March 24, 2002 - Morris to Challenge Ore Tobacco Award

Phillip Morris will attempt to slash a $150 million punitive damage award made by an Oregon jury to the estate of a woman who died at the age of 53 after switching to low-tar cigarettes when attempts to kick the habit altogether were unsuccessful.

The tobacco company said the award was not justified because it was legally out of proportion to the relatively paltry $168,500 in compensatory damages awarded Friday to the estate of Michelle Schwarz.

"Even if the jury believed Philip Morris was liable for punitive damages, there must be some reasonable relationship between the compensatory damage and punitive damage amounts. Clearly, that hasn't happened in this case," said Phillip Morris U.S.A. Vice President William S. Ohlemeyer.

A jury in Portland announced Friday after five days of deliberations that it had awarded the damages to Schwarz's family, including her husband, Dr. Richard Schwarz.

The awards were the first ever assessed in a case involving the marketing of low-tar cigarettes, which the Schwarz attorneys characterized as lulling smokers into a false sense of security.

"The fact is, low-tar cigarettes are a fraud," declared plaintiff's attorney Lawrence Wobbrock. "They do not provide a health benefit."

Wobbrock told the Oregonian Friday that tobacco companies actually are able to keep smokers hooked through marketing that allegedly falsely promises that products with reduced tar have fewer negative health effects.

"They are really intercepting potential quitters," he opined.

Phillip Morris maintained that there were never any claims made that smoking any type of cigarette was safe, and that Schwarz, who was a nurse and the wife of a physician, should have been well award of the hazards.

"Michelle Schwarz was fully aware of the risks of smoking when she began smoking as an 18-year-old nursing student; she chose to accept those risks by continuing to smoke; and, by law, the jury should have found her solely responsible for her actions," Ohmeyer said. "Philip Morris U.S.A. did not cause Mrs. Schwarz to begin smoking, and nothing the company said or did prevented her from quitting."

Ohlemeyer said there were other technical reasons why the punitive damages should be reduced. He said that the U.S. Supreme Court had suggested a 4 to 1 ratio between punitive and compensatory damages appeared to be in line with the Constitution's definition of "reasonable," but the ratio of the Oregon award was closer to 900 to 1.

Phillip Morris planned to file an appeal if the award was not reduced on the grounds that documents submitted as exhibits had been improperly marked up by the plaintiff's attorneys in order to draw the jurors' attention to points they wanted to highlight.

"We immediately asked Judge (Roosevelt) Robinson to declare a mistrial, and he refused. These errors, in addition to other legal errors committed by the court during the trial, clearly should have resulted in a mistrial," said Ohlemeyer.

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