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Appeals Court Upholds California Jury’s Multi-Million Dollar Verdict against R.J. Reynolds and Philip Morris 

The family of Leslie Whiteley, a smoker who smoked her first cigarette in 1972 at age 13, was diagnosed with lung cancer in 1998 and who died in July 2000 at the age of 40, won a major victory on Wednesday when the Court of Appeal of the State of California, First Appellate District, Division Two, upheld the jury’s awards, rendered in 2007, for her estate: $225,000 (for past economic damages); $2,345,964 (on wrongful death claims); and $250,000 (in punitive damages against R.J. Reynolds on the false promise cause of action). The jury also awarded Leonard Whiteley, Leslie’s widower, $30,000 for pre-death loss of consortium.

“I am delighted for the Whiteley family that the Court of Appeal has rejected each of the tobacco companies’ arguments to overturn the verdict. The family is closer to the day when these companies will be held accountable for their reprehensible wrongdoing,” said Edward L. Sweda, Jr., Senior Attorney for the Tobacco Products Liability Project (TPLP), which is based at Northeastern University School of Law in Boston.

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• Court upholds verdict against tobacco firms 

A state appeals court has upheld a San Francisco jury's award of $2.85 million in damages to the family of a woman who died of lung cancer after smoking cigarettes for 27 years, ruling that she relied on tobacco companies' claims that their products were safe.

In another development, San Francisco's ban on tobacco sales in drugstores survived a legal challenge from Philip Morris. City Attorney Dennis Herrera's office said the tobacco company had dropped its appeal of a ruling upholding the year-old ordinance.

The Ninth U.S. Circuit Court of Appeals in San Francisco upheld the ban last month, rejecting Philip Morris' argument that the city was effectively prohibiting tobacco advertising at drugstores in violation of freedom of speech. The court said the ordinance restricted only tobacco sales, not advertising.

A state appeals court in San Francisco is considering a separate suit by Walgreens, which says the ordinance discriminates against drugstores by allowing supermarkets and big-box retail stores with pharmacies to sell tobacco.

Another panel of the state appeals court ruled Wednesday in favor of the family of Leslie Whiteley, who sued R.J. Reynolds and Philip Morris before her death in 2000 at age 40.

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WHITELEY v. R.J. REYNOLDS TOBACCO COMPANY  

Defendants urge us to reverse the judgments, contending: (1) plaintiffs were collaterally estopped by a special verdict in Whiteley I from showing Whiteley's reliance upon false statements by agents of defendants and, therefore, the trial court erred in admitting evidence of such statements by various entities and organizations alleged to be agents of defendants; (2) the jury's findings of Whiteley's reliance on false promises or other misrepresentations by defendants was unsupported by substantial evidence; and (3) the personal injury action (as distinguished from the wrongful death action) was barred by the statute of limitations.

We shall affirm the judgments.

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• WHITELEY v. R.J. REYNOLDS TOBACCO COMPANY  

Defendants Philip Morris Inc. (Philip Morris) and R.J. Reynolds Tobacco Company (R.J. Reynolds) appeal from judgments in favor of plaintiffs in a combined wrongful death and survival action by the estate and the surviving spouse and children of Leslie Whiteley (Whiteley), a smoker who was diagnosed with lung cancer in 1998 and who died in July 2000.

This is the second appeal by defendants. . . .

On retrial, the jury rendered verdicts in favor of plaintiffs on their causes of action for false promise and negligent misrepresentation. For the personal injury claims, the jury awarded Whiteley's estate $90,640 for past economic damages, which was increased to $225,000 based on a previous stipulation. It awarded Leonard Whiteley $30,000 for pre-death loss of consortium. The jury awarded plaintiffs damages of $2,345,964 on the wrongful death claims. Deadlocking on the issue of whether there was sufficient evidence of malice to warrant punitive damages against Philip Morris, the jury assessed $250,000 punitive damages against R.J. Reynolds on the false promise cause of action. Following a limited retrial of the punitive damages claim against Philip Morris, the jury found in favor of Philip Morris. Judgment was entered against R.J. Reynolds on July 13, 2007, and against Philip Morris on November 19, 2007. These consolidated appeals followed.

Defendants urge us to reverse the judgments, contending: (1) plaintiffs were collaterally estopped by a special verdict in Whiteley I from showing Whiteley's reliance upon false statements by agents of defendants and, therefore, the trial court erred in admitting evidence of such statements by various entities and organizations alleged to be agents of defendants; (2) the jury's findings of Whiteley's reliance on false promises or other misrepresentations by defendants was unsupported by substantial evidence; and (3) the personal injury action (as distinguished from the wrongful death action) was barred by the statute of limitations.

We shall affirm the judgments. . . .

A. Evidence at the Second Trial

Whiteley's deposition testimony was presented at both the first and second trials. She testified that, in February 1998, she had what she called "chronic bronchitis" for approximately a week. It was "a cold that got worse. As the symptoms got worse, then I went to seek medical care." She saw Dr. LaMonica one time at the Ojai Valley Community Health Center. Whiteley's testimony continued as follows:

"Q. Did Dr. LaMonica tell you that smoking was, in his opinion, a likely cause of your chronic bronchitis?

"A. Yes.

"Q. Was your chronic bronchitis at that time, in your opinion, causing you appreciable pain?

"A. Yes, it was.

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Reynolds Ordered to Pay $250,000 to Smoker's Family (Update1) 

Reynolds American Inc., the second- largest U.S. tobacco company, must pay $250,000 in punitive damages to the family of a woman who died of lung cancer at the age of 40, a San Francisco Jury determined.

The verdict came today in a wrongful death lawsuit brought by the family of Leslie Whiteley, a Californian who died in 2000, according to Madelyn Chaber, a lawyer for Whiteley's family. On May 2 the jury ordered Reynolds and Altria Group Inc.'s Philip Morris USA, the world's largest publicly traded tobacco company, to pay $2.6 million in compensatory damages to Whiteley's husband. . . .

The punitive award against Reynolds was for acting with malice by falsely promising that it didn't know cigarettes caused lung cancer and that it would conduct scientific research to find out. The jury found both companies intentionally and negligently misrepresented the dangers of cigarettes and made false promises, according to the jury verdict form.

Only Reynolds American was subject to punitive damages because only eight of the 12 jurors found Philip Morris acted with malice.

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• $2.75 million award for damages 

A San Francisco jury has awarded $2.75 million in damages to the family of a woman who died of lung cancer after smoking cigarettes for 26 years, an award less than one-seventh the amount of a previous verdict that was overturned on appeal.

The Superior Court jury decided Wednesday that R.J. Reynolds should pay $250,000 in punitive damages to the estate of Leslie Whiteley, who died in 2000 at age 40. Last week the same jury awarded about $2.5 million against Reynolds and Philip Morris as compensation for financial losses and emotional distress suffered by Whiteley and her family. . . .

But a state appeals court overturned the verdict in 2004 and ordered a new trial. The court cited a 2002 California Supreme Court ruling saying tobacco companies were not responsible for any harm caused by their conduct from 1988 to 1998, while a state law was in effect protecting the firms from suits by individual smokers.

The appeals court said the jury's verdict could have been affected by evidence from that 10-year period, because Whiteley's lawyers had argued during the trial that the companies continued to misrepresent the dangers of smoking throughout the period.

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• Tobacco Suit Yields Small Punitives Award 

After battling for nearly three months of trial, Madelyn Chaber and H. Joseph Escher III came together and shook hands in the San Francisco courtroom where jurors had just returned a $250,000 punitive damage verdict Wednesday morning.

They congratulated each other politely, but the verdict was a disappointment for Chaber, who sued the R.J. Reynolds and Philip Morris tobacco companies for fraud and negligence in contributing to Leslie Whiteley's development of lung cancer.

"It needed at least another comma and a few more zeroes," she said in the third-floor hallway of San Francisco Superior Court.

Seven years ago, Chaber won $21.7 million, including $20 million in punitives, for Whiteley and her family. It was one of the first punitive awards in California tobacco litigation.

Soon after the first trial ended, Whiteley died at age 40. . . .

All told, Chaber won about $2.8 million the second time around, including compensatory damages against R.J. Reynolds and Philip Morris.

"At the end of the day, it's still a punitive damage verdict ... and in relation to zero, it's a lot of money," said Chaber, who's of counsel at the law firm Paul, Hanley & Harley. . . .

After Judge Robert Dondero released the jury, foreman Ed Collar briefly described how the jurors reached a decision on punitive damages.

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Attorney Who Has Never Lost a Trial Against Big Tobacco to Returns to the Courtroom and Wins in Retrial of Lung Cancer Case 

Mark Gottlieb, Director of the Tobacco Products Liability Project at Northeastern University School of Law in Boston observed that, "While Philip Morris escaped punitive damages, it still has a major problem with this verdict. In the nearly 7 years that Philip Morris and R.J. Reynolds has had to tweak their defenses, this jury, like the one before it, still find them legally responsible for the lung cancer that killed Ms. Whiteley. After the California Supreme Court gave the green light for tobacco litigation to resume in California earlier this year, attorney Madelyn Chaber's extraordinary record of success should encourage many new cases to be filed"

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• Calif. Smoker Gets Higher Compensatory Damages in Second Trial 

For the second time in about seven years, a San Francisco jury has found two major tobacco companies liable for damages related to Leslie Whiteley's habit of smoking cigarettes.

In court Wednesday, a jury recommended Whiteley's husband get about $2.5 million in compensatory damages, more than the $1.7 million in compensatories attorney Madelyn Chaber helped the Whiteleys win the first time around, before a higher court ordered a retrial.

Yet it's not clear how Leonard Whiteley will fare this time when it comes to punitive damages.

Back in 2000, the jury handed him and his wife a total of $21.7 million -- including $20 million in punitives, $10 million each against two tobacco companies.

But that was before an appeal court overturned the entire verdict in 2004, and substantially limited the plaintiffs' case going forward. In Whiteley v. Philip Morris, 117 Cal.App.4th 635, the 1st District Court of Appeal concluded the defendants could not be held liable for certain conduct during a 10-year window closed by the legislature beginning in 1988.

But in the retrial, it appears that only R.J. Reynolds will face punitive damages, not co-defendant Philip Morris. . . .

Dondero gave Chaber until today to prepare discovery arguments before presenting her case for punitive damages. On Wednesday, Chaber told the judge she wants R.J. Reynolds to turn over historical information about the company's market capitalization.

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• Smoker's Case Relit After Seven Years 

Seven years ago, on the day winter turned to spring, a San Francisco jury found the R.J. Reynolds and Philip Morris tobacco companies liable for fraud and negligence contributing to Leslie Whiteley's development of lung cancer.

The Whiteleys were handed $21.7 million, including $20 million in punitives -- one of the first punitive awards in California tobacco litigation. Hardly three months after the jury reached a final verdict, Leslie Whiteley died at age 40.

Now Chaber, the tobacco industry attorneys and Leonard Whiteley are all back in San Francisco Superior Court to do the trial over again.

An appeal court ruling in 2004 overturned the entire verdict and substantially limited the Whiteleys' case going forward. That opinion concluded the defendants could not be held liable for certain conduct during a 10-year period that had been imposed by the Legislature beginning in 1988.

But Whiteley v. Philip Morris, 117 Cal.App.4th 635, wasn't a total defeat for Chaber's case against Big Tobacco.

Though the unanimous ruling reversed the judgment, the opinion said Chaber had produced "substantial evidence that defendants and their agents knowingly engaged in a deliberate scheme to deceive the public, individual smokers and potential smokers (including children and adolescents) about the health effects of smoking."

Daniel Smith, who argued the appeal for Leonard Whiteley, said that favorable finding gives Chaber an assurance that she can once again demonstrate liability for conduct not protected by the 10-year, court-enforced immunity period. . . .

The retrial, which began in late February, was originally scheduled to last eight weeks. Chaber concluded the presentation of her case on Wednesday.

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Whiteley v. Philip Morris, Inc., et al. Reversed 

Mark Gottlieb, an attorney for the Tobacco Products Liability Project at Northeastern University School of Law in Boston observed that, "While it is certainly disappointing to lose a verdict like this on a mere technicality, the Court's opinion strongly supported the damning case against Philip Morris, R.J. Reynolds , and Big Tobacco in general. I do not think that anyone at Philip Morris or Reynolds is looking forward to seeing Madelyn Chaber trying a case against them for the first time in more than four years. She is very good and they have been very bad."

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Whiteley v. Philip Morris, Inc., et al. Reversed 

Mark Gottlieb, an attorney for the Tobacco Products Liability Project at Northeastern University School of Law in Boston observed that, "While it is certainly disappointing to lose a verdict like this on a mere technicality, the Court's opinion strongly supported the damning case against Philip Morris, R.J. Reynolds , and Big Tobacco in general. I do not think that anyone at Philip Morris or Reynolds is looking forward to seeing Madelyn Chaber trying a case against them for the first time in more then four years. She is very good and they have been very bad."

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California court reverses key tobacco verdict 

The California Court of Appeal has handed U.S. cigarette makers a win in ruling that a lower court failed to properly instruct the jury in the Whiteley case, a key smoking lawsuit.

The court reversed the verdict and ordered a new trial on one claim. R.J. Reynolds Tobacco Co. and Philip Morris and a number of asbestos companies were defendants in the suit. . . .

"This is in essence a victory for the tobacco companies involved since very few cases that are remanded back to the trial level are actually re-tried," wrote Bonnie Herzog, analyst with Smith Barney in New York. "However, since we were fairly confident that this decision would be reversed and that much of the positive litigation risk is already priced in the stocks, we would expect modest upside in the tobacco stocks." . . .

"We are confident that we will prevail if this case is retried," said Mark Holton, vice president and assistant general counsel for R.J. Reynolds. "As in all the other personal injury cases, we intend to show what jurors and everyone plainly know -- that smokers have long been aware of the significant, inherent risks of smoking, and that people who choose to smoke in the face of these known risks should not be financially rewarded."

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• WHITELEY v. PHILIP MORRIS, ET. AL. (.DOC) 

We shall conclude: (1) The trial court erred in refusing to instruct the jury regarding the 10-year statutory immunity and that the error was prejudicial. (2) The fraud claim was not preempted. (3) Substantial evidence supports the jury's finding reasonable reliance. (4) The negligent design verdict is not supported by substantial evidence that the negligent design of cigarettes was a substantial factor contributing to Whiteley's risk of developing lung cancer. (5) It is unnecessary to address the punitive damages issue at this time. We shall reverse the judgment and remand to the trial court for a new trial on the fraud-related causes of action and for entry of judgment in favor of defendants on the negligent design cause of action. . . .

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While the common knowledge doctrine in some jurisdictions may operate as a definitional defense to a strict liability claim, it plays no similar role in a fraud context.
California Appellate Court judgement in the Whiteley case.

Our review of the record satisfies us that there was substantial evidence that defendants and their agents knowingly engaged in a deliberate scheme to deceive the public, individual smokers and potential smokers (including children and adolescents) about the health effects of smoking. . . Defendants ignore the evidence that Whiteley believed their disavowal of the Surgeon General's warnings and their insistence that the health case against smoking had not been proved. They ignore evidence that Whiteley believed them when they held themselves out as the "people who know the most about cigarettes," and evidence that, through the Tobacco Institute, defendants encouraged smokers like Whiteley to be skeptical about the "substance" of the Surgeon General's report "and its source."
California Appellate Court judgement in the Whiteley case.

$21.7 million tobacco award held for retrial 

San Francisco jury's $21.7 million damage award to a longtime smoker who died of lung cancer was set aside Wednesday by a state appellate court, which ordered a new trial because of the state Supreme Court's recent limits on tobacco company liability.

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