A jury ordered
Friday to pay $28 billion to a woman with lung cancer who accused the company of failing to warn her of the dangers of smoking.
The report sent tobacco stocks down sharply. Shares of Philip Morris fell $2.40, or 6.1%, to $37.16 on the news. Meanwhile,
( RJR) shed $2.26, or 5.9%, or $36.20,
( LTR) sunk $2.30, or 5.5%, to $39.69, and
shed 14 cents, or 0.7%, to $20.45.
Philip Morris has said it will appeal the verdict, saying it is "inconsistent" with the evidence and law. In a statement, Philip Morris said that the jury's punitive damage award was "33,000 times greater than the compensatory damage award, well in excess of the four-to-one ratio the United States Supreme Court has suggested approaches the constitutional limits of such awards."
The Los Angeles jury deliberated for less than two days before reaching a verdict. A week ago, the same jury awarded $850,000 in compensatory damages to the California woman, Betty Bullock.
"This jury should have focused on what the plaintiffs knew about the health risks of smoking, and whether anything the company ever said or did improperly influenced her decision," said William S. Ohlemeyer, vice president and general counsel for Philip Morris. "Instead, it appears that this decision speaks to more general policy issues regarding smoking that can't fairly be decided in lawsuits like this."