Too Costly an Appeal
When it comes to civil lawsuits, tobacco companies are high on the list of disliked defendants. That makes it even more important that judges be vigilant in making sure that cigarette makers, like other unpopular parties, are given the full protection of constitutional due process. Mindful of that, an Illinois trial court acted wrongly when it required Philip Morris to post a $12 billion bond before it could appeal an adverse judgment.
On March 21, Judge Nicholas Byron of Madison County, Ill., found Philip Morris, now a subsidiary of the virtuous-sounding Altria, liable in a class-action lawsuit. The plaintiffs, more than a million smokers, convinced the judge that despite federally mandated warnings, they had been fraudulently misled by Philip Morris into believing that light and low-tar cigarettes were less harmful. The
judge awarded them $7.1 billion in damages, their lawyers $1.78 billion and Illinois $3 billion. He then set the appeal bond required at the total liability, plus interest.
Whatever the merits of the underlying decision, it is absurd to require someone — even a cigarette manufacturer — to put up $12 billion to file an appeal. That is the kind of ruling that erodes the credibility of our legal system.
Even if Philip Morris fails to overturn the judge's ruling on appeal, it stands a good chance of getting those damages reduced. Yet in making an appeal so prohibitively costly — the company claims that it would have to file for bankruptcy to post it — Judge Byron renders the right to an appeal nearly meaningless, thus violating the defendant's due process rights. The plaintiffs may hope that the situation forces Philip Morris to settle now, but such pressure would be akin to extortion.
Things get even stranger, as they usually do when tobacco is involved. It turns out that this unpopular defendant does have some powerful allies, if not exactly friends: most of the states that have successfully sued the industry and obtained a $246 billion settlement. Many state governments, strapped for cash, have borrowed against those expected payments. Judge Byron has managed to underscore the degree to which states have become hooked on tobacco, and their paradoxical interest in seeing cigarette makers like Philip Morris continue to prosper. Its bankruptcy would imperil the ability of states to continue plugging their budget gaps with settlement revenues. California has already had to put off a mid-April $2.3 billion bond offering backed by its share of the tobacco settlement.
Many states will now be filing legal briefs and lobbying Illinois officials on Philip Morris's behalf. Still, the terms of the appeal bond should not be struck down to ameliorate states' fiscal crises, but rather to uphold principles of due process.
nytimes.com |
