R.J. Reynolds Tobacco Co. v. Hiott

• Decision Date: 03 January 2014
• Docket Number: 1D12–6008.,Nos. 1D12–5956,s. 1D12–5956
• Citation: 129 So.3d 473
• Parties: R.J. REYNOLDS TOBACCO COMPANY, Appellant, v. Carolyn HIOTT, as Personal Representative of the Estate of Kenneth Hiott, Appellee.
• Court: Florida District Court of Appeals

129 So.3d 473

R.J. REYNOLDS TOBACCO COMPANY, Appellant,
v.
Carolyn HIOTT, as Personal Representative of the Estate of Kenneth Hiott, Appellee.

Nos. 1D12–5956, 1D12–6008.

District Court of Appeal of Florida,
First District.

Jan. 3, 2014.

[129 So.3d 474]

Robert B. Parrish, Charles M. Trippe, Jr., Jeffrey A. Yarbrough, Andrew J. Knight and David C. Reeves of Moseley Prichard Parrish Knight & Jones, Jacksonville; Charles R.A. Morse of Jones Day, New York, NY; Stephanie E. Parker, John F. Yarber and John M. Walker of Jones Day, Atlanta, GA; Kevin D. Boyce of Jones Day, Cleveland, OH; Edward Carter of Jones Day, Columbus, OH, for Appellant.

Donald B. Ayer of Jones Day, Washington, D.C., pro hac vice on behalf of Appellant.

Charles Farah and Eddie Farah of Farah & Farah, P.A., Jacksonville; Norwood S. Wilner, Richard J. Lantinberg and Janna M. Blasingame of The Wilner Firm, Jacksonville; Kristi Stahnke McGregor of Milberg LLP, New York, NY, for Appellee.

Melissa H. Nafash and Peggy J. Wedgworth of Milberg LLP, New York, NY; Janine L. Pollack and Martin E. Restituyo of Wolf Haldenstein Adler Freeman & Herz LLP, New York, NY; pro hac vice on behalf of Appellee.

THOMAS, J.

Appellant R.J. Reynolds Tobacco Company (Reynolds) appeals a Final Judgment awarding damages to Appellee Carolyn Hiott, Personal Representative of the Estate of Kenneth Hiott (Hiott). Reynolds asserts three grounds of reversible error: 1) the trial court erred in admitting evidence that Reynolds successfully challenged new proposed tobacco warnings in federal court; 2) the trial court erred in denying Reynolds' requested jury instruction on the statute of repose; and 3) Reynolds' due-process rights were violated by the application of factual findings of its misconduct which resulted from prior litigation

[129 So.3d 475]

in Engle v. Liggett Group, Inc.¹

Hiott cross-appeals the trial court's order applying the jury finding that Mr. Hiott was partially at fault for his smoking-related illness to reduce the damages award. She asserts that because the jury found Reynolds committed the intentional tort of fraudulent concealment, section 768.81(4), Florida Statutes, barred application of Mr. Hiott's comparative fault to reduce damages. The trial court found that Hiott waived this argument below by failing to raise it in the complaint or at trial.

We affirm on all issues. We certify conflict with Philip Morris USA, Inc. v. Hess, 95 So.3d 254 (Fla. 4th DCA 2012), rev. denied,117 So.3d 412 (Fla.2013), on the question of whether the trial court erred in denying Reynolds' requested jury instruction on the statute of repose.

TRIAL EVIDENCE AND RULINGS

Hiott sued Reynolds for the wrongful death of her husband, who died in 1996 of lung cancer, asserting claims of strict liability, negligence, fraudulent concealment, and civil conspiracy to fraudulently conceal. The jury found Mr. Hiott was a member of the Engle class due to his addiction to nicotine.

Pursuant to Engle, the jury was instructed that the following findings were binding in its deliberations:

1. Cigarette smoking causes lung cancer;

2. Cigarettes are addictive;

3. Reynolds put cigarettes on the market that were defective and unreasonably dangerous;

4. Reynolds concealed material information not otherwise known or failed to disclose that smoking was addictive and caused other related health issues;

5. Reynolds agreed with other companies to conceal or omit information regarding the health effects of cigarettes “or their addictive nature or both with the intention that smokers ... would rely on this information to their detriment”; and

6. Reynolds was negligent.

Thus, the remaining issues for resolution by the jury and the trial court were:

1. Whether Mr. Hiott was addicted to nicotine;

2. Whether the defective cigarettes manufactured by Reynolds were the cause of Mr. Hiott's death;

3. Whether Reynolds' negligence was the cause of Mr. Hiott's death;

4. Whether Reynolds' concealment of the dangers of smoking was a legal cause of Mr. Hiott's death;

5. Whether the conspiracy to withhold information by Reynolds and others was a legal cause of Mr. Hiott's death;

6. Whether Mr. Hiott was at fault, and if so, his portion of fault for his injuries and damages; and

7. Compensatory and punitive damages.

The trial was bifurcated in two phases, with Engle class membership, liability, comparative fault, compensatory damages, and entitlement to punitive damages to be determined in Phase I; and if punitive damages were found, the amount of punitive damages to be assessed against Reynolds in Phase II.

The evidence established that Mr. Hiott started smoking at approximately age 15, or about 1966. He smoked a pack of cigarettes every day for 28 years, until just before his death in 1996. Mr. Hiott consumed

[129 So.3d 476]

approximately 200,000 cigarettes or 2 million doses of nicotine. He attempted to quit smoking several times, including attending a cessation clinic.

Hiott presented substantial evidence of Reynolds' corporate misconduct and decades-long concealment of the health dangers of nicotine. Further, Hiott presented extensive testimony regarding how the company ensured that smokers would become addicted to smoking and would be misled regarding the dangers of nicotine. This evidence included testimony that lung cancer was a rare disease in the United States in the early 20th century before smoking became prevalent, but later became a disease killing approximately 400,000 people annually, as modern marketing and manufacturing methods of cigarettes evolved.

In a pre-trial ruling, the trial court allowed Hiott to introduce evidence that in 2012 Reynolds successfully challenged graphic tobacco warnings proposed by the federal Food and Drug Administration in federal court. Hiott argued that Reynolds' challenge to the proposed graphic warnings was part of a long pattern of misconduct in which the company attempted to thwart public health education. Thus, Hiott argued, contrary to Reynolds' self-presentation of a “reformed” company which now cooperated with public health agencies, Reynolds continued to evade their obligation to make every effort to warn the public. Reynolds argued that the company prevailed in its First Amendment challenge to these proposed warnings and that the warnings were ineffective. Reynolds further argued that, because Mr. Hiott died in 1996, long before Reynolds successfully challenged the warnings, the evidence was not legally relevant.

The trial court found the evidence of Reynolds' federal litigation relevant to the issue of punitive damages. This evidence was admitted through Hiott's expert historian and on cross-examination of a Reynolds witness; however, the evidence was discussed only briefly during an extensive trial. The graphic warnings at issue were not admitted at trial.

On the issue of the statute of repose, section 95.031(2), Florida Statutes, Reynolds argued below that Hiott could only recover on her fraudulent concealment and fraud-based conspiracy claims to the extent they rested on conduct that occurred after May 5, 1982, twelve years before the Engle suit was filed. Reynolds argued that an action for fraud under section 95.11(3), Florida Statutes, must be brought “within 12 years after the date of the commission of the alleged fraud, regardless of the date the fraud was or should have been discovered.” § 95.031(2)(a), Fla. Stat. Reynolds requested that the trial court instruct the jury that to “find Reynolds liable on [Hiott's fraud-based claims], you must find that Mr. Hiott reasonably relied to his detriment, after May 5, 1982, on a statement fraudulently concealing material facts. Reliance on statements prior to that date cannot by law be a basis for liability.” Reynolds proposed a similar question for the verdict form. The trial court denied both requests.

The jury found for Hiott in Phase I on her claims of strict liability, negligence, and fraudulent concealment, and awarded $1.6 million to her and $225,000 to Mr. Hiott's son by a previous marriage, for a total award of $1.825 million. The jury found for Reynolds on the conspiracy claim. In its determination of comparative negligence, the jury assigned sixty percent of the fault to Mr. Hiott, and assigned Reynolds forty percent of the fault. The jury found in Phase I that Hiott was entitled to punitive damages; however, in

[129 So.3d 477]

Phase II, the jury found that Hiott should receive zero dollars in punitive damages.

Hiott moved for entry of final judgment in the full amount of compensatory damages, arguing that there should be no reduction based on Mr. Hiott's fault because Reynolds committed an intentional tort, and thus Florida's comparative fault statute, section 768.81, Florida Statutes, did not apply. In opposition, Reynolds made two arguments. First, because Hiott's operative complaint, proposed jury instructions and jury comments did not expressly limit Hiott's admission of partial fault to her negligence and strict liability claims, Reynolds argued that the exception for intentional tort in the comparative fault statute did not apply. Second, Reynolds argued, the comparative fault statute applies to actions, and not claims; thus, because Hiott's case is in essence a negligence action, Reynolds asserts, the rule excluding the application of comparative negligence did not apply.

The trial court did not address Reynolds' second argument regarding the nature of Hiott's action, but instead it found Hiott waived any argument against reducing the judgment, because she sought “apportionment of fault and damages” in her complaint. Thus, the trial court found this case distinguishable from an earlier trial court ruling, which this court affirmed in R.J. Reynolds Tobacco Co. v. Sury, 118 So.3d 849 (Fla. 1st DCA 2013), because, here, Hiott did not assert in her complaint that any comparative negligence was solely limited to the claims of negligence. Neither did Hiott in any manner assert to the jury that Mr. Hiott's...