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Philip Morris seeks denial of second request to recuse Karmeier from review of $10B tobacco case

By Bethany Krajelis | Mar 3, 2015

A second request to bump Illinois Supreme Court Justice Lloyd A. Karmeier from the bench during the court's impending review of the decade-old, $10.1 billion legal battle over light cigarette labeling "is just as cynical and dishonest as [the plaintiffs'] first motion was," Philip Morris USA asserts in a recent filing to the high court.

In a memorandum filed late last month, Philip Morris describes the arguments and assertions lodged by the plaintiffs in their Feb. 9 motion for Karmeier's recusal or disqualification as absurd, baseless, false, irresponsible and “to put it bluntly, hogwash.”

As such, the tobacco company asserts, the plaintiffs’ motion should be denied just like their first one was in September, when the court agreed to hear arguments in Sharon Price v. Philip Morris and Karmeier, who was seeking retention at the time, wrote a 16-page order to explain why he wasn’t going to grant the plaintiffs’ recusal request.

“Having failed to defeat Justice Karmeier at the polls, plaintiffs have filed another motion to recuse or disqualify him that is just as cynical and dishonest as their first motion was,” Philip Morris' memo states. "Remarkably, plaintiffs say nary a word about the $2 million campaign their lawyers spearheaded to defeat Justice Karmeier’s retention effort-- a campaign so vicious and deceptive that a federal judge described it as an 'affront to an independent judiciary.’”

The Price case has been bouncing between the state’s courts ever since a Madison County judge in 2003 handed down a $10.1 billion verdict against Philip Morris in a lawsuit St. Louis attorney Stephen Tillery brought in 2000 on behalf of consumers who alleged they were deceived by the company’s use of “light” and “low tar” labeling.

In 2005, the Illinois Supreme Court threw out the multi-billion dollar judgment after determining the tobacco giant couldn’t be held liable under the state’s Consumer Fraud Act for using those terms because the Federal Trade Commission (FTC) allowed them.

Karmeier was one of four justices who made up the majority in the Price ruling. Two justices dissented and one did not participate.

On behalf of the plaintiffs, Tillery revived the case in 2008 by filing a petition under Section 2-1401 of the Illinois Code of Civil Procedure, seeking relief from the Supreme Court’s dismissal of the verdict based on newly-discovered evidence.

Madison County Circuit Judge Dennis Ruth refused to reopen to the case in late 2013, and after the high court rejected Philip Morris’ request for a direct appeal, the Fifth District Appellate Court in April reversed Ruth’s denial, effectively reinstating the $10.1 billion bench verdict.

The high court in September granted the tobacco company’s appeal of the Fifth District ruling and on the same day it agreed to hear arguments in the case, Karmeier penned an order to explain why he was denying the plaintiffs’ recusal request.

Karmeier made it clear he wasn’t going to step aside because he believed the plaintiffs failed to provide any evidence to back up their claims he voted to overturn the verdict because Philip Morris funneled donations to his 2004 campaign coffers.

They argued Karmeier needed to recuse himself because a number of factors – the campaign donations, as well as the media attention they got and their alleged implications on judicial impartiality, and his 2005 vote-- created “an objective and reasonable public perception” of bias in favor of Philip Morris.

“In reality, the notion that movant (Philip Morris) was responsible for financing my run for office ten years ago is just that, a notion,” Karmeier wrote in his September order. “It is based entirely on conjecture, innuendo and speculation which, once started, took on a life of its own for a while in the press.”

On Feb. 9, the plaintiffs filed a second request for the justice’s recusal or disqualification, alleging that comments attributed to Karmeier on election night in a downstate newspaper article allegedly show he intends to vote against them and thus, requires him to bow out of the court’s impending review.

The plaintiffs further argued his recusal is necessary because Philip Morris’ parent company, Altria Group, apparently funneled donations to Karmeier’s retention campaign through an entity of the Republican State Leadership Committee (RSLC).

In its Feb. 26 memo, Philip Morris points out the plaintiffs’ lawyers failed to mention that they-- as well as lawyers representing the plaintiffs in a pending federal case stemming from the high court’s reversal of a $1 billion award against State Farm Insurance-- donated the majority of the $2 million Campaign 2016 spent trying to unseat Karmeier.

Philip Morris contends the existence and timing of the anti-retention campaign provide a lot of context to Karmeier’s election night remarks at the crux of the plaintiffs’ second recusal request.

The article published in The Southern Illinoisan notes that while the retention race was close to call on election night, Karmeier said he felt encouraged with the number of “yes” votes in and that he hadn’t been optimistic with all the negative ads.

The article goes on to provide a quick summary about the anti-retention effort and said, “The judge said the lawyers could stand to gain financially if he were ousted from the bench. One less judge to vote against a judgment in either case could net plaintiffs’ a substantial sum -- $1.77 billion in legal fees for a $10 billion settlement.”

“It’s the size of these fees that is distorting the system,” Karmeier was quoted as saying in the article. “The money is so substantial."

Contrary to the plaintiffs’ contention that these statements show Karmeier has already made his mind up in the Price case, Philip Morris says that “No reasonable reader would have read his statement as indicating that he had prejudged the outcome in Price or was biased against either plaintiffs or their counsel."

The tobacco company goes on to call the plaintiffs’ expert’s assertion that Karmeier’s statement expresses his intent to rule against the plaintiffs “hogwash” and notes the justice's comments were his opinions and a recognition of the obvious.

And, the company adds, the facts support Karmeier’s opinion: that “something is terribly out of joint when the only opposition to a Supreme Court Justice’s retention campaign is spearheaded by lawyers with a huge financial interest in the outcome of a case pending before the Court.”

Philip Morris also contends the plaintiffs’ allegation it bankrolled the justice’s retention campaign is completely false, saying it “did not contribute a penny, either directly or indirectly, to support Justice Karmeier’s retention campaign."

According to its memo, Philip Morris’ affiliate, Altria Client Services, has contributed to RSLC for years and gave $731,023 to RSLC’s Illinois entity between March 2013 and October 2014 with the restriction it not be used for state judicial races.

Pointing to the fact Altria’s last contribution was posted on Oct. 8 and the anti-retention campaign against Karmeier didn’t surface until an attack ad aired on Oct. 18, Philip Morris says "Absent a crystal ball, Altria could not have known at the time it made its contributions to the RSLC that Justice Karmeier’s retention campaign would be contested, let alone that the RSLC would play any role in supporting him.”

It is unclear when the recusal request will be ruled on or when Supreme Court will hear arguments in the Price case.

Philip Morris’ recent memo was filed by Chicago attorney Michele Odorizzi of Mayer Brown, who is representing the company along with James R. Thompson, George C. Lombardi and Matthew R. Carter of Winston & Strawn in Chicago; Larry Hepler and Beth Bauer of HeplerBroom in Edwardsville; Kevin M. Forde of Forde Law Offices in Chicago and Washington D.C. attorneys Lisa S. Blatt and Sarah M. Harris.

Besides Tillery, the plaintiffs in Price are being represented by Robert L. King, George A. Zeles, Maximilian C. Gibbons and Matthew C. Davies of Korein Tillery in St. Louis; Joseph A. Power Jr. of Power Rogers & Smith in Chicago; and South Carolina attorneys Michael J. Brickman and Nina Hunter Fields. 

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