Nine years after tossing $10B verdict, Illinois Supreme Court agrees to review Price v. Philip Morris cigarette labeling case

By Bethany Krajelis | Sep 24, 2014

The Illinois Supreme Court will once again weigh in the Madison County case over cigarette labeling that has been smoldering in the state’s courts for more than a decade.

The justices today granted Philip Morris’ petition for leave to appeal the April ruling from the Fifth District Appellate Court, which reversed the lower court and effectively reinstated the $10.1 billion verdict in the lawsuit St. Louis attorney Stephen Tillery brought in 2000 on behalf of a class.

Believed to be the nation’s first consumer fraud suit against a tobacco company, the suit --Sharon Price v. Philip Morris -- accused Philip Morris of deceptively promoting health benefits of “light” and “lowered tar and nicotine” cigarettes.

Over the last 14 years, the lawsuit has been on a tour of Illinois’ court system that started in Madison County’s circuit court and has included repeat stops in the appellate court in Mt.  Vernon and Springfield, where the Supreme Court in 2005 overturned the multi-billion dollar bench verdict and ordered its dismissal.

The high court threw out the verdict after determining that Philip Morris, which is owned by Altria Group, couldn’t be held liable under the state’s Consumer Fraud Act for using “light” and “lowered tar and nicotine” terms because the Federal Trade Commission (FTC) allowed them.

In 2008, Tillery reignited the case by filing a petition under Section 2-1401 of the Illinois Code of Civil Procedure to seek relief from the Supreme Court’s dismissal of the verdict, putting the suit back where it first began in Madison County.

On behalf of the class, Tillery argued the Supreme Court had relied on factually inaccurate information in 2005 to reach the 4-2 ruling that overturned the $10.1 billion bench verdict since-retired Madison County Circuit Judge Nicholas G. Byron handed down in 2003.

In the petition and during an August 2012 hearing, Tillery also claimed the 2008 U.S. Supreme Court opinion in Altria Group v. Good, as well as statements by the FTC that same year, constituted “newly discovered evidence” that warranted relief.

The FTC in 2008 said it did not have a formal policy allowing use of “light” and “low tar” labeling, statements that Tillery claimed contradicts testimony from a witness in the 2003 trial that it did.

Attorneys for Philip Morris argued that relief couldn’t be granted because the evidence the plaintiffs were attempting to rely on occurred two years after the judgment was handed down in Price v. Philip Morris.

Madison County Circuit Judge Dennis Ruth in December 2012 denied Tillery’s petition seeking to reopen the case, finding that the plaintiffs “failed to show it is more probably true than not that the Illinois Supreme Court would not have ruled in Defendant’s favor” had they had access to the allegedly new evidence.

Given the suit’s history and its potential price tag, which includes nearly $2 billion in plaintiff attorneys’ fees, Ruth acknowledged his ruling would likely not mark the last stop for the case.

In his December order, Ruth wrote, “Plaintiffs maintain the Court should reinstate the previous ten billion dollar judgment while defendant maintains this Court can, at most, only set aside the Circuit Court’s December 18, 2006 order” dismissing the suit.

Even though his ruling made this dispute moot, Ruth stressed that “should either the Fifth District Appellate Court or the Illinois Supreme Court reverse this Order, that dispute may again be an issue. In that possibility the Illinois Supreme Court may, eventually, be called upon to rule on the issues they reserved for another day.”

Ruth was making a reference to a line in the Supreme Court’s 2005 opinion that now-Chief Justice Rita Garman wrote for the majority.

She noted that despite the importance of various questions briefed and argued by the parties in the case, the justices declined to address them because they resolved the appeal on the basis the claims were barred by the Consumer Fraud Act and said “these are issues for another day.”

Garman was joined in the majority by Justice Lloyd Karmeier, the now-late Justice Mary Ann McMorrow and retired Justice Thomas Fitzgerald. Justices Charles Freeman and Thomas Kilbride dissented. Karmeier wrote a special concurrence and Justice Robert Thomas did not participate.

In January 2014, the plaintiffs appealed Ruth’s ruling to the Fifth District and Philip Morris unsuccessfully sought direct appeal to the Supreme Court.

The Fifth District in its April ruling reversed Ruth’s decision to deny the plaintiffs’ petition seeking relief, saying he exceeded the scope of his Section 2-1401 review when he “attempted to predict how the supreme court would rule on the question of damages.”

The appeals panel –Justices Melissa Chapman,  Bruce Stewart and S. Gene Schwarm - said Ruth’s discussion of what the Illinois Supreme Court would have decided had it addressed certain issues is “inherently speculative in a way its discussion of the impact of the new information on the issue it actually did decide is not.”

“For these reasons, the order denying the petition for relief from judgment must be reversed,” Chapman wrote for the unanimous panel.

The Supreme Court today allowed Philip Morris’ petition seeking leave to appeal from the Fifth District’s ruling that effectively reinstated the $10.1 billion bench verdict. It is unclear when the court will hear arguments in the case.

Since last weighing in on the case, two of the four justices who voted to toss the verdict no longer sit behind the bench.

This time around, Justices Ann Burke and Mary Jane Theis will be weighing in on the case. Burke took over for McMorrow following her 2006 retirement Theis replaced Fitzgerald, who retired in 2010.

In addition to this case, the Supreme Court today agreed to hear arguments in 19 other cases -- 14 are civil in nature and six are criminal -- while denying nearly 400 petitions for leave to appeal.

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