Tuesday, August 21, 2012

The joys of federalism -- tobacco edition

There is this weird thing that's going on in Florida -- and only Florida -- in which long-time smokers, or in most cases their survivors, are winning millions upon millions of dollars from tobacco companies.
Only Floridians are allowed to sue.  Only Floridians (or their families) who can prove that they were addicted to cigarettes before it became public knowledge that cigarettes were addictive killers, got cancer (and in most cases died) have a hope in hell of winning. 
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Here's what happened as best as I can figure out:  In 1994, a class action lawsuit was filed in a Florida state court against all of the major tobacco companies.  There ensued a lot of really complicated legal stuff over the next 12 years, including a separate suit by the states themselves against the tobacco companies culminating in the "Master Settlement Agreement" in which the tobacco companies agreed to pay hundreds of billions of dollars to the states to pay their Medicaid costs for treating indigent smokers, and individual suits in most other states were somehow verboten as part of the agreement.
But in this one case, now known as Engle v. Liggett Group (Fla. 2006), the Miami trial judge certified a nationwide class of people with smoking-related diseases and survivors of deceased smokers.  A jury eventually heard the case and awarded damages of more than $145 billion.  A state appeals court later said the class can only be made up of Florida residents.
Then the Florida Supreme Court in 2006 decertified the class altogether and tossed out the $145 billion verdict, but it ruled that class members -- 8,000 of them -- could file individual suits using the Engle jury's findings that the tobacco companies lied about the dangers and addictiveness of smoking over decades.
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Sooo, ever since that ruling, trial after trial has been going on in the Florida courts with varying results.  The family of one woman won $300 million, later reduced to $37 million, another family won $5 million, later overturned, the widow of a construction worker got $75 million.
Overall, the families have won nearly 70 percent (42 cases) of the trials held so far and the tobacco companies have won about 30 percent (19).  One verdict has been overturned and several large awards have been reduced in the Florida appeals courts.  Interestingly, in April the U.S. Supreme Court refused to hear the tobacco companies' appeals of four cases -- thus upholding verdicts of $28 million, $15.8 million, $3.4 million and $6.2 million.
In doing so, the high court also affirmed the Engle ruling itself -- that is, the one that decertified the class, overturned the $145 billion verdict but said plaintiffs could use the jury's findings to pursue their own suits -- in Florida only. 
And so, the trials go on.  Only 7,930 or so to go.
In a recent case, a Florida appeals court ordered a new trial on damages because the smoker's husband was listed on the verdict form as supplying his wife with cigarettes, allegedly contributing to her death and thus perhaps prejudicing the jury to award low damages of only $500,000.
In another case, a Florida appellate court has thrown out a $79.2 million jury award against R.J. Reynolds Tobacco Co.  finding that the $7.2 million compensatory damages portion was larger than the evidence at trial reasonably supported.
Some attorneys are making boatloads of money, some appellate judges are beholden to the tobacco companies for their election campaign money, some families are really making out big-time, some are losing heart-breaking amounts of money they thought they had won from sympathetic juries.  The tobacco companies are employing phalanxes of lawyers and the only fun aspect of the whole thing is watching juries take those companies for astronomical amounts of money.  

What I find so strange is this:  How did we get to the point that only Floridians can sue for wrongdoing that the tobacco companies committed on millions of people nationwide?   Or, since the states settled with the tobacco companies in 1995, why is it that anybody is allowed to sue? Or why isn't everybody? 
It's all part and parcel of our very odd and somewhat rare federal system in which the federal government and each of our 50 states can make separate and sometimes very unequal laws.
You do see the occasional suit in some other state, but they have become rare as statutes of limitation have expired, not to mention smokers.   Only the Engle class members are guaranteed the right to sue. 
It is not that way in most other countries where one set of laws govern the entire country.
Ain't life grand in these United States?

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