When jury selection began in Florida in 1998 for a $200 billion smoker's class-action suit against the

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When jury selection began in Florida in 1998 for a $200 billion smoker's class-action suit against the nation's cigarette makers, it was "high noon" for Big Tobacco. The industry had come prepared to fight. There would be no pretrial settlement, such as in the flight attendants' case the previous year. "That was a different time," a spokesman for RJ Reynolds declared.71The smokers charged that the tobacco industry had made a defective product and had conspired to deceive the public about smoking-related illnesses.72 The lawsuit alleged, "Cigarettes are a product that when used as directed will inevitably cause death and disease to a large percentage of its users."73 Hundreds of the plaintiffs were in the courtroom on the first day—some of them with portable oxygen tanks. "Questioning began amid a steady backdrop of coughing, wheezing, and the sound of electronic voice boxes."74

At the center of the suit was the issue of addiction—the same ground on which the earlier Pennsylvania class action had been tossed. Plaintiffs claimed that it was impossible for them to kick the habit. In the words of one of their attorneys, "The essence of the conspiracy and fraud of these defendants has been to get smokers hooked on nicotine as young as possible and make lifelong customers of them."75The attorney for Philip Morris argued, "You can't defraud somebody by hiding something they already knew."76 He pointed out that health concerns about smoking had been raised as early as 1604 and that cigarettes were already being called "coffin nails" in the 19th century.77 The industry further maintained that those who want to quit can do so. Industry lawyers challenged the plaintiffs' addiction claim by contending that 46 million people had quit smoking for good in the previous 30 years.78On July 7, 1999—after eight months of testimony—the Florida jury dealt a crushing blow to Big Tobacco, finding that cigarette manufacturers had conspired to "mislead smokers about the addictive and deadly nature of their product."79 The verdict ruled that cigarette makers had "acted with reckless disregard"80 and "engaged in extreme and outrageous conduct."81Although there were only nine named plaintiffs, the suit had been brought on behalf of as many as 500,000 sick Florida smokers.82 Legal experts believed that the case had opened the door for similar class-action suits in other states. The executive director of Citizens for a Tobacco-Free Society proclaimed, "The Marlboro Man just fell off his horse into quicksand."83The second phase of the trial concluded in April 2000, when three plaintiffs, chosen to represent the hundreds of thousands of smokers in the potential class, were awarded $12.7 million in compensatory damages by the same jury.84 Legal experts predicted that this verdict would be a harbinger of a huge punitive damage award against the tobacco industry when that jury began the third phase of the trial—the determination of damages on behalf of the entire Florida class.85The predictions could not have been more prescient. On July 14, 2000, the tobacco industry was ordered to pay $145 billion to Florida smokers who had become sick or had died as a result of their addiction to cigarettes. It was the largest jury award in U.S. history.86 To put the size of the award in perspective, it exceeded the entire national budget of Canada.87 The damages were apportioned against the defendants according to their market share—ranging from $74 billion against Philip Morris down to $790 million against Ligget Group.88 After reading the breakdown, the judge muttered, "Lots of zeros."89 Many judicial authorities, as well as the tobacco attorneys, expected the spectacular award to be overturned or at least trimmed drastically. But four months later, a circuit judge upheld the verdict, rejecting claims that the amount would bankrupt the tobacco industry.90 The founder of Smokefree Educational Services, a former Wall Street executive, also dismissed the bankruptcy threat: Cigarette makers "can raise the price of cigarettes tomorrow and take in as much money as they need to pay," he said. "They have the luxury that smokers are addicted."91 Since the verdict, the tobacco industry has tried mightily to reshape its image. As part of its $100 million corporate image campaign, Philip Morris has unveiled a new Web site, on which it unequivocally states for the first time that there is an "overwhelming medical and scientific consensus that cigarette smoking causes diseases including lung cancer, emphysema, and heart disease."92 The company has also finally conceded at tobacco hearings held by the World Health Organization in 2000 that cigarettes are addictive.93 Most remarkable of all, Philip Morris now refers to nicotine as a "drug" and has even said that the company could accept some regulation of tobacco by the FDA.94

But for all the belated admissions, the stunning damages were never paid out. On May 21, 2003, the Florida Third District Court of Appeal reversed the jury's verdict and overturned the mammoth award. The court determined that the award would be bankrupting, in violation of Florida law. More significantly, the appeals court ruled that the case should not have had class-action status since each smoker in the case had "unique and different experiences" that would require separate litigation.95 Many observers believed that the ruling weakened plaintiffs' arguments in pending class-action cases and might well deter future litigation. Moreover, a strongly pro-business and anti-litigation Congress seemed determined to pass legislation dramatically capping punitive damages on future product liability lawsuits. Meanwhile, thousands of other tobacco suits, both individual and class action, remain pending in a state of limbo. But whatever finally happens, prolonged future appellate litigation will surely outlive all the original plaintiffs. Before the verdict was overturned, Big Tobacco's timetable for paying off the Florida claims was about 75 years.96 Now its timetable is never.

Analyze and discuss the case study above "Lots of Zeros"