A Pulaski County judge was right to grant class-action status to a 2003 lawsuit alleging that Philip Morris USA violated a state consumer-protection law by falsely advertising its "light" cigarettes, the Arkansas Supreme Court decided Thursday, with one judge dissenting.
A 17-page order written by Justice Rhonda Wood on behalf of the majority affirmed the 2013 pretrial ruling by Circuit Judge Tim Fox, which could result in the largest class ever in Arkansas.
Two weeks ago, attorneys Thomas Thrash, representing potentially hundreds of thousands of plaintiffs, and Lisa Blatt, representing the tobacco company, made oral arguments before the justices, disagreeing on whether people who bought Marlboro Lights in Arkansas between 1971 and 2010 have enough "commonality" to constitute a class.
The lawsuit alleges that the tobacco company, now a division of Altria Group Inc., violated the Arkansas Deceptive Trade Practices Act by advertising Marlboro Lights as safer and having less tar and nicotine than other cigarettes.
Light cigarettes first went on sale on Nov. 1, 1971. A federal law that went into effect on June 22, 2010, banned tobacco companies from advertising cigarettes as "light" or "low tar," prompting Marlboro Lights to be renamed Marlboro Gold and Ultra Lights to be renamed Marlboro Silver.
Wood said the majority of the court agreed with Fox's ruling "because common issues predominate, because the class-action method is a superior method to adjudicate at least some parts of the plaintiffs' cause of action, and because the class is ascertainable."
She said that class-action certification is governed by Arkansas Rule of Civil Procedure Rule 23, which imposes six musts for a case to be certified as a class action. Those musts are numerosity, commonality, typicality, adequacy, predominance and superiority -- or having enough plaintiffs with common concerns that can be adequately defined and would best be decided through a class-action case.
The opinion noted that Fox found several common questions of law and fact among the potential class members that predominate over questions concerning only individuals. In agreeing with that, the majority of the court rejected Philip Morris' argument that each class member's smoking habits must be separately considered.
The court agreed with the plaintiffs' assertion that "whether an individual received less tar or nicotine is irrelevant -- the issue is Philip Morris' advertising Lights cigarettes as safer, healthier and less addictive when, according to plaintiffs, Philip Morris knew those representations were false."
Philip Morris argued that to constitute a class, all the plaintiffs must prove they relied on the advertised claims that the cigarettes were safer, but that there are a number of different reasons why people bought the "light" cigarettes. The Supreme Court said that each class members' degree of reliance on the ads is outweighed by the group's common concerns and can be resolved individually by the trial judge if necessary.
"The common issue of whether Philip Morris behaved in a deceptive manner predominates this litigation," Wood wrote.
In response to Philip Morris' complaints that monetary damages would have to be determined individually, the Supreme Court said the trial court could decide the common questions first and then "bifurcate" the trial -- split it into a second phase devoted to individual issues.
The court rejected Philip Morris' argument that the class is poorly defined because members would have to provide receipts to become a class member, which is nearly impossible. The justices said they agree that the plaintiffs can prove their class membership in other ways, such as by affidavit or testimony.
"There is no receipt requirement in order to join a class action," the opinion said.
In a six-page dissent, Justice Josephine Hart wrote that the plaintiffs, Wayne Miner of Franklin County and James Easley of Miller County, failed to show there are enough common issues among class members, that a class action is the superior method of adjudication and that the borders of the class can be adequately defined.
Metro on 02/27/2015