Bullock v. Philip Morris Usa, Inc.

Citation71 Cal.Rptr.3d 775,159 Cal.App.4th 655
Decision Date30 January 2008
Docket NumberNo. B169083.,No. B164398.,B164398.,B169083.
CourtCalifornia Court of Appeals
PartiesJodie BULLOCK, Plaintiff and Appellant, v. PHILIP MORRIS USA, INC., Defendant and Appellant, Michael J. Piuze, Objector and Appellant.

Law Offices of Holly L. Hostrop and Holly L. Hostrop, Cathedral City, for Tobacco Trial Lawyers Association as Amicus Curiae on behalf of Plaintiff and Appellant.

Arnold & Porter, Ronald C. Redcay, Los Angeles, and Murray R. Garnick, Washington, DC, for Defendant and Appellant.

Dunn Koes, Pamela E. Dunn and Daniel J. Koes, Pasadena, for Association of Southern California Defense Counsel as Amicus Curiae on behalf Defendant and Appellant.

O'Melveny & Myers, Charles C. Lifland and Marc S. Williams, Los Angeles, for California Manufacturers & Technology Association as Amicus Curiae on behalf of Defendant and Appellant.

Gibson, Dunn & Crutcher, Theodre J. Boutrous, Jr., William E. Thomson and Dominic Lanza, Los Angeles, for Chamber of Commerce of the United States of America as Amicus Curiae on behalf of Defendant and Appellant.

Haigh, Brown & Bonesteel, Rita Gunasekaran, Maureen Haight Gee, Los Angeles; Law Office of Michael J. Piuze, Michael J. Piuze and Geraldine Weiss, Los Angeles, for Objector and Appellant.

Fred J. Hiestand, Sacramento, for Civil Justice Association of California as Amicus Curiae.

Pillsbury & Levinson, Arnold R. Levinson, San Francisco; Altshuler Berzon, San Francisco, James Finberg; Lieff, Cabraser, Heimann & Bernstein and Robert J. Nelson, San Francisco, for Consumer Attorneys of California, Arnold R. Levinson and Robert J. Nelson as Amici Curiae.

Deborah J. La Fetra and Timothy Sandefur, Sacramento, for Pacific Legal Foundation as Amicus Curiae.


Philip Morris USA, Inc. (Philip Morris), a cigarette manufacturer, appeals a judgment in favor of Betty Bullock awarding her compensatory and punitive damages after a jury trial. Philip Morris challenges the findings of liability on several counts based on products liability and fraud, the admission of evidence, the refusal of proposed jury instructions relating to liability and punitive damages, and the amount of the punitive damages award. Jodie Bullock, Betty Bullock's successor in interest, also appeals, challenging a conditional new trial order that reduced the amount of punitive damages by way of remittitur.1 Bullock's attorney, Michael J. Piuze, appeals an order awarding attorney fees against him as a sanction.

We conclude that Philip Morris has shown no error with respect to its liability for fraud and products liability, but that the refusal of Philip Morris's proposed instruction not to impose punishment for harm caused to nonparties to the litigation was error. We therefore affirm the judgment as to the finding of liability, the award of compensatory damages, and the finding that Philip Morris was guilty of oppression, fraud, or malice, and reverse the judgment as to the amount of punitive damages, with directions to conduct a new trial limited to determining that issue. We also hold that the court had no authority to award attorney fees as a sanction against Piuze and reverse the sanctions order.

1. Factual Background2

Bullock smoked cigarettes manufactured by Philip Morris for 45 years from 1956, when she was 17 years old, until she was diagnosed with lung cancer in 2001. She smoked Philip Morris's Marlboro brand of cigarettes until 1966, and then switched to its Benson & Hedges brand.

Scientific and medical professionals in the United States and worldwide generally agreed by the late 1950's that cigarette smoking caused lung cancer, after several epidemiological studies reached that conclusion. Philip Morris and other cigarette manufacturers sought to cast doubt on the increasing body of knowledge supporting the conclusion that smoking caused lung cancer and sought to assuage smokers' concerns. To that end, Philip Morris and other cigarette manufacturers issued a full-page announcement in newspapers throughout the United States in January 1954 entitled "A Frank Statement to Cigarette Smokers." The announcement stated, "Recent reports on experiments with mice have given wide publicity to a theory that cigarette smoking is in some way linked with lung cancer in human beings," and stated, "[distinguished authorities point[ed] out" that there was no proof that cigarette smoking caused cancer and that "numerous scientists" questioned "the validity of the statistics themselves."

That announcement also stated, "We accept an interest in people's health as a basic responsibility, paramount to every other consideration in our business. [¶] We believe the products we make are not injurious to health. [¶] We always have and always will cooperate closely with those whose task it is to safeguard the public health." It announced the formation of the Tobacco Industry Research Committee and stated, "We are pledging aid and assistance to the research effort into all phases of tobacco use and health. This joint financial aid will of course be in addition to what is already being contributed by individual companies. [¶] ... [¶] In charge of the research activities of the Committee will be a scientist of unimpeachable integrity and national repute. In addition there will be an Advisory Board of scientists disinterested in the cigarette industry. A group of distinguished men from medicine, science, and education will be invited to serve on this Board. These scientists will advise the Committee on its research activities." In the years that followed, the Tobacco Industry Research Committee and its publicists disseminated the message that there was no proof that cigarette smoking was a cause of lung cancer and other diseases through news releases, distribution of research and editorial materials favorable to the tobacco industry, personal contacts with editors, journalists, and producers, and other means.

Philip Morris for many years publicly continued to insist that there was no consensus in the scientific community that cigarette smoking was a cause of lung cancer and that Philip Morris was actively pursuing scientific research to resolve the purported controversy, while privately acknowledging that there was no true controversy, that its true goal was to discredit reports that linked smoking with lung cancer, and that Philip Morris had no intention of funding research that would reveal the health hazards of smoking. The Tobacco Institute, a trade organization funded by Philip Morris and other cigarette manufacturers, issued a press release in 1961 discrediting a recent article and stating that the views that smoking caused cancer "are a subject of much disagreement in the scientific world" and "the cause or causes of lung cancer continue to be unknown." The Tobacco Institute stated in a press release in 1963 that the tobacco industry was "vitally interested in getting the facts that will provide answers to questions about smoking and health," and described the industry's research efforts as a "crusade for research—in the agricultural stations, the scientific laboratories, and the great hospitals and medical centers of the nation." It stated, "the industry does not know the causes of the diseases in question."

A cigarette company executive appearing before Congress in 1965 on' behalf of several cigarette manufacturers, including Philip Morris, stated that "[n]early everyone familiar with these difficult problems will agree ... that there is a very high degree of uncertainty" whether "smoking causes cancer or any other disease." Later that year, the Tobacco Institute issued a press release stating, "Research to date has not established whether smoking is or is not causally involved in such diseases as lung cancer and heart disease, despite efforts to make it seem otherwise. The matter remains an open question—for resolution by scientists." The press release stated, "we are earnestly trying to find the answers," and, "If there is something in tobacco that is causally related to cancer or any other disease, the tobacco industry wants to find out what it is, and the sooner the better. If it is something in tobacco or the smoke, I am sure this can be remedied by the scientists."

Philip Morris's chief executive officer and chairman of the Executive Committee of the Tobacco Institute, Joseph Cullman III, stated on the television news program Face the Nation (CBS, Jan, 3, 1971), "if any ingredient in cigarette smoke is identified as being injurious to human health, we are confident that we can eliminate that ingredient." He stated further, "We do not believe that cigarettes are hazardous; we don't accept that." The Tobacco Institute issued a report in 1979 entitled Smoking and Health 1969-1979: the Continuing Controversy, stating, "Scientists have not proven that cigarette smoke or any of the thousands of its constituents as found in cigarette smoke cause human disease." The Tobacco Institute issued a report in 1984 entitled The Cigarette Controversy: Why More Research is Needed, stating, "it is not known whether smoking has a role in the development of various diseases ... a great deal more research is needed to uncover the causes and the mechanisms involved in their onset." The 1984 report stated that the theory that cigarette smoking causes various diseases "is just that, a theory"...

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