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At the Supreme Court this week are oral arguments on the constitutionality of a jury award of punitive damages against a tobacco company. The outcome of this case will affect not just the tobacco industry but also all elderly victims whose injuries may be undervalued by compensatory damages. After Jesse Williams, a retired janitor, died from lung cancer, his widow, Mayola, sued Philip Morris USA for negligence and fraud. Jesse Williams had smoked Philip Morris cigarettes from the early 1950s until his death in 1997. In response to his family’s efforts to get him to stop smoking, he stated that the cigarette companies would not sell them if they were dangerous to his health as his family claimed. Mayola Williams based her fraud claim on a 40-year publicity campaign by Philip Morris and the tobacco industry to cast doubt on published concerns about the dangers of smoking. The case went to trial in 1999. After a jury ruled in her favor, she was awarded approximately $820,000 in compensatory damages. Based on evidence that Jesse Williams and other Oregonians were harmed by their reliance on the company’s misrepresentations about the link between smoking and cancer, the jury also awarded punitive damages of $79.5 million. Philip Morris appealed, and these damages remain unpaid. NO RIGID RATIO In an amicus brief in Philip Morris USA v. Williams, AARP, the Consumer Federation of America, the Southern Poverty Law Center, and others have asked the Supreme Court to rule that a company’s decades-long deceptive marketing justified the large punitive damages. We think the Court should not impose a rigid formula or ratio between compensatory and punitive damages. Instead, we support maintaining the Court’s flexible approach that recognizes a higher ratio may be appropriate when compensatory damages are low or difficult to measure. The Supreme Court has held that punitive damages violate due process when they are grossly excessive in relation to the state’s legitimate interest in punishment and deterrence. The Court evaluates the conduct’s reprehensibility, the disparity between actual harm and the punitive damages, and the difference between the damages award and any civil penalties imposed in similar cases. Although the Court consistently rejected this notion in BMW v. Gore (1996) and State Farm v. Campbell (2003), Philip Morris still asks the Court to adopt a constitutional line marked by a simple mathematical formula. The tobacco company wants to override the primacy of reprehensibility in favor of an arbitrary limit: a low single-digit ratio, one that falls short of reflecting the full harm to Williams and his family and that fails to deter the company from wrongdoing. HARSH TO THE ELDERLY The implications of Philip Morris’ plea for a ratio reduction are especially ominous for those who suffer significant harm that generates low compensatory damages. Of particular concern are the retirees not entitled to replace lost wages or recover back pay, and the aged or low-income people who suffer injury from wrongful conduct. Such a decision in favor of Philip Morris would have disastrous results because defendants will be less severely punished when those they harm are older or poorer. Wrongful death damages undervalue older Americans, like Jesse Williams, who died at age 67. They focus not on the contributions that older Americans have made to our society and economy during their lifetimes, but rather on lost wages and future earning capacity. A regime that calculates punitive damages primarily in relation to this diminishing value, rather than based on reprehensibility of the conduct that caused the harm, serves as an ineffective deterrent for conduct that victimizes the elderly. Punitive damages should not be artificially low, especially in the face of highly reprehensible conduct, merely because a plaintiff’s age resulted in relatively low actual damages. This would have the perverse effect of punishing wrongdoers less when their victims are older. The result of limiting punitive damages would be that those (such as insurers, nursing homes, and employers) who take advantage of older people may be able to operate with impunity because ratios will likely result in substantial underdeterrence. Furthermore, if punitive damages are to deter misconduct, they must be sufficient to modify the behavior of a wrongdoing corporation. In this case, where the Williams punitive damage award is only a week or two of Philip Morris’ annual profits, it allows such conduct to remain economically profitable — just a simple cost of doing business. Our legal system leaves the responsibility of policing corporations almost entirely to the states. Most states rely on punitive damages in civil lawsuits as the established enforcement mechanism of choice. Arbitrary ratio limits that operate as maximum fines, regardless of the level of harm or reprehensibility, place those corporations whose activities affect the lives of the most people outside the effective reach of civil law. If the Supreme Court requires strict adherence to a ratio between actual and punitive damages and determines that single-digit ratios can never be exceeded, then punitive damages will lose their deterrent effect. Such a strict adherence to ratios would lead to unconscionable results: Lesser punishments would be imposed against those whose actions resulted in great harm, merely because their victim was not younger. This is not a result that the Supreme Court should allow.
Deborah Zuckerman is a senior attorney with AARP Foundation Litigation in Washington, D.C. Elizabeth J. Cabraser is a partner in the San Francisco office of Lieff, Cabraser, Heimann & Bernstein. They filed an amicus brief in support of Williams.

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