Graham v. R.J. Reynolds Tobacco Co.

• Decision Date: 08 April 2015
• Docket Number: No. 13–14590.,13–14590.
• Citation: 782 F.3d 1261
• Parties: Earl E. 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, Lorillard Tobacco Company, et al., Defendants.
• Court: U.S. Court of Appeals — Eleventh Circuit

782 F.3d 1261

Earl E. 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–AppellantsLorillard Tobacco Company, et al., Defendants.

No. 13–14590.

United States Court of Appeals, Eleventh Circuit.

April 8, 2015.

Samuel Issacharoff, New York University School of Law, Jennifer Gross, Lieff Cabraser Heimann & Bernstein, LLP, New York, N.Y., Kathryn E. Barnett, Kenneth S. Byrd, Lieff Cabraser Heimann & Bernstein, LLP, Nashville, TN, Frederick C. Baker, Rebecca M. Deupree, Lance V. Oliver, Motley Rice, LLC, Mount Pleasant, SC, Charles Easa Farah, Jr., Farah & Farah, PA, Edward I. Warren, Norwood Wilner, Richard Lantinberg, Stephanie J. Hartley, Janna M. Blasingame, The Wilner Firm, PA, Jacksonville, FL, Donald Alan Migliori, Motley Rice, LLC, Providence, RI, Scott Purington Nealey, Robert J. Nelson, Jerome Mayer–Cantu, Sarah Robin London, Richard M. Heimann, Kent L. Klaudt, Jordan S. Elias, Elizabeth Joan Cabraser, Lieff Cabraser Heimann & Bernstein, LLP, San Francisco, CA, for Plaintiff–Appellee.

Gregory G. Katsas, Hilary R. Mehrkam, Jones Day, Michael S. Tye, James B. Murphy, Jr., Terri Lynn Parker, Carolyn A. Pearce, Khalil Gharbieh, David E. Kouba, Keri Arnold, Renee Tyndell Beaver, Judith Bernstein–Gaeta, Arnold & Porter, LLP, Paul D. Clement, Bancroft, PLLC, Khalil Gharbieh, Peter T. Grossi, Brittany E. Hamelers, Arnold & Porter, LLP, Cathy Ambersley Kamm, David E. Kouba, M. Sean Laane, Derek Read Molter, Arnold & Porter, LLP, Washington, DC, Andrew Brenner, Stephen N. Zack, Kenneth J. Reilly, Stephanie Sowers Sankar, Hildy M. Sastre, I, William Patrick Geraghty, Shook Hardy & Bacon, LLP, Mark Jurgen Heise, Boies Schiller & Flexner, LLP, Stacey Koch Lieberman, Hughes Hubbard & Reed LLP, Stephen N. Zack, Stacey Koch Lieberman, Patricia Melville, Boies Schiller & Flexner, LLP, Miami, FL, Robert B. Parrish, J.W. Prichard, Jr., David C. Reeves, Jeffrey Alan Yarbrough, Moseley Prichard Parrish Knight & Jones, Jacksonville, FL, David M. Monde, Stephanie Ethel Parker, John M. Walker, John F. Yarber, Jones Day, Atlanta, GA, Cecilia M. Bidwell, Shook Hardy & Bacon, LLP, Bonnie C. Daboll, Cathy Ambersley Kamm, James B. Murphy, Jr., Terri Lynn Parker, Shook Hardy & Bacon, LLP, Tampa, FL, Cecilia M. Bidwell, Dana G. Bradford, II, Andrew Brenner, Joshua Reuben Brown, Bonnie C. Daboll, Karen C. Dyer, Roger C. Geary, Mark Jurgen Heise, Robert D. Homolka, Brian Alan Jackson, Shook Hardy & Bacon, LLP, Stephanie Sowers Sankar, Connor Jay Sears, Kansas City, MO, Keri Arnold, William Patrick Geraghty, Michael Craig German, Arnold & Porter, LLP, Lauren R. Goldman, Mayer Brown, LLP, Charles Richard Allan Morse, Jones Day, Connor Jay Sears, Ingo Sprie, Jr., Arnold & Porter, LLP, New York, N.Y., Thomas W. Stoever, Jr., Arnold & Porter, LLP, Denver, CO, Dana G. Bradford, II, Smith Gambrell & Russell, LLP, Jacksonville, FL, Joshua Reuben Brown, Greenberg Traurig, LLP, Karen C. Dyer, Boies Schiller & Flexner, LLP, Orlando, FL, Timothy James Fiorta, Jones Day, Cleveland, OH, for Defendants–Appellants.

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

Before TJOFLAT, JILL PRYOR and COX, Circuit Judges.

Opinion

TJOFLAT, Circuit Judge:

In 1996, a Florida District Court of Appeal approved certification of a class-action lawsuit originating in the Circuit Court of Dade County that encompassed an estimated 700,000 Floridians who brought state-law damages claims against the major American tobacco companies for medical conditions, including cancer, “caused by their addiction to cigarettes that contain nicotine.”R.J. Reynolds Tobacco Co. v. Engle (“Engle I ”), 672 So.2d 39, 40 (Fla.App.1996) (quotation marks omitted). A year-long, class-wide trial was conducted on the issue of liability, and “the jury rendered a verdict for the class on all counts.” Liggett Grp. Inc. v. Engle (“Engle II ”), 853 So.2d 434, 441 (Fla.App.2003). The Florida Supreme Court then decertified the class but held that the jury findings would nonetheless have “res judicata effect” in cases thereafter brought against one or more of the tobacco companies by a former class member. Engle v. Liggett Grp. Inc. (“Engle III ”), 945 So.2d 1246, 1269 (Fla.2006) (per curiam).

Here, a member of that now-decertified class—a so-called Engle -progeny plaintiff—successfully advanced strict-liability and negligence claims that trace their roots to the original Engle jury findings. Over the defendants' objection, the District Court instructed the jury that “you must apply certain findings made by the Engle court and they must carry the same weight they would have if you had listened to all the evidence and made those findings yourselves.” Among them: that the defendants “placed cigarettes on the market that were defective and unreasonably dangerous” and that “all of the Engle [d]efendants were negligent.”

When the jury found in favor of the plaintiff on both claims, the defendants renewed their motion for a judgment as a matter of law, contending, among other things, that federal law preempted the jury's imposition of tort liability as based on the Engle jury findings. The District Court denied the motion, and the defendants appealed. We must decide whether federal law preempts this suit because it stands as an obstacle to the purposes and objectives of Congress.

I.

A.

Like so many of her generation, Faye Graham started each morning with a cup of coffee and a smoke. By day's end, she usually burned through one-and-a-half to two packs of cigarettes. According to her brother, “she smoked right on up until she wasn't able to smoke.” Doctors diagnosed Graham with non-small cell lung cancer.

She died on November 18, 1993, at age fifty-eight.

Faye was survived by her husband, Earl Graham, a tugboat captain. He filed, as personal representative of his wife's estate, a wrongful-death suit against R.J. Reynolds Tobacco Co. and Phillip Morris USA, Inc. (“R.J. Reynolds” and “Phillip Morris”)¹ in the United States District Court for the Middle District of Florida.² Among other things, the complaint alleged that Faye Graham was addicted to cigarettes manufactured by the defendants and that the addiction caused her death. The complaint contained seven counts, two of which are relevant to this appeal: a strict-liability claim, based on the fact that “the cigarettes sold and placed on the market by [the defendants] were defective and unreasonably dangerous,” and a negligence claim, based on the fact that the defendants were negligent “[w]ith respect to smoking and health and the manufacture, marketing and sale of their cigarettes.”

B.

1.

This is no ordinary tort suit, however: Graham's is an Engle -progeny case. The Engle litigation epic began in 1994, when six Floridians filed a putative class-action lawsuit seeking over $100 billion in both compensatory and punitive damages against the major domestic tobacco companies: Philip Morris, Inc.; R.J. Reynolds Tobacco Co.; Brown & Williamson Tobacco Co., individually and as successor by merger to The American Tobacco Company; Lorillard Tobacco Co.; and Liggett Group, Inc. Engle II, 853 So.2d at 441 & n. 1. Two years after the plaintiffs filed their initial complaint, the Third District Court of Appeal approved class certification on interlocutory appeal, defining the class as “all Florida citizens and residents” “and their survivors, who have suffered, presently suffer or who have died from diseases and medical conditions caused by their addiction to cigarettes that contain nicotine.” Engle I, 672 So.2d at 40, 42 (alteration omitted) (quotation marks omitted). The class included an estimated 700,000 members. Engle II, 853 So.2d at 442.

The trial court charged with managing this class action devised a trial plan consisting of three phases. In Phase I, the court conducted a year-long trial on “common issues relating exclusively to defendants' conduct and the general health effects of smoking.” Id. at 441. At the trial's conclusion, “the jury rendered a verdict for the class on all counts.” Id.

To reach that verdict, the jury answered special interrogatories submitted by the Phase I trial court, at least two of which concerned the claims litigated here: First, did each tobacco company “place cigarettes on the market that were defective and unreasonably dangerous”? Walker v. R.J. Reynolds Tobacco Co., 734 F.3d 1278, 1282 (11th Cir.2013). And second, did each tobacco company “fail to exercise the degree of care which a reasonable cigarette manufacturer would exercise under like circumstances”? Id. (alteration omitted). The tobacco companies argued that these questions “did not ask for specifics about the tortious conduct of the tobacco companies, rendering the jury findings useless for application to individual plaintiffs.” Id. (alterations omitted) (quotation marks omitted). But the trial court overruled their objection, and the jury answered “yes” to both questions. Id.

In Phase II, the same jury found the tobacco companies liable for the injuries of three class representatives, awarded them compensatory damages of $12.7 million, and calculated punitive damages for the entire class to be $145 billion. Engle II, 853 So.2d at 441. Before the trial reached Phase III, in which new juries were to have decided individual causation and damages claims for the 700,000 class members, id. at 442, the Third District Court of Appeal decertified the class and vacated the class-wide punitive-damages award, id. at 450, 456.

The class appealed, and the Florida Supreme Court affirmed the Third District Court of Appeal's decision to decertify the class and to vacate the punitive-damages award.³ Engle III, 945 So.2d at 1268 (explaining that “continued class action treatment ... is not feasible because individualized issues such as...