Tobacco Documents Online

Surveying the Litigation Landscape: 1997 As in years past, litigation issues will remain on the fron burner for Philip Morris and the U.S. tobacco industry in 19 7. ithough it is too much to expect a quick end to t e legal hallenges, said Charles R. Wall, senior vice p es dent and dep ty general counsel, Philip Morris Companies In ."we continue to be quite optimistic about the ultimate out e." "Ou traditional defenses remain strong, a 0 a r and factu arguments are understood by common sns r s," onS.h all\b d A class acti is a procedura d vi e whereby one or more members of a g oup may sue as e r entatives of all the members of the group. In May 1996, Phil'p Morris and other tobacco industry defendants won a major ctory in the Castano class action in Louisiana when a federal peals court decertified a class and former smokers that included more than 50 illion current around the country. Following the Castano dec rtification,_the consortium of plaintiff's attorneys that broug t the case vowed to file class actions at the state level. Thus far, 15 such cases have been filed. "These cases will be vigorously efended," Wall said, "and although they involve smaller clas es than Castano they suffer from many of the same infirmities.' Among these "infirmities", he noted, s that smoking and health cases, by their nature, involve i dividual issues such as initiation of smoking, awareness of th alleged risks, varying efforts to quit and specfic_inju 'es. Such

-2- issues are more appropriately resolved in individual litigation than in class actions, Wall pointed out. Other class actions facing PM in 1997 include Broin and Engle, both of them filed in Florida. The Broin case has been brought by plaintiffs on behalf of flight attendants nationwide. The plaintiffs allege that they sustained injury as a result o in the course to trial in exposure to environmental tobacco smoke (ETS) f their work. The case is scheduled to come ,e at which time the court will hear arguments u lleged hazards of ETS. concerning the The Eng1e c is a state class se, scheduled to come to trial in September, addiction to nicot ction in which plaintiffs claim both e and injury as the result of smoking. nd Eng1e, Wall said, Philip Morris will In both Broin argue that individua such as causation of others, and the compan be a significant fact State Medicaid Susts expects its affirmative defenses to the outcome of such trials. In Medicaid reimburse states, states seek to reco healthcare attributable to sm t lawsuits filed by individual the alleged increased costs king. - As of mid-February, lawsu~ states: Arizona, Connecticut, Maryland, Michigan, Massachusett had been filed by 21 orida, Kansas, Louisiana, Mississippi, Minnesota, of New Jersey, Oklahoma, Texas, Washi gton, West Virginia, Utah, m Wisconsin. Illinois, Iowa, New York, Hawaii an In addition, health-care relate the cities of Los Angeles,••San Franci suits had been filed in co; New York City and in Erie County, New York. ~ Philip Morris expects to be success Wall said, because it believes that, unde ul in these cases, state and federal law, the states must prove that each smoke state health care benefits could have prevai litigation. trials are needed to determine issues njury and level of damages, among ho received ed in individual

-3- To prove such a claim, the states will have to overcome the same industry defenses that have been successful in the past: Namely that people choose to smoke with full knowledge of the alleged risks; they can stop if they wish. In addition, the states themselves have received billions of dollars from sales and excise taxes that they have imposed on suits even more u e sale of cigarettes, thus making these new tenable and illogical. st striking example of the illogical Perhaps the m nature of these sui that the State of F1 1970's, manufactured s, Wall said, is our recent discovery rida, for a number of years in the ts own cigarettes and distributed them to inmates in its pri~on system, state hospitals and to local governments with full \~qnowledge of the claimed health risks. Individnat_ Cases In addition to these relatively new class actions and state Medicaid lawsuits, p intiffs are continuing to pursue traditional individual liabi ity cases against the industry. Currently, more than ha of the cases pending against Philip Morris have been filed 'n Florida where last year in Carter a defendant prevailed in a liability suit against Brown & Williamson. Wa11 said that it_was import nt to keep in mind that the Carter case set no legal precedent, since each case must be tried on its own merits and is base on the unique circumstances of the individual smoke . Moreover, two weeks following Ca er Philip Morris won a major victory in the Rogers case i.n In 'ana. The Rogers verdict, said Wall, sent "a clear signal' that there was no major groundswell among juries to reverse the 40-year precedent that "people are responsible for their own actions when it comes to tobacco use." "This verdict was a reaffirmation that'people can stop smoking when they decide to do so, a decision that has

-4- already been made by more than 40 million Americans," Wall said. # # #