Following a four-week trial and a 15-hour deliberation, a Florida jury of six recently handed down a record-shattering $23.6 billion verdict against cigarette manufacturer R.J. Reynolds, citing the company’s failure to properly warn consumers that cigarettes are addictive and can potentially cause lung cancer.
Yes, you read that right. $23.6 billion. The verdict is subject to appellate review and counsel for R.J. Reynolds has vowed to fight the decision, saying the verdict is unconstitutional and demands a “grossly excessive” dollar amount.
How exactly did the plaintiff win an award of this magnitude? What sort of claims must one set forth in order to exact an eleven-figure payday from one of the largest manufacturers of consumer products in the world?
Simple: the plaintiff didn’t know of the harms associated with long-term smoking. The company, on the other hand, knew or should have known of the risks and failed to properly warn consumers of the harm that a longtime smoking habit could cause.
Details of the case against R.J. Reynolds
In the case at hand, a widow whose husband died of lung cancer in 1996 as a result of a 23-year smoking habit successfully advanced these precise claims, and was awarded $16.8 million in compensatory damages.
The remaining $23,583,200,000 was awarded as punitive damages, which may be tacked onto a civil verdict if the jury believes the defendant acted intentionally, with malice or with a reckless disregard to the health and safety of others.
Punitive damages are discretionary, and generally reserved for the most egregious of civil misbehavior. More specifically, these damages are reserved for defendants who had actual knowledge that their misconduct would result in injuries to the plaintiff, but failed to do anything to protect plaintiffs from harm.
In the case against R.J. Reynolds, the jury concluded that company executives knew their product was addictive, destructive and harmful, but nonetheless continued to lie to consumers, including the plaintiff’s late husband.
In terms of jury-backlash toward the tobacco industry, this case is not unique. In fact, this individual verdict stems from a 2006 Florida Supreme Court overturn of a $145 billion class action lawsuit against cigarette makers, filed by thousands of Florida residents seeking retribution from cigarette companies for their failure to warn consumers of the dangers of smoking.
Earlier this year, the U.S. Supreme Court refused to review an appeal from a similar $70 million class action verdict against R.J. Reynolds, Philip Morris and Lorillard Tobacco Company.
What does this mean for future tobacco litigation?
The result of this case will be subject to appellate review and there is a strong likelihood the company will not be required to shell out even a fraction of the $23 billion mega-verdict.
Under state and federal laws, jury verdicts cannot be completely out of the realm of reasonableness, even if the defendant’s conduct proved to be intentional and willful. Under Supreme Court precedent, there must be a “reasonable relationship” between the punitive damages amount and the plaintiff’s actual harm.
Therefore, the plaintiff’s verdict in this case will likely be reduced to something in the eight-figure range, which is commiserate with similar verdicts upheld by federal courts of appeals as a practical measure of both the plaintiff’s injuries and the defendant’s deliberate wrongdoing.
