Philip Morris USA, Inc. v. Scott

This application for a stay of judgment arose from an order by the Fourth Circuit Court of Appeal of Louisiana, in which the court held tobacco companies liable for defrauding a class of smokers by misleading them as to the addictive properties of nicotine and ordered the defendants to fund a 10-year, 241 million dollar smoking cessation program for the benefit of class members.  The U.S. Supreme Court granted a stay of judgment, finding that there was a reasonable probability that the Court would agree to hear the appeal, that there was a significant possibility that the Court would reverse the Fourth Circuit Court of Appeal of Louisiana's order on appeal, and that irreparable damage was likely to occur should the order be prosecuted pending appeal.  Specifically, the Court noted that the failure of the lower court to require each class member who would benefit from the smoking cessation program to prove reliance upon the tobacco companies' deception raised unique due process questions.

Philip Morris USA, Inc., et al. v. Scott, et al., 561 U.S. ____, 130 S. Ct. 3502, Supreme Court of the United States (2010).

  • United States
  • Sep 24, 2010
  • Supreme Court of the United States

Parties

Plaintiff

  • Others
  • Philip Morris USA, Inc.

Defendant

  • Gloria Scott
  • Others

Legislation Cited

Related Documents

Type of Litigation

Tobacco Control Topics

Substantive Issues

Type of Tobacco Product

None

"Applicants complain of many violations of due process, including (among others) denial of the opportunity to cross-examine the named representatives of the class, factually unsupported estimations of the number of class members entitled to relief, and constant revision of the legal basis for the plaintiffs' claim during the course of litigation. Even though the judgment that is the alleged consequence of these claimed errors is massive—more than $250 million—I would not be inclined to believe that this Court would grant certiorari to consider these fact bound contentions that may have no effect on other cases. But one asserted error in particular (and perhaps some of the others as well) implicates constitutional constraints on the allowable alteration of normal process in class actions. This is a fraud case, and in Louisiana the tort of fraud normally requires proof that the plaintiff detrimentally relied on the defendant's misrepresentations. 949 So. 2d, at 1277. Accordingly, the Court of Appeal indicated that members of the plaintiff class who wish to seek individual damages, rather than just access to smoking cessation measures, would have to establish their own reliance on the alleged distortions. Ibid. But the Court of Appeal held that this element need not be proved insofar as the class seeks payment into a fund that will benefit individual plaintiffs, since the defendants are guilty of a "distortion of] the entire body of public knowledge" on which the "class as a whole" has relied. Id., at Thus, the court eliminated any need for plaintiffs to prove, and denied any opportunity for applicants to contest, that any particular plaintiff who benefits from the judgment (much less all of them) believed applicants' distortions and continued to smoke as a result."