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Five years ago, when Miami lawyers Stanley and Susan Rosenblatt settled a landmark class action against tobacco makers on behalf of nonsmoking flight attendants, they were criticized by some for enriching themselves at the expense of their clients. The husband-and-wife legal team sued on behalf of thousands of flight attendants who allegedly had developed a variety of sicknesses because of secondhand smoke that they were exposed to while working on airplanes. The settlement in Norma Broin v. Philip Morris netted the couple $46 million, with $300 million more going to a medical research foundation to study the effects of secondhand smoke. But under the deal, each flight attendant had to sue individually to recover damages. “I’m deeply concerned that this settlement will make it difficult for more than a handful of flight attendants to ever recover any compensation,” Matthew Myers, general counsel at the National Center for Tobacco-Free Kids, said at the time. “The tobacco industry dodged a bullet.” On Tuesday, the Rosenblatts won at least preliminary vindication when Lynn French, who claimed she had developed chronic sinusitis from 14 years of working on smoke-filled planes, was awarded a whopping $5.5 million in pain and suffering damages by a six-person Miami-Dade jury. But the tobacco industry still harbors hope that the Rosenblatts made a crucial omission in drafting the settlement agreement that could derail all the flight attendants’ cases. French was the second flight attendant out of the class of more than 3,000 people to get her case to a jury, and she became the first plaintiff ever to win a secondhand smoke case. The first case involved former flight attendant Marie Fontana, who claimed that she had chronic obstructive pulmonary disease from secondhand smoke. Her case resulted in a defense verdict. Legal observers are hailing the Rosenblatts’ settlement deal as a masterstroke for the flight attendants, and calling the tobacco companies’ approval of the pact a monumental miscalculation. “[Stanley Rosenblatt] was accused of selling out,” says Miles McGrane, a partner at McGrane & Nosich in Coral Gables, Fla., who, along with five other Miami attorneys, is representing flight attendants. “But now we see that he was ahead of his time.” “In retrospect, the settlement was a big mistake by the tobacco companies,” says David J. Adelman, an analyst with Morgan Stanley Dean Witter who monitors Philip Morris. “It’s amazing to me that a jury would award $5 million to someone who is essentially suffering from a runny nose.” Despite his concern with potential damage awards, Adelman continues to give Philip Morris stock his highest rating. THREE KEY PROVISIONS According to attorneys on both sides of the French case, several provisions in the settlement agreement were decisive in the surprisingly large jury verdict Tuesday. These include a shift of the burden of proof from the individual plaintiffs to the tobacco industry; a requirement that each plaintiff be provided with a videotaped copy of the class action trial and be allowed to use the testimony in her or his individual lawsuit; and a waiver of the statute of limitations for each flight attendant’s lawsuit. Those provisions proved critical to French winning her verdict. Marvin Weinstein, a partner at Grover Weinstein & Trop in Miami who represented French, says the provision shifting the burden of proof to the defendants was key. “It gave us a distinct advantage,” he says. “The defendant had to prove that secondhand smoke cannot cause chronic sinusitis.” In addition, he says, the videotaped testimony of former U.S. Surgeon General Dr. Julius B. Richmond and Dr. David Burns, who wrote the 1986 surgeon general’s report on sinusitis, were central in making the case that secondhand smoke can cause sinusitis. Because of the settlement, it’s certain that juries in future flight attendant cases will see this same videotaped testimony. More than 1,800 of the flight attendant lawsuits are based on claims of chronic sinusitis due to the secondhand smoke exposure, Weinstein says. Finally, the statute of limitations waiver was indispensable. “If not for the waiver, French would have been barred from bringing her claim,” says Kenneth J. Reilly, a partner at Shook Hardy & Bacon in Miami who is representing tobacco giant Philip Morris. In fact, he notes, all the individual plaintiffs would have been barred by the statute of limitations. Attorneys representing the flight attendants say up to 15 cases may be tried in Miami-Dade Circuit Court by the end of this year. “This second flight attendant case is reflective of the majority of cases that will be tried,” says Abbey Kaplan, a partner at Kluger Peretz Kaplan & Berlin in Miami who is part of the group of attorneys representing the flight attendants in the individual cases. “This verdict sends one of many messages that’s going to be sent to Big Tobacco. Sooner or later they’ll wake up and smell the coffee.” The implications of the secondhand smoke verdict are many for tobacco companies, says Richard Daynard, a law professor at Northeastern University, head of the Boston-based anti-smoking group Tobacco Control and a longtime observer of tobacco litigation. “Attorneys had begun to despair that they would not win secondhand smoke cases,” he says. “This verdict is a wake-up call to employers whose employees are exposed to secondhand smoke.” A new report by the World Health Organization released Wednesday may bolster the claims of the flight attendants. The WHO study found that secondhand smoke causes cancer. MAJOR MISTAKE? But tobacco companies are pinning their hopes for victory on the argument that the Rosenblatts made a major mistake when they crafted the 1997 settlement agreement. They claim that the Rosenblatts failed to stipulate that liability need not be proven in each case. In the French case, the plaintiff did not have to prove liability on the part of the tobacco companies, but only show causation and damages. The reason is because in October 2000 Miami-Dade Circuit Judge Robert Kaye, who presided over the Broin case, ruled that the 1997 settlement conceded liability and left only the issues of causation and damages to be tried. Last fall, that ruling was appealed to the 3rd District Court of Appeal but it was dismissed on the grounds that there was not yet a final judgment from an individual case to appeal. Now, with the French verdict in, the case is ripe for appeal and tobacco attorneys plan to return to the 3rd District Court with the same argument. According to all sides, the resolution of this question in the appellate courts will be decisive. “This is hugely important,” says Reilly of Shook Hardy. “It’s what everyone has been waiting for.” Attorneys for the plaintiffs say having to prove liability in each case would be a blow to the flight attendants’ cases. “It would take 250 years to try all of the cases,” says Joel Perwin, a partner at Podhurst Orseck Josefsberg Eaton Meadow Olin & Perwin in Miami, who will handle the appeal for the plaintiffs. VERDICT WILL SPEED APPEAL According to one observer who is critical of the lawsuit by the flight attendants, the French verdict provides tobacco companies with the opportunity to quickly answer the key question that could derail the litigation. “Would I have been happier if tobacco had reeled off 15 wins? Yes. But tobacco had to lose one to get the question of liability to the 3rd DCA, and now they have,” says Robert Campagnino, an equity analyst with Prudential Securities Research who monitors Philip Morris. He currently recommends buying the company’s stock. Not surprisingly, the two sides interpret the settlement agreement in starkly different lights. In Reilly’s view, while the settlement shifted the burden of proof, all the other standard evidentiary burdens remain the same. “The plaintiff must prove its entire case, not the truncated process like we have now,” he says. But in Perwin’s view, the settlement is clear and it defies logic to think the Rosenblatts would have settled without the tobacco companies conceding liability. He recalls that when the settlement was struck, the trial on liability was in process, and the plaintiffs had to put on dozens of witnesses to demonstrate liability. “The trial was only stopped and the settlement agreed because they conceded liability,” he contends. “Why would anyone agree to stop one trial on liability in exchange for thousands more long trials on liability?” Essentially, tobacco companies are saying that nothing in the settlement agreement spells out what is excluded at trial, while flight attendant lawyers say the agreement explicitly says what is included at trial. According to both sides, there is not a provision that says explicitly: Liability is conceded by the defendants. The presiding judge in the French case, Miami-Dade Circuit Judge Fredricka Smith, will rule on forthcoming post-trial motions from the tobacco attorneys. Then, unless she overturns the plaintiff verdict, the defendants will appeal to the 3rd District Court of Appeal for an interpretation of the 1997 settlement agreement. It is there, or subsequently in the Florida Supreme Court, that the long-running saga of the flight attendants lawsuits may be resolved. “[The tobacco companies] are arguing the plaintiffs made the stupidest agreement in the history of litigation,” Perwin says. But for now, at least, the Rosenblatts are looking pretty smart.

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