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Hunter v. Philip Morris USA Inc.

Supreme Court of Alaska

December 18, 2015

DOLORES HUNTER, as personal representative for the ESTATE OF BENJAMIN G. FRANCIS, Appellant and Cross-Appellee,
PHILIP MORRIS USA INC., Appellee and Cross-Appellant

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Appeal from the Superior Court of the State of Alaska, Fourth Judicial District, Bethel, Eric Smith, Judge. Superior Court No. 4BE-06-00407 CI.

Don C. Bauermeister, Burke & Bauermeister, PLLC, Bremerton, Washington, for Appellant/Cross-Appellee.

Jeffrey M. Feldman and Susan Orlansky, Feldman Orlansky & Sanders, Anchorage, Steven S. Tervooren, Hughes Gorski Seedorf Odsen & Tervooren, LLC, Anchorage, Geoffrey J. Michael, Arnold & Porter, LLP, Washington, D.C., Patrick J. Gregory, Shook, Hardy & Bacon, LLP, San Francisco, California, and Stanley D. Davis, Shook, Hardy & Bacon, LLP, Kansas City, Missouri, for Appellee/Cross-Appellant.

Before: Fabe, Chief Justice, Winfree, Stowers, Maassen, and Bolger, Justices.


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FABE, Chief Justice.


Dolores Hunter, the personal representative of the estate of Benjamin G. Francis, appeals from a series of orders following a jury verdict in a wrongful death, products liability, and fraud action against Philip Morris USA Inc. resulting from Francis's death from lung cancer. Following the verdict, Hunter moved for a new trial on the basis of evidentiary rulings at trial and on the basis that the verdict was against the weight of the evidence. The superior court initially granted Hunter's motion for a new trial based on the weight of the evidence but then granted Philip Morris's motion to reconsider, vacated its first order and denied Hunter's motion for a new trial. Because the superior court's orders applied a test that is inconsistent with the " weight of the evidence" new trial standard we have established to guide trial courts, we reverse and remand for renewed consideration of Hunter's motion.


A. Background And Pre-Trial Proceedings

Benjamin Francis died of lung cancer in December 2004. Dolores Hunter, the personal representative of his estate, filed a wrongful death action against Philip Morris USA Inc., Altria Group, Inc., and the Alaska Commercial Company, alleging that the cigarettes they collectively sold to Francis were responsible for his death and that they were liable under various theories related to fraud and products liability. Philip Morris answered, and the parties prepared for trial.[1]

In the months before the trial, both parties filed a number of motions in limine. Of particular relevance in this appeal is a Philip Morris motion that sought to preclude Hunter from referring to the findings of fact and conclusions of law from a federal lawsuit, United States v. Philip Morris USA Inc. [2] In that case, Judge Gladys Kessler of the United States District Court for the District of Columbia issued an extensive opinion finding that Philip Morris and other cigarette manufacturers had violated the federal Racketeer Influenced and Corrupt Organizations (RICO) Act by jointly and fraudulently deceiving the public about the health consequences of smoking and secondhand smoke, the addictiveness of nicotine, the health benefits of " light" cigarettes, and design choices aimed at sustaining nicotine addiction.[3] In addition to finding Philip Morris liable in that case, Judge Kessler enjoined the corporation from engaging in a wide variety of practices, including " conveying any express or implied health message or health descriptor for any cigarette brand." [4] To that end, Judge Kessler specified that words such as " low tar," " light," " ultra light," " mild," " natural," and related terms could not be used in any branding, advertising or other informational material.[5]

In its motion in limine, Philip Morris argued that references to Judge Kessler's injunction and findings of fact and conclusions of law would constitute inadmissible hearsay and otherwise confuse and unduly prejudice the jury. It therefore requested that the superior court rule that Hunter would not be permitted to introduce the findings directly, have a witness reference the findings, or cross-examine a defense witness using the findings.

Hunter opposed Philip Morris's motion. She claimed that she did not " seek to have Judge Kessler's Opinion, Findings of Fact, Conclusions of Law or granting of remedies admitted into evidence in this action, unless the door is open to such." But she did request that the superior court " enforce Judge Kessler's injunction" highlighting language

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from the opinion in the federal case that " prohibited [the defendants in that case] from making, or causing to be made in any way, any material, false, misleading or deceptive statement or representation concerning cigarettes that is disseminated in the United States." [6] Her motion concluded that, " [a]s a matter of comity, [the superior court] must enforce Judge Kessler's injunction" and that Philip Morris's counsel and witnesses therefore " should be prohibited from introducing evidence or argument that involves any of the findings made by Judge Kessler."

The superior court granted Philip Morris's motion in limine, concluding that the judicial findings at issue were inadmissible hearsay. The superior court's order noted that " it is not at all clear what plaintiff means in asking the court to 'enforce' the injunction," and expressed the court's " considerable doubt it has the authority to enforce an injunction entered by a federal court when plaintiff is not a party to the case."

B. Trial And Verdict

The trial began in October 2011. Although it lasted nearly a month, the testimony from one witness is most relevant to Hunter's current appeal. During Philip Morris's defense, it called Dr. Peter Lipowicz, a senior principal scientist at Altria Client Services,[7] as an expert witness. Among the topics that Dr. Lipowicz testified about on direct examination was Philip Morris's design effort, starting in the 1950s, to " make a cigarette somewhat less dangerous and a little bit safer." Dr. Lipowicz testified that he believed that Philip Morris's lines of cigarettes with reduced tar and nicotine yields, including Marlboro Lights, had succeeded in that effort, and that " it was really promoted by the public health community" for years.

During cross-examination, Hunter's counsel turned to the reasons that Philip Morris no longer sold cigarettes under the name Marlboro Lights. Dr. Lipowicz testified that Philip Morris " had to take the word 'lights' off our cigarettes [as required by] the FDA." Hunter's counsel asked why federal law banned the descriptor " light," which elicited Dr. Lipowicz's testimony that he was " not sure [of] all the foundation for the law." Hunter's counsel then asked, " Are you telling us that it's not even legal to put 'lights' on the package anymore?" at which point Philip Morris's counsel objected. At that point, the superior court ended Dr. Lipowicz's testimony for the day and discussed Philip Morris's objection and the questions Hunter's counsel planned to ask Dr. Lipowicz the next morning. The superior court identified two lines of conflict between the parties: whether Dr. Lipowicz's testimony had violated Judge Kessler's injunction, and whether Hunter's counsel could cross-examine Dr. Lipowicz about Judge Kessler's findings and the findings Congress had made in the Family Smoking Prevention and Tobacco Control Act, the 2009 legislation that banned the " light" descriptor. Hunter's counsel asked to submit a brief addressing both topics, which the superior court allowed, and Philip Morris's counsel took the opportunity to argue that the Congressional findings were both inadmissible as evidence of the facts Congress found and beyond the scope of Dr. Lipowicz's testimony on direct examination.

The next morning Hunter's counsel moved " for judicial notice and enforcement of [Judge Kessler's] injunction." This motion first argued that Dr. Lipowicz's testimony on direct examination had violated Judge Kessler's injunction against " falsely den[ying] . . . that its light or low tar descriptors are misleading," and requested that the superior court enforce the injunction by offering a corrective instruction. The motion then argued that " Congress has banned 'light' and similar descriptors because they are misleading," and quoted Congress's finding that " many smokers mistakenly believe that 'low tar' and 'light' cigarettes cause fewer health problems than other cigarettes." [8]

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At the start of the day's proceedings, the parties again discussed the evidence Hunter's counsel could use in his cross-examination of Dr. Lipowicz. The superior court determined that it lacked authority to enforce Judge Kessler's injunction, as it had suggested in its pre-trial order. The superior court discussed the admissibility of Congress's findings in greater depth and challenged Philip Morris's counsel's characterization of those findings as hearsay. The superior court concluded the discussion by addressing Hunter's counsel: " Given the complications of the issue, I believe that the witness was asked yesterday if those words had to be taken off, and his answer was, 'Yes, Congress told us to.' And I'm going to -- Mr. Bauermeister, you can -- you'll just leave it at that."

Hunter's counsel resumed his cross-examination of Dr. Lipowicz. In accordance with the trial court's orders, he did not directly ask why Congress and the FDA had banned certain descriptors. But he did cross-examine Dr. Lipowicz using a 2010 report from the National Cancer Institute that concluded that the existence and marketing of low-yield cigarettes may have increased the number of deaths due to smoking by encouraging smokers with health concerns to switch rather than quit altogether. Dr. Lipowicz agreed that Philip Morris did not publicly contest the National Cancer Institute's conclusions, which were read to the jury.

At the conclusion of the trial, the jury returned a special verdict form. The jury found that Philip Morris's product was not defective. But it further found that Philip Morris had made one or more false or misleading statements regarding the dangers of cigarette smoking, that it had known the statements were false or misleading when it made them, and that it intended or had reason to expect that Francis would rely on them. Finally, it found that Francis had not seen or heard any false or misleading statements by Philip Morris and therefore returned a verdict for Philip Morris.

C. The Superior Court's First Order, Granting Hunter's Motion For A New Trial

Hunter moved for a new trial under Alaska Civil Rule 59 on the grounds that the jury had been misled by false evidence, that Philip Morris's defense had violated an injunction issued by another court, and that the jury's findings were against the clear weight of the evidence. Hunter first asserted that the court's evidentiary rulings at trial had impermissibly restricted her counsel's ability to cross-examine Dr. Lipowicz about Judge Kessler's findings, and that as a result Dr. Lipowicz had been able to mislead the jury about whether Congress had found that Philip Morris acted fraudulently. But the superior court rejected this argument.

The superior court reasoned that Judge Kessler's findings were " both hearsay and not binding on either this court or the jury," and that Hunter's " planned cross examination would have rested on the factual accuracy of Judge Kessler's findings." The superior court observed that " the fact that Dr. Lipowicz knew about [Judge Kessler's] findings had no bearing on the content of his testimony unless one compared his testimony to the content of the findings themselves." The superior court thus rejected Hunter's arguments that the results of the suit in Judge Kessler's court should have been admissible as an exception to hearsay offered for a purpose other than the truth of the matter asserted. Additionally, the superior court reasoned that because the injunction was stayed when Philip Morris removed the descriptor " light" from its products, Dr. Lipowicz could have testified truthfully that the injunction had not been the cause of that change.

But the superior court granted Hunter's motion for a new trial on the ground that the jury's finding that Francis did not see or hear any false or misleading statements was against the weight of the evidence. Its order set out the standard trial courts should consider when deciding whether to grant a new trial by citing and quoting this court's opinions in Kava v. American Honda Motor Co. [9]

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and Hogg v. Raven Contractors, Inc. [10] Specifically, the superior court quoted the following language from Kava :

[A] trial court may set aside a verdict and order a new trial in the interest of justice if the verdict is against the weight of the evidence. In deciding a motion for a new trial on this basis, the court must use its discretion and independently weigh the evidence. A court may set aside a verdict as being against the weight of the evidence even when " there is substantial evidence to support it." The decision is a matter for the trial court's discretion.[11]

In a footnote, the superior court examined the court of appeals' decision in Taylor v. State.[12] Quoting that decision's statement that a new trial is available " only when the evidence supporting that verdict '[is] so slight and unconvincing as to make the verdict plainly unreasonable and unjust,'" [13] the superior court concluded that " [t]he standard used in reviewing a motion for a new trial in the context of a criminal trial actually is somewhat more deferential than that used in a civil trial."

The superior court then applied its understanding of the new trial standard to Hunter's contention that the jury's finding that Francis had not seen or heard any false or misleading statements by Philip Morris was against the weight of the evidence. The court wrote that " Francis clearly was exposed to the descriptor 'light,'" based on its inclusion on the packaging of Marlboro Lights, and that

as defendant admitted at oral argument,[14] Mr. Francis switched to light cigarettes because they were less harsh and because he thought they were better for him. He accordingly had to have been exposed to . . . information that, as discussed below, had to have come to him directly or indirectly from [Philip] Morris.

The superior court thus reasoned that the verdict " therefore necessarily was against the weight of the evidence unless the jury found that the marketing of light ...

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