Posts Tagged ‘ Morgan Stanley ’

Landmark Ruling Awards Florida Smoker $300 Million

November 21st, 2009. By Hunter West

Fort Lauderdale, FL: A landmark ruling by a jury in Fort Lauderdale late Thursday could set the stage for additional personal injury lawsuits after a Florida woman was awarded $300 million in a tobacco lawsuit. Provided the verdict survives an assumed appeal by defendant Philip Morris, the award represents the largest single award to an individual suing a tobacco company.

Lucinda Naugle was 20 when she started smoking, a habit she maintained for 25 years before finally quitting at the age of 45. Now 61, Naugle suffers from severe emphysema and requires a lung transplant she can’t afford.

If she lives long enough to see an end to the appeal process, Naugle would have more than enough to fund her surgery. The sister of a former Fort Lauderdale mayor was awarded $56 million in compensatory damages and $244 million in punitive damages. Following three hours of deliberation after a three-week trial, the jury assessed liability to Naugle at 10 percent, whereas Philip Morris was saddled with 90 percent.

Altria Group, the parent company of Philip Morris based in Virginia, indicated that it would appeal the verdict. A spokesperson called the Florida rules “fundamentally unfair and unconstitutional.”

Lawsuits against tobacco companies are not unique, especially since 1998 when the seven largest tobacco companies agreed to fork over $206 billion in a master settlement agreement with 46 states.

Florida was one of those states. However, what sets Florida apart is a major legal ruling three years ago that makes it easier for individuals to sue tobacco companies, by way of the lowering of the burden of proof.

In 2006 the Florida Supreme Court rejected a class-action verdict and an award totaling $145 billion to plaintiffs, stating that plaintiffs would have to litigate individually. However-and this is the important caveat-the court dictated that plaintiffs would not be required to prove some key elements that had been upheld in the first stage of the class action: namely that nicotine is addictive, that smoking causes diseases and that cigarette companies fraudulently withheld those facts.

“That makes Florida unique,” said Clifford Douglas of the University of Michigan Tobacco Research Network, in comments published yesterday in the New York Times.

Naugle’s legal counsel told the New York Times that 25 additional cases would go to trial in Florida next year. In all, more than 9,000 people from the former class action have filed individual lawsuits in various Florida courts. Approximately 4,000 of those cases were filed in federal court and have been stayed pending a review scheduled for early next year.

A tobacco analyst for Morgan Stanley said that the tobacco industry could afford several hundred million dollars a year in legal losses. “That is a financially manageable issue,” David Adelman said.

Tags: Altria Group, Clifford Douglas, David Adelman, Lucinda Naugle, Morgan Stanley, Philip Morris, University of Michigan Tobacco Research Network
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