Largest punitive damages in U.S. history

“Philip Morris Ordered to Pay $28 Billion to Smoker.” I had glanced indifferently past this headline at the Los Angeles Times web site, assuming it had said $28 million. Then I looked again, and saw it said $28 billion. Thinking it had to be a typo, I opened the story, and there was no mistake. The jury had awarded the plaintiff, a 64-year-old woman suffering from lung cancer, $28 billion in damages. Though legal experts expect the amount to be reduced substantially by the judge, as it now stands it is the largest punitive award given to an individual in any case in U.S. history.
Posted by Lawrence Auster at October 05, 2002 10:38 AM | Send

While I’m no legal expert, it seems that this kind of decision has potentially catastrophic consequences.

Damages are now being awarded for actions which were perfectly legal at the time they were carried out. Surely this effective retroactive legislation is a violation of fundamental traditional legal thinking. If retroactive law is accepted, none of us can be assured that anything we now do (say, posting dissident messages in forums like this) will not be punished later.

In particular, this makes a great deal of economic initiative very risky. Why should the imposition of damages on corporations, at levels high enough to bankrupt those corporations, stop at tobacco companies? Why not companies selling any kind of food current medical opinion holds to be unhealthy, for example? The scope for such litigation is potentially practically unlimited. Long-term property rights are as a result rendered highly uncertain.

In the nearer term, with regard to tobacco more specifically, the effect of this kind of decision may be to shut down legal tobacco manufacture and thereby start up a whole new illegal tobacco industry, offering vast new opportunities to organized crime.

Attacking tobacco companies strikes me as an example of majority tyranny against an unpopular minority, at the hands of the branch of the government—the judiciary—that is supposed to protect against majority tyranny. Singling out the corporations in this instance seems to be arbitrary. Why not ordinary tobacco farmers, or the governments who failed to pass laws restricting tobacco production despite available scientific evidence? Instead, the governments have been claiming damages from the tobacco firms!

Posted by: Ian Hare on October 5, 2002 2:46 PM

It could also be seen as an indirect form of socialism. Out-and-out socialism is discredited today; even the left recognizes that the production of wealth is dependent on the free market and the profit motive. But the left still resents those who actually produce wealth and it still wants the advantages of socialism. So it leaves private businesses in existence, while appropriating their earnings through law suits.

Posted by: Lawrence Auster on October 5, 2002 3:50 PM

The jury system is a key element of self-government. This kind of award means that the jury system is breaking down. It furthers the abolition of self-government.

Posted by: Jim Kalb on October 6, 2002 9:12 AM
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