Tobacco Verdict in Florida

Yesterday, a Fort Lauderdale jury returned a verdict in favor of the widow of a man who died of lung cancer at age 55 after smoking for 40 years. $3m of the award was compensatory, and $5m was punitive. The jury further found that the widow's deceased husband was 58% at fault for having smoked.

While this on its face looks like an $8m verdict, it appears that the verdict will be reduced. Under Florida law (to be clear, I am not licensed Florida, and am only reading Florida statutes for guidance), the fault of a plaintiff reduces the recovery for compensatory damages by the percentage of the plaintiff's fault. Consequently, the $3m compensatory award may drop to $1,260,000, to account for the finding that the deceased man was 58% at fault.

Lawyers for Altria, the parent company of Philip Morris, also argue that the punitive damages will be stripped away. The basis for the argument, however, is unclear. Surely, under the Supreme Court's newest jurisprudence on the "ratio" between compensatory and punitive damages, this award would pass constitutional muster. In State Farm v. Campbell (2003) 538 U.S. 408, the Supreme Court held that the punitive damages essentially cannot exceed 9 times the compensatory damages. Here, the ratio would be a miniscule 1.67.

The most likely result is this: despite the verdict, the parties will settle the case. The plaintiff will be forced to accept far less than the verdict amount because Altria will no doubt threaten endless appeals, meaning no money for a very, very long time time. (Update: Altria will appeal.)

While there are many lessons one could take from this result, something that strikes me is the headlines in the papers. The vast majority of them (taken from my informal survey on Google News) include the purported amount of the verdict: "$8 million." The problem is that, as explained above, the actual verdict will likely be less, and the actual amount received in settlement far less than $8m.

In the end, Altria will get the best of both worlds: on one hand, it will pay pennies on the dollar for the verdict and, on the other, it can use the publicity of the "$8 million" verdict to persuade the public that this jury (and, Altria I'm sure would argue, other juries) are awarding far too much in damages.