The Lawletter Vol 43 No 7
In a decision dated September 5, 2018, the U.S. Court of Appeals for the Eleventh Circuit held that the due process rights of the defendant tobacco manufacturers were not violated by the district court’s application of collateral estoppel based on a jury’s findings in a previous class action against the defendants. See Searcy v. R.J. Reynolds Tobacco Co., 902 F.3d 1342 (11th Cir. 2018). Searcy was an action by the daughter of a cigarette smoker against tobacco companies for negligence, strict liability, concealment, and conspiracy to conceal arising from the death of her mother. The plaintiff alleged that her mother’s illnesses were caused by her addiction to cigarettes manufactured by the defendants. Following trial, the district court entered judgment in favor of the plaintiff for $1 million in compensatory damages and $1.67 million in punitive damages.
On appeal, the defendants argued that their due process rights were violated by giving preclusive effect to the jury’s findings in a previous class action against the tobacco manufacturers in Engle v. Liggett Group, Inc., 945 So. 2d 1246 (Fla. 2006). The court of appeals, however, noted that its precedent foreclosed a due process challenge to the application of the Engle jury’s findings on negligence and strict liability claims. Based on such precedent, the court rejected the manufacturers’ due process challenge to the application of the Engle jury’s findings on such claims.
The court did note, however, that it was an open question as to whether the Engle jury’s findings applied to a claim of intentional concealment against the cigarette manufacturers. The defendant manufacturers argued that an intentional concealment claim depends on a specific statement or omission by a specific defendant, and thus presents a due process issue that does not necessarily arise with a classwide negligence or strict liability claim. The defendants argued that preclusive effect could be given to the Engle jury’s findings only as to a finding that actually decided the matter that is at issue in the second proceeding. The defendants asserted that it was not clear that the Engle jury made a finding regarding intentional concealment that was applicable to the specific concealment claims made by the plaintiff. The court rejected the defendants’ argument in holding that the district court did not violate the defendants’ due process rights in giving preclusive effect to the Engle jury’s findings regarding intentional concealment by the cigarette manufacturers. In so holding, the court observed that binding precedent established that due process was not violated by applying preclusive effect to “categorical” concealment findings in subsequent trials, and the manufacturers had notice and an opportunity to be heard on the claims.
Searcy is thus an interesting analysis of the limits of issue preclusion when a question arguably involving individualized conduct by a defendant was decided by a class action jury. The Searcy court ruled that “categorical” concealment findings by the class action jury may be given preclusive effect in subsequent litigation involving the defendant. It is thus implied that findings regarding the defendant’s specific concealment in respect of an individual plaintiff may not qualify for preclusive effect.