Judge Upholds $145B Smokers' Award

Tuesday, November 7th 2000, 12:00 am
By: News On 6

MIAMI (AP) — A record $145 billion verdict won by Florida smokers has been upheld by a judge, who also widened the scope of the lawsuit to cover more people.

Circuit Judge Robert Kaye concluded the award was reasonable and did not violate a Florida law which prevents a punitive verdict from bankrupting a defendant.

``The award is in keeping with the degree of wrongful conduct without sending the defendant into bankruptcy,'' Kaye wrote in a 68-page order issued Monday.

Kaye's decision came the same day he received a federal judge's decision rejecting federal jurisdiction and sending the case back to him.

Based on ``the decades of abuses committed by the defendants,'' Kaye said he was more shocked by their ``concerted behavior ... over so many years'' than the award itself.

The judgment opens the door on what is expected to be a prolonged appeals process in state courts by the five largest cigarette companies.

The industry must post a $100 million bond to launch an appeal — and tobacco attorneys immediately promised to do so. They've argued that the companies could afford to pay only $150 million to $375 million, and that they would be put out of business if the award was much higher.

Philip Morris vice president William Ohlemeyer called the order improper and inappropriate.

``One thing is crystal clear. Under Florida law, juries cannot award damages that would financially cripple or destroy a company, and no industry in the world can pay a $145 billion punitive damage award,'' he said.

Kaye also decided the jury's findings of industry conspiracy, fraud and misrepresentation outweighed a four-year statute of limitations. That means the lawsuit covers smokers with illnesses diagnosed more than four years before the lawsuit was filed in 1994, not just between 1990 and 1994.

``It's great,'' smokers' attorney Stanley Rosenblatt said. ``I don't think any punishment is too great for an industry that has caused the kind of injury for so long that they have.''

``Wow. Oh, my goodness. You delivered us good news,'' said Margaret Amodeo, wife of one of the three Florida smokers chosen to represent thousands of others in the first smokers' class-action suit to go to trial.

A six-member jury set a U.S. record with its punitive damages verdict in July. The same panel earlier decided that the industry makes a deadly, dangerous product and awarded $12.7 million in compensatory damages to the three sick smokers, who represented between 300,000 to 700,000 sick Florida smokers or their families.

The defendants are Philip Morris, which was ordered to pay $73.96 billion; R.J. Reynolds, $36.28 billion; Brown & Williamson, $17.59 billion; Lorillard, $16.25 billion; Liggett Group, $790 million; and the industry's defunct Council for Tobacco Research and Tobacco Institute.

Martin Feldman, a tobacco stock analyst with Salomon Smith Barney, said he was surprised by Kaye's decision to keep the award intact.

``A brief perusal of the companies' balance sheets and accounts would indicate that they simply cannot pay $145 billion on a single payment,'' he said.


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