On March 20, the U.S. Supreme Court indicated it would not review a California court’s decision to award $50 million in punitive damages to the estate of a two-pack-a-day cigarette smoker who developed cancer.
Richard Boeken of Topanga, California, who started smoking at age 13, sued Philip Morris USA five years ago, claiming the cigarette producer was guilty of fraud, negligence, misrepresentation, and selling a defective product.
In 2001, the Los Angeles County Superior Court ruled in Boeken’s favor. The jury initially set the punitive award at $3 billion; the trial court judge reduced the punitive damages to $100 million. Later that year, Boeken passed away at age 57.
On April 1, 2005, the California Court of Appeals reduced the punitive damages to $50 million. Both Philip Morris USA and Boeken’s widow appealed that decision to the California Supreme Court, which rejected the appeals on August 10, 2005. Both parties then appealed to the U.S. Supreme Court.
Consistent with Precedents
“I’m not surprised that the Supreme Court didn’t hear the appeal,” said Robert Levy, a senior fellow in constitutional studies at the Cato Institute, a Washington, DC-based think tank. He said the final damage amount was consistent with an earlier Supreme Court decision, State Farm v. Campbell (2003), which ruled punitive damages could not exceed 10 times the amount of the compensatory damages. In Boeken’s case, the compensatory damages were set at $5.5 million.
“The ratio [in the Boeken case] is consistent,” Levy said, “and I doubt that the Court is going to revisit [State Farm].”
Hans Bader, counsel for special projects at the Competitive Enterprise Institute, a Washington, DC-based think tank, also said he was not surprised.
“The Supreme Court turns down 99 percent of those seeking an appeal,” Bader said.
Issues Unresolved
“The Supreme Court can only jump in if there are federal issues, and that wasn’t the weirdest aspect of this case,” Bader explained.
The most troubling aspect of Boeken’s case, Bader said, was that the trial court had excluded relevant information about Boeken from the hearings. Bader said Boeken previously had been convicted of possessing stolen goods and wire fraud but the evidence was ruled inadmissible.
“I suspect the jury would have been less likely to believe [Boeken’s] claims that he was a victim of fraud, if they had known about his previous fraud,” Bader said. “Philip Morris USA did not get a fair trial, but we don’t have a right to a perfect trial.”
Bader also said he was concerned about California’s overly broad definition of fraud.
“Boeken claimed fraud and said that he believed that cigarettes were good for him and that the Surgeon General’s warnings were only his personal vendetta,” Bader explained. “This case may not be fraud outside of California.”
Tobacco Company Hopeful
Bader said he believes the facts of the case should not have led to such large punitive damages.
“It seems to me that the constitutional maximum shouldn’t have applied,” Bader said.
While Philip Morris USA would have liked a different result in the case, the company is not greatly troubled by the precedent.
“Philip Morris has a very good record defending itself at trial in these types of cases,” said John Sorrels, communications director for Altria Corporate Services, Inc., Philip Morris USA’s parent company. “In fact, since the Boeken verdict it has won the last five individual smoking cases.”
Michael Coulter ([email protected]) teaches political science at Grove City College in Pennsylvania.
For more information …
For details of the Boeken decisions, visit http://www.courtinfo.ca.gov/courts/courtsofappeal/ and search for “Boeken.”
