By Bob Van Voris - Dec 3, 2011 12:01 PM GMT+0700
Altria Group Inc. (MO)’s Philip Morris USA must pay $47.7 million to Oregon, the state’s Supreme Court ruled, rejecting arguments from the biggest U.S. cigarette maker that the tobacco industry’s landmark 1998 settlement with 46 states barred the recovery.
The Oregon Supreme Court decided yesterday that Philip Morris, a unit of Richmond, Virginia-based Altria, must pay the state 60 percent of a $79.5 million punitive damages award, plus interest, in a smoking-related wrongful death claim.
A jury in 1999 awarded that amount, in addition to compensatory damages, to the estate of Jesse Williams, a smoker who had died of lung cancer. An Oregon law cited in the court’s ruling requires that 60 percent of punitive damages awards go to the state.
Philip Morris claimed the state released its claim by signing the $206 billion multistate settlement agreement resolving health care cost-recovery lawsuits against U.S. cigarette makers.
“We believe that the Oregon Supreme Court misapplied the law and reached an erroneous result,” said Murray Garnick, Altria Client Services senior vice president and associate general counsel. “As the lower court recognized, the state released its claims to any punitive damages when it signed the Master Settlement Agreement.”
The case is Williams v. R.J. Reynolds, SC S059014, Oregon Supreme Court (Salem).
To contact the reporter on this story: Bob Van Voris in New York at rvanvoris@bloomberg.net
To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net
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