Courts split on state tobacco class actions.

Two East Coast courts handed tobacco plaintiffs a victory and a defeat in October, offering few clues about the future of tobacco class action litigation.

The cases were filed in 1996 after the Fifth Circuit dismissed a massive national class action of nicotine-addicted smokers. (Castano v. American Tobacco Go., Inc., 84 F.3d 734 (5th Cir. 1996).) The coalition of more than 60 plaintiff law firms that had signed on to pursue the national case immediately began filing smaller class actions in state courts around the country.

In the first two rulings on the statewide suits, a federal judge in Pennsylvania and a state judge in New York reached opposite conclusions about whether the cases were appropriate for class certification.

In Pennsylvania, where the case was removed from state to federal court, District Judge Clarence Newcomer reversed the court's prior decision to certify a class of more than 1 million smokers seeking a fund for medical monitoring. He cited new evidence as the reason for the reversal. (Barnes v. American Tobacco Go., Inc., No. 96-5903, 1997 U.S. Dist. LEXIS 16181 (E.D. Pa. Oct. 17, 1997).)

Although attorneys for the smokers had recast the case as a medical monitoring claim to minimize individual issues, Newcomer concluded that the "highly individualistic" addiction question, as well as problematic causation issues, would still have to be resolved.

"When the court looks ... to determine how this case would be tried, it is obvious that the litigation is unmanageable as a class action and would ultimately splinter into individual issues, which would have to be tried separately," Newcomer wrote.

Russ Herman, a New Orleans lawyer who is a member of the plaintiffs' legal team, said the judge did "a disservice to the system" by decertifying the class only a week before the scheduled trial date. "if you're going to reach a decision like that, it's in the public's best interest that it not be reached at the last moment" after both sides have spent large amounts of time and money preparing for trial, said Herman, a former ATLA president.

Things went the other way in New York where state Supreme Court Justice Charles Ramos granted certification to a class of smokers suing tobacco companies for fraud under a state consumer protection statute. (Small v. Lorillard Tobacco Co., Inc., No. 110949/96 (N.Y., N.Y. County Sup. Ct. Oct. 28, 1997).)

The class includes more than 1 million New Yorkers who have been buying cigarettes since 1980, the year the legislature allowed citizens to bring lawsuits under the statute. The plaintiffs claim the industry engaged in deceptive trade practices and fraudulently hooked smokers by concealing that nicotine is addictive. The case seeks reimbursement from tobacco companies for the money the plaintiffs have spent buying cigarettes.

Ramos noted it was unlikely smokers could afford to bring individual suits for the relatively low damages involved: "The court is convinced that the class action mechanism is the only means by which a claim challenging the sales practices of defendants will ever be adjudicated."

Ramos distinguished the New York class action from Castano and other cases involving health-related issues. In a consumer-fraud case, "liability will not depend on whether cigarettes cause a particular plaintiff disease or personal injury," he wrote. "Rather, the central issue is whether plaintiffs and the class members can recoup the money they spent in a transaction that was purportedly riddled with fraudulent activities."

He added that the issue of nicotine addiction "is a red herring because damages are to be measured by the cost of the cigarettes purchased, not by the harm the plaintiffs suffered from smoking."

Richard Daynard, chair of the Boston-based Tobacco Products Liability Project, agreed with Ramos's finding, adding that addiction is also a red herring in the Pennsylvania case.

"It seems insane to prevent the case from going forward on the basis that you're not sure in advance who is addicted and who isn't," Daynard said. "That would be a decision made in due course by a physician" for each claimant after a medical monitoring program was implemented.

Similar class actions are pending in more than a dozen other states.

"The real lesson [of these decisions] is that there are no easy tobacco cases," said Herman. "They're difficult, they're costly, and they're time consuming. The other lesson is that we don't intend to quit. There are 65 law firms still dedicated to moving forward against the tobacco companies. We're going to continue to fight."