Tobacco Documents Online

?.. 1999 3:31PY HOWARD, RICE, ET A. CaBc avuuu.,ct: 1:»-w-5~~ uv..uau~..a, ieuuu.ici. +.. ~ H Joseph 8echer Howard Rice Nemeroveki Canady.Falk and Rabkin Three Smbarcadero Center Suite 700 San Francisco CA 94111

-- djl. 23. 1999- 3:3iPY-3G'k:.s~. ~ . 1 2 3 ROBffitT E. COYLB UNITED'STATSS DISTRICT 3VDGS ---Ya. 2094-P. 1 3/!5 is Plaintiff's allegations regarding public reliance on Dsfendants' representations are irrelevant, and should be excluded froa her Amended Coaplaint, should she choose to file one. , Dated':. 1999 271 12

. ,_Iai. _3. 1999 .- 3:3t°Y 30WA3D. 3:(:c, ii A:.. ;::~; L 1a. Z"'JH4 P. !4/<'.; United States Dis~rict Court for the Eastern.District of California May 26, 1999 * * CSRTIFICATE OF S$RVICE * * 1199-cv-05449 Myers V. Philip Morris Inc iv I, the undersigned, hereby certify that I am an employee in the Office of the Clerk, U.S. District Court, Eastern District of California. That on May 26, 1999, I SERVED a true and correct copy(iea) of the attached, by placing said copy(ies) in a postage paid envelope addressed to the person(s) hereinafter•listed, by depositing said enveSope in the U.S. Mail, by placing said copy(ies) .into an inter-office delivery receptacle located in the Clerk's office, or, pursuant to prior authorization by counsel, via facsimile. Phillip C Bourdette • REC LJO Bourdette and Partners . 2924 W Main Street Visalia, Ch 93291 H Joseph Sscher III Howard Rice Nemerovski Canady Palk and Rabkin Three Embarcadero Center Suite 700 San Francisco, CA 94111 Jack L. Wagner, Clerk ' HY: D

jo 3:"[C:S{-- 'C'NA3J,'.'.iC"t,:" A:. ;e_ rc.r' n.C 1 smoked heavily for more than thirty years, she could not quit, 2 and she was subjected to second hand smoke. On April 8, 2998, 3 Plaintiff was diagnosed with lung cancer dus to her exposure to 4 tobacco. Plaintiff alleges that, through a variety of wrongful, 5 deceptive, and fraudulent acts on Defendants' part, they caused 6 her injuries. 7 Defendants move to dismiss Plaintiff'a Complaint. S II. Ma2I` 9 The sotion to dismiss for failure to state a claim 10 is raxely granted -- it is possible only in "eutraordinary" 11 cases. $gg United statas v, City of Redwood City, 640 8.2d 963, 12 966 (9th Cir. 1981); William W. Schwarzer, A. Wallace Tashima 6 13 Tames li. Wagstaffe, Fsnasuw CIVIL Pttoccuvas Bstroaa Taxan i 9 e 210 (The 14 Rutter Group 1997). iS The complaint must be construed in the light most 16 favorable to the plaintiff. $M Parks School of Business, Inc. 17 V. Svmin on, 51 F.3d 1480, 1484 (9th Cir. 1995). "[A] complaint 18 should not be disaissed for failure to state a claim unless.it . 19. appears beyond doubt that the plaintiff can prove no aet of -facts 20 in support of his claim which would entitle him to relief." 21 Conlev v. Gibson, 355 U.S. 41, 45-46 (1957). 22 In reviewing an FRCP 12(b)(6) motion, the court must 23 accept as true all material allegations in the complaint, as well 24 as reasonable inferences to be drawn from them. Aipg Nh 25 Industries. Inc, v. RaDlan, 792 F.2d 896, 898 (9th Cir. 1986)., 26 This is so no matter how improbable the facts alleged. Be& 271 2

- -13'1. c.. ..., 1 2 15 16 17 18 19 20 21 22 23 24 25 26 '4:"J® ;Ya. preempted by the Act. Plaintiff argues that the causes of action at issue contain many allegations besides the failure to warn and duty to disclose by Defendants, which Plaintiff appears to concede are preempted. At the hearing Plaintiff offered to file an Amended Complaint, excluding her preempted allegations. Accordingly, in the event that.Plaintiff elects to file a First Asended Complaint, that Coaplaintvhould exclude any preempted allegations, including Plaintiff's post-1969 allegations regarding failure to warn. 2. Reliance Defendants contend that Plaintiff's claims for fraud and negligent misrepresentation must be dismissed because Plaintiff claims that Defendants' action harmed "the public in general," without asserting that she personally, justifiably relied on Defendants' representations. Plaintiff responds that she has alleged that the misrepresentations were made to the public in general, and her in particular. Defendants reply that Plaintiff has alleged that the public relied on Defendants' misrepresentations, and such claims of public reliance aie- irrelevant to the determination of liability. According to Defendants, Plaintiff should be required to replead her claims absent reference to the misrepresentations made to the public in general. The Court agrees with Plaintiff that she has sufficiently alleged reliance in har initial Complaint. However, 271 11

_){iY. ?Q. :?y~ " 3:L'3 ~- 3~$!~ ~iCC, CT AL. ~4i~i L1? ~~. l ® :(Q C~E ~r ~ 4 .. Zi:~ 0 - ' fJAY L, ~ 57 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF CALIFORNIA 21 22 23 24 25 26 27 BE7TY SEAM MYER4, j ) Plaintiff, ) No. CIV-8-99-5449-REC-LSO ) v. ) ORDER GRANTING DEFENDANTS' ) MOTION TO DISMISS PHILLIP MORRIS, INC., et al., ) ) Defendants. ) ) ) On May 24, 1999, the Court heard Defendants' Motion to Dismiss. Upon due consideration of the arguments and the record, Defendants' Notion is granted. I. BACBGROUND On March 4, 1999, Plaintiff filed the instant action in state court. On March 16, 1999, Defendants removed the instant action to federal court, asserting complete diversity of citizenship. Plaintiff's Complaint allages causes of action for: strict liability, negligence, breach of implied warranties, fraud, neqliqent misrepresentation, civil conspiracy and joint tortfeasor liability. Essentially, Plaintiff alleges that she 1 EXHIBIT A

1 2 3 4 5 6 7 8 9 10 15 16 17 18 19 20 21 22 23 24 25 26 does not apply to the instant action (as discussed below at section IIIA2), even if it did, the Former Section applies only to product liability actions. Thus, Plaintiff argues, her conspiracy claims and ber claims for fraud and negligent misrepresentation would not be affected by the Former Section. Given the broad language of the Former Section - which states that "'product liability action' neans any action for injury or death caused by a product, except that the term does not include an action based on a manufacturing defect or breach of an express warranty" - the Court agrees with Defendants' position that Plaintiff's claims for fraud, strict liability, breach of implied warranties, negligence and misrepresentation would be barred if the Former Section applies to the instant action. Under the Former Section, only claims for breach of express warranty or manufacturing defect could survive.' "' 2. Tinina of Inaunitv Defendants contend that the immunity afforded by the Foraer Section was in place at all tiies relevant to this action. According to Defendants, to the extent Plaintiff's Complaint contains allegations.relating to Defendants' conduct prior to the of an artificial heart valve against the manufacturer, alleging emotional and physical distress on learning the valve was within a group being recalled. 3The Court respectfully disagrees with the Northern District of California's position to the contrary in City and County of San Fran isco v. Philic Horris, sna., 957 F.Supp. 1130, 1140 (N.D.Cal. 1997). 271 5

3:2;7x _=.1 wa3,, R :C -, _. .{~. ,_. ;2:7-591a 2as: u ® . -- ® ' t= 1 1988 enactment of the Foraar Section, the Former Section extended 2 iarmunity to actions accruing before 1988, as the Former Section 3 provided that it was "declarative of existing law," and its 4 immunity extended to any claims "pending on, or commenced after 5 January 1, 1988." As to Plaintiff's allegations that she waa not 6 diagnosed with lung cancer until after the dnendment to the 7 Former Section, Defendants argue that, although Plaintiff alleges e that she was diagnosed with lung cancer in April 1998, she also 9 alleges that she stopped smoking in 1997. Therefore, Defendants 10 argue, any conduct of which Plaintiff complains must have 11 occurred before the January 1, 1998 Amendment of the Former 12 Section. Defendants thus argue that they are entitled to 13 immunity unde= the Former Section because the Former Section bars 14 not only recovery in those cases where a plaintiff's injuries 15 manifested themselves during the period of immunity, but also in 16 those cases where the conduct about which a plaintiff complains 17 occurred during the period of immunity. ,g=g, e.a., Van Fosaen v. 18 American Toba_cco_co., No. CIV 8-98-1694 GEB DAD, slip op. at 4 19 (E.D. Cal. Jan. 22, 1999) ("Defendants are immune from liability 20 for Plaintiff's tobacco-related personal injuries caused by 21 conduct occurring during the effective period of the 1987 22 statutory enactment"). 23 Plaintiff has a number of responses. First, 24 Plaintiff argues that because she alleges that she began smoking ' 25 in 1956, before the effective date of the Former Section, and she 26 was diagnosed with lung cancer in April 1998, after the 271 6

_M:7. 1v`Ad3D" 3i...~ :i 1i 1 - ® ' - ~ 1 2 3 4 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 Williamson Tobacco Co., No. CIV S-94-1325 GBH JFM, slip op. at 4 (E.D. Cal. Jan. 3, 1996) (dismissing claims for fraud and deceit because the Former Section barred wall actions for injuries caused by the use of tobacco other than those based on a manufacturing defect or the breach of an express warrantyW); American Tobacco Co. v. Suoerior Court, 208 Cal.App.3d 480, 486- 87 (1989) (tobacco companies enjoy "nearly complete" immunity from liability for harm to smokers caused by the availability of cigarettes). Citing IQsan v. Shiley. Inc., 217 Ca1.App.3d 848, 855-58 (1990)2, Plaintiff responds that, while the Former Section (b) For purposes of this section, the term 'product liability action' means any action for injury or death caused by a product, except that the term does not include an action based on a manufacturing defect or breach of an express warranty." The current version of section 1714.45 reads, in part: "(a) In a product liability action, a manufacturer or seller shall not be liable if both of the following apply: (1) The product is inherently unsafe and the product is known to be unsafe by the ordinary consumer who consumes the product with the ordinary knowledge common to the community. (2) The product is a common consumer product intended for personal consumption, such as sugar, castor oil, alcohol, and butter, as identified in comment i to Section 402P, of the Re- statement (Second) of Torts. (b) This section does not exempt the manufacture or sale of tobacco products by tobacco manufacturers and their successors in interest from product liability actions, but does exempt the sale or distribution of tobacco products by any other person, including, but not limited to, retailers or distributors." 2Man does not address the liability of tobacco compa- nies, or the interpretation of the tera *product liability" in the Former Section. Instead, it was an action by the recipient 4 ~ ~

?:_3 ?Y 3SWA3): ic_Ca, 3" ® ® 1 1 2 3 13 14 i5 16 17 18 19 20 21 22 23 24 25 26 Amendment, Defendants are not entitled to immunity under the Former Section. Plaintiff points to Henley v. Phillip Morris, a. San Francisco Superior Court case attached as Exhibit H to Defendants' Request for Judicial Notice, wherein the court hsld that there was no immunity under the Former Section where the plaintiff was diagnosed with cancez after the immunity was lifted and alleged that she became addicted to cigarettes before the Former Section was enaeted.' Clearly Henley supports Plaintiff'a position that Defendants are not entitled to immunity under the Former Section on Plaintiff's Complaint. Henley, however, is not binding on this court, and the Court does not agree with the legal.conclusions reached in that action. Plaintiff further argues that, contrary to Defendanta' assertion, all of the complained of conduct did not take place prior to January 1, 1998 because Plaintiff only alleged that she stopped smoking "heavily° in November of 1997, not that she stopped smoking altogether. Plaintiff further contends that the effective date of the Amendment was June 12, 1997, not January 1, 1998, and thus she still was smoking heavily 'Plaintiff further notes that in yan Fossen the court granted the plaintiff leave to amend the Complaint to state a claim for injuries that became manifest in 1998. However, it is not clear from the order in Van Fossen precisely why the Court granted leave to amend, and ultimately the plaintiff in yJM Fosen did not file an amended complaint. Thus, yan Fossen does not aid Plaintiff's case. in addition, Plaintiff also points to countv of Los 1~+*celes v. R.J. Resmolds, a San Diego Superior Court case attached aa Bxhibit F to Defendants' Request for Judicial Notice, wherein the court held that damages caused by conduct occurring after June 12, 1997 are actionable.. In that case, however, the Court was referring only to damages sought by a public entity. 271 1