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$23 Billion Tobacco Verdict Reduced to $16.9 Million

Tobacco company granted remittitur of $23B punitive damages to match $16.9M in compensatory damages.

A $23 billion punitive damage award against Tobacco giant R.J. Reynolds has been drastically reduced to $16.9 million by an Escambia County, FL, circuit court judge.  However, the judge denied Reynolds motion for a new trial and for remittitur of the compensatory damages.

The case is part of the Engle class, a group of Florida smokers who filed a class action lawsuit against the tobacco industry in 1994.  After decertifying the class, The Florida Supreme Court ruled that each of the class members, known as the “Engle Progeny,” could file individual lawsuits against the tobacco industry.

Judge Terry Terrell said the punitive damage award, which was the largest given so far in the Engle cases tried, was “admittedly and clearly constitutionally excessive,” and that “remittitur must be granted.”

Reynolds requests a new trial

Cynthia Robinson of Pensacola, FL, brought the wrongful death lawsuit in 2008 for the death of her former husband, Michael Johnson Sr., who died of lung cancer at the age of 36.  At the end of a four-week jury trial in July 2014, Robinson and Michael Johnson Sr.’s son, Michael Johnson Jr., were awarded $16.9 million in compensatory damages and a hefty $23 billion in punitive damages.

Less than one week after the trial, Reynolds filed a motion to set aside the verdict and asked for a new trial or remittitur of the damages.

Reynolds raised several issues in addition to what it called a “wildly and absurdly excessive” “1390-to-1” punitive to compensatory damage ratio, according to its motion.

Reynolds asserted that the damages were not justified because Robinson was only married to Johnson for six years and that they were separated at the time of his death.  Reynolds also claimed that Johnson’s son, who was 14 at the time of his father’s death, was not entitled to the damages because he never lived primarily with his father and “has not suffered lingering effects from his death.”

Reynolds argued that there was no evidence in the case that supported the damages awarded, and that the amounts resulted from the jurors “passion and prejudice” incited by the plaintiff attorney's “improper arguments” including “comparisons of Reynolds to murderers and dealers of illegal drugs,” according to court documents.

Jury decisions on issues upheld

In his opinion, Judge Terrell agreed that Reynolds developed evidence providing a “legitimate basis to question the closeness of the relationships” while they “rather forcefully questioned [plaintiffs] on their closeness to” Johnson, but the issue was “clearly resolved by the jury” favoring Johnson Jr. and Robinson.

Furthermore, Judge Terrell ruled that although the compensatory damages were large compared to other Engle progeny cases, the unique issues the jurors resolved, including how relatively young Johnson was when he died, were supported by the evidence presented and were not “the product of passion and prejudice.”

No guidance given for punitive damages

Judge Terrell suggested that the massive punitive damage amount was due in part to neither party presenting any evidence on the issue of the amount of punitive damages to be awarded.  The only guidance given to the jury was that the punitive damages could "not be so large as to bankrupt" Reynolds, according to the order.

Lacking any information on Reynolds' net income or net worth, the jury may have determined the punitive damage amount relying only on inferences of the "millions, if not billions of dollars spent by the tobacco industry on advertising" provided by the evidence and testimony introduced by the plaintiff, according to court documents.

$299 million in verdicts

As of December 2014, Reynolds has been served in 3,885 Engle Progeny cases stemming from the class action brought by smokers and their survivors who were injured due to their nicotine addictions.  A jury awarded a $145 billion verdict in favor of the Engle class, but the class action was later decertified and the verdict vacated on an appeal made by the Tobacco companies involved.  The original class members were allowed to file individual lawsuits and to use the jury findings made in the class action trial, maintaining a res judicata effect for class member's individual cases.

According to Reynolds 2014 Security and Exchanges Commission (SEC) regulatory filing, outstanding jury verdicts against them total $299,365,200, which are all in “various stages in the appellate process.”

A new trial on damages is granted if a party is adversely affected by the court ordered amount.  Because the plaintiffs were handed a reduction of more than $22 Billion dollars, and Reynolds is asking for punitive damages to be capped at $2.4 Million, the disparity between the parties requested damage awards will likely lead to both parties requesting a new trial.

The case is Robinson v. R.J. Reynolds Tobacco Company, et al., case number No. 2008-CA-0098 in the Escambia County Circuit Court of Florida.

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