In the U.S., one state is ground zero for tobacco suits

The family of a deceased Air Force veteran who died of lung cancer at the age of 50 recently won a $34 million verdict against R.J. Reynolds, a unit of Reynolds American (RAI), from a jury in Pensacola, Florida. It was one of thousands of legal challenges the industry faces in the Sunshine State.

Lawyers for the tobacco company unsuccessfully argued that Garry O'Hara knew of the dangers of smoking but choose to partake anyway before kicking the habit at age 35. They also argued that the evidence wasn't clear that the cancer originated in his lungs.

O'Hara's attorney Mark Avera and Jones Day partner David Monde, who represents Reynolds, the nation's second-largest tobacco company, didn't respond to requests for comment. Brian D. Hatchell, a spokesman for Reynolds American, declined to comment for this story. The company's brands include Newport, Camel and Pall Mall.

The legal claim brought by O'Hara's widow and two of his three children is what is known as an Engle Progeny case, named after a class action brought by Florida smokers against the tobacco industry in 1994. A Florida judge ruled in the plaintiffs' favor in 2000, awarding $145 billion in damages, one of the largest awards in history.

An appeals court, however, eventually rejected the payout, and the class was decertified, though the Florida Supreme Court did allow individual cases to proceed. They were able to use the jury findings from the class action, such as that tobacco companies omitted and concealed material information concerning the addictive nature of smoking and its potential health effects.

American Lawyer recently estimated that about 3,100 Engle cases are still pending in Florida state courts. Others are being tried on the federal level.

"They are being closely watched by interested persons throughout the country (because of) the way in which the case originated and the number of plaintiffs that have been able to prevail against the tobacco industry," said Maggie Mahoney, executive director of the Tobacco Control Legal Foundation, in an interview with CBSNews.com.

Wall Street is also interested in the Engle cases, named after pediatrician Howard Engle, who died in 2009 after contracting emphysema. According to American Lawyer, plaintiffs have won more than $500 million in verdicts from Reynolds, Liggett and Lorillard. Reynolds, which is based in Winston-Salem, North Carolina, is fighting a 2014 $23.6 billion punitive damage award in a lawsuit similar to the O'Hara one. A Florida judge reduced the judgment to $16.9 billion in January.

Earlier this year, R.J. Reynolds, Lorillard and Philip Morris USA, a unit of Altria (MO), announced they had reached a settlement of most of the federal Engle cases that were pending against them. Reynolds and Philip Morris each agreed to pay $42.5 million, while Lorillard agreed to shell out $15 million. (Reynolds' $27.4 billion acquisition of Lorillard closed in June.) The agreement didn't cover the cases in Florida state courts.

"With respect to the cases pending in state court, we will continue to defend them vigorously, which includes appealing adverse verdicts, " said Jeff Raborn, vice president and assistant general counsel for R.J. Reynolds, in a press release.

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    Jonathan Berr is an award-winning journalist and podcaster based in New Jersey whose main focus is on business and economic issues.