Tobacco Begins Legal Assault on $145 Billion Ruling
MIAMI (Reuters) - U.S. cigarette makers launched their post-trial legal assault on a record-shattering $145 billion punitive damage award, filing papers to move the landmark Florida state court case on behalf of sick smokers to federal court, lawyers said
Based on a motion to intervene in the Engle case filed by a union health care plan, lawyers representing the major tobacco firms filed notice on Monday in Miami U.S. District Court to transfer the entire 6-year-old class-action lawsuit to federal court.
``We filed a notice of removal of the case, which actually transfers the entire case to federal court,'' Philip Morris attorney Michael York said. ``The case is no longer pending before the circuit court.''
The industry also filed motions challenging the July 14 verdict, in which a Miami state court jury decided the nation's five largest cigarette makers should pay $145 billion as punishment for making up to 500,000 Florida smokers sick -- by far the biggest civil damage award in U.S. history.
The tobacco companies say the judgement should be overturned or reduced because legal errors were made at trial.
The industry had asked the trial judge, Miami-Dade Circuit Court Judge Robert Kaye, to order the jurors to return an award no larger than the companies' combined audited net worth, but he refused. In closing arguments the companies suggested to jurors an award of $75 million to $225 million. The judgement was handed down against Philip Morris Cos. Inc. , the No. 1 cigarette maker whose brands include Marlboro; R.J. Reynolds Tobacco Holdings Inc., maker of Dorals and Camels; Brown & Williamson, a unit of British American Tobacco Plc; Lorillard Tobacco Co., owned by Loews Corp.; and Liggett, a unit of Vector Group Ltd..
Tobacco lawyers said it was likely that the plaintiffs would file a motion before the federal court seeking to have the case sent back to the state court. Plaintiffs' lawyers Stanley and Susan Rosenblatt were not immediately available for comment.
In the removal notice filed on Monday, the tobacco firms said an intervention motion filed by the Southeastern Iron Workers Health Care Plan allowed them to have the case transferred from state to federal court because ``the legal matters involved confer jurisdiction on the federal court.''
The union filed its motion on July 14 -- the same day the punitive damages verdict was reached -- asserting rights under the federal Employee Retirement Income Security Act.
``The union was asserting contract subrogation rights,'' York said. ``They were trying to recover costs attributable to their payment of health care costs.''
The case was assigned to U.S. District Judge Ursula Ungaro-Benages, who will be able to decide if the federal court should retain jurisdiction, York said.
In a statement, Brown & Williamson Tobacco Corp., the nation's third-largest manufacturer, said it expected to receive full federal court protection on ``post-trial motions, the proper timing of any judgement and bonding.
``The federal court will be asked to decide all pending issues, including defendants' motions to decertify the class and other pending and post-trial motions filed in state court,'' Brown & Williamson attorney Richard Schneider said.
The state court held a two-year-long trial that resulted in a jury determination that smoking causes a host of diseases and a $12.7 million compensatory damage judgement for three plaintiffs harmed by smoking.