Products Liability Law Reporter

A Florida appellate court held that a trial court had erred in denying R.J. Reynolds Tobacco Co.’s motion for a directed verdict on a plaintiff-estate’s claim for conspiracy to fraudulently conceal.

The estate of Salvatore Giambalvo Jr., sued R.J. Reynolds Tobacco Co., alleging that Giambalvo was a member of the Engle class and asserting claims for negligence, strict liability, fraudulent concealment, and conspiracy to fraudulently conceal. The jury awarded $7 million in compensatory damages and approximately $8.49 million in punitive damages, apportioning fault at 50% to the defendant and 50% to Giambalvo. The defendant moved to set aside the judgment in accordance with the motion for directed verdict it had made during trial. The defense argued that the estate had failed to present evidence of Giambalvo’s reliance on a statement by R.J. Reynolds or a tobacco-industry co-conspirator. The trial court denied the motion, citing a relative’s recollection that Giambalvo did not believe the warning statements on cigarette packages and thought filters in the cigarettes he smoked prevented toxins from getting into his lungs.

Reversing, the appellate court noted that under relevant case law, to prevail on the reliance element of a fraudulent concealment and conspiracy claim, an Engle plaintiff must prove reliance on a statement that was made by an Engle defendant or a co-conspirator that concealed or omitted material information about the health effects or addictiveness of smoking cigarettes. The court added that a plaintiff must have received, believed, and acted on a defendant’s misrepresentation.

Considering the evidence and witness testimony, the court concluded the estate had failed to present evidence that a tobacco co-conspirator’s fraudulent conduct caused Giambalvo to form a false belief about smoking’s addictiveness or health effects and then act to his detriment. The court found that the plaintiff had presented inadequate evidence from which the jury could infer that Giambalvo had relied on co-conspirators’ statements when he began smoking or when he chose filtered cigarettes, notwithstanding whether the evidence established that a tobacco co-conspirator had omitted material information. Thus, the court concluded that the trial court should have granted the defendant’s motion for directed verdict on the plaintiff’s claim for conspiracy to fraudulently conceal.

The court nevertheless rejected the defense argument that a new trial was warranted based on the fact that the plaintiff’s claims for negligence, strict liability, and conspiracy to fraudulently conceal were inextricably intertwined. The conspiracy claim was independent of the negligence and strict liability claims, the court said, citing the verdict form. A new trial was required on punitive damages, however. The court reasoned that in considering punitive damages, the jury was instructed to consider R.J. Reynolds’s conduct within the tobacco industry conspiracy that harmed Giambalvo. Moreover, the estate, in closing arguments, told the jury it should rely on evidence of the conspiracy in determining punitive damages. Thus, the court said, it could not conclude there was no reasonable possibility the claim for conspiracy to fraudulently conceal contributed to the verdict on punitive damages.

Consequently, the court remanded with instructions to enter a verdict in the defendant’s favor on the claim for conspiracy to fraudulently conceal and to hold a new trial on the entitlement to and amount of punitive damages.

Citation: R.J. Reynolds Tobacco Co. v. Giambalvo, 2024 WL 1824880 (Fla. Dist. Ct. App. Apr. 26, 2024).