R.J. Reynolds Tobacco Co. v. Giambalvo

386 So.3d 251

R.J. REYNOLDS TOBACCO COMPANY f/k/a RJR Nabisco, Inc., individually and as successor by merger to Brown & Williamson Tobacco Corp., individually and as successor by merger to the American Tobacco Company, individually and as successor to Lorillard Tobacco Company, Appellant,

v.Laura J. GIAMBALVO, as personal representative of the Estate of Salvatore Giambalvo, Jr., deceased, Appellee.

No. 2D2022-3194

District Court of Appeal of Florida, Second District.

April 26, 2024

Appeal from the Circuit Court for Pinellas County; Patricia Muscarella, Judge.

Troy A. Furhman and Marie A. Borland of Hill Ward Henderson, Tampa; and Jason T. Burnette and Brian C. Lea of Jones Day, Atlanta, Georgia, for Appellant.

David J. Sales and Daniel R. Hoffman of David J. Sales, P.A., Sarasota; Gary M. Paige and Cassandra Lombard of Gordon & Partners, P.A., Davie; and James W. Gustafson, Jr., of Searcy Denney Scarola Barnhart & Shipley, P.A., Tallahassee, for Appellee.

BLACK, Judge.

In this Engle ¹ progeny case, R.J. Reynolds Tobacco Company appeals from the final judgment entered in favor of Laura Giambalvo, as personal representative of the Estate of Salvatore Giambalvo, Jr. We agree with Reynolds that its motion for directed verdict on the Estate’s conspiracy to fraudulently conceal claim should have been granted. The final judgment is reversed in part, and the case is remanded for reduction of the compensatory damages in accordance with the jury’s apportionment of fault and a new trial on the punitive damages claim.

In this wrongful death action against Reynolds, the Estate, alleging that Salvatore Giambalvo, Jr., was a member of the Engle class, asserted claims of negligence, strict liability, fraudulent concealment, and conspiracy to fraudulently conceal. At trial, the jury returned a verdict finding that Mr. Giambalvo was a member of the Engle class and that the Estate had proven the negligence, strict liability, and conspiracy to fraudulently conceal claims. However, it rejected the Estate’s fraudulent concealment claim, finding that Mr. Giambalvo did not rely to his detriment on a statement made by Reynolds.² The jury awarded a total of $7,000,000 in compensatory damages, apportioning 50% fault to Reynolds and 50% fault to Mr. Giambalvo. The jury also awarded $8,495,000 in punitive damages. Judgment against Reynolds was entered accordingly.

Reynolds moved to set aside the judgment in accordance with the motion for directed verdict it had made during trial but which had not been ruled upon by the trial court.³ As it had during trial, Reynolds asserted that the Estate had failed to present evidence of Mr. Giambalvo’s reliance on a statement by Reynolds or a tobacco-industry coconspirator. Reynolds accurately set forth the law requiring the Estate to prove detrimental reliance in order to prevail on its conspiracy to fraudulently conceal claim. See Hess v. Philip Morris USA, Inc., 175 So. 3d 687, 698 (Fla. 2015). It then identified testimony supporting its contention that the Estate had failed to meet its burden.

After the motion had been filed but before the trial court ruled on it, the Florida Supreme Court issued Prentice v. R.J. Reynolds Tobacco Co. (Prentice II), 338 So. 3d 831 (Fla. 2022). Reynolds supplemented its motion to set aside the judgment, arguing that Prentice II "remove[d] all doubt that Reynolds [was] entitled to a directed verdict where the Estate’s evidence did not satisfy the supreme court’s definition of the reliance element applicable to conspiracy claims in Engle progeny cases."

A hearing was held, and the trial court reserved ruling and asked the parties to submit proposed orders. Ultimately, the court denied Reynolds’ motion. In the order of denial, the trial court cited testimony including Ms. Giambalvo’s recollection that Mr. Giambalvo did not believe the warning statements on cigarette packages,⁴ her testimony as well as the adult children’s that Mr. Giambalvo told them that the "toxins" and "stuff" in his cigarettes were not getting into his lungs because of the filters in the cigarettes he smoked, and the Estate’s expert’s testimony regarding the "pervasive and misleading advertising campaigns perpetuated" by tobacco coconspirators. The court rejected Reynolds’ arguments that "[w]ith only generalized evidence about widespread advertising, a plaintiff cannot ‘prove a causal connection running from an Engle defendant’s statement or statements, to the plaintiff’s beliefs about the health effects or addictiveness of smoking cigarettes, to the plaintiff’s injury,’ " quoting Prentice II, 338 So. 3d at 837, and that "[a plaintiff’s] false belief stemming from another source cannot provide a basis for holding an Engle defendant liable for conspiracy."

[1, 2] Our review of a trial court’s denial of a motion to set aside the judgment in accordance with the motion for directed verdict is, like our review of the denial of a motion for directed verdict, de novo. Walerowicz v. Armand-Hosang, 248 So. 3d 140, 143 (Fla. 4th DCA 2018) (citing Aragon v. Issa, 103 So. 3d 887, 888 (Fla. 4th DCA 2012)); see Philip Morris USA Inc. v. Holliman, 374 So. 3d 87, 92 (Fla. 3d DCA 2022) (citing R.J. Reynolds Tobacco Co. v. Rouse, 307 So. 3d 89, 92 (Fla. 3d DCA 2020)). A directed verdict should only be granted "where no proper view of the evidence could sustain a verdict in favor of the nonmoving party." R.J. Reynolds Tobacco Co. v. Whitmire, 260 So. 3d 536, 538 (Fla. 1st DCA 2018) (first quoting Owens v. Publix Supermarkets, Ina, 802 So. 2d 315, 329 (Fla. 2001); and then citing Fla. R. Civ. P. 1.480).

In Prentice II, the supreme court "resolve[d] a district court conflict over what proof is required to prevail on the reliance element of [an Engle plaintiff’s] fraudulent concealment and conspiracy claims—a disagreement that ha[d] led to divergent jury instructions in Engle progeny cases." 338 So. 3d at 834. The court held that "an Engle progeny plaintiff must prove reliance on a statement that was made by an Engle defendant (for a concealment claim) or a co-conspirator (for a conspiracy claim) and that concealed or omitted material information about the health effects or addictiveness of smoking cigarettes." Id. In reaching that conclusion, the court, reiterated that the Phase I Engle findings— those findings "related ‘exclusively to the defendants’ conduct and the general health effects of smoking"’—do not satisfy the reliance element of fraudulent concealment claims.⁵ Id. at 835-36 (quoting Engle v. Liggett Grp., 945 So. 2d 1246, 1256 (Fla. 2006)). This includes the Phase I finding that the tobacco coconspirators "agreed to conceal or omit information regarding the health effects of cigarettes or their addictive nature with the intention that smokers and the public would rely on this information to their detriment." Id. at 835 (quoting Engle, 945 So. 2d at 1257 n.4). The court further held that an Engle progeny plaintiff’s burden as to the reliance element of a fraudulent concealment claim "is to prove that the defendant’s fraudulent conduct— as defined in Engle—caused the plaintiff to form a false belief about the health effects or addictiveness of smoking cigarettes and then to act to his detriment." Id. at 840.

[3–5] As relevant to our decision, Prentice II states that "reliance requires the plaintiff to have ‘received, believed, and acted upon’ a misrepresentation by the defendant." 338 So. 3d at 838 (quoting John C.P. Goldberg, Anthony J. Sebok & Benjamin C. Zipursky, The Place of Reliance in Fraud, 48 Ariz. L. Rev. 1001, 1007 (2006)). "[W]hat matters for purposes of reliance is that the plaintiff be able to prove a causal connection running from an Engle defendant’s statement or statements, to the plaintiff’s beliefs about the health effects or addictiveness of smoking cigarettes, to the plaintiff’s injury." Id. at 837. That is, "[t]he element of reliance overlaps with (and may be considered a form of) the usual requirement in tort that a defendant’s wrong be a factual or ‘but for’ cause of the harm that the plaintiff suffered." Id. at 838 (quoting Restatement (Third) of Torts: Liability for Economic Harm § 11 cmt. a (Am. L. Inst. 2020)).

[6] During trial, Ms. Giambalvo testified, as did the three adult children of Mr. and Ms. Giambalvo and Mr. Giambalvo’s cousin. Though they each presented testimony concerning Mr. Giambalvo’s addiction to cigarettes, none of them testified that Mr. Giambalvo relied upon statements from tobacco coconspirators when he chose to begin smoking or at any point during his decades of smoking. When Ms. Giambalvo was asked during trial whether she was aware of Mr. Giambalvo "ever seeing or hearing or relying on any information from" the "various tobacco industry organizations that have been talked about in the trial," she responded, "No." When she was asked whether she was aware if Mr. Giambalvo had ever seen, heard, or relied on any of the "statements that [the Estate’s expert] talked about," she responded, "No." Ms. Giambalvo further testified that she was not aware of her husband ever making any smoking decision based on any action of a tobacco coconspirator. Each of the children testified similarly, as did Mr. Giambalvo’s cousin. In addition, Mr. Giambalvo’s cousin testified to the approximate age at which Mr. Giambalvo began smoking, initially "sneaking" cigarettes from his parents who had "always" smoked. She testified that many of Mr. Giambalvo’s family members smoked, including five brothers and sisters, and that she had no recollection of Mr. Giambalvo reading the newspaper or watching the news at around the time he began smoking. And while she recalled that cigarettes were advertised on television when she and Mr. Giambalvo were growing up, her testimony was that she and Mr. Giambalvo saw those advertisements at a point in time after Mr. Giambalvo began smoking. That was the extent of her testimony regarding Mr. Giambalvo receiving tobacco coconspirators’ statements.

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