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NH Supreme Court Sides with Philip Morris in Light Cigarette Case

Tuesday was a big day for Philip Morris USA Inc. in litigation over light cigarettes. On Tuesday the New Hampshire Supreme Court threw out a rare class certification in a case brought on behalf of state residents who bought Marlboro Lights. On the same day the company tried to persuade a judge in Madison County, Ill., not to reinstate a $10 billion jury verdict that the Illinois Supreme Court overturned in 2005.

A unanimous three-judge panel of the New Hampshire Supreme Court held in an eight-page ruling that a class could not be certified for individuals who bought light cigarettes starting in 1995 because common issues didn't predominate. Chief Judge Linda Stewart Dalianis pointed to all the information available before 1995 that light cigarettes are as harmful as regular cigarettes. As a result, the court couldn't assume that all individuals in the class shared the same understanding of the risk.

Philip Morris is represented by Wilbur Glahn III of Manchester, N.H.'s McLane, Graf, Raulerson & Middleton, who gave the oral argument, and by Philip Curtis of Arnold & Porter. Lead plaintiffs counsel is Stephen Tillery of Korein Tillery, which has brought several light cigarette cases around the country, including the Madison County case.

Lead plaintiff Karen Lawrence sued the tobacco company more than a decade ago, claiming in 2002 that Philip Morris violated the New Hampshire Consumer Protection Act by falsely representing that Marlboro Lights would deliver less tar and nicotine than other cigarettes. Lawrence, however, wasn't suing for personal injury damages. Instead, she asserted that the light cigarette was worth less than the product Philip Morris promised, and sought damages for this difference in value. In 2010 the trial court certified a class.

In an interlocutory appeal, Philip Morris countered by detailing the information about light cigarettes available to consumers from 1976 to 1995, citing everything from segments on "The Today Show" to articles in mainstream newspapers. These reports described the so-called "compensation effect," in which smokers of light cigarettes inhaled more deeply and held the smoke longer to get the same amount of nicotine. You can read the company's appellate brief here.

"The Court recognized correctly that there are too many individual issues for this case to be treated as a class action," said Murray Garnick, Altria Client Services senior vice-president and associate general counsel in this statement.

Plaintiffs lawyer Tillery noted that the case was decided under New Hampshire law and should have little effect on other cases. Nontheless, he criticized the ruling as unfair. "The decision allows a tobacco company to escape liability for a massive fraud because some information about the fraud trickled out through scientists, while the corporation simultaneously denied that same information," Tillery wrote in an email.

Plaintiffs have had limited success in mass litigation over light cigarettes. At least 13 cases have sought class certification and it appears that only three have succeeded--in Missouri, Massachusetts, and Minnesota. (Philip Morris later won the Minnesota case on the pleadings.)

Meanwhile, in Tuesday's hearing in the Madison County case, Tillery claimed that newly-discovered evidence should lead the court to revive the $10 billion verdict, according to this account by The Record, a local legal publication affiliated with the U.S. Chamber of Commerce. The plaintiffs won that verdict by accusing Philip Morris of harming Illinois smokers by claiming light cigarettes were safer. Tillerly told Third Judicial Circuit Court Judge Dennis Ruth that Philip Morris had convinced the Illinois Supreme Court to toss the verdict by incorrectly stating that the Federal Trade Commission had authorized the light designation. As we previously reported, the Illinois case was revived after the U.S. Supreme Court reversed the dismissal of a similar Maine consumer fraud class action in 2008.

George Lombardi of Winston & Strawn told the judge there was no newly-discovered evidence, and the evidence cited by the plaintiffs would not have affected the outcome of the case, according to The Record. The judge has not yet issued a ruling.



Published: Friday, August 24, 2012

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