Supreme Court to review huge award in tobacco case

June 11, 2008 4:05:02 AM PDT
The Supreme Court said Monday it will review a $79.5 million punitive damages judgment against Marlboro-maker Philip Morris for the third time. The justices have twice struck down the award to the family of a longtime smoker of Marlboros, made by Altria Group Inc.'s Philip Morris USA.

Oregon courts have repeatedly upheld the judgment. The most recent ruling, in January, followed a high court decision last year that said jurors may punish a defendant only for harm done to someone who is suing, not other smokers who could make similar claims.

The justices will consider only whether the Oregon Supreme Court in essence ignored the U.S. high court's ruling, not whether the amount of the judgment is constitutionally permissible.

The case will be argued in the fall.

The award was for the family of Jesse Williams, a former Portland janitor who started smoking during a 1950s Army hitch and died in 1997, six months after he was diagnosed with lung cancer. A jury in Portland made the award in 1999.

The Oregon high court made its first decision in 2002, refusing to hear an appeal from Philip Morris.

Then the U.S. Supreme Court rejected the judgment of nearly $80 million, saying that punitive damages generally should be held to no more than nine times actual economic damages. It declined, however, to make that a firm rule.

In the Williams case, the family was awarded $800,000 in actual damages. the punitive damages are about 97 times greater. A state court previously cut the compensatory award to $521,000.

Next, the Oregon Supreme Court upheld the punitive damages, citing "extraordinarily reprehensible" conduct on the part of Philip Morris officials.

Then came the U.S. Supreme Court's second take on the case, last year, a narrower ruling that did not address the size of the award but only how juries could consider the conduct of defendants in determining punitive damages.

Philip Morris also had asked the justices to rule on the size of the award, but they declined Monday to review that aspect of the appeal.

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