R.J. Reynolds Tobacco Co. v. Eighth Judicial Dist. Court of Nev.

• Decision Date: 28 July 2022
• Docket Number: 83724
• Citation: 514 P.3d 425
• Parties: R.J. REYNOLDS TOBACCO COMPANY, a Foreign Corporation, Individually and as Successor-by-Merger to Lorillard Tobacco Company and as Successor-in-Interest to the United States Tobacco Business of Brown & Williamson Tobacco Corporation, which is the Successor-by-Merger to the American Tobacco Company, Petitioner, v. The EIGHTH JUDICIAL DISTRICT COURT of the State of Nevada, IN AND FOR the COUNTY OF CLARK; and the Honorable Nadia Krall, District Judge, Respondents, and Sandra Camacho, Individually; Anthony Camacho, Individually; Philip Morris USA, Inc., a Foreign Corporation; Liggett Group, LLC, a Foreign Corporation; and ASM Nationwide Corporation, d/b/a Silverado Smokes & Cigars, a Domestic Corporation, Real Parties in Interest.
• Court: Nevada Supreme Court

514 P.3d 425

R.J. REYNOLDS TOBACCO COMPANY, a Foreign Corporation, Individually and as Successor-by-Merger to Lorillard Tobacco Company and as Successor-in-Interest to the United States Tobacco Business of Brown & Williamson Tobacco Corporation, which is the Successor-by-Merger to the American Tobacco Company, Petitioner,

v.The EIGHTH JUDICIAL DISTRICT COURT of the State of Nevada, IN AND FOR the COUNTY OF CLARK; and the Honorable Nadia Krall, District Judge, Respondents,andSandra Camacho, Individually; Anthony Camacho, Individually; Philip Morris USA, Inc., a Foreign Corporation; Liggett Group, LLC, a Foreign Corporation; and ASM Nationwide Corporation, d/b/a Silverado Smokes & Cigars, a Domestic Corporation, Real Parties in Interest.

No. 83724

Supreme Court of Nevada.

Filed July 28, 2022

Bailey Kennedy and Dennis L. Kennedy, Joseph A. Liebman, and Rebecca L. Crooker, Las Vegas; King & Spalding LLP and Val Leppert, Atlanta, Georgia; King & Spalding LLP and Ursula Marie Henninger, Charlotte, North Carolina, for Petitioner.

Claggett & Sykes Law Firm and Sean K. Claggett, Matthew S. Granda, and Micah S. Echols, Las Vegas; Kelley Uustal and Kimberly L. Wald, Michael A. Hersh, and Fan Li, Fort Lauderdale, Florida, for Real Parties in Interest Sandra Camacho and Anthony Camacho.

Lewis Roca Rothgerber Christie LLP and Daniel F. Polsenberg, J. Christopher Jorgensen, and Abraham G. Smith, Las Vegas, for Real Party in Interest Liggett Group, LLC.

Weinberg, Wheeler, Hudgins, Gunn & Dial, LLC, and D. Lee Roberts, Jr., Las Vegas, for Real Parties in Interest Philip Morris USA, Inc., and ASM Nationwide Corporation.

BEFORE THE SUPREME COURT, SILVER, CADISH, and PICKERING, JJ.

OPINION

By the Court, CADISH, J.:

Petitioner challenges a district court order reinstating a deceptive trade practices complaint, arguing that real parties in interest/plaintiffs lack standing to bring that claim against petitioner because they never used petitioner's products and thus cannot show that they are victims of consumer fraud who sustained damages from petitioner's allegedly deceptive trade practices under NRS 41.600(1). As NRS 41.600 creates a cause of action for victims of consumer fraud, which includes deceptive trade practices under the Nevada Deceptive Trade Practices Act (NDTPA), and nothing in the NDTPA limits consumer fraud victims to only those who used a manufacturer's product, we conclude that the district court correctly granted reconsideration and reinstated the complaint, as its prior order granting petitioner's motion to dismiss rested on an overly narrow interpretation of NRS 41.600(1). We further conclude that plaintiffs pleaded sufficient facts, including that they were directly harmed by petitioner's false and misleading advertising, to bring an NDTPA claim against petitioner. Thus, mandamus relief is not warranted, and we deny the petition.

FACTS AND PROCEDURAL HISTORY

Real party in interest Sandra Camacho began smoking cigarettes in 1964 and continued to smoke until 2017. She smoked L&M cigarettes, which were manufactured by real party in interest Liggett Group, LLC, and Marlboro and Basic cigarettes, which were manufactured by real party in interest Philip Morris USA, Inc. Sandra concedes that she did not purchase or use any of petitioner R.J. Reynolds Tobacco Company's products. In March 2018, Sandra was diagnosed with laryngeal cancer

caused by her cigarette use. Sandra and her husband, real party in interest Anthony Camacho, filed suit against Liggett, Philip Morris, and Reynolds. The Camachos raised several claims, including fraud and products-liability-based claims against Philip Morris and Liggett, and a civil conspiracy claim against all three cigarette manufacturers alleging that they "acted in concert to accomplish an unlawful objective for the purposes of harming ... Sandra," namely by concealing, omitting, or otherwise misrepresenting the health hazards of cigarettes in various public statements and marketing materials. The Camachos also asserted a claim for violating the NDTPA, alleging that Reynolds and the other defendants knowingly made false representations in their advertisements.

Reynolds filed a motion to dismiss the two claims against it. It argued that although the Camachos labeled their claims as a violation of the NDTPA and civil conspiracy, the claims were effectively products-liability claims. Reynolds asserted that those claims failed as a matter of law because product use "is a fundamental requirement" of a products-liability claim, and Sandra did not use a Reynolds product. Similarly, Reynolds contended that the Camachos’ NDTPA claim failed, as there was "no connection between Reynolds’ alleged deceptive trade practices as they relate to the health risk of its particular products and [Sandra's] alleged laryngeal cancer

" because Sandra never used a Reynolds product.

The Camachos opposed the motion to dismiss, arguing that under Nevada law neither a civil conspiracy claim nor a deceptive trade-practice claim includes a product-use requirement. They contended that the cases Reynolds relied on in support of a product-use requirement involved claims for negligence, strict products liability, or fraud, as opposed to an NDTPA- or civil-conspiracy-based theory of liability. Regarding the NDTPA claim specifically, the Camachos asserted that they adequately pleaded causation, as they alleged that but for cigarette manufacturers engaging in "concerted actions" to misrepresent the health risks of smoking, Sandra would not have continued to smoke cigarettes. The district court granted Reynolds’ motion to dismiss, concluding that Sandra was not a consumer fraud victim under NRS 41.600(1) because she did not use a Reynolds product.

The Camachos filed a motion for reconsideration, asserting that a deceptive trade practice under the NDTPA includes a business's knowingly false representation regarding the product for sale and that a sale under the NDTPA includes an attempt to sell. Because a sale includes an attempt to sell, and an attempt to sell implies a failure to sell, the Camachos argued that the district court clearly erred by reading a product-use requirement into the NDTPA. Because NRS 41.600(1) confers standing on victims of consumer fraud, which includes victims of deceptive trade practices as defined by the NDTPA, the Camachos asserted they pleaded viable claims against Reynolds, even though Sandra never used a Reynolds product.

The district court granted reconsideration over Reynolds’ opposition, concluding that the earlier dismissal order was clearly erroneous because it added an atextual product-use requirement or legal-relationship requirement into the NDTPA. It also pointed to Nevada precedent stating "that an NDTPA claim is easier to establish than common law fraud." Because the court reinstated the NDTPA claim, it reinstated the derivative civil conspiracy claim. Reynolds now seeks mandamus relief directing the district court to vacate its order granting reconsideration and to reinstate the dismissal order.¹

DISCUSSION

"The decision to entertain a petition for a writ of mandamus is within our sole discretion." Canarelli v. Eighth Judicial Dist. Court , 138 Nev. ––––, 506 P.3d 334, 337 (2022). While we may issue mandamus "to compel an act that the law requires" or to correct a lower court's " ‘clear and indisputable’ legal error," Archon Corp. v. Eighth Judicial Dist. Court, 133 Nev. 816, 819-20, 407 P.3d 702, 706 (2017) (quoting Bankers Life & Cas. Co. v. Holland , 346 U.S. 379, 384, 74 S.Ct. 145, 98 L.Ed. 106 (1953) ), writ relief is not appropriate where there is a "plain, speedy, and adequate remedy in the ordinary course of law," NRS 34.170, such as the right to appeal from a final judgment, Archon Corp., 133 Nev. at 820, 407 P.3d at 706. However, even if traditional mandamus is not appropriate, we may issue advisory mandamus "when the issue presented is novel, of great public importance, and likely to recur." Archon Corp., 133 Nev. at 822, 407 P.3d at 708 (quoting United States v. Horn, 29 F.3d 754, 769 (1st Cir. 1994) ). It should only issue where the legal question presented is "likely of significant repetition prior to effective review." Id. at 822-23, 407 P.3d at 708 (quoting In re Bushkin Assocs., Inc., 864 F.2d 241, 247 (1st Cir. 1989) ).

Although traditional mandamus is inappropriate because, in granting reconsideration, the district court essentially denied Reynolds’ NRCP 12(b)(5) motion to dismiss, and Reynolds can appeal from any adverse final trial decision, see Smith v. Eighth Judicial Dist. Court, 113 Nev. 1343, 1344-45, 950 P.2d 280, 281 (1997) (observing that this court generally will not consider writ petitions challenging orders denying motions to dismiss), we exercise our discretion to entertain this petition because the issue of whether a nonuser of a product may qualify as a victim with standing to bring an NDTPA suit against a product manufacturer presents a novel legal question of statewide importance requiring clarification. Moreover, this issue in this matter implicates substantial public-policy concerns regarding the scope of liability for deceptive trade practices, and "[o]ur intervention is further warranted because district courts are reaching different conclusions on this very issue." Lyft, Inc. v. Eighth Judicial Dist. Court, 137 Nev. ––––, 501 P.3d 994, 998 (2021).

The district court did not manifestly abuse its discretion in granting the Camachos' motion for reconsideration

While we ordinarily review a district court's decision to grant or deny a motion for reconsideration for an abuse of discretion, see AA Primo Builders, LLC v. Washington , 126 Nev. 578, 589, 245 P.3d 1190, 1197 (2010), we may only grant writ relief if the district court manifestly abused its discretion, Round Hill Gen. Improv. Dist. v. Newman, 97 Nev. 601, 603-04, 637 P.2d 534, 536 (1981). The district court "may reconsider a previously decided issue if ... the decision is clearly erroneous."...