Philip Morris hit with record tobacco liability verdict

RELATED VIDEO CNN's Tom Watkins reports on the jury award against cigarette maker Philip Morris Windows Media 28K 80K

March 30, 1999
Web posted at: 9:53 p.m. EST (0253 GMT)

In this story: Punitive damages set at $79.5 million Analysts: Jurors raising bar for companies RELATED STORIES, SITES

PORTLAND, Oregon (CNN) -- In the biggest liability verdict ever against the tobacco industry, a jury ordered Philip Morris to pay $81 million Tuesday to the family of a man who died of lung cancer after smoking Marlboros for four decades.

The victory by the wife and children of Jesse Williams marked the second time this year that Philip Morris has lost a major suit. Although no smoking liability verdict against the tobacco industry has survived on appeal, Wall Street analysts have been watching the case closely to see if huge damage awards against Big Tobacco are now a trend.

"This is bad news," Credit Suisse First Boston analyst Bonnie Zoller said Tuesday. "Does it mean that the industry will start to lose more of these cases? Probably. Does it mean that more lawyers will file these kinds of cases against the industry? Probably."

Punitive damages set at $79.5 million

The jury found Williams and the company to be equally negligent for his illness and awarded $1.6 million in compensatory damages and $79.5 million in punitive damages.

Oregon's product liability laws require a plaintiff to be no more than 50 percent at fault to win damages.

The Williams family, who sought $101 million, alleged the company knew its cigarettes could cause cancer.

Philip Morris attorney Walter Cofer said he will appeal. Cofer said Williams was well aware that smoking could harm his health and had been warned of that by doctors and family members.

"If you look at this verdict, it was not supported by the evidence," Cofer said. "It was a product of passion and prejudice."

Testimony portrayed Williams, a former janitor with the Portland school system, as a three-pack-a-day Marlboro smoker who believed the manufacturer wouldn't sell a harmful product and who was heavily addicted to nicotine.

Williams died in 1997 just five months after he was diagnosed with small-cell carcinoma of the lungs. He was 67 and left behind a wife, Mayola, and six adult children.

"My late husband Jesse Williams had a dying wish," said Mrs. Williams. "He wanted to make cigarette companies stop lying about the health problems of smokers."

The 12-member Circuit Court jury, which included three smokers and four former smokers, spent a little more than two days reviewing a month of technical and often conflicting testimony from experts in such areas as cancer diagnosis, radiology and the chemistry of tobacco smoke.

Tuesday's verdict comes on the heels of a decision by a San Francisco jury last month to award $51.5 million to a Marlboro smoker who has inoperable lung cancer.

Besides the San Francisco case, U.S. juries have awarded damages in smoking liability cases only three times -- twice in Florida and once in New Jersey. All three verdicts were overturned on appeal.

Analysts: Jurors raising bar for companies

Analysts said the size of the award in the Oregon case suggests that juries are seeking to punish companies they increasingly hold responsible for smoking-related illnesses.

"The fact that you have had two major plaintiff awards in recent weeks is a clear departure from the fairly strong defense records that tobacco companies had amassed to this point," said Lester Brickman, a Cardozo School of Law professor who follows tobacco litigation.

"Are jurors reassessing traditional and winning arguments of tobacco companies that smokers knew what they were doing when they continued to smoke?" he said.

"It shows that, once the truth is laid bare and the documents uncovered and shown to 12 common citizens, they're willing to make a very harsh judgment on Philip Morris," said Chuck Tauman, a lawyer in the Portland firm of Bennett, Hartman, and Reynolds, which brought the suit and is investigating another 50.

Philip Morris ended the day Tuesday as the biggest loser on the Dow industrial average, down 3 7/16 to 37, and it helped push other tobacco stocks down.

The tobacco industry reached a $206 billion legal settlement with states in November, but cigarette makers still face individual and class-action claims.

Reuters contributed to this report.

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