Graham v. R.J. Reynolds Tobacco Co.

• Citation: 857 F.3d 1169
• Decision Date: 18 May 2017
• Docket Number: No. 13-14590,13-14590
• Parties: Theresa GRAHAM, as PR of Faye Dale Graham, deceased, Plaintiff-Appellee, v. R.J. REYNOLDS TOBACCO COMPANY, individually and as successor by merger to the Brown and Williamson Tobacco Corporation and the American Tobacco Company, Philip Morris USA, Inc., Defendants-Appellants.
• Court: United States Courts of Appeals. United States Court of Appeals (11th Circuit)

857 F.3d 1169

Theresa GRAHAM, as PR of Faye Dale Graham, deceased, Plaintiff-Appellee,

v.R.J. REYNOLDS TOBACCO COMPANY, individually and as successor by merger to the Brown and Williamson Tobacco Corporation and the American Tobacco Company, Philip Morris USA, Inc., Defendants-Appellants.

No. 13-14590

United States Court of Appeals, Eleventh Circuit.

May 18, 2017

Elizabeth Joan Cabraser, Jordan S. Elias, Richard M. Heimann, Kent L. Klaudt, Sarah Robin London, Scott Purington Nealey, Robert J. Nelson, Lieff Cabraser Heimann & Bernstein, LLP, SAN FRANCISCO, CA, Samuel Issacharoff, New York University School of Law, Jason L. Lichtman, Lieff Cabraser Heimann & Bernstein, LLP, NEW YORK, NY, Frederick C. Baker, Rebecca M. Deupree, Lance V. Oliver, Motley Rice, LLC, MOUNT PLEASANT, SC, Kathryn E. Barnett, Law Office of Morgan & Morgan, Kenneth S. Byrd, Andrew R. Kaufman, Lieff Cabraser Heimann & Bernstein, LLP, NASHVILLE, TN, Janna M. Blasingame, Stephanie J. Hartley, Richard Lantinberg, Edward I. Warren, Norwood Wilner, The Wilner Firm, PA, Charles Easa Farah, Jr., Farah & Farah, PA, JACKSONVILLE, FL, Donald Alan Migliori, Motley Rice, LLC, PROVIDENCE, RI, for Plaintiff-Appellee.

Stephanie Ethel Parker, Jason Todd Burnette, David M. Monde, John M. Walker, John F. Yarber, Jones Day, ATLANTA, GA, Keri Arnold, Arnold & Porter, LLP, Charles Richard Allan Morse, Jones Day, NEW YORK, NY, Cecilia M. Bidwell, Bonnie C. Daboll, Cathy Ambersley Kamm, James B. Murphy, Jr., Terri Lynn Parker, Shook Hardy & Bacon, LLP, TAMPA, FL, Dana G. Bradford, II, Smith Gambrell & Russell, LLP, Robert B. Parrish, Joseph W. Prichard, Jr., David C. Reeves, Jeffrey Alan Yarbrough, Moseley Prichard Parrish Knight & Jones, JACKSONVILLE, FL, Andrew Brenner, Mark Jurgen Heise, Stephen N. Zack, Boies Schiller & Flexner, LLP, William Patrick Geraghty, Kenneth J. Reilly, Shook Hardy & Bacon, LLP, Stacey Koch Lieberman, Hughes Hubbard & Reed, LLP, MIAMI, FL, Joshua Reuben Brown, Greenberg Traurig, LLP, Karen C. Dyer, Boies Schiller & Flexner, LLP, ORLANDO, FL, Paul D. Clement, Kirkland & Ellis, LLP, Khalil Gharbieh, David E. Kouba, Arnold & Porter Kaye Scholer, LLP, Hilary R. Mehrkam, Jones Day, WASHINGTON, DC, Timothy James Fiorta, Jones Day, CLEVELAND, OH, Stephanie Sowers Sankar, Connor Jay Sears, Shook Hardy & Bacon, LLP, KANSAS CITY, MO, for Defendant-Appellant R.J. Reynolds Tobacco Company.

Lauren R. Goldman, Mayer Brown, LLP, Keri Arnold, Michael Craig German, Ingo Sprie, Jr., Arnold & Porter, LLP, NEW YORK, NY, Renee Tyndell Beaver, Judith Bernstein-Gaeta, Khalil Gharbieh, Peter T. Grossi, Brittany E. Hamelers, David E. Kouba, M. Sean Laane, Derek Read Molter, Carolyn A. Pearce, Michael S. Tye, Arnold & Porter Kaye Scholer, LLP, Miguel A. Estrada, Amir Cameron Tayrani, Gibson Dunn & Crutcher, LLP, WASHINGTON, DC, Cecilia M. Bidwell, Bonnie C. Daboll, Cathy Ambersley Kamm, James B. Murphy, Jr., Terri Lynn Parker, Shook Hardy & Bacon, LLP, TAMPA, FL, Dana G. Bradford, II, Smith Gambrell & Russell, LLP, JACKSONVILLE, FL, Andrew Brenner, Mark Jurgen Heise, Patricia Melville, Stephen N. Zack, Boies Schiller & Flexner, LLP, William Patrick Geraghty, Kenneth J. Reilly, Shook Hardy & Bacon, LLP, Stacey Koch Lieberman, Hughes Hubbard & Reed, LLP, MIAMI, FL, Joshua Reuben Brown, Greenberg Traurig, LLP, Karen C. Dyer, Boies Schiller & Flexner, LLP, ORLANDO, FL, Roger C. Geary, Robert D. Homolka, Brian Alan Jackson, Stephanie Sowers Sankar, Hildy M. Sastre, I, Connor Jay Sears, Shook Hardy & Bacon, LLP, KANSAS CITY, MO, Thomas W. Stoever, Jr., Arnold & Porter Kaye Scholer LLP, DENVER, CO, for Defendant-Appellant Philip Morris USA, Inc.

Cory L. Andrews, Richard Abbott Samp, Washington Legal Foundation, WASHINGTON, DC, for Amicus Curiae Washington Legal Foundation.

F. Paul Bland, Jr., Public Justice, PC, WASHINGTON, DC, for Amicus Curiae Public Justice, PC.

John Beisner, Skadden Arps Slate Meagher & Flom, LLP, WASHINGTON, DC, for Amici Curiae Chamber of Commerce of the United States of America, Alabama Civil Justice Reform Committee, American Tort Reform Association, Business Council of Alabama, and National Association of Manufacturers.

Robert Cecil Gilbert, Kopelowitz Ostrow Ferguson Weiselberg Gilbert, CORAL GABLES, FL, for Amicus Curiae Tobacco Control Legal Consortium.

John Stewart Mills, Courtney Rebecca Brewer, The Mills Firm, Philip John Padovano, Brannock & Humphries, TALLAHASSEE, FL, Steven L. Brannock, Celene Harrell Humphries, Maegen P. Luka, Brannock & Humphries, PA, TAMPA, FL, Kenneth S. Canfield, Doffermyre Shields Canfield & Knowles, LLC, ATLANTA, GA, for Amicus Curiae Engle State Plaintiffs' Firms.

Rachel Bloomekatz, Gupta Wessler PLLC, WASHINGTON, DC, for Amici Curiae American Cancer Society Cancer Action Network, American Lung Association, Americans for Nonsmokers' Rights, Campaign for Tobacco-Free Kids, National Association of County and City Health Officials, Tobacco Control Legal Consortium, Truth Initiative, and NAATPN Inc.

Before TJOFLAT, HULL, MARCUS, WILSON, WILLIAM PRYOR, MARTIN, JORDAN, ROSENBAUM, JULIE CARNES, and JILL PRYOR, Circuit

Judges.^*

WILLIAM PRYOR, Circuit Judge:

This appeal presents the questions whether due process forbids giving a jury's findings of negligence and strict liability in a class action against cigarette manufacturers preclusive effect in a later individual suit by a class member and, if not, whether federal law preempts the jury's findings. Florida smokers and their survivors filed a class action against several tobacco companies, and after a yearlong trial designed to answer common questions concerning the companies' tortious conduct against all members of the class, a jury found that each company had breached its duty of care and sold defective cigarettes. The Florida Supreme Court upheld the jury verdicts of negligence and strict liability in Engle v. Liggett Group, Inc. , 945 So.2d 1246 (Fla. 2006) (Engle III ), and decertified the class to allow individual actions about the remaining issues of specific causation, damages, and comparative fault. The Engle decision made clear that the jury findings of negligence and strict liability had preclusive effect in the later individual actions, and the Florida Supreme Court reaffirmed that ruling in Philip Morris USA, Inc. v. Douglas , 110 So.3d 419 (Fla. 2013). R.J. Reynolds Tobacco Company and Philip Morris USA Inc. challenge a jury verdict against them in one of those individual actions in the district court. They argue that giving the Engle findings preclusive effect violates the Due Process Clauses, U.S. Const. Amends. V, XIV, and they urge us to overrule our decision to the contrary in Walker v. R.J. Reynolds Tobacco Co. , 734 F.3d 1278 (11th Cir. 2013). They argue, in the alternative, that federal law preempts giving preclusive effect to the Engle findings of negligence and strict liability. Because we reaffirm our holding in Walker and conclude that federal law does not preempt the Engle jury findings, we affirm the judgments against R.J. Reynolds and Philip Morris.

I. BACKGROUND

In 1994, six individuals filed a putative class action in Florida court against the major domestic cigarette manufacturers, including R.J. Reynolds and Philip Morris, and two tobacco industry organizations. Id. at 1281. They alleged claims of strict liability, negligence, breach of express warranty, breach of implied warranty, fraud, conspiracy to commit fraud, and intentional infliction of emotional distress. Id. The strict liability count alleged that the companies manufactured "cigarettes containing nicotine," "manufactured their defective tobacco products by manipulating the levels of nicotine so as to addict the consuming public," "failed to design, manufacture, distribute and sell a safer alternative cigarette that would not addict smokers," and "failed to warn" members of the class of the dangers. The negligence count alleged that the companies "breached their duty of reasonable care" through several "acts and omissions," including the "failure to design and manufacture products that were not addictive," the "failure to ... adequately or sufficiently reduce or remove the level of nicotine in cigarettes," and the "failure to warn the smoking consumers of the addictive nature of nicotine." A Florida district court of appeal approved the certification of the following class: all Florida citizens and residents, "and their survivors, who have suffered, presently suffer or have died from diseases and medical conditions caused by the addiction to cigarettes that contain nicotine." R.J. Reynolds Tobacco Co. v. Engle , 672 So.2d 39, 40–42 (Fla. Dist. Ct. App. 1996) (Engle I ).

The trial court in Engle divided the proceedings in three phases. Walker , 734 F.3d at 1281. In Phase I, a jury "decide[d] issues common to the entire class, including general causation, the Engle defendants' common liability to the class members ..., and the class's entitlement to punitive damages." Douglas , 110 So.3d at 422. Phase I was a year-long trial on "common issues relating exclusively to defendants' conduct and the general health effects of smoking." Liggett Grp. Inc. v. Engle , 853 So.2d 434, 441 (Fla. Dist. Ct. App. 2003) (Engle II ). Phase I required "hundreds of witnesses, thousands of documents and exhibits, and tens of thousands of pages of testimony." Douglas , 110 So.3d at 431. In Phase II, the jury determined the liability of the tobacco companies to three class representatives, awarded them compensatory damages, and fixed the amount of class-wide punitive damages. Walker , 734 F.3d at 1281. The trial court planned to have new juries decide specific causation and damages for the remaining class members in Phase III. Id.

In his opening statement in Phase I, the plaintiffs' attorney stated, "The evidence will show, ladies and gentlemen, that there is no dispute or controversy in the medical and scientific communities but that cigarette smoking causes lung cancer

, heart disease, chronic obstructive...