![[Virginia GASP]](iconvag.GIF){kind=small}
ENGLE TRIAL -
ENGLE TRIAL - Tobacco Companies are trying cosmetics to hide their sins; spreading fears of going broke; convincing states to partner with tobacco by protecting state tobacco money.Florida legislature passed legislation to help "keep Florida's children smoking" in order to preserve tobacco money! "Now does that make sense?" asks Rita Zemlock.Six states have now passed legislation designed to protect the tobacco companies, and the money slated to be sent to the states thanks to the state attorneys general agreement with tobacco companies.
Excerpts from The Charleston Gazette, May 3, 2001, writer J. R. Brammer, headlined: Wise signs bill capping tobacco appeal bond
Gov. Bob Wise signed a bill late Wednesday capping the amount of money tobacco companies will have to pay to appeal unfavorable court rulings.
The law (SB661) means if a jury awards damages to West Virginia plaintiffs, the money tobacco companies must pay to appeal the case can't exceed $100 million for punitive damages and $100 million for compensatory damages.
Anti-tobacco groups had lobbied Wise to veto the measure, saying it allows companies a relatively cheap way to avoid paying damages by keeping cases tied up in litigation. They argued that big tobacco firms have made the threat of bankruptcy into a bigger deal than it really is.
Proponents said the caps address concerns about tobacco companies going bankrupt and not being able to pay the state's portion of the $206 billion Master Settlement Agreement of 1998. Under the MSA, West Virginia receives between $56 and $74 million annually.
Since the MSA was signed, West Virginia has spent its
installments on Medicaid, public health programs and
construction projects.Edward Sweda Jr., senior attorney for the Tobacco Products Liability Project in Boston, attended Philip Morris' annual
shareholders meeting in Richmond, Va. last week."When they're talking about the impact of the lawsuits with friends and investors from Wall Street, everything is rosy and the bottom line is fine," Sweda said. "When they're talking about the issue with state governments, there's the threat of bankruptcy and their inability to continue paying the settlement and they say they need protection.
"It's always astounding to see how manipulative the tobacco companies can be."
Tim Manchin, president of the West Virginia Trial Lawyers Association, says the law sets a precedent for other industries to request special protection and consideration.
Judges typically require that appeal bonds equal those of damages.
West Virginia becomes the sixth state to have caps placed on appeal bonds.
Links
to Lists of articles and Information on trial
as well as efforts to delay or stop the trial including the
Florida
legislature interfered in the Engle trial, capping amount for bond
appeal.
Oppostion
to the Florida Tobacco Shield - had been announced by:
Virginia GASP, on this web site
Action
on Smoking and Health on its web site
Tobacco
Product Liability Project news release
Campaign
for Tobacco Free Kids news release
Tri-Agency,
Florida news release
GASP
of Florida news release
American
Cancer Society news release
Nutshell
Overview of trial and efforts to delay outcome
Links
to North Carolina's efforts to delay or stall Engle trial
Links
to Virginia's efforts to delay Engle Trial
EXCERPTS from Bloomberg, May 5, 2000, writer Lawrence Viele; headlined: Tobacco Companies Win Damage Protection From Florida Lawmakers
The measure ... would put a ceiling of $100 million on the bond
the
companies must post while they appeal a damage verdict. Philip
Morris Cos. and other companies would thus be spared the
possibility of bankruptcy from a multibillion dollar judgment.
The bill passed unanimously in the House today and by a 37-2
vote in the Senate earlier this week.
"Our interest is entirely in the financial aspects of this
settlement,'' said State Representative Carlos Lacasa, a Miami
Republican.
"We think current law addressed the problem, but I think
this is the way to go. I don't think this is a bailout of the
industry,'' said Neal Roth, president of the Academy of Florida
Trial Lawyers.
The bond cap is unnecessary and sets a bad precedent, said
plaintiffs' lawyer Larry Stewart of Miami. He said Florida case
law already bars damages that could bankrupt a company and
bankruptcy court offers protections as well.
"The irony of it all is now the state of Florida, which
successfully sued tobacco -- which everyone agreed was evil -- is
now through the Florida legislature in cahoots with the
industry,'' he said.
A six-member Miami jury awarded $12.7 million in
compensatory damages on behalf of three former smokers last month.
The jury will begin hearing arguments May 15 on punitive damages
for all smokers in the state.
EXCERPTS
from Bloomberg,
April 24, 2000, writer Lawrence VIele; headlined: Philip
Morris Loses Bid to Delay Florida Punitive Damages Trial
Philip Morris lawyer Daniel Webb asked Dade County Circuit
Court Judge Robert Kaye to rule on up to 40 motions filed
earlier in the case before letting the jury hear arguments on
punitive damages May 15. The companies also wanted time
to appeal any adverse rulings on those motions, Webb said.
The judge rejected the request. 'You've had four years,'' Kaye
told Webb. "See you all on May 15.''
Letter to the Editor, Sun-Sentinel, published April 23, 2000 (not available on-line); headlined: Killing the goose?
Killing the goose?EXCERPTS from The Sun-Sentinel, April 25, 2000, writer Terri Somers; headlined: Florida protecting tobacco companies to save $17 billion settlement, lawyers say
What is going on in Tallahassee is outrageous. Our Florida Legislature is in session right now protecting the tobacco industry. The tobacco victims (trial in Miami) are in the midst of having their day in court and our legislators are ready to pull the rug from under them. Of course, our legislators are worried that the funds from Florida's settlement will stop if the companies go bankrupt.
In reality, the situation is this: The "truth" campaign is working. It is run by kids with the result that our kids are smoking less. The tobacco companies will make fewer sales and our legislators fear that our tobacco settlement will be affected. It is more important to keep Florida's children smoking. Now does that make sense?
RITA ZEMLOCK
The country's biggest cigarette companies
engineered a legal coup when they offered $246
billion to settle lawsuits brought by 46 states,
said the lawyers now representing hundreds of
thousands of sick Florida smokers in a
precedent-setting class action.
"They've got all these states trying to protect
them now because the more cigarettes they
sell, the more money the states get," said
Susan Rosenblatt, one of the Miami lawyers
representing the smokers in the ongoing
class-action trial. "It's really a mind-boggling
situation, because our supposed allies have
joined with the defense," Rosenblatt said during
a hearing Monday in Miami-Dade Circuit Court.
The hearing came during a break in the trial,
which will resume on May 15, when the
six-person jury will return to hear evidence and
answer this question: How much should the
tobacco companies pay class members as
punishment for selling a dangerous product and
lying about its health risks?
A proposal now before the state Legislature
in Tallahassee that would protect the tobacco
industry from a huge punitive damage award
fueled Rosenblatt's ire.
Under a 1997 settlement of a Medicare case
brought against the cigarette makers by
Florida, they will pay the state $17 billion over
the next 30 years.
"And not one cent of that money goes to any
individual," said Stanley Rosenblatt, Susan's
husband and the other half of the legal team
representing Florida smokers.
Their case against the tobacco companies is
precedent-setting because any punitive or
compensatory damages the cigarette makers
actually pay out would be the first to go directly
to people who became sick from smoking, or
the relatives of those who died from tobacco
use.
Lawyers for the tobacco companies have
said the class could be as large as 500,000,
and the jury could award as much as $300
billion in punitive damages to the smokers,
effectively bankrupting the cigarette industry.
"The (Florida) Legislature and Attorney
General Bob Butterworth are now convinced
that if there is a huge punitive award in this
tobacco case, the state's money for roads is at
risk," said Susan Rosenblatt, referring to the
fact that most of the money from the 1997
settlement goes for general revenue purposes.
The tobacco companies also want to use the
settlement with the states to show the jury
hearing the class-action case that they have
changed their ways, Stanley Rosenblatt said.
"And we will show that they (tobacco) haven't
changed a thing," he said.
Fears the class action could interfere with
the state's settlement prompted a legislative
committee last week to recommend a change
in the law.
The committee wants to put a $50 million
cap on the amount tobacco companies would
have to put in a bond pending appeals of the
verdicts.
Under current law, the tobacco companies
would be required to post about 120 percent of
the damage amount in bond. The bond would
ensure there is money waiting for the sick
smokers after the appeals are over.
Several other states passed similar laws
earlier this month.
The Rosenblatts reminded the court that
state law does not allow damage awards so
high that they bankrupt a company. And urged
the judge not to give special favors to the
industry.
"This is an industry awash in cash," said
Stanley Rosenblatt. "Think about it: They were
willing to pay $246 billion to make this go
away. And Mr. Webb (the lead tobacco
attorney in the trial) can now quote the attorney
general of Florida."
"Now (the legislators and Butterworth) are
fighting against their own constituents to keep
the cash flow coming from the tobacco
industry," Rosenblatt said. "It would be
interesting to see if any of the (tobacco) CEOs
took any pay cuts since that settlement."
Florida's "leaders" and some private attorneys are trashing the rights of tobacco victims in order to protect their own cash flow. Dick Scruggs, who once said, "I think tobacco is a menace that needs to be eradicated," is actively lobbying Florida's legislature to help tobacco companies continue to addict and kill in order to protect his own money. Does it hurt that his brother-in-law is U.S. Senator Trent Lott, who already proclaimed that Congress could not take up legislation this year to regulate tobacco as a drug?
Florida is saying that it must keep tobacco from going broke in order to protect the Florida settlement money and in order not to lose gains from the settlement such as no tobacco ads on billboards, etc. They too are willing to trash the tobacco victims, just like the tobacco companies.
At
least four things are wrong with the picture in Florida:
1. It is immoral and puts them on the same level as the Columbian
drug dealers.
2. The only way the money can continue to flow is if the tobacco
companies continue to addict and kill Americans.
3. Florida law prevents punitive damages
that
would bankrupt a company.
4. They are legislators. They can pass legislation that
would
codify the health gains made in the settlement.
If the Florida Governor and legislature act to protect tobacco, then concerned citizens may wish to re-evaluate any business dealings with Florida companies, including convention business, tourism, purchases of orange juice, etc.
Additionally, Philip Morris officials have stated they will present evidence to the Engle jury that PM has changed their company. But PM's documents reveal that the tobacco industry knew their products would addict and kill, they still know that, and they are still ready to continue marketing, advertising, and selling it. They are only rearranging the public image furniture.
EXCERPTS from The St. Petersburg Times, April 12, 2000, writer Jo Becker; headlined: Tobacco's foes work to save it; Lawyers who battled cigarettemakers lobby to avert bankruptcies that might sink the legal settlement and their fees.
Then comes the matter of the lawyers' own fees: Tobacco
companies owe lawyers who fought them as much as
$5-billion.
"I
don't really want to be in the position of pulling for the
tobacco industry," acknowledged lawyer Dick Scruggs, who
helped dream up the first big lawsuit by a state to recover the
taxpayer cost of treating sick smokers.
The reason Scruggs and others made the trip to Tallahassee
is a huge class-action lawsuit against tobacco companies,
brought on behalf of sick Florida smokers.
"Bankrupting these companies won't end smoking, it'll end
controlled smoking," Scruggs said.
But Scruggs said that while this scenario plays out, tobacco
executives still may find it in their best interest to file for
bankruptcy protection and pick the states where they do it.
While companies cannot file bankruptcy simply to get out of
paying punitive damages, Scruggs said some tobacco
companies' finances already are so precarious that a judge,
particularly in a tobacco-growing state, could find their
arguments compelling.
In Florida, lawmakers have much to sort out and not a lot of
time to do it. The Legislature adjourns in less than a month.
The debate here began with a proposal by Gov. Jeb Bush.
Florida is owed $13-billion over the next 25 years. Bush
wants to sell about $9-billion of that to investors, who would
assume the risk that tobacco companies would actually make
the payments. Under the plan, the state would receive
$2.8-billion upfront, which it could then invest.
The state's take from the settlement is tied to domestic
cigarette sales. If the sales drop, so does the state's income.
Selling off future tobacco revenue would allow lawmakers to
pursue tough anti-smoking policies without worrying about a
conflict of interest.
Lawyers such as Rice and Scruggs think selling future
revenues, called "securitization," is so smart they are trying to
strike the same deal for fees they are owed.
But they have encountered a problem that Florida also may
face: No one on Wall Street is buying while the Miami case is
pending.
He [Rice] and Scruggs are pushing a measure that would limit the
annual amount of punitive damages the tobacco companies
would have to pay. One proposal caps that amount at
$50-million a year.
That doesn't sit well with lawmakers who are worried about
limiting the payout to Florida residents who were genuinely
harmed by tobacco companies.
"You're the guys that got the choo-choo train rolling, and a lot
of cabooses got on board," Campbell said to the lawyers.
"Now you're saying to these folks, "Folks, you don't deserve
your compensation, but we're going to get ours.' "
Scruggs said there is a major difference between Florida's
lawsuit against tobacco companies and the Miami lawsuit.
Florida sued on behalf of taxpayers who had to pay to treat
Medicaid patients with illnesses caused by smoking.
Three-quarters of those taxpayers don't smoke, he said.
"It's a question of culpability," Scruggs said. "I elevate the
taxpayers of Florida above the smokers of Florida."
Scruggs has a brother-in-law in the U.S. Senate - Trent Lott. With "friends" of health like these, who needs enemies, one might ask.
EXCERPTS from The New York Times, April 10, 2000, writer Barry Meier; headlined: News Analysis: Award In Miami Tobacco Suit Leads To Unexpected Twists
State lawmakers who recently vilified cigarette makers as profiteers hawking a deadly product are now pressing to protect industry profits so they can continue to receive lawsuit settlement payments worth $246 billion to the states.EXCERPTS from The Vero Beach Press-Journal, April 9, 2000, writer not identified; headlined, Lawmakers may protect Big TobaccoCigarette makers, who decried the state lawsuits as little more than legal shakedowns, have also changed their tune. Now, in arguments to jurors like those in the Miami case, they point to settlement concessions as evidence that they have agreed to change their practices and so don't need to be further punished.
Just a few years ago ... , Florida lawmakers removed legal roadblocks to the state's lawsuit against cigarette makers. The result: an industry settlement worth $13 billion over the next two decades.
Now the Florida Legislature is again considering the tobacco industry. But this time, it is reviewing ways to blunt the possible impact of a verdict in the Miami case on the ability of companies to make continuing settlement payments.
All of this has made for some awkward moments for state officials. Last year, Bob Butterworth, the Florida attorney general who filed the state's cigarette case, cheered when the Miami jury returned a verdict finding tobacco makers guilty of "outrageous conduct" in misrepresenting the dangers of their product, a finding that sets the stage for punitive damages.
But now with the case heading that way, Mr. Butterworth's cheers have apparently turned into cold sweat, and he is among those consulting with state lawmakers looking for ways to rein in the Miami case.
But while some lawmakers fret, others with a new stake in the tobacco industry's financial well-being said they were not very concerned about the Miami suit.Dick Scruggs, a lawyer from Mississippi who represented some 30 states in their action against producers, said he believed some legislation would soon emerge from the Florida Legislature to lower the case's possible impact.
Mr. Scruggs, whose law firm expects to receive nearly $1 billion in legal fees from the settlements, said he was told that Florida lawmakers were looking at capping the appeal bond a company has to post and limiting the amount of punitive damages that a defendant would have to pay out in any single year.
Told that it would be several weeks before the Miami jury took up the question of punitive damages, Mr. Scruggs appeared relieved. "Good," he said. "That gives us a couple of weeks."
Less
than three years after Lawton Chiles
donned a gorilla costume and declared victory over Big
Tobacco, Florida lawmakers are looking for ways to protect
the same industry that they are still spending state money
to vilify.
With a $13 billion settlement in their pockets, a growing
number of lawmakers are calling for legislation that will
ensure that the money slated to flow from the industry into
the state for the next three decades continues to do so.
With those proceeds tied directly to industry profits and
plaintiffs' lined up to sue, a small but influential group of
legislators is saying it might be time to either insulate the
industry from devastating punitive damages, or take the
money and run.
''The best thing I can tell you is that the attorneys who
represented us in this case are protecting their receipts,''
Sen. Locke Burt, a Republican from Ormond Beach, told
colleagues this week. ''The long-term prospects for the
tobacco companies in the United States is not good,
whether it is the (Miami) case or the next case.''
''The (Miami) case is coming to a conclusion and all of a
sudden the state of Florida and other states are now
scurrying because the industry is going out to the press
and state legislators and saying, 'Folks, now you have to
save us because we are your cash cow,' '' said Sen. Skip
Campbell, a Democrat from Tamarac. ''I find that to be
offensive.''
Senate leaders have called for a joint legislative committee
to study the issue and return with a slate of
recommendations by April 20. A legislative proposal would
follow four days later.
The committee has been asked to explore a number of
options including buying insurance, passing legislation to
insulate companies from potentially devastating punitive
damage awards, or selling off some or all of the
settlement's future proceeds at present value.
EXCERPTS from The Sun-Sentinel, April 8, 2000, writer Terri Somers; headlined: Florida jury issues record award in tobacco case
A jury in Miami-Dade County Circuit Court on
Friday ordered the nation's five largest cigarette makers to
pay two smokers with cancer, and the family of a third who
died last year, a record $12.7 million for medical bills and
the pain and suffering they found in cigarettes.
While the million-dollar judgments may seem like a windfall
to these three families, they could look paltry next to the
punitive damages that tobacco companies could be ordered
to pay to hundreds of thousands of ailing Florida smokers in
the next phase of the trial.
In that phase, the jury will consider how much money the
tobacco companies make before determining how much
they should pay as punishment for decades of lying to the
public about the hazards of smoking.
"Everyone should be happy with what happened," said
plaintiff Mary Farnan, a nurse from Ingles who was awarded
$2.85 million.
After the jury left the courtroom, Stanley and Susan
Rosenblatt, the lawyers representing the smokers, hugged
the plaintiffs and other supporters in the courtroom.
The lawyers declined to comment on the verdict.
Ralph DellaVecchia, husband of the late Angie
DellaVecchia, had tears in his eyes after the jury awarded
him and his son $4 million. "It's been a long time and so
hard since she died" last July, he said. Asked about the
smokers' chances for punitive damages, he said, "I think
they've got a good shot."
Plaintiff Amodeo, whose damage award may turn out to be
only symbolic, said, "I'm smiling, I'm smiling, I'm smiling."
On the verdict form, the jury answered "yes" to the question
of whether Amodeo missed a four-year deadline for filing
suit after learning his cancer stemmed from smoking. That
appears the panel meant to agree with tobacco's assertion
that Amodeo made the link when he was diagnosed with
cancer in 1987.
But farther down the same form, the jury gave Amodeo the
biggest single damage award of $5.8 million.
When Rosenblatt asked the judge to clarify which jury
determination would stand -- that Amodeo gets no award for
filing too late, or that he gets the money -- Kaye said he
would resolve that later.
Martin Feldman, an analyst who follows tobacco stocks for
Salomon Smith Barney, said the verdict indicates "the jury
is going to go in there with some tough attitudes about
tobacco" during the punitive-damage phase.
"In the punitive stage the jury is going to look
at just how
fraudulent tobacco companies have been toward these
smokers and this is where they are really going to get
whacked," said Joseph Daly, a professor at Hamline
University Law School in Minnesota.
Philip Morris intends to present a substantial defense to the
claim for punitive damages, demonstrating to the
six-member jury how the company has changed the way it
does business, said William S. Ohlemeyer, a lawyer for the
company.
And Morris is considering how quickly to ask an appellate
court to review the trial procedure that led to these verdicts,
he said.
Farnan, who began smoking at 11 and has had tumors
removed from both her lungs and her brain, was 20 percent
responsible for her illness, the jury ruled.
Amodeo, an Orlando clockmaker, began smoking at 14 and
has been unable to eat or drink since he throat cancer was
diagnosed 12 years ago, was 25 percent responsible for his
illness. And Angie DellaVecchia, the housewife from New
Port Richey who died from lung and brain cancer two weeks
after a jury verdict in the trial's first phase, was 15 percent
responsible for her illness, according to the jury. She started
smoking when she was 11.
The percentages seemed to be guided by evidence on which
brands each of the individuals smoked and for how long.
The finding that tobacco companies were more than
50 percent responsible for each of the plaintiff's illnesses
showed the smokers largely overcame the personal choice
defense that has worked so well for the tobacco industry in
previous court challenges.
Nationwide, juries have awarded damages to individual
smokers only six times. Three verdicts were overturned, two
are on appeal, and one was returned last month with a
then-record $1.72 million compensatory award to a single
smoker. That smoker and her husband also were awarded
$10 million each in punitive damages.
However, the industry has yet to pay anything in an
individual smoker's case. It has started paying out $246
billion in settlements with the states.
The two women and four men deciding this case
began
hearing testimony 18 months ago. Last July, after nine
months of trial, the panel ruled the industry fraudulently
conspired to produce a dangerous, addictive product that
caused 29 illnesses, including several types of
cancer.
"In and of itself, the compensatory award is not damaging
because it is a relatively low amount that can be absorbed
by the companies," said Paul Gallagher, a lawyer with the
Washington, D.C., firm of Cohen, Milstein, Hausfield & Toll,
which has successfully brought huge cases against
corporate giants such as Texaco and Exxon.
"But it sets the table for the punitive award. And the second
shoe to drop may be a Paul Bunyan-size shoe," he said.
The verdict shows that the jury accepted almost the full
value of the plaintiff's theory, Gallagher said. And it almost
reached the full $13.2 million Rosenblatt had asked for in
damages.
Fear of a huge award prompted several states, including
Florida, to consider or approve legislation that would protect
the tobacco industry from a crippling award by setting a cap
of $25 million to $100 million on the amount a company has
to post as bond before it can pursue an appeal.
And other states, such as Florida, are worried about their
share of the $246 billion settlement they reached with
tobacco in an unrelated case.
None of that money is going to individual smokers, as it is in
this class-action case, the first statewide case to ever make
it to a jury.
Clark Freshman, a University of Miami law professor who
has watched the case closely, said this verdict is a tribute to
class actions.
The case has already taken 18 months, but if the smokers'
cases had been tried individually it could have taken several
years and "been a tremendous waste of judicial resources."
EXCERPTS from Bloomberg, April 7, 2000, writers William McQuillen and Lawrence Viele; headlined: Tobacco Firms Told to Pay Florida Smokers $12.7 Mln
A Miami jury told Philip Morris Cos. and other cigarette makers to pay $12.7 million to two cancer-stricken smokers and the family of a third, setting the stage for class-action punitive damages that could run into the billions.In an amazing "double speak," a Florida legislator, John Thrasher, has said he is only concerned about helping the children with the tobacco money. Another hypocrite, this time an attorney in the Attorney General's office in North Carolina, has said it definitely would be unconstitutional to tie such legislation to a guarantee from tobacco companies that they would buy tobacco from NC farmers. Isn't money wonderful!The six-person jury next will determine whether possibly
hundreds of thousands of Florida smokers should share in a
punitive award. While the industry has said a huge punitive
verdict could bring bankruptcies, Florida law would prevent that.Philip Morris, the sixth-most actively traded stock, fell
7/16 to 22 1/2 on the New York Stock Exchange; R.J. Reynolds fell 1/16 to 20.The Standard & Poor's 500 Index of tobacco stocks has
declined 60 percent in value since November 1998 ...Judge Kaye scheduled a meeting Monday with lawyers to discuss the next step in the case.
Even if reduced, today's verdicts exceed compensatory awards in cases brought by individual smokers. Two San Francisco juries in the last two years have awarded sick smokers $1.72 million and $1.5 million in compensatory damages. Those awards and punitive judgments in the cases have been appealed by tobacco companies.
A Portland, Oregon, jury in 1999 awarded survivors of a dead smoker $1.23 million in compensatory damages. That judgment and a $79.5 million punitive damage verdict in the case are on appeal.
NEWS
RELEASES - GROUPS OPPOSING FLORIDA'S
LEGISLATIVE PROPOSALS
Action
on Smoking and Health, on its web site
Virginia GASP on this web site
Tobacco
Products Liability Project
Campaign
for Tobacco Free Kids
Florida
Tri-Agency
GASP
of Florida
American
Cancer Society
NEWS RELEASE - GASP of Florida says FLORIDA legislature is forgetting tobacco's victims, haggling over drug money
Immediate Release,
April
13, 2000
FROM: GASP of
Florida,
Group Against Smoker's Pollution
Contact: Rita
Zemlock,
Executive Director, 305-935-0804
GASP of Florida today announced its opposition to efforts by the Florida legislature to save tobacco companies while sacrificing the rights of tobacco's victims.
Rita Zemlock, Executive
Director
of GASP of Florida, has attended many sessions of the Engle trial, in
recess
until May 15th. "I can't believe that the same state that started
the 'Truth' campaign, which has helped reduce youth smoking, is now
saying
they are willing to make kids smoke," Zemlock
said. "That's
exactly
what this means. The only way on earth that this company can
continue
to survive is by luring young people into smoking, and hooking them.
How can any Florida legislator, and this goes for Governor Bush as
well,
in good conscience support this kind of legislation? It puts
them
in the position of being partners with a drug dealer. That's all
this is - haggling over drug money."
Zemlock continued, "The
state
wants its money, Dick Scruggs wants his money, and so they're willing
to
toss the rights of consumers into the trash. These tobacco
victims
were addicted by a company that knew its product was addictive, knew it
could kill, but marketed it anyway. The tobacco
companies are nothing more
than legalized drug pushers."
"The tobacco victims are in the midst of having their day in court, and suddenly Florida is ready to change the law, ready to pull the rug out from under them. This only makes sense for those who care more about money than lives. And that's exactly the definition of the tobacco industry," Zemlock said.
"And the irony," Zemlock added, "is that if Florida manages to reduce teen smoking, the money is also reduced anyway. As for the fears about losing the health advances we achieved under the leadership of Governor Chiles, GASP urges the legislators to spend time writing up some legislation to codify those advances into the law."
<>Zemlock said that she would be encouraging GASP members and the public in general to call their state legislators to ask them to remember the victims of tobacco. "Florida has no business being soft on drugs, and tobacco is a deadly drug, more addictive than any illegal drug. It's time for Florida to punish the drug pushers, not the victims."Contact: Roger Salazar,
202-661-5710,
of the American Cancer Society
Web Site: http://www.cancer.org
WASHINGTON, April 12 /
U.S.
Newswire / -- The American Cancer
Society, America's largest
voluntary health organization, today
condemned efforts to
provide
special protection to big tobacco. The
Society cited moves by
legislators
in Florida, North Carolina,
Georgia, Virginia and
Kentucky
to shield the tobacco industry from
punitive damages in the
Engle class action tobacco lawsuit in
Florida.
"Punitive damages are
intended
to punish an individual or entity
for their egregious
behavior,
and prevent them from engaging in that
behavior in the future,"
said John R. Seffrin, Ph.D., chief executive
officer for the American
Cancer Society. "The American Cancer Society
opposes any legislation
or measure that would change the rules and
grant special legal
protections
to the same tobacco companies that
have been found guilty of
deceiving the public about the dangers of
smoking."
"While we are pleased
with
the jury's compensatory damages award
in this case, we will be
keeping a close eye on the next phase of the
trial," added Dr. Seffrin.
"The tobacco industry's extreme and
outrageous behavior has
compromised the health of millions of
Americans. The Supreme
Court
recently concluded that while the FDA
does not currently have
the authority to regulate tobacco products,
tobacco use among children
'poses perhaps the greatest public health
risk in America.' Until
Congress acts, the courts are the only
recourse available to keep
the tobacco industry's behavior in check."
Tobacco use is the
number
one preventable cause of death in
America, killing nearly
430,000 people each year. Thirty percent of
all cancer cases are
attributable
to tobacco use. More than $50
billion is spent in health
care costs each year to treat smokers
suffering from
cardiovascular
disease, cancer and lung disease and
other related ailments.
For Immediate
Release
April 6, 2000
Contact: Mark Gottlieb
1-800-387-7848
$300 BILLION
PUNITIVE
DAMAGES AWARD FIGURE IS
A TOBACCO INDUSTRY RUSE
DESIGNED TO SCARE
STATES INTO ENACTING
SPECIAL LEGAL PROTECTIONS.
FLORIDA LEGISLATURE
CAN
EASILY PROTECT SETTLEMENT
FUNDS WITHOUT SHIELDING
BIG TOBACCO, SAYS TPLP.
Boston - For several weeks, a furor has been building in Florida and beyond over the possibility of a Miami jury awarding lump sum punitive damages of $300 billion in the class action trial known as "Engle." This fantastic figure comes from one source: Big Tobacco's top Florida attorney Dan Webb. In arguing against the lump sum punitive damages trial plan to the Third District Court of Appeals last October 20th, Webb said that a $300 billion award, "would destroy any industry." The appeals court and the Florida Supreme Court rejected that appeal and let the lump sum punitive damages trial plan stand.
"Webb, a top attorney for an industry chock full of legal talent, must have known that Florida law prohibits punitive damages that exceed the industry's net worth of about $100 billion," said Northeastern University Law Professor Richard Daynard, who is Chair of the Tobacco Products Liability Project. In any case where it has come up, Florida courts have ruled that punitive damages "may properly punish each wrongdoer by exacting from his pocketbook a sum of money which, according to his financial ability, will hurt, but not bankrupt." (e.g., Bould v. Touchette, 349 So.2d 1181 (Fla. 1977)).
Webb's dubious contention is the industry's equivalent of shouting "FIRE" in a crowded theater. Panic has ensued and the rights of sick smokers and their survivors are being trampled. A panicky Florida attorney general, Bob Butterworth, seems to have lost his bearings.
Butterworth issued an opinion to the Legislature last week urging action on a bill to delay any punitive damages award in the Engle case until after each claim of an estimated half million sick Florida smokers has been separately adjudicated over the next 10-20 years or more. The action is needed, purportedly, to protect tobacco industry settlement payments to the state of Florida should the companies seek bankruptcy protection.
There are 2 problems with this logic: 1) under Florida law, punitive damages cannot bankrupt a defendant, and 2) As suggested recently by Credit Lyonnais Securities, Florida could easily protect and maintain settlement revenues by passing a contingent cigarette excise tax that would take effect only if the industry's payments to the state were interrupted. Importantly, excise taxes are not affected by bankruptcy protection. Florida could also securitize their settlement as a bond issue, thereby breaking the state's ties to Big Tobacco's future.
Daynard notes that,
"it
appears this is simply an attempt by the tobacco companies to scare
state
governments into granting them special legal protections. Instead
of falling for this trick, Florida should let the jury that has been
hearing
this case for more than a year and a half finish its work and let
justice
take its course."
CAMPAIGN for TOBACCO FREE KIDS announces opposition to Florida Tobacco Shield:
For Immediate
Release
Contact: Vince Willmore/Joel Spivak
April 4,
2000
202-296-5469
Statement By Matthew
L.
Myers, President
CAMPAIGN
FOR TOBACCO-FREE KIDS
Regarding Consideration
by the Florida Legislature of a Proposal to Protect the Tobacco
Industry
from Punitive Damages in the Engle Case
Washington, D.C. (April 4, 2000) - The Campaign for Tobacco-Free Kids opposes any effort in the Florida Legislature to change the rules in the middle of the Engle trial and grant special legal protection to cigarette companies that have been found guilty of lying about the health risks and addictiveness of smoking.
The proposed legislation is not needed to protect the state or its taxpayers. But it would block Florida citizens who are victims of established cigarette company wrongdoing from receiving proper compensation. The only winners would be the cigarette companies.
Last year, the Engle jury found the cigarette companies guilty of widespread wrongdoing. The jury is now determining whether the three named representatives of a class of Florida smokers are entitled to receive compensatory damages. If the jury awards compensatory damages to the class representatives, the court has ruled that the same jury should then decide if the cigarette companies must pay punitive damages to all members of the class. The proposed legislation would reverse this ruling and require that individual compensatory damages for each smoker be determined before punitive damages could be assessed for that smoker, a process that could take years.
Based on a legal opinion by Florida?s Attorney General, Robert A. Butterworth, proponents of the legislation claim that the judge?s legal ruling on punitive damages was wrong. Whether or not this is correct, it is wrong for the Florida legislature to take this case out of the hands of the jury and the Florida judicial system in order to protect the cigarette companies. Judicial procedures are already in place to appeal and correct court rulings that do not follow existing laws. And Florida certainly does not need any special new laws to protect and aid the cigarette companies.
Accordingly, the
proposed
legislation is unnecessary and excessive. It represents the worst
form of special interest politics and should be rejected.
The Florida Coalition on Smoking OR Health Issues a Position on Engle Class Action Tobacco Suit
MIAMI, April 12 /PRNewswire/ -- The following is a letter sent to Governor Jeb Bush regarding the Florida Coalition on Smoking OR Health position on legislation and proposals that affect the punitive damage stage of the Engle class action tobacco suit:
April 12, 2000
Attn: Carol Licko
The Honorable Jeb Bush
Governor of Florida
Dear Governor Bush:
We are writing to you to express our concern over
proposals
that have been proffered by a number of public officials that would
provide
protections to the tobacco industry in the Engle class action tobacco
suit.
We realize that the state of Florida benefits
financially
from the annual tobacco settlement payments. However, the tobacco
industry has been found guilty in a court of law and the courts should
be allowed to handle this phase without interference from the
legislature.
Enclosed is our position, which
addresses our concerns regarding proposals to protect
the tobacco industry. We would be deeply disappointed if the Florida
Legislature
enacted new legislation to deny victims their rights and at the same
time
grant additional rights to those that have already been found guilty of
wrong doing.
The proposals to protect the tobacco industry are
predicated
on exaggerated fears of tobacco industry bankruptcy. Many groups and
organizations
have already attested to the fact that it is extremely unlikely that
the
tobacco industry will go bankrupt. Tobacco analysts on Wall Street, the
plaintiff attorneys in the Engle suit, and health groups have all said
that tobacco industry bankruptcy
is very unlikely. In fact, tobacco industry
representatives
have stated publicly that they do not fear bankruptcy. We have also
enclosed
some information that addresses the unfounded fears of tobacco industry
bankruptcy.
The tobacco industry has obviously been fueling concerns about bankruptcy. Their motivation is obviously to reduce the amount of the appeal bond they may have to post and to significantly reduce and delay any punitive damage award that may be handed down.
Governor Bush, we hope you will keep our concerns in mind. We respectfully ask you to veto any legislation that comes to your desk that would in any way intervene in the Engle class action tobacco suit.
Sincerely,
Eliza Perry,
R.N.
William B. Blanchard, MD Larry W.
Serlo,
CPA
Chairman of the
Board
President
President
American Cancer Society,
American
Heart Association, American Lung
Florida
Division
Florida/Puerto Rico Affiliate Association of
Florida, Inc.
cc: Attorney General,
Robert
A. Butterworth
Senate President, Toni Jennings
Speaker of the House, John
Thrasher
Members of the Florida Legislature
Contact:
Ralph DeVitto, American Cancer
Society,
813-785-3767
Brian Gilpin, American Heart
Association,
727-570-8809
Brenda Olsen, American Lung
Association,
850-386-2065
Position of the Tri-Agency Coalition on Smoking OR Health
On legislation and
proposals
that affect the punitive damage stage
Of the Engle class action tobacco suit
The Tri-Agency Coalition is opposed to any
legislation
or proposal that would in any way limit or prevent the Engle class
action
tobacco suit from proceeding expeditiously to the punitive damage
stage.
Florida's Legislature should not be pushing for special protections
that
would shelter the tobacco industry, but should instead focus on
protecting
the health of their citizens from the predatory practices of Big
Tobacco.
The Engle case should continue without the burden of any new
legislation that would only delay or impede due process
for the victims of the tobacco industry.
The Engle class action lawsuit is the first of its kind to ever go to trial. The lawsuit was first filed in 1994 on behalf of an estimated 500,000 sick Florida smokers. The jury has already decided that the tobacco companies are guilty of deceiving the public about the addictive and harmful effects of cigarettes and has awarded the plaintiffs $12.7 million in compensatory damages. The jury will decide on punitive damages in the next phase of the trial.
The plaintiff attorneys in the Engle case have stated that they have no intention of requesting punitive damages that could bankrupt the industry. In fact, Florida law does not permit them to do so. Punitive damages are to punish and deter, not to bankrupt.
The purpose of punitive damages is to punish an individual or entity for their egregious behavior, and to try to prevent them from engaging in that behavior in the future. Since the Supreme Court recently decided that the FDA does not have the authority to regulate tobacco products, the courts are the only recourse available to keep the tobacco industry's behavior in check.
We now know that the tobacco industry deceived the public about the dangers of smoking, hid research results, and aggressively marketed their product to children. The tobacco industry's extreme and outrageous behavior has compromised the health of millions of Americans.
Tobacco use is the number one preventable cause of death in Florida, killing nearly 30,000 people in Florida each year. More than $4.6 billion is spent in health care costs each year in Florida to treat smokers suffering from cardiovascular disease, stroke, cancer, lung disease, and other related ailments.
The Facts on Tobacco Industry Bankruptcy Fears
The tobacco industry has been fueling fears of bankruptcy in order to ease the punitive damages they may have to pay in the Engle class action tobacco suit. However, the facts tell a very different story on the likelihood of bankruptcy.
Fact: There are over 45 million addicted smokers in the U.S. alone. With that many dedicated customers, the tobacco industry will not be going away for a long time.
Fact: The risk of tobacco industry bankruptcy has been greatly exaggerated. Robert Larkins, a managing director with Morgan Stanley Dean Witter, stated, "The role of the bankruptcy bogeyman in any potential financing has been greatly exaggerated. All of the tobacco companies are solidly investment-grade.'' (The Bond Buyer, July 1, 1999, p. 48)
Fact: Representatives from the tobacco industry have stated publicly that there is no risk of bankruptcy "We certainly have no intention of going bankrupt.'' Steven Parrish, senior vice president for Philip Morris on CBS News' Face the Nation on March 26, 2000.
Fact: Litigation against the tobacco industry in Florida cannot force bankruptcy. Florida law prohibits a damage award so high that it puts a company out of business.
Fact: The plaintiff attorneys in the Engle class action tobacco suit have stated that they have no intention of asking for punitive damages that would bankrupt the tobacco industry.
Fact: The tobacco industry is afraid of a large
punitive
damage award, but they aren't afraid of bankruptcy. "Richard
Daynard,
law professor at Northeastern University and chair of the Tobacco
Products
Liability Project, believes the bankruptcy scenario is a ruse drummed
up
by tobacco's legal team to scare states into enacting special legal
protections
before the Miami jury sets punitive
damages.'' (Palm Beach Post, April 10, 2000)
Fact: The tobacco companies are quite healthy despite all the doom and gloom. Philip Morris alone pays its shareholders $4.5 billion in dividends a year. Last year they saw their domestic tobacco sales soar to $19.5 billion from $15.3 billion.
SOURCE: American Heart Association
The Engle trial is a case of true smokers' rights.2. "Guilty!"
Smokers have brought suit against tobacco companies, holding them accountable for tobacco company actions in knowingly addicting and harming and indeed killing smokers. One of the plaintiffs has already died since the trial began about 18 months ago.
The jury in Phase 1 of this trial found the tobacco industry liable for deceiving the public about the addictive and lethal nature of tobacco products.3. Compensatory damages
Now in Phase 2, the jury is considering compensatory damages for the plaintiffs.4. Punitive damages
Then they would move to consideration of punitive damages to cover the class action of approximately 500,000 Florida smokers.5. Tobacco begins rumors on bankruptcy, to delay and stall justice.
Enter rumors of possible bankruptcy, spread by the tobacco industry, which has never played fair with anyone, especially smokers.6. Legislation to delay or sidetrack the Engle trial:
Enter greed and fears for politicians of life without tobacco money, and no more tobacco settlement cash for states.
When appeals on punitive damages are made, a bond must be posted, to ensure that there will be enough money to pay the plaintiffs later if the appeals are lost.7. Now Florida is looking at other legislation to help save the tobacco industry, and their goose that lays the golden green eggs.
Tobacco companies are pushing bills to "cap" the amount of the posted bond at no more than $25 million.
Philip Morris wrote a bill for Virginia, and Virginia's governor deceptively entered it without labeling it a Philip Morris bill. A free press discovered the ruse. The bill passed. Georgia has passed a similar bill, and Kentucky is working on one. North Carolina will hold an expensive special session to discuss their bill.
Florida's attorney general and governor are proposing legislation that would require each of the 500,000 cases to be heard individually. Think how long that would take!8. Several law professors have said the "bail out tobacco from those bad smokers" legislative actions:Florida is also considering a "tobacco bond" to get more tobacco money "up front", which some critics say is fueled by Wall Street investors.
9.
Several legal experts have said that the tobacco industry is not likely
to go bankrupt, and if they did, they would simply reorganize, with new
restrictions put into place regarding their product and the marketing
of
it.
A financial analyst has noted that this industry could easily survive
posting
even a $300 billion bond, a figure floated by the tobacco attorneys.
10.
It is most disturbing that these state AGs and legislators in some of
the
states care more about the money
than the rights of citizens:
- to hold industry accountable, and
- to expect that a product, when used as intended, will neither addict
them nor kill them. No other industry has been able to get away
with
murder.
Various news articles, excerpted
in this page, explain the legislative furor and the trial further.
QUESTION: Just who is running this country?
ANSWER: Big Tobacco - the Merchants of
Death.
QUESTION: Who is helping Big Tobacco, besides politicians?
ANSWER: From press reports, it appears that some
state attorneys general and some of the private attorneys,
who worked with the state attorneys general, are helping, in
order to collect fees.
QUESTION: Will Big Tobacco continue to rule?
ANSWER: Our only hope lies in brave
jurors, and an informed public.
Note: Many thanks to writers such as Teri Somers and The Sun-Sentinel. While most in the news media totally ignored the Engle trial for two years, the Florida papers, the Florida AP, and The LA Times brought us the news. Ironically, some other papers sued to lift the "gag" order; a federal judge has agreed to this.EXCERPTS from The Sun-Sentinel, April 7, 2000, writer Terri Somers, headlined: Gag-less tobacco parties quiet
Lawyers for tobacco companies on trial in a
Miami-Dade Circuit Court wanted a gag order
lifted so that they could talk to the media about
the case and the cigarette business, according
to motions they filed in the case.
Urged by lawyers for several media
companies, including the Sun-Sentinel, a
federal judge lifted the gag order on
Wednesday, calling it unconstitutional.
But on Thursday, attorneys for the tobacco
companies, the smokers suing them and the
judge who issued the gag order still had
nothing to say.
Judge Robert Kaye said in court that he had
received U.S. District Judge Adalberto Jordan's
20-page decision, but had not read it. He said
that until he goes over it, he would have no
comment on the decision.
And attorneys for the country's five largest
cigarette makers continued their 18-month
silence, citing ongoing jury deliberations on
whether smoking caused the cancer suffered
by three people who represent the many
thousands of sick Florida smokers who
comprise the class suing the industry. It is not
unusual for lawyers to refrain from commenting
while a jury is weighing a case.
Stanley and Susan Rosenblatt, the
Miami-based attorneys who are asking for $10
million to $14 million on behalf of the three
smokers, said they would continue to abide by
the gag order until they are given some
direction by the judge, and while the jury
deliberates.
Two tobacco stock analysts, David Adelman
of Morgan Stanley Dean Witter and Martin
Feldman of Salomon Smith Barney, projected a
victory for the smokers Thursday.
Feldman thinks at least two of the smokers
will receive an award. Amodeo is a possible
exception.
EXCERPTS from The Sun-Sentinel, April 5, 2000, writer Terri Somers; headlined: Jury to begin deliberating links between cigarettes, smokers' illnesses.
Feeling
that lawyers for the five top tobacco
companies portrayed his clients as
money-grubbers in search of a big payout,
Miami attorney Stanley Rosenblatt went on the
defensive Tuesday.
Of course the ailing Floridians suing the
tobacco industry want money from the
cigarette-makers as compensation for their
pain and suffering; it is their only legal remedy,
Rosenblatt said. It is not as if the sick smokers
can burn down Philip Morris in retribution, he
said.
In concluding his closing arguments,
Rosenblatt, who represents the smokers
involved in a statewide class-action lawsuit
against the tobacco industry, called cigarettes
"the only legal product in America that, when
used as directed, will kill its customers."
Rosenblatt wants tobacco to pay his clients
$10 million to $14 million in compensatory
damages.
Today, Miami-Dade County Circuit Judge
Robert Kaye is expected to give last
instructions before the six-member panel
begins deliberating a verdict for the second
phase of this landmark trial.
In the first phase, the same jury found that
the tobacco companies produce a dangerous
product that causes cancer and several other
diseases.
Now the jurors must decide whether three
plaintiffs who are representing the entire class
of smokers, as many as 500,000 people,
contracted cancer because they smoked for
decades. If the jury finds there is a link
between their smoking and cancer, it must
decide whether the three should be
compensated for past and future lost wages,
medical bills and the emotional suffering
caused by their illnesses.
The plaintiffs are Mary Farnan, a nurse who
has had cancer in both lungs and her brain;
Frank Amodeo, an Orlando clock maker,
whose throat cancer rendered him unable to
eat or drink anything for the past 12 years; and
Angie DellaVecchia, a housewife who died last
summer of the lung cancer that spread to her
brain.
If the jurors grant compensatory damages,
they will be asked in the third phase to
determine whether the tobacco companies
should be ordered to pay punitive damages to
the entire class.
Without discussion, Kaye rejected one of
several mistrial motions by the industry after
Rosenblatt called cigarette-makers
"fundamentally dishonest" and accused them
of using a "bag of tricks."
EXCERPTS from The Sun-Sentinel, writer from The Associated Press, for April 4, 2000; headlined: Defense: Smokers don't deserve to be paid for their bad habit
Stanley
Rosenblatt, attorney for a class of
thousands of sick Florida smokers, has asked
the jury to pay two smokers, and the survivors
of a third, $14.4 million. If any one of the three
is awarded damages, the jury will go on to
consider punitive damages for the entire class
that could reach a potentially staggering
amount.
Also on Monday, attorneys for two other
cigarette makers, Lorillard Tobacco Co. and
Liggett Group Inc., asked to be cleared of any
damage claim because the smokers were
never regular users of their products.
The jury ruled last July that the industry
conspired to produce a dangerous product and
conceal its risks. The panel will begin
deliberating later this week whether the
industry is at fault in the individual cases of the
three smokers, representing the entire class.
Two of the smokers, Frank Amodeo and
Mary Farnan, have taken part in the trial. The
third, Angie Della Vecchia, died last year of
lung cancer, and her husband testified that she
was hopelessly addicted to cigarettes.
On Monday, tobacco attorney [Brown &
Williamson Tobacco Corp. attorney Gordon] Smith
rejected the idea of nicotine addiction as "bull.
That shows how far people will go to try to say
things bad about tobacco companies."
Even if jurors agree that Lorillard and Liggett
are not responsible for the smokers' illnesses
because the smokers did not buy their
products, the jury could find all five cigarette
makers in the case liable under overall fraud
counts based on conspiracy, concealment or
misrepresentation. The other defendants are
tobacco giants Philip Morris Inc. and R.J.
Reynolds, and industry groups the Council for
Tobacco Research and the Tobacco Institute.
Ending a four-month phase of the
unprecedented trial, the panel will be asked to
set damages for the medical bills, lost income,
lost services, pain and suffering from lung
cancer in Farnan and Della Vecchia and throat
cancer in Amodeo.
If any money is awarded, the jury would hear
more testimony and be asked to set punitive
damages for an estimated 500,000 sick Florida
smokers covered by the lawsuit.
EXCERPTS on a second legislative tactic, from The Sun-Sentinel, April 4, 2000, writer John Kennedy; headlined: Bill would allow Florida to get some cash upfront from tobacco settlement
Fearing
that mounting
lawsuits could bankrupt tobacco companies, a
[Florida] House panel approved legislation Monday that
would allow Florida to trade its $17 billion
cigarette settlement for a portion of the money
up front.
The legislation would
allow the state to bond part of the 30-year
settlement, getting cash it could then invest in
stocks, bonds and other financial instruments
that may prove more dependable than the
tobacco payments.
Some charged that the anxiety over the
tobacco industry's future is being fanned by
Wall Street firms, which stand to make millions
from the Florida bond deal.
Indeed, representatives of Wall Street's
major brokerages are eagerly watching the
legislation, which is similar to the steps taken
last November by New York City, which issued
the nation's first-ever tobacco bond.
Lacasa's bill still faces an uncertain future.
The Senate is considering authorizing the state
to insure the tobacco settlement but not put
any of it on the market.
EXCERPTS from Reuters, April 3, 2000, writer Michael Connor; headlined: Florida Governor Backs Act Sapping Smoker Claims
As a jury in Miami readied to decide damages in the EngleEXCERPTS from The Miami Herald, April 1, 2000, writer Steve Bousquet, with assistance from Amy Driscoll and Lesley Clark; headlined: Proposal would delay jury award in tobacco suit
tobacco case, Florida Gov. Jeb Bush, brother of Republican
Party presidential candidate George W. Bush,
said Florida now receives about $450 million a year from a $13
billion tobacco settlement reached in 1997."We would be supportive of protecting the flow of funds that
come from the settlement,'' Bush said at a news conference in
Tallahassee, Fla."If a bill was passed that dealt with that issue, in anticipation of
the pending decision in Miami, that would be a good thing to do.''A punitive award may be just weeks away, analysts have said.
Analysts and experts are divided over what immediate effect a
massive award would have on the tobacco industry, since
appeals against the verdict were highly likely and might takes
years to decide.Tobacco stocks rose on Monday, at least partly on hopes
Florida would pass a law giving cigarette makers succor, analysts said.
[Florida's Attorney General] Butterworth sent a long legal memo to [Florida] Senate President Toni Jennings and House Speaker John Thrasher recommending passage of a law that would require that compensatory damages -- the kind given for lost income, medical bills, pain and suffering -- be awarded to all plaintiffs before punitive damages can be awarded. Such a measure already exists in Florida common law -- the kind set by previous judicial rulings, or precedent -- but is not codified as an official statute.BUT, North Dakota's Attorney General says the states will still get their money even if the industry goes bankrupt. The private attorneys are not mentioned:Such a law would add years to the already lengthy case, because it would require the trial judge, Robert Kaye, to hold separate hearings to assess compensatory damages for every one of the more than 500,000 sick smokers covered under the class-action lawsuit.
But Miami lawyer Neal Roth, president of the Academy of Florida Trial Lawyers, said Butterworth's argument ignores a crucial provision in Florida case law: A jury award for punitive damages cannot bankrupt the defendant.
"The judge knows what the law is,'' Roth said, adding that "even if the jury were to make a mistake'' and award too high an amount, the judge "would be duty-bound to correct it.''
Some observers have questioned Butterworth's motives in what appears to some critics as protecting the industry from a devastating damage award.
Jurors in the Miami case decided in July 1999 that the tobacco firms fraudulently conspired to produce a dangerous product.
"I can't understand why people are all stirred up about this,'' said a key senator, Locke Burt, R-Ormond Beach. A lawyer and chairman of the Senate Budget Committee, Burt said three important questions must be answered before the Legislature acts.
"Is the Engle case a real, immediate threat to the tobacco settlement agreement? Is it appropriate for the Senate to jump into the middle of an ongoing lawsuit? And is there any consensus on the words [of a bill]? At this point, there's no consensus,'' Burt said.
Burt spoke Friday after an hour-long conversation with Assistant Attorney General Kim Tucker, who's monitoring the Miami lawsuit. Burt described Tucker as "uptight'' about the possibility that a devastating punitive damage award could wreak havoc on the Florida tobacco settlement. Tucker could not be reached for comment.
"It's not the money,'' Burt said of the attorney general's office position. "What they care about are the enforcement provisions in the agreement,'' referring to limits on tobacco advertising targeting teenagers.
Thrasher said the House will look at any legislation the Senate proposes. And he said he's not particularly worried about the effect on the lawsuit.
"I'm more concerned about the kids in the state of Florida who are benefiting from the settlement,'' Thrasher said. "Whatever we can do to protect that, that's what my concern would be.''
The Miami jury has not yet awarded damages to sick smokers or the survivors of cancer victims, but the economic implications of the case are being felt far and wide.
Along Tobacco Road, in North Carolina, headquarters of some of the tobacco companies being sued, Gov. Jim Hunt called the Legislature into emergency session next week to consider a cap of $25 million in damages that an out-of-state court can impose on companies appealing a verdict. Virginia and Georgia already have adopted $25 million limits.
But such a cap would be ``clearly unconstitutional,'' argued Richard Daynard, a Northeastern University law professor and director of a group that encourages lawsuits against tobacco companies. A cap would violate the "full faith and credit' clause of the U.S. Constitution, which requires states to recognize each other's court decisions, he said.
"Think about what this would be like in another lawsuit,'' Daynard said. "The Legislature comes in the middle of the case and says, 'We don't like the way it is going.' Surely the Constitution doesn't read this way.''
EXCERPTS from The Chicago Tribune, April 2, 2000, writer Stevenson Swanson; headlined: STATES POISED TO INHALE TOBACCO'S WINDFALL
North Dakota Atty. Gen. Heidi Heitkamp, who chairs the
committee of state attorneys general overseeing
implementation of the settlement[:]
"There is a provision in the master settlement agreement
in the unlikely event of a bankruptcy," she said.
"Bankruptcy should have no effect on our expectation
that we will receive payments. Basically, we have a
contractual agreement with the industry that they will pay
us."
States received their initial checks at the end of last year,
and, provided that Americans keep smoking, the checks
will keep rolling in annually in perpetuity. The widely
cited $246 billion figure is for the first quarter-century of
an open-ended agreement.
Protection
is growing for the death merchants.
And now, apparently,
it is coming from several of the state attorneys
general, and the private attorneys who worked with them, all of whom
evidently
want to protect the goose that laid the golden, or in this case the
green
$$$$, egg.
If this is indeed the case, these so-called public servants, and the private attorneys they hired to help them in their lawsuits against tobacco, have a huge conflict of interest - wanting to protect their fees $$$$. If the tobacco industry goes under, these attorneys will not have any more big bucks.
So, they would be sacrificing lives for money, trading morality for money, and becoming - in effect - accessories to murder, for money. And these are the top protectors of the law in their states. Talk about corruption.
Perhaps impeachment should be considered, or maybe resignation of them all, if this is true, for they would have deceived the public and betrayed the public trust, and flaunted the public welfare for private gain. These are the same attorneys general, and the assisting firms, who blasted then Attorney General Skip Humphrey for refusing to go along with a national deal to grant immunity to the tobacco companies.
How much is a life worth? Not as much as the tobacco industry, free to addict and kill at will, with no tobacco executives - or attorneys who help them - serving prison terms as drug dealers and murderers.
If this is not the case, then these state attorneys general, and the private firms of attorneys who helped them, should come forward and set the record straight. Otherwise, the public will continue to add 2 + 2.
Remember in 1997, several state attorneys general, and groups of private attorneys who helped them in their lawsuits against tobacco, pushed for a "national settlement" of their lawsuits, which would have included immunity from many lawsuits against the tobacco industry? Then, health activists exposed this, fought to have the "deal" killed, and succeeded.
Then John McCain drew up national legislation, and the tobacco industry had an immunity clause added. When the health activists lobbied successfully to have that immunity clause removed, the tobacco industry launched an all out campaign to kill the McCain bill, and won.
Skip Humphrey, in Minnesota, was one of the few state attorneys general who refused to sign onto any protection for the tobacco industry. He couageously pressed his case until the industry agreed to several health measures, and agreed to release thousands upon thousands of secret documents, which has helped other attorneys and tobacco victims.
Now the industry, faced with its worst nightmare - accountability, is finding help from state attorneys general and those private firms and attorneys who helped them in the lawsuits against tobacco companies. Excerpts on the Florida legislature articles include The La Times, The Sun-Sentinel, The Winston-Salem Journal, The Gainesville Sun, and The Miami Herald. The LA Times reports on the new protection strategy in the excerpts below.
EXCERPTS from The Los Angeles Times, March 30, 2000; writer Myron Levin; headlined: "Fla. Bill Could Protect Tobacco Industry From Massive Award Lawsuit: The measure, an effort to preserve the flow of settlement money to other legal actions, would prevent huge punitive damages in a landmark class action."
A campaign is building in the Florida Legislature to
save the tobacco industry from a potentially
catastrophic punitive- damages award in the landmark
Engle class-action case in Miami.
The effort appears aimed not so much at protecting
tobacco companies as preserving the flow of
tobacco
industry settlement payments to Florida and other
states, which some officials fear could be interrupted by
a damage award in the Engle case that could reach into
the hundreds of billions of dollars.
Many of the attorneys general, who in 1997 and '98
agreed to out-of-court settlements with tobacco
companies, fear this would interrupt the flow of
payments to states, which are supposed to amount to
$246 billion over 25 years.
The bill was drafted by Florida Atty. Gen. Robert
A. Butterworth, one of the leaders of the massive legal
assault on Big Tobacco by the states. A copy of the
proposed measure and a legal opinion signed by
Butterworth and sent to Florida Senate President Toni
Jennings and House Speaker John E. Thrasher were
obtained Wednesday by The Times.
The bill drafted by Butterworth would declare that it
is already the law in Florida that punitive damages can
be awarded only after compensatory verdicts are
reached.
Prospects for the bill were uncertain. But
Republicans generally have been more sympathetic to
the tobacco industry than Democrats, and there are
Republican majorities in the Florida Senate and House.
Florida Gov. Jeb Bush is also a Republican.
This trial in Florida, known as the Engle case, which has been slowly progressing for almost two years, has Stanley and Susan Rosenblatt as the courageous attorneys for the plaintiffs.
The tobacco industry has sought to stop the Engle trial in many ways, including trying to have national legislation passed which would have granted them immunity from this and other trials. The McCain bill contained this immunity clause, but health activists helped legislators to remove it. Once immunity was gone, the tobacco companies waged an all out war to kill the McCain bill, and succeeded. Of course, the industry framed it as a war to protect themselves from a tax increase - further deceit. Now they are trying to delay it further with legislation in tobacco states such as Virginia and North Carolina, and now including Florida.
Closing arguments in the Engle trial began March 27th.
EXCERPTS from The Sun-Sentinel, April 1, 2000, writer Terri Somers; headlined: Tobacco trial has some jurors nodding off as case drags on
Fourteen months and counting.
As yet another month draws to a close and
lawyers in a Miami Circuit courtroom are still
arguing the ground-breaking class action case
against the country's five largest tobacco
companies, even the jurors, which Judge
Robert Kaye has called "the most
sophisticated" he has ever seen, are getting
weary.
When a tobacco lawyer said during his
second day of closing arguments on Friday
that he ought to wrap things up because they
had probably heard enough, jurors and others
in the courtroom nodded. And later in the day,
as yet another tobacco lawyer recalled the trial
testimony about the complicated science of the
structure of cancer cells found in one ailing
smoker's lungs, jurors struggled to keep their
eyes open, some unsuccessfully.
The 12-member panel, six of them the
decision-making jurors and the others
alternates, spent nine months in 1998 and
1999 listening to testimony in phase one of the
trial. Then they ruled last July that the tobacco
companies manufactured a dangerous product,
knew it, and conspired for decades to keep that
knowledge from the public.
If the jurors decide that Mary Farnan, a nurse
with lung and brain cancer; Frank Amodeo, an
Orlando clockmaker who had throat cancer,
and the family of Angie DellaVecchia, a
housewife who died of lung cancer, should be
compensated for medical bills, lost wages and
other financial burdens, they will then be asked
to decide if tobacco should pay punitive
damages to the entire class.
Ben Reid, the lawyer for R.J. Reynolds, then
launched his attack against the claims of
Farnan, disputing the type of cancer that
doctors said she had.
Reid also argued that the plaintiffs failed to
prove tobacco should be held responsible for
their decision to smoke.
Reid likened quitting smoking to someone
being determined to diet, and said, "If there
was something about nicotine that grabbed her,
she'd still be smoking now."
EXCERPTS from The Sun-Sentinel, March 31, 2000, writer Teri Somers; headlined: "Tobacco attorney: It's smokers' fault they got sick from cigarettes"
The three smokers, who represent an entire
class of ailing and deceased Florida smokers,
"would have had to live 200 feet underground in
a steel chamber as a hermit" to not be aware of
the health risks posed by smoking, said Webb,
who represents cigarette maker Philip Morris.
The six-member jury is being asked to order
tobacco to compensate the smokers for past
and future lost wages, medical expenses and
more intangible suffering, including one
plaintiff's loss of the ability to eat and drink
because of radiation on a tumor in his throat.
If the jury grants the award, it would then be
asked to consider awarding punitive damages
to about 500,000 Floridians who are members
of the class.
Webb previously estimated that award could
be as much as $300 billion, which he said
could cripple the industry.
Outside the presence of the jury, Stanley
Rosenblatt, the smokers' attorney, railed
against the tobacco industry for introducing the
$300 billion figure to create fear and
speculation about the continued solvency of the
industry. This fear, Rosenblatt said, prompted
tobacco foes such as Attorney General Bob
Butterworth to look for ways to derail the
damages phase of this case.
In Tallahassee, some legislators are trying to
keep the punitive stage of the case from
proceeding until compensatory damages are
paid, even though a state appeals court already
has approved the trial plan. Legislation is
being
considered because state officials fear a big
punitive award in this case could hurt tobacco's
ability to continue making payments to the
state under a multibillion dollar settlement
reached with Florida and other states in
another case.
But Judge Robert Kaye seemed unfazed and
continued with the trial. "As someone wisely
once said, 'It's none of my business,'" Kaye
said. Legislators "can do what they want to
do."
Webb, the first of a brigade of tobacco
lawyers to present closing arguments,
hammered away at the assertions by Mary
Farnan, a nurse with lung and brain cancer,
Frank Amodeo, an Orlando clock-maker with
throat cancer, and Angie Della Vecchia, a
housewife who died of lung and brain cancer
last summer, that they were addicted to
cigarettes and their habit was influenced by
cigarette advertisements.
But he concentrated mostly on Amodeo,
who was diagnosed with throat cancer after
smoking Marlboro cigarettes, a Philip Morris
product, for many years.
For 15 years, Amodeo made cypress
clocks, which exposed him to wood dust.
"No one is going to come in here and say
that smoking doesn't cause laryngeal cancer. It
is a risk factor. But so is wood dust," Webb
said, recalling studies from 1980, 1995 and
1976.
EXCERPTS from The Winston-Salem Journal, March 31, 2000, writer Adrian Zawada; headlined: SIDELINE: Florida law could upend smokers trial
Before the court recessed for lunch, plaintiffs' attorney Stanley
Rosenblatt notified Judge Robert Kaye of the possible legislation and
blasted it. Jurors were not present for his comments.
''At the tobacco industry's behest, the legislature of Florida is
considering one of the most outrageous acts in the history of
legislation,'' Rosenblatt said.
''We are involved in an utterly outrageous political, not legal,
situation
which could obviously have a definite impact on what we're doing
here,'' he said.
The news reported yesterday by Feldman and the Los Angeles
Times sent tobacco stocks soaring when the stock market opened
yesterday morning. Philip Morris Cos. stock prices rose 2 3/8 to 21
1/2 and R.J. Reynolds Tobacco Co. shares rose 1 1/4 to 17.
The bill, which Florida Attorney General Bob Butterworth is expected
to introduce today, would seek to codify existing Florida case law, or
common law, and make it retroactive to include the present trial.
Last September, the 3rdDistrict Court of Appeals in Florida ruled in
favor of a lump-sum punitive-damages decision.
Taking that into account, it seems that existing common law allows for
the jury to decide punitive damages after it awards compensatory
damages to the three lead plaintiffs, as Kaye has the trial now
structured, said David Logan, a professor at Wake Forest
University's School of Law.
''The tobacco companies are going around spreading the untrue rumor
they are going out of business, that they are going into bankruptcy,''
Rosenblatt said. ''They are so clever and so skillful that they have
even made allies out of the so-called good guys . . . and got them
worried that states won't get their money.''
KAYE SAID HE WOULD not consider any state legislative efforts
until they affected the trial directly.
''As someone wisely once said, it's none of my business,'' Kaye said.
''They can do whatever they want to do in the state of whatever. . . .
Whatever goes on in Tallahassee is their business.''
EXCERPTS
from The
Gainesville Sun, March 31, 2000, writer Dara Kam;
headlined: Proposal
tempers tobacco damages.
A proposal to rescue Big Tobacco from a
potentially catastrophic class-action lawsuit is floating in the
Legislature.
But Attorney General Bob Butterworth, who drafted the
legislation, said that he wasn't out to assist cigarette makers in
any way.
''I personally don't care if they go bankrupt,'' Butterworth said.
''I don't like them. I can't stand them. This is one thing the
Legislature can consider.''
Butterworth said he wrote an opinion and draft legislation at the
request of legislators and gave it to House Speaker John
Thrasher and Senate President Toni Jennings early this week.
At issue is 1994 landmark Engle class-action lawsuit filed
against the tobacco industry in Dade County. Miami-Dade
County. The jury in the case is expected to begin deliberating
next week whether or not three individuals selected as class
representatives should receive compensatory damages from
cancer caused by smoking cigarettes.
Compensatory damages reflect actual monetary losses, while
punitive damages represent a punishment for misbehavior.
Last year, the jury decided against cigarette manufacturers,
determining that they had lied to consumers about the dangers
of smoking.
The trial court judge ruled that the jury would determine
''lump-sum'' punitive damages for the class if the jury first
decides any of the three should receive compensatory damages.
But Butterworth said there was no way of estimating the award.
''I think tobacco is crying wolf, they do it all the time,''
Butterworth said. ''They lied about the product for 50 years so
they'd be lying about this, too. I don't see bankruptcy in their
future.''
Butterworth said his proposal would actually speed up the rate
at which plaintiffs were compensated by establishing a ratio for
punitive damages compared to compensatory damages.
He said the ratio could range from three-to-one to 10-to-one,
as was recently established in California, so that punitive
damages could only be three to 10 times as much as
compensatory damages. It would also require all cases in a
class-action suit to be tried before punitive damages could be
levied.
But some lawmakers said they don't like the attorney general's
measure.
''It's a totally unacceptable proposal that would in effect clog
our court system for 250- to 300 years,'' said Sen. Skip
Campbell, D-Fort Lauderdale, a member of the Senate
Judiciary Committee. ''What he has proposed is trying 500,000
cases before you get to punitive damages. That's why we have
class actions.''
Campbell said he is working on another proposal. He declined
to reveal details about it, but said no legislation would be
proposed until next week.
Stanley Rosenblatt, an attorney representing the smokers in the
Engle case, called the Florida proposal ''one of the most
outrageous acts in the history of legislation.''
House Judiciary Committee Chairman Johnnie Byrd, R-Plant
City, was also wary of the draft.
''It's political and we're hesitating to do it because we're not
interested in being characterized as trying to help anybody in
any pending litigation one way or the other,'' Byrd said.
Byrd said that he thought it was ''odd'' that Butterworth would
try to ''bail out'' the tobacco companies after winning the
settlement.
''You have the goose that laid the golden egg,'' Byrd said. ''You
tried to kill it. Now you'd like to revive it and get a few more
eggs.''
EXCERPTS from the Sun-Sentinel, March 30, 2000, writer Terri Somers, headlined: 3 sickened smokers should be paid $10 million to $14 million, Miami jury told:
What is it worth never to be able to eat or drink
for the rest of your life? How do you assess the
loss of the capacity to enjoy life?
"It's almost offensive to put a price tag on
some of the intangibles," Stanley Rosenblatt,
the lawyer representing sick Florida smokers
told a jury in Miami Circuit Court on
Wednesday.
But Rosenblatt did just that. Somewhere
between $10 million and $14 million would
cover the tangible and intangible damages
suffered by three smokers who are now
representing the 500,000 or more ailing
Floridians suing the country's five largest
tobacco companies, he said, ending his
three-day closing argument.
Not wanting that mournful plea to be the last
thing jurors heard before going home for the
day, a tobacco attorney took the last 25
minutes of the afternoon to begin closing
arguments for the cigarette industry. He told
the jurors that during his side's 13-hour closing
argument, he would offer "a couple of reality
checks," countering Rosenblatt's assertions.
The jury is expected to begin deliberating
next week.
The next phase of the trial will require the
jurors to decide whether tobacco should pay
punitive damages to the estimated 500,000
smokers involved in the class-action case.
Rosenblatt wants the tobacco companies to
be ordered to pay for all the medical bills and
past and future wages the three plaintiffs lost
as a result of contracting cancer. An economist
who was called to testify on behalf of the ailing
smokers tried to put a dollar amount on those
tangible losses, he said.
For Mary Farnan, a nurse who had lung
cancer that spread to her brain, that would be
$1.628 million. For Frank Amodeo, an Orlando
clock-maker who was diagnosed with throat
cancer in June 1987 and has not been able to
eat or drink since then, the tangible damages
are $2.081 million, Rosenblatt said. And for the
estate of Angie Della Vecchia, the New Port
Richey housewife who died last year of the lung
cancer that spread to her brain, that figure is
$523,000, he said.
Then there is the question of the value of
intangibles, such as the loss of a soul mate,
Rosenblatt said referring to Ralph Della
Vecchia, who lost his wife of 30 years and was
the mother of his two children.
He asked the jury to recall the testimony of a
tobacco company chemist who said he was
ordered to destroy documents that showed the
medical dangers of cigarettes, and the
testimony of a tobacco company chief
executive officer who said he did not know
anything about specific chemicals in
cigarettes.
Those chemicals are proven carcinogens,
Rosenblatt said. "If he doesn't know anything
about them, how are the plaintiffs supposed to
know?" he asked the jury.
EXCERPTS from the Sun-Sentinel, March 29, 2000, writer Terri Somers, headlined: Lawyer: Desperate cigarette makers pitch 'phony theories' to Miami jury"
Calling tobacco industry lawyers "desperate," a
lawyer representing ailing Florida smokers said
his adversaries want a jury in a Miami Circuit
Court to buy "cooked-up, phony theories" that
something other than cigarettes are
responsible for the plaintiffs' illnesses.
During his second day of closing arguments
on behalf of the smokers, attorney Stanley
Rosenblatt hammered at the credibility of
witnesses who testified for the tobacco
companies.
.
Rosenblatt asked the jury to recall how,
earlier in the trial, industry lawyers questioned
whether Frank Amodeo, an Orlando clock
maker, contracted throat cancer after decades
of smoking, or whether it was caused by wood
dust. "They dredged up a quarter-of-a-century
old article on wood dust (possibly being linked
to cancer)," Rosenblatt said.
But all the board-certified doctors who
examined Amodeo and testified about his
illness said that wasn't the cause. His smoking
was, Rosenblatt said.
Tobacco's theory, Rosenblatt said , made
him think of a line he attributed to
Shakespeare: "Dost thou take me for a fool?" It
was a line he repeated several times in his
closing remarks.
EXCERPTS
from a Sun-Sentinel article,
March 27, 2000, writer Terri Somers,
headlined: Historic tobacco
trial nears a close in Miami:
The "geniuses" of the tobacco industry
used images of glamour and outdoorsy
health to sucker three young people into
smoking. Decades later, those children are
now cancer-stricken adults, and the
tobacco industry claims the smokers are
victims of their own personal choices, said
the smokers' lawyer.
After almost five months of testimony in
the second phase of a statewide
class-action case against the world's five
largest cigarette makers, Stanley
Rosenblatt, the smokers' lawyer, asked a
six-member jury in a Miami Circuit Court to
find tobacco responsible for causing the
cancer of three Floridians who smoked for
decades.
"Nine-, 10- and 11-year-old kids, they
chose to smoke and then they chose not
to quit?" Rosenblatt asked on Monday. "It
is these (tobacco) companies that made
the choice, a choice to conspire, and
unfortunately they conspired all too well."
"They were clever and they suckered all
three of these people, and that's what they
intended," Rosenblatt said.
After the tobacco companies present
their closing arguments to the jury later
this week, Rosenblatt will stand in the
courtroom one more time and ask the jury
to order the cigarette makers to
compensate the three smokers for their
illnesses.
If the jury agrees and awards them
damages, the next phase of the case will
have the jury decide if the tobacco
companies should pay punitive damage for
the entire class of smokers, estimated to
be more than 500,000 Floridians.
EXCERPTS
from a March 26th Sun-Sentinel
article by Teri Sommers,
headlined: Final
arguments in smoking trial to address future of ill tobacco users, and
the industry
A grilled cheese and tomato on rye.
Sitting in a Fort Lauderdale hospital room, a
respirator snaking out of a tracheotomy tube in
her neck and into a machine that's been
helping her breathe for more than eight months,
Anna Simons mouthed that's what she really
wants.
Instead, nourishment for the 76-year-old
grandmother is a jug of cardboard-colored liquid
protein fed through a tube in her stomach.
For Simons that sandwich symbolizes much
more than a simple meal. It conjures up a life
liberated from the respirator and days at her
Coconut Creek home doing simple chores:
sweeping her patio, pruning her rose bushes
and growing her tomato plants.
But it also conjures questions: Once at
home, who will attend to her medical needs?
Can she afford to pay a nurse to visit her each
day and clear the mucus buildup from her
lungs, charred and diseased after smoking at
least two pack of cigarettes a day for 50 years?
And how many of her medical bills, currently
topping $1 million, will be covered by her health
insurance?
Simons is one of hundreds of thousands of
ailing Florida smokers seeking relief from a jury
in a Miami courtroom where the country's five
largest cigarette makers are on trial.
On Monday, a lawyer for the smokers is
slated to begin his closing argument in the
second phase of the first statewide
class-action lawsuit against the tobacco
industry to get to trial.
The stakes here are unimaginably high.
In depositions, experts testified that the
number of Floridians who have become sick
from smoking, and the survivors of those who
have died as a result of their illness, is
anywhere from 250,000 to 800,000 people.
If the jury decides any of the class
representatives should be paid damages, its
next task will be to decide how much the
tobacco companies should pay in punitive
damages to the entire class of smokers.
One tobacco attorney said he feared the
six-member jury could award these ailing
smokers as much as $300 billion.
Last week, several state attorneys general
said they were fearful a monumental damage
award in this case could wreak such financial
havoc on the tobacco companies that they
would be unable to continue the cash
payments that are part of previous settlements
the industry entered with numerous states,
including Florida.
However, lawyers who have watched the
Miami case closely contend these bankruptcy
fears are being fueled by the tobacco industry,
in hopes of softening the court and public
opinion.
"It's almost as if they are preparing the public
and shareholders for a big hit," said Gregory
Maxwell, a Jacksonville attorney who has faced
off with the tobacco industry in other cases. "I
think it is part of their orchestrated campaign to
soften their public perception."
Clark Freshman, a University of Miami law
professor who has followed the case closely,
scoffed at the talk of bankruptcy.
Most tobacco companies on trial are
diversified and can sustain payments in a
possibly colossal award by selling assets in
other areas, Freshman said.
"It's like a person who has trouble paying the
mortgage. You sell off other assets so you
don't lose your home," Freshman said.
"Besides, punitive awards are supposed to
punish a business and stop it from its bad
behavior, not put it out of business. There's
Florida case law on that." Judge Robert Kaye,
who is presiding over this trial, can lower a
punitive award determined by the jury,
Freshman said.
Industry insiders and business analysts have
speculated that even if there were a monstrous
award, the cigarette companies would fare well
on appeal.
The state's top court denied the industry's
attempt to get the case thrown out as a class
action suit. And, when the industry sought to
prevent the jury from awarding punitive
damages in one lump sum, the Supreme Court
said it would not entertain that request until the
Miami jury has made its ruling.
"Tobacco has really taken a licking in this
case already," Nova Southeastern University
law professor Bruce Rogow said. "Stanley and
Susan Rosenblatt have really bested the
tobacco lawyers through most of this case,"
Rogow said. "This has really been the best of a
David and Goliath story."
Before the tobacco companies can file their
appeals, Florida law requires them to post a
bond equal to the full amount of the judgment
plus 20 percent. The bond assures money is
there to pay the judgment despite what may
happen to the businesses while they fight it out
in appeals court.
Legal observers were unable to come up with
another case in which a defendant has had to
post a bond as big as the one that tobacco
companies may have to post. But they could
come up with cases in which companies were
forced into bankruptcy protection by the bonds
they were required to post.
In states like Virginia, where tobacco
employs thousands and contributes generously
to powerful politicians, legislators have tried to
create laws that would cap the amount
cigarette makers would have to bond pending
appeal. In Virginia, which enacted
such a law,
that cap is 25 percent of the verdict.
While some lawyers say the basis for the law
is unconstitutional, it buys time for the tobacco
industry while the issue is decided in court.
"The ? only way people get paid is if
tobacco kills more people," Rogow said. "In
other cases of product liability, the product is
taken off the market. There is no more
asbestos, no more Dalkon Shield."
Tobacco's physicians have disputed that cigarette smoking caused the illnesses involved. This is yet another splendid example of how the industry speaks with more than one tongue. Here are excerpts from a March 8th Sun-Sentinel article by Terri Somers:
The Miami doctor is probably the lastSeveral newspapers have filed suit to lift the gag order imposed by the judge in the Engle trial. Ironically, some of these papers, such as The Richmond Times-Dispatch, have rarely covered the trial, refusing to send a reporter to the trial, refusing even to carry available stories on the trial from Florida papers or the Florida Associated Press. This causes one to be skeptical when those papers begin talking about the public's right to know.
witness who will be called to testify on behalf of
Big Tobacco.Under cross-examination by Stanley
Rosenblatt, the lawyer for the smokers,
Blaustein said he made his "clinical" diagnosis
after reading Farnan's medical records. He
never viewed a sample of the cancer cells from
her body under a microscope, he said.As he continued to try to chip away at the
doctor's credibility with the jury, Rosenblatt
questioned Blaustein about the $400 an hour
the tobacco defense paid him to testify.
In the Engle case in Florida, the merchants of death have tried many tactics: they sought to remove the judge, get the gag order lifted, and handed out roses, "From Your Good Friends at Lucky Strike" just one block from the court house.
Indeed, a funny thing happened on the way to corporate accountability - political greed for money from the state attorneys general settlement has obscured responsibility to consumers and the public in general.
Now tobacco and their allies have passed legislation in Virginia, and are working on it in North Carolina, Georgia, and Kentucky, to help them delay, delay, delay justice in the Engle trial. Although, some have speculated that the fears creating this legislation are fears fueled by the tobacco industry, and not reality.
The merchants of death are looking for protection from those who might well be considered accessories to addiction and murder: legislators addicted to the money for themselves, and their state. Another legacy of the state attorneys general settlement.
As even Martin Feldman, a tobacco analyst has noted: "I do have trouble believing that these rules are constitutional or that they would survive U.S. Supreme Court scrutiny. But it could take a few years for them to be found unconstitutional, so they'll help the tobacco industry during a sticky patch." The Depot
For an index to information on these save tobacco from responsibility for their actions bills, try Further Information, or read on.
EXCERPTS from The New York TImes, March 20, 2000, writers Barry Meier with Emily Yellin; headlined:Further information regarding a Virginia bill to protect Philip Morris, requested by Philip Morris, and similar North Carolina legislation is now on a separate web page.
Big Tobacco Is Lobbying the States for ProtectionCigarette makers, faced with the prospect that a Miami jury may soon hand out the largest punitive damage award ever, have taken unprecedented steps in recent weeks to protect themselves from bankruptcy by persuading tobacco states to pass bills that shield industry assets.
Stanley Rosenblatt, a lawyer in Miami who represents smokers in the Florida case, told a court there last year that he would seek $100 billion in punitive damages, said Martin Feldman, a tobacco industry analyst with Salomon Smith Barney who attended that hearing. Mr. Feldman and others said they believed that the tobacco industry as a group could put up $10 billion to $20 billion while it appealed.
"We are in totally uncharted water," Mr. Feldman said.
The bulk of the tobacco industry's operations are in the four states that have passed or are considering the new measures. Several legal experts said they believed such laws were unconstitutional because they were designed to frustrate the actions of courts in other states. However, such legislation would still help the companies gain time, because a drawn-out legal fight would precede any final court decision on the laws.
Christine Gregoire, the Washington State attorney general, said
producers told regulators late last year that damages in the Florida case could pose a bankruptcy threat. As a result, she said, state officials expected this week to hire an expert to represent them as creditors in the event of a bankruptcy filing.This month, Gov. James S. Gilmore of Virginia signed a bill that would place a $25 million limit on a bond during the appeal of punitive damages. Lila Young, a spokesman for Mr. Gilmore, said that lobbyists for Philip Morris U.S.A., which has its tobacco headquarters in Richmond, had urged Mr. Gilmore to back the bill.
"Peggy Roberts, a spokeswoman for Philip Morris, declined to comment. But in a recent filing with the Securities and Exchange Commission, Philip Morris, the nation's biggest cigarette maker, said that "in a worst-case scenario, it is possible that a judgment for punitive damages could be entered in an amount not capable of being bonded."
In Georgia, a bill similar to the new Virginia law has passed both houses of the state legislature, and Gov. Roy Barnes is expected to sign it soon. In Kentucky, a bill placing a limit of $100 million on an appeal bond has passed the state Senate. The state's House judiciary committee is expected to begin action on it this week.
Each tobacco company is pushing bills in states where it has major operations. For example, Brown & Williamson, which has headquarters in Louisville, Ky., and a major cigarette plant in Macon, Ga., has been promoting bills in those states, said Mark Smith, a company spokesman.
Mr. Feldman, the financial analyst, said he expected the laws to be overturned. "This is about time buying," he said.
EXCERPTS from The Los Angeles Times, March 20, 2000, article by Henry Weinstein, Myron Levin; headlined:
States Brace for Threat of Tobacco Suit BankruptcyCourts: Officials are readying plans to counter a possible
record-breaking award in Florida case. Billions of dollars from 1998 settlement, aimed at health care, public works and other programs, would be affected.Christine Gregoire, Washington attorney general, said a panel of attorneys general will interview bankruptcy counsel on Tuesday,
adding that the states "have every intent of . . . holding [cigarette
makers'] feet to the fire" regarding payment obligations under $246 billion in settlements reached in 1998 with the states.In some respects, a Chapter 11 filing by tobacco companies would be unique in the annals of business bankruptcies. Other firms that were forced into bankruptcy by product liability litigation--such as makers of asbestos products, breast implants and the Dalkon shield intrauterine device--stopped marketing the products that created their liability. Under any scenario imaginable, tobacco companies would go on making cigarettes for the 48 million Americans who continue to smoke.
Reflecting Engle-related jitters in tobacco land, the Legislature in Virginia, home to some of Philip Morris' largest plants, recently
passed a law seeking to cap at $25 million the bond required for the firm to appeal an out-of-state judgment. Some legal scholars, such as Columbia Law School's John C. Coffee Jr., say the measure is constitutionally dubious.The attorneys all noted that trial judges who have attempted to set appeal bonds at lower levels have been reversed by appellate courts.
On the other hand, the trial judge clearly has the discretion to
reduce a punitive damage award, in the process lowering the amount of the appeal bond. Moreover, Miami attorney Joel Eaton noted that in some instances the two sides in a case have reached an agreement on a lower bond and that this is permissible under Florida law.No litigant has ever been forced to post an appeal bond of the
magnitude now considered possible in the Engle case.However, there is a precedent for a huge appeal bond driving a profitable company into bankruptcy. In the mid-1980s Texaco was ordered to post a $12-billion bond to stay judgment while pursuing its appeal of an $11.1-billion damage award for interfering with Pennzoil's acquisition of part of Getty Oil. Ultimately, Texaco filed for bankruptcy.
More recently, Exxon was able to avoid that situation by obtaining a $6.75-billion letter of credit from a consortium of banks while appealing a $5-billion verdict involving the 1989 Alaskan oil spill.
==================================================================================
FURTHER
INFORMATION
PROTECTION
for Big Tobacco
For
information on Virginia and North
Carolina legislation to delay Engle and justice, see separate web
page
Excerptsfrom
Virginian-Pilot,
Feb. 25, 2000
Excerpts
from The
Virginian-Pilot, Feb. 29, 2000
Excerpts
from Florida's Sun-Sentinel
, Feb. 29, 2000
Excerpts
from Reuters,
March 1, 2000
Excerpts
from Reuters, March
3, 2000
Excerpts
from The Washington Post, March 3, 2000
Full
article: The Washington Post, print edition, libraries,
[online not immediately available]
Excerpts
from Virginian-Pilot,
March 4, 2000
Excerpts
from Sun-Sentinel,
March 4, 2000
Excerpts
from Richmond
Times-Dispatch, March 4, 2000
Excerpts
from The
Roanoke Times , March 8, 2000
Excerpts
from The
Depot, March 14, 2000
Excerpts
from
The
Winston Salem Journal online,
March 17, 2000
Excerpts
from The
Winston Salem Journal, March 18, 2000
Excerpts
from The New York Times, March 20, 2000
Excerpts
from The
Los Angeles Times , March 20, 2000
Excerpts
from The Raleigh News & Observer, March 22, 2000
Excerpts
from The
Winston-Salem Journal, March 23, 2000
Excerpts
from The Sun-Sentinel
,March 26, 2000
Excerpts
from The Sun-Sentinel,
March 27, 2000
Excerpts
from The Sun-Sentinel,
March 29, 2000
Excerptsfrom
The Sun-Sentinel,
March 30, 2000
Excerpts
from The
Los Angeles Times, March 30, 2000
Excerpts
from The
Sun-Sentinel, March 31, 2000
Excerpts
from The
Winston-Salem Journal, March 31, 2000
Excerptsfrom
The
Gainesville Sun, March 31, 2000
Excerpts
from The
Sun-Sentinel, April 1, 2000
Excerpts
from The
Miami Herald, April 1, 2000
Excerpts
from The
Chicago Tribune, April 2, 2000
Excerpts
from Reuters,
April 3, 2000
Excerpts
from The
Sun-Sentinel, The Associated Press, April 4, 2000
Excerpts
from The
Sun-Sentinel, April 4, 2000
Excerptsfrom
The
Sun-Sentinel, April 5, 2000
Excerpts
from The
Raleigh News & Observer, April 5, 2000
Excerpts
from The
Sun-Sentinel, April 7, 2000
Excerpts
from Bloomberg,
April 7, 2000
Excerpts
from The
Sun-Sentinel, April 8, 2000
Excerpts
from The Vero
Beach
Press-Journal, April 9, 2000
Excerpts
from The New York Times, April 10, 2000
Excerpts
from The
St. Petersburg Times, April 12, 2000
Excerpts
from Bloomberg,
April 24, 2000
Excerpts
from The
Sun-Sentinel, April 25, 2000
Excerpts
from Bloomberg,
May 5, 2000
Excerpts
from Bloomberg,
May 17, 2000
Excerpts
from The Raleigh News & Observer, Dec. 22, 1999
The
Florida
legislature's efforts to interfere in the Engle trial
Oppostion
to the Florida Tobacco Shield - announced by:
Virginia GASP, on this web site
Action
on Smoking and Health on its web site
Tobacco
Product Liability Project news release
Campaign
for Tobacco Free Kids news release
Tri-Agency,
Florida news release
GASP
of Florida news release
American
Cancer Society
The
North
Carolina tobacco protection measure
The
Virginia
Bill: EVENTS
Richard A. Daynard, Northeastern Univ. School of Law
Summary of the Virginia Bill; Complete Text of H.B. 1547
Final Virginia Senate Vote
GASP's letter to then Attorney General Earley
Money contributed to Governor James Gilmore
and his Political Action Committees (PACs)
BACKGROUND INFORMATION ON THE ENGLE TRIAL
The trial in Florida, known as the Engle case, resumed on January 18, 2000. Sick and dying smokers in Florida brought the case against the tobacco companies who had deceived them about the addictive and harmful nature of cigarettes. Stanley and Susan Rosenblatt are the courageous attorneys for the plaintiffs. The tobacco industry has sought to stop this case in many ways, including trying to have national legislation passed which would have granted them immunity from such trials. Most recently they have worked to have legislation passed in some states to reduce the appeal bond.
In 1999, after the tobacco industry sought to derail the trialt by an appeal to the Florida Supreme Court, then the Florida Supreme Court refused to hear the appeal on an October 1999 decision by the 3rd District Court of Appeals.
Other information is
available
at the following web sites:
Tobacco
Product Liability Project
Action
on Smoking and Health
Tobacco.org
Updated May 2001 and
links updated 14 January
2006
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