if RJ Reynolds will appeal in light of a recent federal ruling. Earlier in April, the 11th U.S. Circuit Court of Appeals reversed more than $800,000 in damages from R.J. Reynolds and Altria Group Inc unit Philip Morris USA Inc awarded in 2013 to Earl Graham, whose wife Faye, a longtime smoker, died in 1993 of lung cancer. In their opinion, the court said smokers who, like Graham, were originally part of a massive class action in Florida against the tobacco companies could not rely on findings from the class action trial to prove claims that cigarettes are defective and tobacco companies were negligent. Engle v. Liggett was the class action which resulted in a $145 billion award, which was eventually overturned.

Regardless of the denial of the award, the Florida Supreme Court addressed the issue again in 2006 and said smokers could use findings from the trial in their individual lawsuits.

In appealing the Graham verdict, R.J. Reynolds and Philip Morris said it was unfair to allow Engle progeny plaintiffs to hold tobacco companies liable based on the class action jury findings, which have been applied across the board to many cigarette brands and makers. The 11th Circuit agreed, saying Florida courts had interpreted those findings with such "unprecedented breadth" that it created a legal duty that was the "functional equivalent of a flat ban" on tobacco, which the U.S. Congress had expressly declined to impose. Plaintiffs bringing strict liability and negligence claims against the tobacco companies must build cases based on their specific injury rather than the inherent risks of smoking, the 11th Circuit held. The decision will not affect claims alleging that companies conspired to cover up the dangers of smoking, the ruling said.

Tobacco companies said in February that they will pay $100 million to settle most federal smoking lawsuits. Thousands of cases remain pending in state court. While the 11th Circuit's ruling will not have an immediate effect there, Florida state appeals courts have often looked to that court for guidance in ruling on similar issues.

Read more: http://www.dailybusinessreview.com/id=1202724166306/Broward-Jury-Hits-RJ-Reynolds-With-25M-in-Punitive-Damages#ixzz3Y48rnhI8


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