Philip Morris got its ass handed to it by the Oregon Supreme Court, which shockingly (to me, because the good guys rarely win these cases, at least completely win) upheld a jury award to the widow of a smoker killed by lung cancer.
The Supreme Court ruled that Philip Morris must pay another $99 million to the widow of Jesse Williams, Mayola Williams. The original decision was made by a jury way back in 1999, but then got appealed and appealed all the way to the U.S. Supreme Court. The U.S. Supreme Court upheld a punitive damage of $79.5 million, but kicked part of the case back to the Oregon Supreme Court. That figure is now up to $99 million in part due to interest.
OK, I know what you’re thinking — $99 million is nothing to a multi-billion dollar company like Philip Morris. True. But ask yourself why the hell would Philip Morris fight this for 12 years and spend millions on legal fees? Because the tobacco industry is TERRIFIED of legal precedent.
Philip Morris was essentially fighting the dollar amount. The tobacco company had already paid millions to the widow. The widow and the state of Oregon, prosecuting the case, reached an interesting settlement. If they won before the Oregon Supreme, the state would receive $55 million to go toward its crime victim’s fund (which makes sense, since what the tobacco companies do is a crime), while Ms. Williams would receive $45 million (somehow, that adds up to $99 million).
Philip Morris had an interesting argument. The company contended that Oregon had already signed off on its right to the money because in 1998 – one year before the jury’s verdict – the state agreed not to pursue any more claims for injuries from tobacco exposure in the massive 1998 Master Settlement Agreement. The clause was part of a settlement brokered with Philip Morris, other tobacco companies and 46 states for the billions of dollars the states had paid and would continue to pay for health care for ailing, low-income smokers.
Under that deal, the tobacco companies agreed to pay Oregon $2.1 billion during the first 25 years and then about $81 million a year in perpetuity.
But attorneys for Oregon and Ms. Williams argued that state was simply trying to collect on the 60 percent due to it under the state’s punitive-damages law, separate from the 1998 MSA. The Supreme Court agreed.
No word if Philip Morris will appeal, but I suspect it will.