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Swanson, Martin & Bell, L.L.P.

Missouri Supreme Court Transfers Court of Appeals’ Decision Finding Deceased Smoker’s Family Has Separate Wrongful Death Cause of Action Against Tobacco Company Even Though Smoker Unsuccessfully Filed Similar Lawsuit While Alive
The family of deceased former smoker brought a wrongful death action in Missouri state court against a tobacco company alleging negligence and product defect. The jury awarded the family $2 million in compensatory damages and $20 million in punitive damages. The compensatory damages were reduced to $500,000 after the jury determined the decedent was 75% responsible for her injuries.

The tobacco company argued that the wrongful death suit was precluded by the language of the wrongful death statute because the decedent had previously brought suit in federal court against the tobacco company for the same claims and, accordingly, would be unable to bring suit in state court. The tobacco company’s argument was rooted in the language of the wrongful death statute; it never argued that the wrongful death claim was barred by virtue of res judicata or collateral estoppel. Recognizing it was adopting a minority position, the Court held that the wrongful death statute does not bar a wrongful death action by a decedent’s survivors where the decedent brought a personal injury action during her lifetime for injuries resulting from the same cause of her death. The court noted that: the language of the wrongful death statute requires only that there be some tort for which the defendant could be found liable as opposed to the decedent actually being able to bring suit at the time of injury or death; the manifest purpose of the wrongful death statute is to compensate bereaved plaintiffs; Missouri’s wrongful death statute is an independent cause of action; and the damages recoverable for wrongful death differ from those recoverable in a personal injury action. Thus, it determined a wrongful death statute brought by a decedent’s survivors could not be compromised by a personal injury suit brought by a decedent.

The dissent disagreed with this determination. It argued that the majority wrongly interpreted the wrongful death statute. It stated that the plain wording of the statutory language creates a condition for the filing of a wrongful death action by the survivors of a tort victim. In this case, according to the court, that condition was not fulfilled because the decedent, having already resolved her tort claim, would be precluded from bringing another suit against B&W.

The tobacco company also argued that insufficient evidence was presented for a jury to find that the decedent did not know of the danger of smoking and that the decedent would have heeded a warning, had a warning been given. The court noted the rebuttable legal presumption that a decedent would have heeded a warning if the decedent knew of the danger. It determined that the presumption arose and that the decedent’s family presented sufficient evidence for the jury to determine that the decedent was injured because the tobacco company failed to warn the decedent of the danger of smoking.

The dissent disagreed with this finding. It argued that the family failed to make a submissible case as to causation on the failure to warn claim, because the evidence showed that no warning would have been effective. Thus, according to the dissent, there was no basis for applying a presumption that a warning would have been heeded. Given its finding that insufficient evidence of causation was presented, the dissent determined that a submissible case was not made as to the failure to warn claim; any recovery for that claim was error.

The tobacco company claimed that the decedent’s family needed to prove there existed a feasible and safe alternative cigarette design as opposed to the design smoked by the decedent in order to establish strict liability design defect. The court held that such a showing was not necessary because Missouri has rejected the “reasonable alternative/risk utility” test and the “consumer expectation” test set forth in the Restatements. The tobacco company’s claim was based upon these tests.

The tobacco company further claimed that the evidence at trial failed to demonstrate that the brand of cigarettes smoked by the decedent was dangerous in a manner different from cigarettes as a general category. The court concluded that sufficient evidence was presented from which the jury could conclude that the brand of cigarettes smoked by the decedent contained more free nicotine than other cigarettes; was intentionally designed to allow the smoker to inhale the smoke more deeply; contained a blend of tobacco intended to ensure certain nicotine delivery; was a highly engineered product; was protected by confidentiality agreements not to disclose trade secrets; contained numerous harmful additives; and contained the most scientifically tested filter in the world. Thus, a jury could conclude that the brand smoked by the decedent was dangerous in a manner different from ordinary cigarettes.

The tobacco company argued that the family’s suit was based upon the general health risks of cigarette smoking and that such a suit is preempted by federal law. The court determined that the evidence presented at trial demonstrated that the tobacco company made specific design choices that had the potential to negatively impact a smoker’s health. Thus, the suit was based upon specific defects in the design of a particular cigarette, and was not based upon general smoking risks. Accordingly, the suit was not preempted by federal law.

One of the claims asserted by the family was that the tobacco company was negligent in failing to warn the decedent of the dangers of smoking. The tobacco company claimed that the dangers of smoking were open and obvious and, accordingly, it did not have a duty to warn the decedent of the dangers. The court noted that the open and obvious exception to the duty to warn in a negligence claim requires a visibly observable open and obvious danger or that the injured person have actual knowledge of the specific danger. The court determined that reasonable minds could differ as to whether public knowledge about the health risks of developing disease and nicotine addiction from smoking cigarettes was so certain and generally known that the tobacco company had no duty to protect a smoker from injury. Thus, the issue was for the jury to decide.

The tobacco company also argued that the trial court erred in giving a comparative fault instruction because it had previously withdrawn its comparative fault affirmative defense. The court noted that this issue was recently addressed in Thompson v. Brown & Williamson Tobacco Corp., 207 S.W.3d 76 (Mo. App. W.D. 2006). Pursuant to Thompson, because sufficient evidence was presented to support the giving of a comparative fault instruction, it was not error for such an instruction to be given, despite the tobacco company’s withdrawal of its affirmative defense.

The jury awarded punitive damages in the amount of $20 million dollars. The issue of punitive damages for: (1) negligent failure to warn; (2) negligent design; and (3) and strict liability product defect were presented to the jury in one verdict director. Thus, it was unclear whether the punitive damages were awarded for one, two, or all three of these claims. Accordingly, the court determined whether a submissible case was made as to punitive damages for each claim. If a submissible case was not made as to one or more of the claims, the court noted that the case would be remanded so that the jury could consider punitive damages only as to the claim for which a submissible case was presented.

As to the negligent failure to warn claim, the court determined that a submissible case was not presented for punitive damages to be awarded. It found that insufficient evidence was presented that the tobacco company’s act of manufacturing or selling unreasonably dangerous cigarettes without giving an adequate warning prior to July 1, 1969, was tantamount to intentional wrongdoing. It noted that the evidence demonstrated that the tobacco company was aware that nicotine is addictive and attempted to increase the amount of nicotine in cigarettes so as to make them more addictive and more profitable, yet it consistently denied that cigarettes were harmful and no evidence demonstrated that the tobacco company was insincere in its denial. This evidence was insufficient, according to the court.

As to the negligent design claim, the court determined that a submissible case was not presented for punitive damages to be awarded. It found that insufficient evidence was presented that the tobacco company’s act of designing cigarettes containing harmful constituents and failing to use ordinary care to design a safer cigarette was tantamount to intentional wrongdoing where the evidence demonstrated that the tobacco company stopped trying to develop a safer cigarette for fear it would hurt overall sales, but that, regardless, it was not possible to make a safe cigarette. This evidence was insufficient, according to the court.

As to the strict liability product defect claim, the court determined that a submissible case was presented warranting punitive damages. It found that sufficient evidence was presented that the tobacco company’s act of manufacturing or selling defective or unreasonably dangerous cigarettes was tantamount to intentional wrongdoing where the evidence demonstrated that the tobacco company: had an active process of creating controversy regarding the health risks of smoking; planned to dispute every Surgeon General’s Report, regardless of its basis; had policies of preventing harmful information from becoming available to the public; and established procedures to ensure negative information did not reach the public. This evidence was sufficient, according to the court.

The court remanded the matter to the trial court for a new trial on punitive damages for the strict liability defect claim only. It affirmed the judgment in all other respects. The dissent exercised the authority granted by Article V, section 10 of the Missouri Constitution, and by Rule 83.03 of the Supreme Court Rules and transferred the case to the Missouri Supreme Court. The case has been transferred to the Missouri Supreme Court.

07-31-2007

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Pachulski, Stang, Ziehl, Young, Jones & Weintraub, P.C.

Henry Kevane and John Fiero Named Super Lawyers
Henry C. Kevane and John D. Fiero, partners in the San Francisco office of Pachulski Stang Ziehl Young Jones & Weintraub LLP, have been named in the 2007 edition of Northern California Super Lawyers as two of Northern California's top bankruptcy and creditor/debtor rights attorneys. The publication is published annually by Law & Politics and San Francisco Magazine.

07-31-2007

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Newmeyer & Dillion LLP

Walnut Creek Partner Jan Gruen Named to 'Top 50 Women Attorneys' in Super Lawyers Survey
Jan A. Gruen, managing partner of the Walnut Creek office of Newmeyer & Dillion LLP, was named to the “Top 50 Women Attorneys” in Northern California in the latest compilation of “Super Lawyers,” as published in the August issue of San Francisco magazine and in the companion Northern California Super Lawyers.

Gruen has been selected in each of the four years since the 2004 launch of Northern California Super Lawyers, a list of the top 5 percent of attorneys in the area as chosen by their peers and through the independent research of Law & Politics, a Minneapolis-based trade publication.

“We are proud that Jan continues to be recognized among the best in her profession,” said Greg Dillion, co-founding partner of the business and real-estate firm. “This is particularly gratifying since the selections were made by other lawyers.”

A highly successful real estate litigator serving the needs of Northern California residential and commercial builders, Gruen was also honored in 2006 by the East Bay Business Times as one of 14 “Outstanding East Bay Attorneys.” She is active in the Home Builders Association of Northern California, currently serving as President of its Women’s Council.

07-31-2007

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Kummer, Kaempfer, Bonner & Renshaw, Attorneys At Law

Attorney Steven Pacitti rejoins Kummer Kaempfer Bonner Renshaw & Ferrario
The statewide law firm of Kummer Kaempfer Bonner Renshaw & Ferrario (Kummer Kaempfer) is pleased to announce Steven Pacitti is returning to the firm’s Las Vegas office after serving as general counsel for Xyience Incorporated, a multi-million dollar energy drink and supplement corporation.

Pacitti rejoins Kummer Kaempfer as an “Of Counsel” attorney in the Transactional Department on July 16. Pacitti is licensed to practice law in Nevada, New York and New Mexico and is admitted to practice before the United States Tax Court. He received his law degree from the University of Toledo and his LL.M. in taxation from the University of Florida. Pacitti graduated from St. Bonaventure University in New York with a B.B.A. concentrating in accounting. His practice will focus on business entities and transactions, tax planning and controversy, intellectual property, sports and entertainment and real estate.

“We are very pleased to welcome Steve back,” said Michael J. Bonner, managing partner of Kummer Kaempfer. “He has gained invaluable experience serving as the chief legal counsel for a growing, innovative company, and this additional knowledge will serve our clients well as he returns to his passion of private practice.”

During his prior tenure with Kummer Kaempfer, Mr. Pacitti supervised or participated in transactions for many of the firm’s clients. In 2006, after spending two years with Kummer Kaempfer, Pacitti accepted the top legal position at Xyience Incorporated, serving that company during a period of unprecedented expansion in the supplement and beverage industries. Prior to working at Kummer Kaempfer in 2004, Pacitti served as in-house counsel to a full spectrum sports and entertainment companies as well as a national hotel management company. Pacitti also has substantial private practice and in-house counsel experience. He has received the United States Small Business Administration Regional Director’s Award and the Albuquerque Hispano Chamber of Commerce’s Minority Business Advocate of the Year Award.

07-31-2007

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Kitch, Drutchas, Wagner, DeNardis & Valitutti, P.C.

Patrick Cavanaugh Appointed to Bar Association Grievance Committee
Patrick Cavanaugh has been appointed to the Grievance Committee for the Toledo, Ohio Bar Association, effective July 1, 2007. The committee’s responsibilities include hearing grievances and presenting findings and recommendations to the Ohio Supreme Court for ultimate decisions on attorney discipline matters.

Cavanaugh has served on the Grievance Investigation Committee for the Toledo Bar for a number of years prior to this appointment. He is an associate principal with the Kitch firm.

07-31-2007

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Debevoise & Plimpton, LLP

Debevoise & Plimpton To Expand European Funds Practice
Debevoise & Plimpton LLP today announced that Anthony McWhirter will join the firm in September as a partner in the firm’s investment management practice. He will be resident in the firm’s London office. Mr. McWhirter was previously a partner with Freshfields Bruckhaus Deringer, where he founded that firm’s investment funds practice.

Mr. McWhirter advises investment managers and other financial institutions on a broad range of multi-jurisdictional private equity and other investment funds, including tax-driven fund structures and listed funds.

James C. Scoville, managing partner of the firm’s London office, said: "We welcome Anthony to the firm and to our London office. Anthony joins an outstanding group of lawyers practising in the funds area who work cohesively across the globe to ensure clients receive the benefit of all of the resources the firm can offer".

Marwan Al-Turki, co-chair of the firm’s European private equity funds group, said: "Anthony is recognised for his expertise in the area of investment funds. His understanding of the wide and complex range of legal issues in this area, underscored by a strong background in fund-related taxation issues, will add further strength and depth to our European funds practice. We are absolutely delighted to have Anthony join the firm and our team".

Anthony McWhirter said: "Debevoise’s reputation as an international leader and long-time innovator in the area of investment funds is well known. It is also one of the few firms to have senior English and US qualified corporate and tax lawyers based in London who specialise in investment funds, thus providing a full complement of skills to sponsors of internationally offered funds from one office. I am delighted and privileged to be joining this group of lawyers and look forward to being a part of one of the most dynamic and high quality funds practices in Europe and worldwide".

Debevoise’s private equity funds practice is one of the largest in the world, whether measured by the number of funds, total committed capital or resources devoted to private equity fund formation. Since 1995, the firm has acted as counsel for sponsors of or investors in over 850 private equity funds worldwide, with committed capital of more than $720 billion.

07-31-2007

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Morris, Manning & Martin, LLP

Morris, Manning & Martin Partner Speaks at Georgia Bar’s Technology Law Section Annual Meeting
The Art of Negotiating Technology Acquisition Deals” was the topic of the Georgia Bar Technology section’s recent annual meeting. The panel featured Sandra Sheets Gardiner, a Partner in the Corporate Technology Group at Morris, Manning & Martin. She shared the podium with Lael Bellamy, the Director of Legal Services at Home Depot Kevin Cranman, the General Counsel at Tandberg TV, moderated the event, which was held on June 27 at noon.

The discussion explored potential pitfalls in negotiation, indemnification concerns and limitation of liability as well as new information that could affect large acquisitions in the technology sector

Gardiner co-chairs Morris, Manning & Martin’s Green Business practice group, and is also a member of the firm’s Privacy and Security group. She counsels public and private technology companies and large end users regarding their technology business needs, and represents private and public technology companies as well as large end users across various industries. She has counseled clients in a number of transactions, including joint ventures, strategic alliances, technology procurement and acquisition, management of intellectual property assets and privacy and security issues.

07-31-2007

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