Ill. court revives $10 billion verdict in cigarette lawsuit

ST. LOUIS -- An Illinois appellate court has reinstated a decade-old $10.1 billion verdict in a class-action lawsuit against Phillip Morris USA that found the nation's biggest cigarette maker misled customers about "light" and "low tar" designations.

Philip Morris swiftly decried Tuesday's ruling by a three-judge panel of the Mount Vernon-based 5th District Appellate Court, saying it would ask the Illinois Supreme Court to review the matter. As that takes place, Philip Morris said, the latest decision is automatically stayed.

The appeals court ruling revived a 2003 verdict in Madison County that found Philip Morris broke Illinois law by marketing "light" and "low tar" cigarettes as safer than other cigarettes. The lawsuit was the nation's first to accuse a tobacco company of consumer fraud.

The Illinois Supreme Court later threw out that verdict, saying the Federal Trade Commission allowed companies to characterize or label their cigarettes as "light" and "low tar." It said Philip Morris could not be held liable under state law even if the terms were misleading or false.

The U.S. Supreme Court let that ruling stand in late 2006, and Byron dismissed the case the next month.

But in a 5-4 decision in December 2008, the nation's high court ruled in favor of three Maine residents who said smokers should be able to use state consumer protection laws to sue cigarette makers for promoting "light" and "low tar" brands.

Stephen Tillery, the attorney behind the Illinois class-action lawsuit, said that decision counted as new evidence and could be applied to reinstate his case. An Illinois appellate court agreed.

Subsequent appeals led to Tuesday's reinstatement of the verdict.

The class-action lawsuit was filed in 2000 on behalf of perhaps more than one million people who bought "light" cigarettes in Illinois. The suit claimed Philip Morris knew when it introduced such cigarettes in 1971 and hid the fact that they were no healthier than regular cigarettes, and that "light" cigarettes actually contain a more toxic form of tar.

Tillery's law firm said in a statement that Tuesday's development was "yet another chapter in the long and tortuous history" of the legal saga, and that interest accrued over the 11 years since the original ruling should double the size of the judgment.

"We are pleased with the Fifth District's well-reasoned decision and are happy that Philip Morris will finally be held accountable for deceiving Illinois consumers," Tillery said.

Vowing to appeal, the senior vice president and associate general counsel for Altria Client Services, which represents Richmond, Va.-based Altria Group Inc.'s subsidiary Philip Morris, argued that the appellate court overstepped.

"The law does not allow the Fifth District to reopen a decision by the Illinois Supreme Court based on speculation about the possible impact of subsequent events on the higher court's ruling," Murray Garnick said in a statement.

Garnick also argued the appellate court erred in reinstating the verdict "despite the fact that the Illinois Supreme Court previously raised other problems with the judgment, including whether the case was properly certified as a class action."

The regulatory U.S. Food and Drug Administration now bars cigarette makers from using "light" or other descriptors without authorization.