California Courts of Appeal
Aug. 19, 2011
Panel upholds punitive damages award in smoker case
A divided state appellate court on Wednesday upheld a $13.8 million punitive damages award against Philip Morris USA Inc. in a sick smoker case that has been litigated for 10 years.
Daily Journal Staff Writer
A divided state appellate court on Wednesday upheld a $13.8 million punitive damages award against Philip Morris USA Inc. in a sick smoker case that has been litigated for 10 years.
The dissent argued that the award - at 16 times the amount of compensatory damages - was constitutionally excessive in light of the U.S. Supreme Court's suggested ratio of 9-to-1.
But the majority said it was justified in light of the tobacco company's bad behavior.
"We believe that the extreme reprehensibility of Philip Morris's misconduct, including the vast scale and profitability of its course of misconduct, and its financial condition justify the $13.8 million punitive damages award against Philip Morris," wrote 2nd District Court of Appeal Justice H. Walter Croskey. Bullock v. Philip Morris USA Inc., 2011 DJDAR 12485.
Attorneys for Philip Morris did not immediately return a call for comment Wednesday.
Betty Bullock had smoked for 45 years until she was diagnosed with lung cancer in 2001 and filed suit. When she died in 2003, her daughter Jodie took over as plaintiff.
A jury had originally returned $850,000 in compensatory damages and $28 billion in punitive damages. The trial court judge reduced the punitive award to $28 million, and then the 2nd District Court of Appeal ordered a new trial on that issue because of a jury instruction error. On retrial, jurors were told to punish the company only for its conduct against Bullock, not against other smokers.
Bullock's attorney, Michael J. Piuze, said Jodie Bullock has been living with the case for 10 years.
"I am sure that she is relieved that it's one step closer to finally being over," he said.
Fred J. Hiestand, general counsel of the pro-tort reform Civil Justice Association, said Wednesday's ruling only made the law more confusing for litigants trying to settle cases before trial.
"It does raise the troublesome question of what ratio here means anything," said Hiestand, who filed an amicus brief in the case. "This court has had this case three times and it keeps getting whittled down, but basically if you're a cigarette company you're done for."
Croskey, joined by Justice Joan Dempsey Klein, also rejected Philip Morris' argument that the award was barred by the California Attorney General's settlement with tobacco companies.
Justice Patti S. Kitching dissented, pointing out that a 9-to-1 ratio was used to reduce an award in a similar sick smoker case. There, a jury awarded the plaintiff $5.5 million in compensatory damages and $3 billion in punitive damages, which were reduced to $50 million on appeal. Boeken v. Philip Morris USA Inc. (2005) 127 Cal.App.4th 1640.
"I see no reason why we should not do the same here," Kitching wrote.
Only a handful of sick smoker cases have gone to trial in California, Piuze said.
A recent state Supreme Court decision makes it easier for plaintiffs to bring cases.
In May, the court ruled that cigarette smokers who get lung cancer might still be able to sue, even if they were diagnosed with a different smoking-related illness years earlier. Pooshs v. Philip Morris USA Inc., 2011 DJDAR 6417. href="mailto:
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