An Australian grandmother dying from lung cancer and suing British American Tobacco (BAT) was awarded $700,000 (Australian or about $375,000 US) by a Melbourne jury. The jury only considered the amount of damages and not any liability questions because the trial judge found that BAT's document destruction activities made a fair trial impossible.
CASE BACKGROUND
Rolah Ann McCabe is a 51-year old woman suffering from the advanced stages of lung cancer. Her lawsuit sought compensatory, pain and suffering, and punitive damages against British American Tobacco Australia Services Limited (formerly WD and HO Wills), the Australian subsidiary of tobacco giant BAT. She smoked Escort and Capstan brands. Ms. McCabe alleged that BAT Australia, itself or through its predecessor and affiliated companies, knew that cigarettes were addictive and dangerous to health, and by its advertising targeted children to become consumers. She charged that BAT Australia, knowing the dangers of addiction and to health of consumers, took no reasonable steps to reduce or eliminate the risk of addiction or the health risks, and ignored or publicly disparaged research results that indicated the dangers to health of smoking.
Ms. McCabe allowed her punitive damages claims to be voluntarily dismissed because her health was such that she might not survive to the end of the trial were those additional claims to be presented. Had she died prior to the jury's verdict, monetary recovery would have been substantially reduced under Australian law. Due to the circumstances of the case, one can only assume that she would have likely succeeded had those claims gone to the jury.
The trial was held in the Supreme Court of Victoria at Melbourne with Justice Geoffrey Eames presiding. After four hours of deliberation, the jury returned its verdict in favor of Ms. McCabe.
Document Destruction Sanctions
The plaintiff's attorney (known as a barrister in Australia), Jack Rush, QC, filed a motion on January 25, 2002, asking the judge to strike BAT's legal defenses to liability and leave the jury to determine on the amount of damages to be awarded.
Three primary reasons cited in the motion included: 1. The destruction of potentially relevant documents by the defendant, at a time when litigation was apprehended, has rendered it impossible for the plaintiff to have a fair trial;
2. The defendant, through counsel, solicitors and deponents to affidavits, has misled the court and the plaintiff as to the true situation concerning documents discoverable in the trial;
3. The defendant’s conduct caused severe prejudice to the plaintiff. Justice Eames essentially agreed with each of these points and, on March 22, 2002, issued the order to strike BAT's defenses. The judge took particular note of the conduct of BAT's primary Australian law firm, Clayton Utz, which appears to have played a substantial role in developing and executing a plan to destroy and withhold many documents related to Ms. McCabe's and, by extension, other injured smokers' claims against BAT.
Justice Eames wrote:
"In my opinion, the process of discovery in this case was subverted by the defendant and its solicitor Clayton Utz, with the deliberate intention of denying a fair trial to the plaintiff, and the strategy to achieve that outcome was successful. It is not a strategy that the court should countenance, and it is not an outcome that, in the circumstances of this case, can now be cured so as to permit the trial to proceed on the question of liability. In my opinion, the only appropriate order is that the defense should be struck out and judgment
be entered for the plaintiff, with damages to be assessed."
In only two other instances have courts outside the United States awarded smokers or their families damages resulting from litigation. In 1997, the widow of a smoker who died from a heart attack sued Souza Cruz in Rio de Janeiro, Brazil, and was awarded about $85,500 (USD) and a 35-year pension. In 1999, the family of cancer victim and his insurer successfully sued French tobacco maker Seita and was awarded about $500,000 (USD). That award was reversed on appeal because Seita was owned by the French government at one time.
COMMENTARY
Richard Daynard, a professor at Northeastern University School of Law and Chair of the Tobacco Products Liability Project noted that, "BAT may be, for all practical purposes, defenseless in Australia. In fact, wherever BAT does business, this decision is likely to haunt them both in the courts and in Parliamentary chambers where government investigations are likely to follow."
"In the US, where tobacco litigation has produced millions of pages of documents, this decision raises the question of whether some of the most important documents might not have been turned over at all, said Mark Gottlieb, an attorney with the Tobacco Products Liability Project at Northeastern University School of Law. "Lawyers taking on the tobacco companies are going to find out whether these document destruction practices were limited to BAT in an industry that has, historically, acted together on product liability issues."
Edward L. Sweda, Jr., Senior Attorney for the Tobacco Products Liability Project said that "this decision upholds the principle that corporate wrongdoers must be punished for their actions. It is not surprising that a company that has a history of lying to the public about an addictive and deadly product would also try to hide its wrongdoing by deliberately destroying incriminating documents thereby preventing individuals from having meaningful access to the halls of justice."
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