Tobacco CEOs To Testify
MIAMI (AP) -- Hoping to dissuade a Florida jury from punishing their companies, titans of the tobacco industry will take the witness stand this week to highlight ``enormous changes'' made in their industry in recent years.
The panel is scheduled to hear testimony Monday from Philip Morris Inc. CEO Michael Szymanczyk, the first of five tobacco company executives expected to take the stand on a potential multibillion-dollar punitive damage request by 300,000 to 500,000 sick Florida smokers.
``We're going to present substantial evidence to show some enormous changes in these companies in the last three years,'' said lead tobacco attorney Dan Webb. ``We're going to show the jury why it is that punitive damages simply would not be warranted in this case.''
The six-member jury previously awarded $12.7 million in compensatory damages to three people in the nation's first smokers' class-action suit to go to trial.
The expected appearance of the CEOs before the jury demonstrates the importance of the case to the industry. Tobacco executives make infrequent public appearances, primarily at corporate annual meetings, and rarely testify under oath.
Smokers' witnesses estimated the companies could raise $150 billion to $157 billion to pay a punitive verdict. Those figures would dwarf the national punitive damages record of $3 billion, assessed against Texaco in 1987.
The oil company, sued by Pennzoil Co. over their rival attempts to acquire Getty Oil Co., was also ordered to pay $7.53 billion in compensatory damages. After Texaco filed for bankruptcy protection, the companies agreed in 1988 to settle for a total of $3 billion.
The nation's five biggest cigarette makers, who are asking for no award at all, don't want the jury to consider anything beyond their present value because of the potential for borrowing and price increases to inflate the verdict.
One witness representing smokers estimated the industry value at $150 billion.
In a deposition May 10, Szymanczyk denied his company recruits kids as customers despite two recent studies indicating more cigarette advertising in magazines with high youth readership.
Philip Morris announced magazine ad cutbacks last week, a move seen by smokers' attorney Stanley Rosenblatt as a ploy that jurors will see through.
Szymanczyk, who is expected to be on the stand at least a day, ``will submit himself to cross-examination so the jury can hear the truth,'' Webb said.
The other CEOs who will testify are Andrew Schindler of R.J. Reynolds Tobacco Co., Nicholas Brookes of Brown & Williamson Tobacco Corp., Martin Orlowsky of Lorillard Tobacco Co. and Bennett LeBow of Liggett Group Inc.
Although the Philip Morris Web site cites an ``overwhelming scientific and medical consensus that smoking causes'' disease, Szymanczyk said in his deposition that the company has not adopted the same position. His personal belief is ``smoking is bad for your health,'' but he refused to be pinned down on specifics.
Most of the touted changes were accepted when cigarette makers settled state lawsuits for $254 billion in 1997 and 1998. Cigarette billboards came down, and companies pledged to end youth marketing, among other things. But Circuit Judge Robert Kaye has made it clear that the settlements were voluntary and the payments cannot be characterized as punishment.
During the trial, smokers called nine witnesses, mostly public-health experts who contend the industry has not changed its ways following decades of misconduct.