R.J. Reynolds wins reversal of fraud judgment in Engle progeny case
Clients R.J. Reynolds Tobacco Company
Jones Day represented R.J. Reynolds Tobacco Company in an Engle progeny case brought by the estate of deceased smoker Evelyn Whitmire. Engle progeny cases proceed on the basis of certain jury findings that survived the Florida Supreme Court's 2006 decision to decertify a statewide smoker class action. The usual claims in these cases are strict liability, negligence, fraudulent concealment, and civil conspiracy to fraudulently conceal. In the Whitmire case, a jury found for the plaintiff on all four claims, assigned 33 percent of fault to the smoker, and awarded $3 million in compensatory damages. Under Florida law, awards for strict liability and negligence are subject to reduction to reflect comparative fault; awards for fraudulent concealment are not. Because the plaintiff prevailed on concealment claims, the trial court entered judgment in the full amount of $3 million.
The concealment claims depended on a jury finding of reliance, i.e., that the smoker would have avoided injury had the concealed information not been concealed. Following the First District Court of Appeal's decision in R.J. Reynolds Tobacco Co. v. Martin, 53 So. 3d 1060 (Fla. Dist. Ct. App. 2010), many courts throughout the state have allowed plaintiffs to carry their burden on reliance on the strength of an inference that smokers rely on pervasive cigarette advertising. This had the effect of making it easier for plaintiffs to prevail on what are ordinarily difficult-to-prove claims.
In Whitmire, Jones Day persuaded the same court that decided Martin to clarify that an inference based on the pervasiveness of advertising cannot establish reliance. Martin is properly understood to stand for the uncontroversial proposition that a plaintiff can use circumstantial evidence to establish reliance. But that circumstantial evidence must go well beyond an inference that a smoker must have relied because cigarette advertising was pervasive. Instead, plaintiffs must show how individual smokers relied on tobacco companies' statements. If they use circumstantial evidence, that evidence "must establish individualized reliance by the plaintiff, and this cannot be shown through mere presentation of general evidence of the plaintiff's life and behavior."
Because Whitmire's estate failed to show reliance, the appellate court reversed and directed entry of judgment in R.J. Reynolds Tobacco Co.'s favor on the concealment claims. This led to a reduction of the damages award to reflect the smoker's 33 percent fault.
R.J. Reynolds Tobacco Co. v. Whitmire, No. 1D17-1986 (Fla. 1st DCA)