Graham v. R.J. Reynolds Tobacco Co., 051817 FED11, 13-14590

Docket Nº:13-14590
Opinion Judge:WILLIAM PRYOR, Circuit Judge.
Party Name: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.
Judge Panel:Before TJOFLAT, HULL, MARCUS, WILSON, WILLIAM PRYOR, MARTIN, JORDAN, ROSENBAUM, JULIE CARNES, and JILL PRYOR, Circuit Judges. JULIE CARNES, Circuit Judge, concurring in part and dissenting in part: TJOFLAT, Circuit Judge, dissenting: WILSON, Circuit Judge, dissenting:
Case Date:May 18, 2017
Court:United States Courts of Appeals, Court of Appeals for the Eleventh Circuit

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


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

Appeal from the United States District Court for the Middle District of Florida D.C. Docket No. 3:09-cv-13602-MMH-JBT


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.


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 pulmonary disease, emphysema and many other diseases." He stated that "the evidence will establish overwhelmingly" that "[n]icotine is addictive." And he explained that the tobacco companies "have the technology to make a safer cigarette" but not one that is profitable. He also stated that "the evidence will show that the tobacco companies have so successfully misled the American people that many highly intelligent people, in 1998, are confused."

The smokers presented a substantial body of evidence that all of the cigarettes manufactured by the named defendants contained carcinogens that cause disease, including cancer and heart disease, and that nicotine addicts smokers. Douglas, 110 So.3d at 423. They presented evidence that the tobacco companies "failed to address the health effects and addictive nature of cigarettes, manipulated nicotine levels to make cigarettes more addictive, and concealed information about the dangers of smoking." Id. For example, Dr. Julius Richmond, a former Surgeon General of the United States and professor at the Harvard Medical School, testified that cigarettes contain carcinogens and that cigarettes cause pulmonary disease, emphysema, lung cancer, heart disease, and bladder disease. Dr. Ronald Davis, a former director of the Office on Smoking and Health and former medical director for the Michigan Department of Public Health, testified similarly that cigarette smoking is addictive and that those who smoke have a heightened risk of stroke, emphysema, cancer, and heart disease. Dr. David Burns, a professor of medicine at the University of California, San Diego, School of Medicine, with a specialty in pulmonary and critical care medicine, testified that nicotine is addictive and that cigarette smoking causes cancers, lung disease, and heart disease. He was an associate scientific editor of a 1981 Surgeon General's Report, and he explained that "the purpose of the report was to make it very clear to the public that there is no safe cigarette and there is no safe level of consumption." He testified, "[W]ith the exception of the tobacco industry, no other scientific group in the last 30 years has reviewed this evidence and reached a conclusion other than that cigarette smoking causes disease." Dr. John Holbrook, professor of medicine at the University of Utah School of Medicine, who is board certified in the field of internal medicine, testified that, in his experience, the tobacco industry "attempted to confound and obfuscate science" in its funding of medical research. Dr. W. Jarrard Goodwin, a professor at the University of Miami School of Medicine, with a specialty in otolaryngology, testified that smoking causes cancer of the mouth, larynx, and pharynx. Dr. Edward Staples, director of the artificial heart program at the University of Florida, testified that cigarette smoking causes emphysema, lung cancer, coronary artery disease, and atherosclerosis. Dr. Neal Benowitz, a doctor at San Francisco General Hospital and professor of medicine, psychiatry, and biopharmaceutical sciences at the University of California in San Francisco, testified that 90 percent of individuals begin smoking before the age of 20 and, within two or three years, those young people will become addicted to nicotine. He stated that tobacco companies could reduce the level of nicotine in cigarettes to nonaddictive quantities. Some of the evidence of design defects...

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