Philip Morris USA Reaches Agreement to Resolve Federal Engle Progeny Litigation
February 25 2015 - 9:47AM
Business Wire
Philip Morris USA (PM USA) announced today that it and other
cigarette manufacturers have reached a tentative agreement to
resolve Engle progeny lawsuits pending against them in federal
court. Under the agreement, there will be no new trials of Engle
progeny cases brought by plaintiffs represented by the law firms of
Motley Rice LLC or Lieff Cabraser Heimann & Bernstein LLP in
federal court. Federal cases that are in trial and those that have
already gone to verdict are not included in the agreement. Engle
progeny lawsuits pending in Florida state courts are also not part
of the agreement.
Under the agreement’s terms, PM USA will pay $42.5 million, and
it will record a corresponding charge against its reported pre-tax
earnings in the first quarter of 2015.
“We are pleased that we were able to work with Motley Rice and
Lieff Cabraser to put the federal Engle progeny trials behind us.
Today’s agreement is in the best interest of the company,” said
Murray Garnick, senior vice president and associate general
counsel, Altria Client Services, speaking on behalf of PM USA. “As
for the Engle progeny cases in state court, we will continue to
defend ourselves vigorously, including appealing adverse
verdicts.”
The Engle case was originally filed in 1994 and attempted to
certify a national class action of smokers. The class was
subsequently limited to Florida residents and ultimately
decertified in 2006 by the Florida Supreme Court. In doing so, the
Florida Supreme Court also ruled that former class members could
file their own lawsuits and use certain general findings from the
class action trial. The court gave former class members until
January 2008 to file their lawsuits, which are commonly referred to
as Engle progeny cases. Plaintiffs filed their suits in U.S.
District Court and various state courts throughout Florida.
The agreement is subject to final approval. In particular,
because the agreement contemplates participation by substantially
all remaining federal-court plaintiffs, the agreement will not
become final unless there is full participation or the parties
otherwise agree. In the interim, the court that administers the
federal Engle progeny cases has ordered that the upcoming trials
against PM USA and the other manufacturers are stayed pending final
approval of the agreement.
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