Metro-East News

Supreme Court hears $10 billion Phillip Morris appeal

The Illinois Supreme Court has heard oral arguments about whether to let a $10 billion class-action verdict against a major cigarette maker stand.

Former Illinois Gov. Jim Thompson and another Phillip Morris lawyer asked the court Tuesday to strike that verdict.

The verdict that Phillip Morris fraudulently marketed “light” and “low-tar” cigarettes as safer than others came in 2003. The state’s high court subsequently threw it out. But an appellate court last year reinstated the 12-year-old verdict.

The core dispute is whether regulators allowed cigarette makers to label cigarettes “light” and “low-tar.”

Phillip Morris attorneys argued they were given permission to label cigarettes that way. But a plaintiff attorney said regulators didn’t OK that labeling practice and so Phillip Morris engaged in a “massive fraud” by do so.

The judgment brought criticism from pro-business groups who accused Madison County courts of bias in favor of plaintiffs. The Illinois Civil Justice League, funded by the Illinois and U.S. Chamber of Commerce, named both Madison and St. Clair counties “judicial hellholes” for a number of years after the verdict.

The scrutiny increased when Gordon Maag, a Democratic judge from Madison County, ran against Karmeier for the Illinois Supreme Court. Karmeier and Maag spent a combined $9.3 million in 2004 in their battle for the Supreme Court. It had been the most expensive judicial race in American history.

Karmeier won and one of his first decisions was the Phillip Morris case. The court had been split on whether to overturn the verdict entirely, but Karmeier cast the deciding vote to overturn the verdict.

Allegations of judicial misconduct were lodged against Karmeier, of Nashville, by public interest groups. The groups complained that Karmeier accepted campaign donations from groups affiliated with Phillip Morris and auto insurance giant State Farm, which also had a pending billion-dollar verdict set to be reviewed before the Illinois Supreme Court. They cited his refusal to recuse himself from either case as an ethic violation. The Illinois Supreme Court, with Karmeier on the panel, eventually also overturned the verdict against State Farm over its use of replacement parts for damaged cars.

It’s the State Farm case that is the basis for a federal racketeering lawsuit filed in East St. Louis. Lawyers are seeking to depose Karmeier about his 2004 election to the Supreme Court. The suit alleges that State Farm funded and directed Karmeier’s campaign in exchange for a favorable ruling in the class-action lawsuit. U.S. District Judge David Herndon ruled plaintiff’s lawyers could submit 20 written questions for Karmeier. That ruling is under appeal.