Supreme Court Nixes Ruling Against Philip Morris

The U.S. Supreme Court has dismissed a nearly $80 million verdict against cigarette maker Philip Morris and its parent, Altria Group. In a 5-4 decision, the high court ruled that the Oregon jury that issued the initial verdict was not properly instructed in terms of how to assess punitive damage amounts. While the decision marks a temporary victory for the tobacco giant, the case will be sent back to the Oregon Supreme Court, which can opt for a retrial or simply adjust the amount of the award.

Significantly, plaintiffs were buoyed by the fact that the U.S. Supreme Court didn’t question the amount of the verdict in and of itself and refused to put a hard-and-fast limit on punitive damages overall. The justices merely questioned whether the punitive damages awarded by the jury were commensurate with actual damage to the plaintiff in that specific case and not a larger segment of the population.

Mayola Williams had sued the company on behalf of her husband, Jesse, a Marlboro smoker who died of lung cancer in 1997 after nearly 50 years of smoking. The Oregon court awarded her $800,000 in compensatory damages plus $79 million in punitive damages. Altria appealed that ruling, asking the high court to put a cap on punitive damages, which they refused to do. The case was already sent back to the Oregon court system in 2004, but a state appellate court kept the verdict award at the same level, a decision upheld by the Oregon Supreme Court.

In its opinion, the Supreme Court noted that “punitive damages based in part on a jury’s desire to punish a defendant for harming nonparties amounts to a taking of property from the defendant without due process.” They added that “the Court finds no authority to support using punitive damages awards to punish a defendant for harming others.”

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