Supreme Court to Hear Philip Morris Appeal

The Supreme Court said Tuesday it will decide if tobacco giant Philip Morris must pay nearly $80 million in damages to a longtime smoker, a case that could shield companies from large jury awards.

The Oregon Supreme Court had ruled that the amount wasn't excessive given the "extraordinarily reprehensible" conduct of Philip Morris in marketing cigarettes.

A jury had ordered damages be paid to the family of Jesse D. Williams, a janitor who smoked three packs of Marlboros a day before he died in 1997 of lung cancer. Williams took up cigarettes in the 1950s while serving in the Army in Korea.

The case gives justices a chance to clarify a 2003 ruling in an insurance case that said punitive damages should generally be in line with actual damages. Arguments will be this fall.

Philip Morris lawyers said that the punitive damages in the Williams case were nearly 100 times the compensatory damages and that the Oregon Supreme Court decision is "dangerous."

The state court said that the company "knew that smoking caused serious and sometimes fatal disease, but it nevertheless spread false or misleading information to suggest to the public that doubts remained about the issue."

Philip Morris is part of Altria Group Inc. (MO).

The case is Philip Morris USA v. Williams, 05-1256.