A closely divided U.S. Supreme Court on Tuesday overturned a $79.5 million punitive damages award won by the widow of a longtime smoker against Philip Morris.
By a 5-4 vote, the high court ruled the huge damages award was unconstitutional because it was intended to punish the tobacco company for harming not just the plaintiff but other smokers as well.
The court ruled that the company, a unit of Altria Group Inc. (MO.N: Quote, Profile , Research), could not be punished for harm to other smokers in a case involving Mayola Williams, an Oregon woman whose husband died of lung cancer in 1997 after smoking for more than 40 years.
The case had been closely watched by business groups that wanted the court to impose new limits on punitive damages designed to punish and deter misconduct. The court last placed limits on such awards in 2003.
Legal experts said the ruling could have a big impact on other types of product liability cases, such as lawsuits against drug companies and automakers.