Philip Morris loses $80M damages appeal

Supreme Court throws out tobacco giant's latest appeal on jury-awarded damages in decade-long dispute over cigarette liability.

EMAIL  |   PRINT  |   SHARE  |   RSS
google my aol my msn my yahoo! netvibes
Paste this link into your favorite RSS desktop reader
See all RSS FEEDS (close)

Should Obama let GM and Chrysler go bankrupt?
  • Yes, they’ve been given enough chances
  • No, they’re too big to fail
  • Give them one more shot and then think about it

WASHINGTON (CNN) -- The Supreme Court dismissed an appeal by Altria Group Inc.'s Philip Morris USA over $79.5 million in punitive damages awarded to the widow of a longtime Oregon smoker.

The top court did not decide the merits of the dispute, but in a one-sentence ruling Tuesday said the appeal was dismissed as "improvidently granted." Altria's (MO, Fortune 500) Philip Morris in its appeal had argued that the Oregon Supreme Court in upholding the award had defied an earlier U.S. Supreme Court ruling in the case.

The case stemmed from a lawsuit filed by Mayola Williams, whose husband died of lung cancer in 1997 after smoking for more than 40 years.

Williams said her husband, a public-school janitor in Portland who smoked as many as three packs a day of Philip Morris' Marlboro cigarettes, had believed the decades of tobacco industry assurances that smoking did not pose a health threat.

In 1999, a jury awarded Williams $821,000 in compensatory damages, which was reduced under state law to $521,000, and $79.5 million in punitive damages. With interest, the award has grown to more than $145 million, the company has said.

The U.S. Supreme Court initially set aside the award in 2003 in view of its ruling that generally limited punitive damages to no more than nine times the compensatory damages.

The Oregon Supreme Court then upheld the award and ruled that the company's reprehensible conduct warranted such a large verdict.

The U.S. Supreme Court in 2007 overturned the award for a second time. It ruled that it was unconstitutional for juries to impose damages to punish a defendant for the harm done to those who are not parties in the lawsuit.

The Oregon Supreme Court in 2008 again upheld the $79.5 million award. It ruled that the proposed jury instructions by Philip Morris were flawed under state law, and the company thus forfeited its claim of federal constitutional error.

Phillip Morris again appealed to the Supreme Court and said the state court had ignored the Supreme Court's instructions.

The Supreme Court heard arguments in the case on Dec. 3. By dismissing the appeal and saying the appeal should not have been granted, the justices left intact the award against the tobacco company. To top of page

They're hiring!These Fortune 100 employers have at least 350 openings each. What are they looking for in a new hire? More
If the Fortune 500 were a country...It would be the world's second-biggest economy. See how big companies' sales stack up against GDP over the past decade. More
Sponsored By:
More Galleries
17 cool gadgets that tease the future Smart telescopes, surveillance for dogs, an electric roadster and more from CES 2018. More
These 12 airplane beds let you really sleep on a flight For the price of a premium class ticket, you may just get a space that's comfortable, private, and quiet enough to ensure a good rest. More
CES 2018 kicks off with oddball gadgets The biggest tech show of the year opened with a collection of quirky gadgets. More
Worry about the hackers you don't know 
Crime syndicates and government organizations pose a much greater cyber threat than renegade hacker groups like Anonymous. Play
GE CEO: Bringing jobs back to the U.S. 
Jeff Immelt says the U.S. is a cost competitive market for advanced manufacturing and that GE is bringing jobs back from Mexico. Play
Hamster wheel and wedgie-powered transit 
Red Bull Creation challenges hackers and engineers to invent new modes of transportation. Play