N.C. Tobacco Growers May Suffer From Florida's $145 Billion Punitive Damage Verdict
Posted July 13, 2000
WAKE COUNTY — The biggest verdict ever in U.S. history could bankrupt tobacco companies and put thousands of people in North Carolina out of work. A Florida jury says tobacco companies must pay more than $140 billion to treat sick smokers.
Philip Morris Inc.'s attorney, Dan Webb, called the ruling "an unfair procedure, unheard-of in American history," but predicted its actual effect on the company would be minimal.
"There's probably not a country in the world that can withstand a verdict this size," said Webb, whose company was ordered to pay $73.96 billion, or about half of the total.
The jury also ordered R.J. Reynolds to pay $36.28 billion; Brown & Williamson $17.59 billion; Lorillard Tobacco $16.25 billion; and Liggett Group Inc. $790 million.
Lionel Edwards, general manager of the Flue-cured Tobacco Stabilization Corporation, says the verdict is a difficult blow for North Carolina tobacco growers.
"We certainly don't agree with the jury's verdict and we hope that it is overturned and appealed because this can be devastating for growers," Edwards says. "If the verdict stands up, the companies are going to raise the price of cigarettes to cover it because the smokers are going to pay for it. They are also going to use cheap, offshore tobacco that is going to translate into less demand on the warehouse floor and lower quotas, forcing farmers out of business."
Debra Bryan of the North Carolina chapter of theAmerican Lung Associationsays she supports the verdict.
"In North Carolina alone, we have had 1,400 deaths each year related to tobacco use so when you put things in perspective, how much is each life worth and can you even measure a life in monetary terms," Bryan says.
Robert Harris, 64, was a two-pack-a-day smoker for close to 40 years. Emphysema and other smoking-related diseases took their toll on Harris and now he wants tobacco companies to pay.
"It was a habit I couldn't break," Harris says. "They didn't tell anybody it was addictive. I did try to stop about five times but every time I stopped, I came back smoking more than I was smoking when I stopped."
Larry Wooten of the North Carolina Farm Bureau says no consumer manufacturing company is safe with the verdict.
"It is about money and greed and the biggest money grab that has ever been perpetrated on American society," Wooten says.
Under Florida law, punitive damages cannot bankrupt companies, so the judge will likely reduce the verdict. The tobacco companies are expected to begin a lengthy appeals process. In the short term, stock for the five tobacco companies on trial dropped after the ruling.
The verdict shattered a national record for punitive damages awards. Exxon held the previous record after losing a $5 billion lawsuit for the "Exxon Valdez" oil spill. From staff and wire reports