WASHINGTON -- The Supreme Court yesterday threw out Philip Morris USA's appeal of a $79.5 million award to a smoker's widow, ending a 10-year legal fight to keep her from collecting.
In a one-sentence order, the court left in place a ruling by the Oregon Supreme Court in favor of Mayola Williams. The state court repeatedly has upheld a verdict against Henrico County-based Philip Morris in a fraud trial in 1999.
The judgment has grown to more than $155 million with interest. Williams, whose husband died of lung cancer, stands to collect between $60 million and $65 million, before taxes and payments to her lawyers, said Robert Peck, her Washington-based lawyer.
The total punitive damages would be the largest amount paid by a tobacco company in an individual product-liability case, according to Edward L. Sweda Jr., senior attorney for the Tobacco Products Liability Project at Northeastern University. The group is a division of the Public Health Advocacy Institute, a legal research center whose focus includes tobacco control.
"This $155 million for just one case portends very badly for the [cigarette] companies, which are facing more cases," Sweda said. "There are thousands of individual cases pending in Florida alone."
Philip Morris said it would challenge the 60 percent of the payment that would go to the state of Oregon. If it prevails, the company said it would be obligated to pay only the remaining 40 percent of the award to the plaintiff.
The justices heard arguments in the case in December. Yesterday, with no explanation, they said they are not passing judgment on the legal issues that were presented. Instead, it is as if the court had declined to hear the case at all.
Philip Morris had argued that the award should be thrown out and a new trial ordered because of flaws in the instructions given jurors before their deliberations.
Business interests had once hoped the high court would use the case to set firm limits on the award of punitive damages, intended to punish a defendant for its behavior and deter a repeat offense.
Because the court itself said nothing about the case, it is hard to read much into the decision, said experts on both sides of the case.
Murray Garnick, Altria's associate general counsel, expressed disappointment with the ruling, but said the decision does not undo earlier high court rulings reining in punitive damages awards.
"While we had hoped for a different outcome, the Supreme Court has decided not to review a narrow procedural ruling by the state court," Garnick said.
Peck read the outcome differently. He said the court has signaled a willingness to allow large awards in certain circumstances.
"I think we can take from this long tale that if the behavior is sufficiently reprehensible, then larger awards are merited," Peck said.
Staff writer John Reid Blackwell and The Associated Press contributed to this report.
Tobacco verdicts
Altria Inc., the parent company of Philip Morris USA, lists these smoking-case verdicts in favor of plaintiffs in the company's latest financial report. Except for the Williams case in Oregon, all the verdicts are under appeal or have been overturned on appeal:March 1999: Williams case in Oregon, $79.5 million in punitive damages against Philip Morris
July 2000: Engle case in Florida, $145 billion in punitive damages against all defendants, including $74 million against Philip Morris
March 2002: Schwarz case in Oregon, $150 million in punitive damages against Philip Morris
June 2002: Lukacs case in Florida, $37.5 million against all defendants, including Philip Morris
October 2002: Bullock case in California, $28 billion in punitive damages against Philip Morris
May 2004: Scott case in Louisiana, $590 million against all defendants, including Philip Morris
March 2005: Rose case in New York, $17.1 million against Philip Morris
May 2007: Whiteley case in California, $2.5 million in compensatory damages against Philip Morris and another defendant
February 2009: Hess case in Florida (individual case stemming from the Engle class action), $3 million in compensatory damages and $5 million in punitive damages against Philip Morris
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