Blue Cross and Blue Shield of New Jersey v. Philip Morris USA
Twenty health insurance plans filed suit against defendant tobacco companies seeking to recover costs of providing health care to plan subscribers as a result of medical conditions causally connected to, or exacerbated by, tobacco use. On appeal of the trial court's denial of defendants' motion for judgment as a matter of law, the Appellate Court held that health care cost recovery claim was improper because it failed to name the identities and claims of its insureds for whom it sought recovery. Regarding plaintiff's claim for damages on its own behalf, the Court held: (1) the plaintiff did not lack standing to sue under the consumer protection statute; (2) the jury properly conditioned liability on defendants' fraudulent misrepresentations, as opposed to defendants' failure to warn; (3) sufficient evidence existed to support the jury's verdict; (4) sufficient evidence existed to support the jury's assessment of damages; (5) the defendants' rights to a jury trial were not violated by the presence or absence of certain types of evidence; and (6) the defendants' due process rights were not violated by the use of aggregate, rather than individualized, evidence of harm. The court delayed resolution of the remaining issues on appeal pending the return of certification of two questions to the New York Court of Appeals.
Blue Cross and Blue Shield of New Jersey, Inc., et al. v. Philip Morris USA, Incorporated, et al., 344 F.3d 211 (2d Cir. 2003).
BCBSD, Inc., (d/b/a Blue Cross Blue Shield of Delaware)
Blue Cross and Blue Shield of Florida, Inc., and its affiliates, Health Options, Inc. and Capital Group Health Services of Florida, Inc., (d/b/a Capital Health Plan)
Blue Cross and Blue Shield of New Jersey, Inc., now known as Horizon Healthcare Services, Inc, (d/b/a Blue Cross Blue Shield of New Jersey, Horizon Blue Cross Blue Shield, Horizon Blue Cross Blue Shield of New Jersey, and Horizon BCBSNJ), and its subsidiary, Horizon Health Care of New Jersey, Inc. (d/b/a Medigroup of New Jersey, HMO Blue and Horizon HMO)
Blue Cross and Blue Shield of North Carolina, and its subsidiaries Personal Health Plan of North Carolina, Inc. and Health Maintenance Organization of North Carolina
Blue Cross and Blue Shield of Vermont
Blue Cross Blue Shield of Georgia, Inc., and it affiliates HMO Georgia, Inc.
Blue Cross Blue Shield of Mississippi, A Mutual Insurance Company, and its affiliate HMO of Mississippi, Inc.
Bluecross and Blueshields of Massachusetts, Inc.
Bluecross Blue Shield of Michigan, and its subsidiary, Blue Care Network of Michigan Incorporated
California Physicians' Services, (d/b/a Blue Shield of California) and its affiliate, CareAmerica Life Insurance Company
Carefirst of Maryland, Inc., and its subsidiary Free State Health Plan Inc.
Empire Blue Cross and Blue Shield
Excellus, Inc., and its subsidiaries, The Finger Lakes Companies, Inc., (and its subsidiaries, Finger Lakes Health Insurance Company, Inc. and Finger Lakes Medical Insurance Company, Inc.), Excellus of Central New York, Inc. (and its subsidiary Excellus Health Plan, Inc.) and Upstate Holding Company, Inc. (and its subsidiary, Utica-Watertown Health Insurance Co., Inc.)
Group Hospitalization & Medical Services, Inc., d/b/a CareFirst BlueCross BlueShield and subsidiary
HealthNow New York, Inc., (d/b/a Blue Cross and Blue Shield of Western New York, Blue Shield of Northern New York)
Louisiana Health Service & Indemnity Company, Inc., (d/b/a Blue Cross and Blue Shield of Louisiana)
Mountain State Blue Cross & Blue Shield, Inc., and its subsidiary, Parker Benefits, Inc., (d/b/a Super Blue HMO)
New Hampshire-Vermont Health Service, (d/b/a Blue Cross Blue Shield of New Hampshire) and its subsidiaries, Matthew Thornton Health Plan, Inc., Matthew Thornton Insurance, Inc. and Health Initiatives, Inc.
Trigon Insurance Company, (d/b/a Trigon Blue Cross Blue Shield) and its affiliates, Physicians Health Plan, Inc., Healthkeepers, Inc., Priority Health Care, Inc., Peninsula Health Care, Inc., and Trigon Administrators, Inc.
Governments or insurance agencies may seek reimbursement from the tobacco companies for health care costs related to tobacco. The most famous example is the case brought by individual states in the U.S.A. that resulted in the Master Settlement Agreement.
Measures to regulate the marketing on tobacco packages. This includes both bans on false, misleading, deceptive packaging, as well as required health warnings on packaging.
(See FCTC Art. 11)
A violation of the right to procedural fairness. For example, a party may claim that a government agency did not consult with public or stakeholders when issuing regulations.
Any violation of a law designed to ensure fair trade, competition, or the free flow of truthful information in the marketplace. For example, a government may require businesses to disclose detailed information about products—particularly in areas where safety or public health is an issue.
The court might consider procedural matters without touching the merits of the case. These might include: improper joinder, when third parties, such as Health NGOs or government officials, seek to become parties to the suit; lack of standing, where a plaintiff fails to meet the minimum requirements to bring suit; lack of personal jurisdiction, where the court does not have jurisdiction to rule over the defendant; or lack of subject matter jurisdiction, where the court does not have jurisdiction over the issue at suit.
Type of Tobacco Product
None
Limitations regarding the use of quotes The quotes provided here reflect statements from a specific decision. Accordingly, the International Legal Consortium (ILC) cannot guarantee that an appellate court has not reversed a lower court decision which may influence the applicability or influence of a given quote. All quotes have been selected based on the subjective evaluations undertaken by the ILC meaning that quotes provided here may not accurately or comprehensively represent a given court’s opinion or conclusion, as such quotes may have originally appeared alongside other negative opinions or accompanying facts. Further, some quotes are derived from unofficial English translations, which may alter their original meaning. We emphasize the need to review the original decision and related decisions before authoritatively relying on quotes. Using quotes provided here should not be construed as legal advice and is not intended to be a substitute for legal counsel on any subject matter in any jurisdiction. Please see the full limitations at https://www.tobaccocontrollaws.org/about.
"Appellants mischaracterize the portions of Dr. Harris' testimony regarding the assumptions behind his model that they cite to support their contentions. According to that testimony, Dr. Harris calculated and testified about two types of damages. The first type of damages stemmed from defendants' alleged failure to innovate as the result of an industry-wide conspiracy not to compete on the basis of health claims. Dr. Harris testified that he believed that if the defendants had not engaged in such a conspiracy, they would have competed with one another to make safer cigarettes. It was in the context of discussing a world with such innovation that Dr. Harris testified that tobacco companies would have publicized health information about cigarettes in an effort to show that their own products would minimize negative health consequences. The second type of damages Dr. Harris calculated were damages resulting from defendants' alleged
dissemination of misinformation regarding the health effects of cigarettes.8 Dr. Harris did not testify that
his calculations as to these damages were based on an assumption that the defendants would have waged an anti-smoking campaign or any assumption that the defendants themselves would have provided the public with accurate information. While Dr. Harris did assume "better information" and "more correct information about smoking and less misinformation" when calculating the damages that resulted from Appellants' dissemination of misinformation, this does not mean that Empire provided insufficient proof of damages to support the jury verdict. Dr. Harris appears to have assumed that in the absence of the misinformation provided by defendants, there would have been more accurate information. This is not an unreasonable assumption. The proliferation of false information can well have the effect of stifling the proliferation of accurate information. Similarly, many of the examples Empire gave of defendants providing misinformation were in response to specific requests for information (e.g., testimony before Congress and responses to interview questions). It is not unreasonable to assume that in such situations, had defendants not given misinformation, they would have given accurate information. In the end, however, it was the jury's responsibility to determine whether or not Dr. Harris' assumptions were reasonable and whether his estimates were reliable, and to evaluate the damages information before it. Given that defense counsel extensively explored on cross-examination the assumptions behind Dr. Harris' calculations, we find no reason to believe that the jury was not able to evaluate Dr. Harris' testimony in this way."
Limitations regarding the use of quotes The quotes provided here reflect statements from a specific decision. Accordingly, the International Legal Consortium (ILC) cannot guarantee that an appellate court has not reversed a lower court decision which may influence the applicability or influence of a given quote. All quotes have been selected based on the subjective evaluations undertaken by the ILC meaning that quotes provided here may not accurately or comprehensively represent a given court’s opinion or conclusion, as such quotes may have originally appeared alongside other negative opinions or accompanying facts. Further, some quotes are derived from unofficial English translations, which may alter their original meaning. We emphasize the need to review the original decision and related decisions before authoritatively relying on quotes. Using quotes provided here should not be construed as legal advice and is not intended to be a substitute for legal counsel on any subject matter in any jurisdiction. Please see the full limitations at https://www.tobaccocontrollaws.org/about.
Twenty health insurance plans filed suit against defendant tobacco companies seeking to recover costs of providing health care to plan subscribers as a result of medical conditions causally connected to, or exacerbated by, tobacco use. On appeal of the trial court's denial of defendants' motion for judgment as a matter of law, the Appellate Court held that health care cost recovery claim was improper because it failed to name the identities and claims of its insureds for whom it sought recovery. Regarding plaintiff's claim for damages on its own behalf, the Court held: (1) the plaintiff did not lack standing to sue under the consumer protection statute; (2) the jury properly conditioned liability on defendants' fraudulent misrepresentations, as opposed to defendants' failure to warn; (3) sufficient evidence existed to support the jury's verdict; (4) sufficient evidence existed to support the jury's assessment of damages; (5) the defendants' rights to a jury trial were not violated by the presence or absence of certain types of evidence; and (6) the defendants' due process rights were not violated by the use of aggregate, rather than individualized, evidence of harm. The court delayed resolution of the remaining issues on appeal pending the return of certification of two questions to the New York Court of Appeals.