Supreme Court rejects Philip Morris appeal of award

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