Setback for Philip Morris in Two Tobacco Cases

TALLAHASSEE, Fla. (CN) - Dealing twin blows to Philip Morris, the Florida Supreme Court ordered the retrial of one case and revived the $6 million verdict in another.

The rulings settle a division between the state's intermediate appeals courts on how the statute of repose applies to claims by longtime smokers.

Tina Russo is the plaintiff in the first case, standing in for her mother, Phyllis Frazier, who died of chronic obstructive pulmonary disease during the case's proceedings.

A trial court in Miami had granted Philip Morris final judgment against Frazier based on a jury's findings about a four-year statute of limitations.

The 3rd District Court of Appeal reversed in 2012, however, because it found that Frazier passed the requirement in the statute of repose to introduce evidence of deceptive statements or omissions occurring after May 5, 1982.

That date triggered the 12-year statute-of-repose window governing fraud claims because it is when the class in Engle v. Liggett Group Inc. filed suit.

Affirming on April 2, the Florida Supreme Court emphasized "that evidence of reliance need not be established within the fraud statute of repose period."

"PM USA and R.J. Reynolds' requested jury instruction would have precluded the jury from considering any evidence of reliance prior to the repose period," Justice Peggy Quince wrote for the unanimous court.

The court cited this holding in another opinion Thursday that reinstates a jury's $6.26 million verdict for Elaine Hess, whose husband, Stuart Hess, died of lung cancer in 1996.

In holding otherwise, the 4th District Court of Appeal had cited the jury's finding that Philip Morris defrauded Hess' husband by an omission before May 5, 1982, predating the 12-year window under the statute of repose.

The high court's reversal last week meanwhile says that "it is not necessary that the smoker relied during the twelve-year repose period."

"Where there is evidence of the defendant's wrongful conduct within the repose period, the statute of repose will not bar a plaintiff's fraudulent concealment claim," Quince wrote.

Though Hess need not show that her husband relied during the repose period, she did present "evidence of PM USA's fraudulent concealment conduct within the statute of repose period," the ruling states.

"Because we conclude that PM USA was precluded from raising the fraud statute of repose defense to Mrs. Hess's fraudulent concealment claim, the jury verdict should not have been disturbed on appeal," Quince concluded.

Though tobacco companies first hired scientists who linked cancer to smoking in 1953, they issued "A Frank Statement" shortly thereafter that said smoking cigarettes was safe.

In 1983, a spokesperson for the Tobacco Industry told a jury, "I don't think that there has been a causal relationship established between cigarette smoking and any other disease."

A tobacco spokesperson also said in 1984, "It is not known whether cigarettes cause cancer."

The surgeon general's 1998 report about nicotine addiciotn meanwhile prompted the Tobacco Institute to say "it has not been established that cigarette smoking produces a physical dependence to nicotine."

Five years before the tobacco companies admitted in 1999 that smoking was harmful, tobacco company executives testified under oath before Congress in 1994 that nicotine was not addictive and that "it has not been proven that cigarette smoking causes cancer."

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