WEST PALM BEACH, Fla. - (Mealey's) The $5 million punitive damages portion of what was originally an $8 million verdict has been vacated by a Florida appeals court, which found May 2 that the reliance required for the fraudulent concealment claim on which the punitive damages award was based was outside the state's statute of repose (Philip Morris USA Inc. v. Elaine Hess, as Personal Representative of the Estate of Stuart Hess, No. 4D09-2666, Fla. App., 4th Dist.; 2012 Fla. App. LEXIS 6882).
(Opinion. Document #04-120516-007Z.)
The jury had returned a verdict in February 2009 that the late Stuart Hess relied to his detriment on an omission by Philip Morris USA Inc. (PM USA) only before May 5, 1982, the Fourth District Court of Appeal said.
"Because reliance is an element of every fraud claim, and PM USA did not defraud Mr. Hess within the twelve-year period established by the statute of repose, we hold that the fraudulent concealment claim and the concealment-based punitive damages award are foreclosed by the statute of repose," the panel said.
The trial case was Elaine Hess v. R.J. Reynolds Tobacco Co. (No. CACE07011513, Fla. Cir., 17th Jud. Cir., Broward Co.). The jury returned a verdict of $3 million in compensatory damages but determined that Hess was 58 percent responsible. Judge Jeffrey E. Streitfeld of the 17th Judicial Circuit for Broward County reduced the compensatory damages award accordingly.
Elaine Hess' wrongful death claims are an "Engle progeny" suit, stemming from Engle v. Liggett Group, Inc. (945 So. 2d 1246 [Fla. 2006]), a class action lawsuit filed against cigarette makers in 1994. The class of smokers who developed a cigarette-related disease between 1992 and 1996 was decertified and a $145 billion punitive damages verdict was vacated, but the Florida Supreme Court ruled that the individual cases could proceed using certain liability findings from the class trial. A plaintiff is required to prove that he or a decedent was addicted to nicotine and that nicotine addiction caused death.
Stuart Hess smoked an average of at least two packs of cigarettes a day for 40 years before dying of lung cancer in 1997. His widow was one of more than 8,000 former class members in Engle who elected to file an individual suit against the major tobacco companies after the Florida Supreme Court broke up the class.
The opinion is by Judge Dorian K. Damoorgian, with Judges Mark E. Polen and Robert M. Gross concurring.
Philip Morris is represented by Miguel A. Estrada of Gibson, Dunn & Crutcher in Washington, D.C., Patricia A. Melville, Andrew S. Brenner and Luis E. Suarez of Boies Schiller & Flexner in Miami and Gary L. Sasso of Carlton Fields in Tampa, Fla.
Hess is represented by Bruce S. Rogow and Cynthia E. Gunther of Bruce S. Rogow P.A. in Fort Lauderdale, Fla., Gary M. Paige and Adam Trop of Paige, Trop & Ameen in Hollywood, Fla., and Alex Alvarez of The Alvarez Law Firm in Coral Gables, Fla.
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