Striking another blow to class-action suits against tobacco companies, the Illinois Supreme Court reinstated the reduced bonding amount of $6.8 billion necessary for Philip Morris USA’s appeal of the Price “Lights” case.
Further, the case, which originally awarded $10.1 billion to smokers of light cigarettes, will now go directly to the state Supreme Court, bypassing the appellate court.
As we said previously, we believe the litigation environment surrounding tobacco settlement bonds has been improving. Recent decisions, including this week’s Federal Appeals Court rejection of a Minnesota case involving damage claims by HMOs, along with the recent decertification of the Engle class-action suit in Florida, follow a long line of cases decided in favor of tobacco manufacturers.
The appeal of the Price “Lights” case is now expected to be expedited by the Illinois Supreme Court, and most observers believe that a decision favorable to Philip Morris is a strong possibility.
Further positive news for Philip Morris this week came as Standard& Poor’s affirmed the credit rating of its parent, Altria, to BBB+ and removed the company from CreditWatch.
Now that Philip Morris has the onerous bonding requirement of the Price “Lights” case behind it, we believe its legal storm clouds are dissipating. We are pleased that S&P agrees.
