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Court Reaffirms Tobacco Verdict

June 10, 2004|From Associated Press

SALEM, Ore. — A state appeals court Wednesday reaffirmed an $80-million verdict against cigarette maker Philip Morris USA Inc. in the case of an Oregon janitor who died of lung cancer.

The U.S. Supreme Court had ordered the Oregon court to reexamine the 1999 verdict to ensure that it was not unconstitutionally excessive under new standards for punitive damages. The state court concluded that the award was justified because Philip Morris knowingly marketed a harmful product for decades.

The family of Jesse D. Williams accused Philip Morris of concealing the dangers of smoking. Williams picked up the habit in the 1950s while serving in the Army in Korea and later smoked three packs of Marlboros a day. Williams' family said he kept smoking because he did not believe a company would sell something that was truly harmful.

He died in 1997 at age 67.

In a statement, Philip Morris' parent company, New York-based Altria Group Inc., called the award "grossly excessive, and clearly inconsistent" with recent U.S. Supreme Court decisions on damage awards. The company said it planned to ask the Oregon Supreme Court to review the decision.

Altria shares fell 48 cents Wednesday to $48.64 on the New York Stock Exchange.

After a Multnomah County jury in 1999 ordered the company to pay the Williams family $79.5 million in punitive damages, the judge reduced the award to $32 million. The state appeals court reinstated the jury's award in 2002.

The jury also awarded the Williams family $821,485 in compensatory damages, an amount cut to $521,485 under state law.

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