Newport was a brand owned by Lorillard Tobacco Co. In 2015, RJ Reynolds Tobacco Co. (RJR Tobacco) acquired Lorillard.
Plaintiffs’ counsel argued that the cases should be consolidated as they were both wrongful deaths, consisted of the same fraud and conduct and they were smoking the same brand at the same time. In July 2017, the judge granted the plaintiffs’ motion for the consolidation of the tobacco trials.
Although the cases were consolidated, each case had their own six-person jury with three alternatives apiece. They shared a jury box for most of the cases’ testimony. However, one jury would leave when a specific witness was testifying relating to only one of the plaintiffs.
Compensatory Result: After five weeks of trial testimony, the jury awarded England’s estate $1 million on August 20th. On the next day, the jury awarded Brown’s estate $70 million.
Punitive Damages Testimony: These verdicts led to the second phase of the trial. Mr. Johnson’s primary task was to frame, in economic terms, the “financial condition” of RJ Reynolds Tobacco Co. The term “financial condition” encompasses the areas of financial health, wealth and economic status.
Mr. Johnson explained to the jury that there are various measures to quantify a company’s financial condition. Some examples for financial health are sales/revenue and net income/net profit. For financial wealth, examples are net worth, cash on hand, and dividends. And lastly, economic status pertains to lines of credit and market capitalization.
Mr. Johnson presented evidence from Reynolds American Inc.’s (parent to RJ Reynolds Tobacco Co.) financial statements filed with the Securities and Exchange Commission (SEC). He also obtained financial statements from British American Tobacco, plc, which fully purchased Reynolds American, Inc. in January 2017.
He explained that RJR Tobacco is a financially strong and stable company with net sales of $4.5 billion or more from 2013 to 2017. Their average daily net sales in 2017 was $12.3 million. RJR Tobacco also had net income of $4.9 billion and net worth of $26 billion in the same period.
On August 23rd, the jury returned a punitive damages verdict of $12.3 million for Brown’s estate. The following day, the jury awarded England’s estate $30 million in punitive damages.
Attorney’s Comments: Plaintiffs’ attorney Michael Weisman commented:
"Mr. Johnson’s punitive damages testimony was very compelling. He had to do quite a bit of research as Lorillard was purchased by RJ Reynolds Tobacco and RJ Reynolds’ parent Reynolds American, Inc. was purchased by British American Tobacco, plc. The financial information was not as straight forward."
"I truly believe Mr. Johnson’s testimony helped put RJ Reynolds’ financial health, wealth and economic status into perspective for the juries. The juries’ verdicts definitely sent a message to Big Tobacco that this kind of conduct and business practices 50 to 60 years ago was and is reprehensible."