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Florida is epicenter of fight against Big Tobacco

Two decades ago, a husband-wife team of Miami lawyers took a David and Goliath swipe at Big Tobacco, filing a class-action suit on behalf of 500,000 Floridians.

"Every family member, every fellow trial lawyer told us we would go down the tubes,'' says Stanley Rosenblatt. But he had questioned industry CEOs before and "I had developed a real distaste for them,'' he says. "I didn't like what they had done to the American people, and I thought we would have some fun.''

That class action was finally dismissed eight years ago, splintering into thousands of individual lawsuits, making Florida the epicenter of tobacco litigation.

Only a few clients have collected, and cases have crept along so slowly that many plaintiffs died before getting their day in court.

Among them: Laura Zeller of Pasco County, who died in 2012 before realizing her dream of buying a mobile home with settlement money.

"Her body just gave out,'' said daughter Melissa Nelson.

Now the pace of litigation may pick up.

Court actions recently stripped the industry of a potent defense that could have wiped out thousands of cases. Lawyers are honing their skills and sharing notes about taking on the industry. A California investment firm is confident enough of ultimate victory that it is fronting cash to plaintiffs and attorneys.

Florida has 2,000 to 3,000 suits that descended from the Rosenblatts' class action, compared to maybe 100 pending antitobacco suits in all other states combined.

Blood is in the water.

'Didn't get the memo'

Stanley Rosenblatt, 77, and his wife, Susan, 63, filed their tobacco class-action suit in 1994. He was a prominent-personal injury lawyer. She had earned a law degree at age 21 and given birth to nine children en route to an ace appellate practice.

Back then, tobacco companies were nearly invincible, says Northeastern University law professor Richard Daynard.

"The notion was that you couldn't possibly take on the tobacco companies unless you had lots of lawyers,'' Daynard says. "Stan and Susan didn't get the memo.''

The class action was called the Engle case, after the lead plaintiff — the Rosenblatts' pediatrician. A lifelong smoker, he suffered from emphysema.

The couple didn't give themselves much of a chance, they say. Maybe they would create some havoc, lose and move on.

Instead, the class action dragged on for 12 years.

"We borrowed tons of money,'' Susan says. "We had a fairly large firm at first, then associates quit, thinking we would go under.''

After a two-year trial, the jury awarded the class $145 billion. On appeal, the Florida Supreme Court rejected the enormous verdict, saying plaintiffs must sue individually to prove their own specific damages.

These individual Engle suits — which had to be filed within a year — carried a big advantage: They could retain the class-action jury findings that cigarettes are addictive and dangerous and the industry had conspired to hide that fact.

Everyone else had to prove those allegations from scratch — a pricey and difficult process.

Even so, only a few dozen Florida lawyers would represent individual Engle plaintiffs. Cases were costly and time consuming. Jurors tended to blame smokers for making bad choices. Appeals could stretch on for years.

Right before one trial, the tobacco side disqualified the judge because she was a board member of a drug rehab organization.

"It was going to take us a year to reschedule'' with a new judge, says St. Petersburg lawyer Kent Whittemore. "The client said, 'I can't do this anymore,' " and dropped the case.

The silver bullet

Looming over the Engle cases was the tobacco companies' claim that their due process rights had been violated because plaintiffs didn't have to prove in each case that the industry concealed the dangers of cigarettes.

It was a silver bullet argument that stood to wipe out dozens of verdicts winding through appeals and decimate a few thousand cases yet to be tried.

The Florida Supreme Court rejected the due process defense last year, followed by the U.S. appellate court in January. When the U.S. Supreme Court refused to even hear the case this month, the cloud lifted.

"That was their last shot. Now they have to face the music,'' crowed Keith Mitnik, tobacco specialist at Morgan & Morgan. "You can stall, but the pipeline is filling and you are going to have to pay.''

About 120 Engle cases have gone to trial, with plaintiffs winning roughly two-thirds. R.J. Reynolds, Philip Morris and Lorillard face about $500 million in pending damages.

California's Law Finance Group looks for promising opportunities to invest in litigation. Plaintiffs may win a big verdict, but do not collect until appeals are exhausted or the defense settles. Legal financing firms will pay plaintiffs and their attorneys a portion of damages and legal fees during appeals. If the plaintiffs win, the financing firm gets its money back, plus a lot more. If the defense wins, the financing firm loses out.

It's an outsider's vote of confidence in the plaintiffs' chances.

Watching the legal trends in the Engle cases, Law Finance began investing in verdicts about a year ago. "We've done more than 10 and less than 40,'' says CEO Alan Zimmerman.

The tobacco industry "has nowhere else to go" with its due process defense after the Supreme Court refused to take it up, he says. "This brought clarity.''

In addition to the verdicts, the industry's legal costs can reach $1 million or more per case, plaintiffs' lawyers estimate. Whittemore says R.J. Reynolds rented an entire floor at the Vinoy hotel in St. Petersburg for its retinue in a two-week trial.

Industry representatives did not respond to a request for comment.

"It's our assumption that at some point (the companies) are not going to want to try these cases anymore'' and start settling, Zimmerman says.

For some people, it's too late.

The mobile home

Engle plaintiffs often started smoking in the 1940s or '50s, before health dangers were well known, and developed cancer, chronic obstructive pulmonary disease and other serious conditions. Many don't survive waiting years for their day in court.

Pasco resident Laura Zeller died two years ago at age 71. She told her daughter Melissa she started smoking as a teenager because it was cool, and quitting "was just too hard.''

"She was a chain smoker,'' says Melissa Nelson. "She would have one burning in the ashtray and light up another.''

Zeller, a secretary, suffered a massive stroke from clogged carotid arteries in 1994, just as the Engle class action was filed. She would go on to have heart attacks, brain surgery and a diseased gall bladder.

After the stroke, Zeller loved to watch game shows, be around her family and, yes, sit out on the porch and smoke, her daughter says. From time to time, she asked about the lawsuit.

The Pinellas lawyers representing her would "say they were still waiting for the Supreme Court, or this and that,'' Nelson says.

Her mother had lost her mobile home and hoped that a verdict would let her buy another, Nelson said. But she died first.

Howard Engle died in 1999, about when the class-action suit went to trial. The Rosenblatts declined to discuss how much they earned from tobacco cases, but they are not hurting. They forced a big settlement in an earlier case involving flight attendants and secondhand smoke. Three named plaintiffs in the Engle class action were awarded $12.7 million in damages.

The Rosenblatts are largely retired, though Susan consults with Engle lawyers fighting appeals.

The U.S. Supreme Court's rejection of Big Tobacco this month "was like winning all over again,'' she says.

Her husband, remembering their gamble of 20 years ago, compared surviving Engle plaintiffs and attorneys to young adults at a bar mitzvah.

"It's like seeing that little kid you remember as baby,'' Stanley Rosen­blatt says.

"All of a sudden, he's reading Hebrew and becoming a man.''

Stephen Nohlgren can be reached at nohlgren@tampabay.com. Times researchers Caryn Baird and Carolyn Edds contributed to this report.

Timeline

Key events in Florida tobacco litigation:

May 1994: Mississippi becomes the first state to sue the tobacco industry to recover Medicaid costs for treating tobacco-related illnesses. Florida and 43 other states file similar suits.

May 1994: Miami lawyers Stanley and Susan Rosenblatt file a class-action suit, known as Engle vs. Liggett Group, against the major cigarette producers, seeking more than $100 billion in compensatory and punitive damages.

August 1997: Florida settles its Medicaid suit with the nation's largest tobacco

companies for

$11.3 billion.

July 2000: The jury in the Engle case awards $145 billion in punitive damages after finding that cigarettes are addictive and dangerous, and that the industry conspired to hide those facts. As many as 700,000 smokers are estimated to be part of the class action.

December 2006: The Florida Supreme Court dismisses the $145 billion award as excessive but tells Engle plaintiffs that if they file individual suits within a year, they can retain conspiracy findings against the tobacco companies.

April 2010: An Alachua jury awards Lyantie Townsend $30 million in damages after her husband dies of smoking-related disease. It is one of the first and largest awards as Engle plaintiffs begin to pursue individual cases, but it would take four years for her to collect.

March 2013: The Florida Supreme Court rules in a Hillsborough case that its earlier Engle decision did not violate the tobacco industry's legal rights.

October 2013: The U.S. Supreme Court declines to review a decision involving the death of smoker Charlotte Douglas, wiping out the industry's argument that it was being treated unfairly in Engle cases being tried in state courts.

June 2014: The U.S. Supreme Court declines to review another ruling, wiping out the industry's claim of unfair treatment in Engle cases being tried in federal courts.

Compiled by

Caryn Baird.

Source: Times files

Florida is epicenter of fight against Big Tobacco 06/21/14 [Last modified: Saturday, June 21, 2014 11:01pm]
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