Latest News From the Florida Tobacco Lawsuit & Engle Trust Fund

Florida smokers to split $600 million tobacco fund

Thousands of sick smokers in Florida could be eligible for money from a $600 million fund in a landmark Miami-Dade County case against the country's five largest tobacco companies.

Tobacco companies agreed to create the trust fund in 2001 to avoid posting a bond as they appealed a Miami-Dade jury's July 2000 verdict. The jury awarded ill smokers and their families $145 billion, which was thought to be the biggest punitive award in American legal history. Whether the tobacco companies won or lost their appeals, the money placed in the trust fund was set aside for sick smokers covered under the class-action case and their attorneys' fees.

The Florida Supreme Court threw out the jury's verdict in 2006, deeming it excessive.

To be eligible for money from the trust fund, a smoker must have been a Florida resident before or on Nov. 21, 1996 and be able to document having symptoms of a cigarette-related illness before that date. Families of deceased smokers can put in claims for the money if their loved ones met the requirements, but there can only be one claim per smoker.

"It's a unique and historic opportunity for people who have been victimized by the tobacco industry," said attorney Robert Kelley, whose law firm is representing about 500 clients who could qualify for the fund. "Nowhere in the nation is this available but Florida."

Miami-Dade Circuit Judge David C. Miller ordered last week that the money be distributed equally among people who qualify for it, rather than have individual determinations on how much money each smoker should receive. He set a June 16 deadline date for smokers and their families to put in for the fund.

The fund's court-appointed trustee said Monday that the goal is to have checks going out by Thanksgiving.

"I want this [process] to be transparent," said Miles McGrane, the trustee. "I want this to be open. I have a judge who has been very vocal that these things usually drag on too long and he's going to put my feet to the fire."

Attorneys said that what could prove to be the sticking point for many smokers is getting documentation showing they suffered from tobacco-related illnesses prior to Nov. 21, 1996. Medical facilities often purge their records.McGrane said he expects 15,000 to 20,000 to qualify for money from the fund. The fund is named after the court case from which it arises — Engle vs. Liggett.

In addition to sick smokers collecting money from the fund, there are at least 7,400 court cases that have spun off from the Engle case. While the state Supreme Court tossed out the monetary damages in that case, it affirmed the jury's conclusions that the companies misrepresented the addictive nature of cigarettes and concealed the health dangers.

Sick smokers and the families of deceased smokers covered under the class-action had to file lawsuits by January if they wanted to have the Engle jury's findings legally established when they walked into the courtroom.

The tobacco companies sued in the Engle case were Philip Morris Inc., R.J. Reynolds Tobacco, Brown & Williamson, Lorillard Tobacco and Liggett Group Inc.

Fill out the form to your right today to have Robert represent you for your Engle Trust Fund.

source: South Florida Sun-Sentinel, April 21, 2008

Common questions about the Engle Trust Fund

Where did the $600 million come from?

Three of the five tobacco companies in the landmark Engle vs. Liggett case agreed in 2001 to create the fund to avoid having to post a huge bond as they appealed the $145 billion verdict in the case. The companies agreed that even if the verdict were tossed out, the money would benefit sick smokers covered by the class-action case.

The Florida Supreme Court set aside the verdict in 2006 but made it easier for individual smokers to file lawsuits.

Who could qualify for money from the fund?

Smokers who were Florida residents prior to or on Nov. 21, 1996, and could prove they had symptoms of a cigarette-related illness before that date. The families of deceased smokers who met the requirements could qualify.

source: South Florida Sun-Sentinel, April 21, 2008

Florida smokers to appeal $145 billion lawsuit

MIAMI (Reuters) - In a huge victory for the tobacco industry, the Florida Supreme Court on Thursday refused to reinstate a $145 billion punitive damages award against major cigarette makers found liable for selling a dangerous product.

The long-awaited decision lifted one of the biggest financial clouds over tobacco companies and sent their stocks up sharply. It upheld the key part of a Florida appeals court ruling three years ago that overturned the punitive damages, one of the largest awards in a U.S. product liability case.

The high court said the award was "clearly excessive" and would "result in an unlawful crippling of the defendant companies."

The ruling cleared one of the hurdles for Altria Group Inc.'s plan to spin off Kraft Foods Inc.

But the Supreme Court also upheld key findings of the Miami trial court in the 12-year-old case known as Engle versus Liggett -- among them, that cigarette smoking causes cancer, heart disease and other ailments, and that tobacco companies marketed "defective and unreasonably dangerous" products.

The high court reinstated individual damage awards to two cancer patients -- $2.9 million to Mary Farnan and $4 million to the estate of Angie Della Vecchia, who died in 1999. But it upheld decertification of the class of plaintiffs, meaning smokers would have to sue individually, not as a group.

"As numerous trial and appellate courts have held, tobacco cases cannot be treated as class actions because liability must ultimately be decided on a case by case basis," William Ohlemeyer, vice president for Philip Morris USA, said in a statement.

Individual lawsuits against tobacco companies are seen as far less likely to succeed than class actions.

Joe Martyak, an official with the anti-smoking group American Legacy Foundation, said the ruling could prove a death knell for class actions against cigarette makers.

"I think it's bad news for public health and it's even worse news for smokers," he said. "The ruling underscores that Big Tobacco will literally be able to litigate to death a smoker's claim for justice."

Tobacco stocks helped boost the overall U.S. share market. Shares of Altria rose as high as $79.00. Shares of Reynolds American Inc. hit a new high of $120.50. Carolina Group , the tracking stock for Loews Corp.'s Lorillard Tobacco Co., jumped to an all-time high of $55.26. Shares of Vector Group went as high as $17.11.

A Miami jury ruled in 2000 that the tobacco companies deceived smokers about the dangers of cigarettes and ordered the companies to pay $145 billion to ailing Florida smokers, estimated to number 300,000 to 700,000.

The case, filed by Miami Beach pediatrician Howard Engle in 1994, was the first smokers' lawsuit to be certified as a class action.

Florida's Third District Court of Appeal overturned the verdict in 2003 and said Florida's settlement with the tobacco companies in a multistate lawsuit barred the awarding of punitive damages. It also decertified the class action.

The Supreme Court ruled that Florida's participation in the multistate settlement did not prevent ailing smokers from suing individually, and gave former members of the class action one year to file those claims.

Engle, who is now 87 and suffers from emphysema and chronic obstructive pulmonary disease, said he was disappointed.

"Not so much for me. I'm dying anyhow. I know that. But there are people who need a little money to take care of things," he said. "I have some insurance and a little money and wonderful family, so I'm OK."

The high court ruling eliminates the largest class-action liability hanging over the tobacco industry, said Charles Norton, co-portfolio manager of Mutuals Advisors Inc.'s Vice Fund, which owns shares in most of the tobacco companies.

"With this out of the way, I believe it relieves a lot of legal risk from the group," Norton said, who expects Altria to now spin off Kraft by the first half of 2007, if not sooner.

Matthew Myers, president of Campaign for Tobacco-Free Kids, said the ruling was not a clear-cut victory for the industry because it upheld a finding of wrongdoing by the companies.

Smokers who sue could benefit from the high court's approval of trial court decisions that smoking causes diseases and that cigarette companies sold defective products and concealed the truth about the dangers.

"With these findings, they're 90 percent on the way to winning these cases," said Stanley Rosenblatt, the Miami lawyer who sued the giant tobacco companies.

Rosenblatt said he had not decided whether to appeal to federal courts.

Defendants in the case included Altria's Philip Morris USA unit; the R.J. Reynolds Tobacco Co. and Brown & Williamson units of Reynolds American Inc.; the Lorillard Tobacco Co. unit of Loews Corp, and Vector Group's Liggett.