WASHINGTON--A U.S. Supreme Court ruling sharply reducing a punitive damage award against Philip Morris USA puts weight behind the insurance industry's arguments that such awards have become unfair, according to industry groups.
David Snyder, vice president and assistant general counsel for the American Insurance Association, said the ruling "is very important in restraining abusive litigation costs that are ultimately paid by families and businesses in higher product and insurance costs and lost productivity."
In its decision on the case of Philip Morris USA v. Mayola Williams, the Supreme Court said that a $79.5 million punitive damage award granted by an Oregon jury to Williams' estate was effectively an unconstitutional punishment for alleged injuries to nonparties who were, in effect, "strangers to the litigation."
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