Legal News

Breaking News: Scotus Denies Philip Morris?s Appeal of Widow?s Award

By Jennifer Forsyth

This morning, the U.S. Supreme Court left in place an Oregon Supreme Court decision that upheld a $79.5 million award to a smoker’s widow against Altria’s Philip Morris.

This case had been closely watched by the business community, which had hoped the Supremes would use it to set firm limits on punitive damages. Instead, the high court took a pass on ruling on the legal issues, after having heard arguments in December. The dismissal came in a short court order that offered no details on why the appeal was dismissed. No justices dissented from the dismissal, reports Dow Jones’s Mark Anderson.

The judgment for Mayola Williams had grown to more than $145 million with interest, reports the AP. (Story here.) While a jury awarded the widow of a Portland janitor who died of lung cancer $800,000 in actual damages (later reduced), it socked it to the company in punitive damages. That sparked nearly a decade of fighting in the appellate courts.

First, the Oregon high court refused to hear an appeal from Philip Morris, the AP reports. Then the U.S. Supreme Court rejected the judgment of nearly $80 million, saying in another case that damages generally should be held to no more than nine times actual economic damages. To the disappointment of businesses, however, the court declined to make that a firm rule.

The Oregon Supreme Court later upheld the punitive damages, citing “extraordinarily reprehensible” conduct by Philip Morris officials.

The case came before the Supremes again in 2007, which said in a 5-4 decision that jurors may punish a defendant only for harm done to someone who is suing, not other smokers who could make similar claims. The state court was told to reconsider the award in the context of instructions for the trial jury that Philip Morris proposed and the trial judge rejected. In January, 2008, the Oregon court said there were other defects in Philip Morris’s proposed language and that the judge’s instructions were proper.

The justices took the case in late 2008 to consider whether the Oregon Supreme Court ignored its 5-4 decision. At oral arguments, some justices indicated they thought the Oregon courts may have properly handled the case after the 2007 Supreme Court ruling. Others said they were concerned the Oregon courts had ignored their earlier ruling.

The case is Philip Morris USA v. Williams, 07-1216.

Full post as published by Law Blog - WSJ.com on March 31, 2009 (boomark / email).