Monday, September 28, 2015

In Re Tobacco Cases II (Cal. Ct. App. - Sept. 28, 2015)

In Re Tobacco Cases II ends not with a bang, but with a whimper.

This famous UCL action, which went all the way to the California Supreme Court, ends today (in all likelihood) in the Court of Appeal.

There's little doubt that, as the trial court found, that Marlboro Lights were just as dangerous as all other cigarettes, that Philip Morris knew that fact, and that Philip Morris nonetheless advertised these products (falsely) as healthier than the alternatives.  Nonetheless, the trial court decided to dismiss the plaintiffs' lawsuit, after all these years, because consumers "received value from Marlboro Lights" (i.e, the "joy" of smoking) and plaintiffs' evidence submitted to show the difference between what consumers paid for Marlboro Lights and the value they actually received "was incompetent and inadmissible."

The Court of Appeal agrees.

The expert evidence submitted by plaintiffs did indeed have its problems.  The trial court said this about the expert's consumer survey evidence: "Rarely have I ever seen something that was subject to such a multifaceted attack. It just demolished this survey."  And it did indeed have problems.

But let's just take one step back.

Of course consumers put some value on the alleged health benefits of Marlboro Lights.  That's why they bought them in the first place.

Yes, there were undoubtedly other factors at work.  And, yes, the "value" of those alleged (but non-existent) health benefits to the consumer are hard to value for restitution purposes.  Did consumers pay an extra five cents a pack?  Twenty-five cents?  A dollar?

Hard to tell.  Plus, it might be different for different people.

But consumers undoubtedly paid something.

Yet Philip Morris gets off entirely without consequence for its deliberate false advertising.

We usually say that when we're fairly confident about the "fact" of damages we're incredibly flexible amount its quantification.  Yet the Court of Appeal takes a slightly contrary approach here.

Maybe the expert evidence here was so bad that it was essentially valueless.  That seems to be what the Court of Appeal holds.

But it may also be that the Court of Appeal's opinion may appear to demand a degree of certainty in the presentation of such evidence that's contrary to both public policy and common sense.

I'd have liked to see something in Justice McConnell's opinion that balanced the need for "some" evidence against the need for "perfect" evidence.  In my view, this is a pretty darn good case where we know full well that some degree of restitution for Phillip Morris' misconduct should be imposed, and if all we can do is to approximate the proper restitutionary amount, that's more than sufficient.

But that's not the way the Court of Appeal goes.  It wants something more than the evidence that was submitted here.

Maybe that's right.  Maybe the evidence here was just really, really bad.  Unacceptably so.

But it might also be nice for the judiciary, somewhere, to expressly recognize that, in cases like this, perfection isn't required.  And that even substantial imperfection would still be more than sufficient to authorize restitutionary relief for deliberately false advertising.