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$29b damages awarded against tobacco firm unlikely to stand: Experts

Published on Jul 21, 2014 6:56 AM

NEW YORK (REUTERS) - A decision by a Florida jury to impose punitive damages of US$23.6 billion (S$29.2 billion) against RJ Reynolds Tobacco Company on Friday is likely to be rejected on appeal or the award reduced substantially, lawyers with expertise in jury awards said on Sunday.

The award, which the cigarette maker has said it will contest, likely falls outside the boundaries for punitive damages that the US Supreme Court has laid down in a series of cases, the lawyers told Reuters.

RJ Reynolds is a unit of Reynolds American, which last week announced it would acquire rival Lorillard in a cash-and-stock deal valued at US$27.4 billion, including net debt.

A Florida state court jury decided the award in a case brought by Mrs Cynthia Robinson of Pensacola. She is the widow of a chain smoker, Michael Johnson, who died of lung cancer in 1996 at 36.

An R.J. Reynolds sign is seen outside the 1-million-square-foot cigarette manufacturing facility in Tobaccoville, North Carolina on May 23, 2014. -- PHOTO: REUTERS
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