Piendle Punitive Damages Phase Begins

Posted by msch on Aug 16, 2010 7:10:00 PM

Judge Robin Rosenberg and Witness CFO Tom AdamsAt the start of the punitive damages phase, the Piendle v. R.J. Reynolds jury heard from former tobacco CEO Robert Heimann by video from a deposition taken in December, 1986. Mr. Heimann testified as to American Tobacco Company's conclusion that cigarettes were not injurious to health, and as to the research underlying this conclusion. Mr. Heimann testified that the surgeon general was "dead wrong" in concluding that cigarette smoking causes lung cancer, and that a long list of health organizations denouncing cigarette smoking as hazardous were all wrong, even though he could not name any organization that had concluded otherwise. 

For the defense, R.J. Reynolds called to the witness stand Tom Adams, Reynolds' Executive Vice President and Chief Financial Officer. Adams testified with respect his role at Reynolds, "Since 2008 I've had a seat at the table, and so virtually all big decisions, I have input on." Mr. Adams testified that the authors of the disturbing memos shown during the first phase of the trial have no current role in running R.J. Reynolds today. According to Mr. Adams, today Reynolds' "Guiding Principles and Beliefs" serve as a constant reminder for people to act the right way, including addressing the issues regardling the use of and harm associated with tobacco products in an open and objective manner

Quoting the guiding beliefs and principles, Mr. Adams told the jury that the best course of action for tobacco users concerned about their health is to quit, and that significant reductions in harm could be achieved by encouraging smokers to migrate to smoke-free tobacco and nicotine products. Mr. Adams specifically mentioned the low-smoke cigarette Eclipse, which he characterized as not-profitable, and smoke-free product Camel Snus. 

RJ Reynolds CFO Tom Adams on Social Responsibility

On cross-examination, plaintiff attorney Greg Barnhart read aloud the warning on Camel Snus, "This product is NOT a safe alternative to cigarettes," and challenged Mr. Adams, "some of your customers, whom you urge to switch to oral tobaccos, will get, as a result, mouth cancers...will get ill, as a result of using Camel Snus.....and so by encouraging people, for whatever reason, as the company does, to switch to a different form of tobacco product, the company is knowingly encouraging people to switch to a product that can make them ill."

Mr. Adams replied, "If they are concerned about their health and they want to reduce the harm associated with tobacco products, they should quit -- completely. And if they can't quit smoking, then the next best thing is to use a non-combustible product."

Mr. Barnhart suggested that if Reynolds were truly concerned about the health of its customers, it would encourage all of its customers stop using tobacco products, not merely the ones who were concerned about their health. Mr. Adams responded that, "There are our customers, and there's all these other stakeholders that are involved, and we're trying to provide alternatives for people who use tobacco products."

Noting that tobacco replacement therapies had been on the market for decades, but that Reynolds was a long way off from introducing them in the United States, Mr. Barnhart asked, "If Reynolds were truly concerned about the health of its cigarettes, can you tell this jury why, until now, and only in a foreign country, it hasn't been at the forefront of trying to develop nicotine replacement therapies to help people get off Snus, and cigarettes, and Camels, and every other product that the company makes?  Why not?"

CVN webcast Piendle v. R.J. Reynolds live.

Topics: Products Liability, Engle Progeny, Tobacco Litigation, Piendle v. RJ Reynolds