Case No. 08-16158-CC

UNITED STATES COURT OF APPEALSFOR THE ELEVENTH CIRCUIT

APPEAL FROM INTERLOCUTORY ORDER PURSUANT TO 28 U.S.C. §1292

Appeal from the United States District Court for theMiddle District of Florida

Case No. 3:07-cv-00761-J-25HTS

BERNICE BROWN, et al.

Plaintiffs/Appellants

v.

R.J. Reynolds Tobacco Co., et al.

Defendant/Appellee

INITIAL BRIEF OF APPELLANTS

Norwood S. Wilner Samuel IssacharoffStephanie J. Hartley 40 Washington Square SouthFrank Fratello, Jr. New York, NY 10012Wilner Block, P.A. (212) 998-6580444 East Duval Street, 3 Floorrd

Jacksonville, FL 32202(904) 446-9817

Attorneys for Plaintiffs/Appellants (other counsel listed on inside cover)

Other Counsel for Plaintiffs/Appellants

Richard A. Daynard90 Commonwealth AvenueBoston, MA 02116(617) 373-2026

Henry GarrardBlasingame, Burch, Garrard & AshleyPost Office Box 832Athens, Georgia 30603(706) 354-4000

Tim Howard, J.D., Ph.D.FL Bar No. 0655325Howard & Associates8511 Bull Headley Road, Suite 400Tallahassee, FL 32312(850) 298-4455

CERTIFICATE OF INTERESTED PERSONSAND CORPORATE DISCLOSURE STATEMENT

Trial Judges: Henry L. Adams, Jr., Timothy J. Corrigan and Harvey E.Schlesinger

Plaintiffs/Appellants: Bernice Brown, et al.

Attorneys for Plaintiffs/Appellants:

Norwood S. WilnerStephanie J. HartleyFrank Fratello, Jr.Wilner Block, P.A.444 East Duval Street, 3 Floorrd

Jacksonville, FL 32202

Samuel Issacharoff40 Washington Square SouthNew York, NY 10012

Richard A. Daynard90 Commonwealth AvenueBoston, MA 02116

Henry GarrardBlasingame, Burch, Garrard & AshleyPost Office Box 832Athens, Georgia 30603

Tim Howard, J.D., Ph.D.Howard & Associates8511 Bull Headley Road, Suite 400Tallahassee, FL 32312

Franklin J. BurrP O Box 789Dunedin, FL 34697-0789Pro Se Appellant

Defendant/Appellee: R.J. Reynolds Tobacco Co., et al.

Defendants whom Appellants believe are an interested person under the local rules ofthis Court.

Attorneys for Defendants/Appellee:

Dana G. Bradford, II, EsquireSmith, Gambrell & Russell, LLP50 N Laura Street, Suite 2600Jacksonville, FL 32202

James B. Murphy, Jr., EsquireJoshua R. Brown, EsquireShook, Hardy & Bacon, LLP100 N Tampa St, Suite 2900Tampa, FL 33602

Stephanie E. Parker, EsquireJohn F. Yarber, EsquireJones Day1420 Peachtree St NE, Suite 800Atlanta, GA 30309-3053

Kenneth J. Reilly, EsquireShook, Hardy & Bacon, LLP201 S Biscayne Blvd, Suite 2400Miami, FL 33131-4332

Kelly Anne Luther, EsquireClarke, Silvergate & Campbell, PA799 Brickell Plaza, Suite 900Miami, FL 33131

1 Miscellaneous notation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii

2 Jurisdictional statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii

3 Statement regarding oral argument . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii

4 Statement of issues presented for review . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

5 Statement of the case . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35.1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35.2 The Engle proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55.3 The Engle verdict . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65.4 The Florida Supreme Court’s “pragmatic solution” . . . . . . . . . . . . . 75.5 Petition for certiorari review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85.6 Follow-on cases and removal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105.7 Rule 16(a) ruling and appeal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

6 Facts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

7 Standard of Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

1 Summary of argument . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

2 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

3 The district court Committed legal error by assuming the authority toreverse a final ruling of the florida supreme court . . . . . . . . . . . . . . 18

4 The District Court committed legal error by failing to give the ruling of theFlorida supreme court the same full faith and credit as it would havereceived in florida state courts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 234.1 Full Faith and Credit requires a district court’s treatment of state law

to be equivalent to a state court’s . . . . . . . . . . . . . . . . . . . . . . . . 234.2 There is no ambiguity in the decision of the Florida Supreme Court, and

Florida courts have uniformly applied it . . . . . . . . . . . . . . . . . . . 294.3 If Tobacco had prevailed in Phase I, there is little question class

members would be unable to relitigate their causes of action . . 31

5 The District Court erred in substituting its own preclusion standard for thatof the State Supreme Court . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

6 The common facts found by the Florida Supreme Court are unexceptional,accurate, and scientifically valid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

7 Through the requirements of individual causation, and through peremptoryinstructions, The Engle findings can be constitutionally applied toindividual cases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 387.1 The District Court acted prematurely in condemning all the findings for

all follow-on cases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 387.2 Common findings are expected in common issue trials, and Engle

approved this practice for Florida law . . . . . . . . . . . . . . . . . . . . 397.3 The District Court erred in accepting Tobacco’s arguments that general

findings could never be applied under any circumstances . . . . . 39 7.3.1 It is a permissible factual finding that cigarette brands do not

materially differ in their ability to cause disease . . . . . . . . 407.3.2 It is a permissible factual finding that the cigarette companies

acted negligently in the marketing of their product to thegeneral public . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

7.3.3 Application of general findings to specific circumstances isanticipated when causation is considered in the follow-on cases

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 427.4 Appropriate peremptory instructions will permit the District Court to

apply the Engle findings to individual cases . . . . . . . . . . . . . . . . 44

8 Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45

TABLE OF CITATIONS

CASES

Allen v. McCurry,

449 U.S. 90 (1980) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

Amos v. Glynn County Bd. of Tax Assessors,

347 F.3d 1249 (11th Cir.2003) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Baldwin v. Traveling Men’s Ass’n,

283 U.S. 522 (1931) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30, 31

Beeler Properties, LLC v. Lowe Enterprises,

2007 WL 1346591 (D. Colo.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19, 20

Blonder-Tongue Laboratories, Inc. v. Univ. of Illinois Foundation,

402 U.S. 313 (1971) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

Brown & Root, Inc. v. Breckenridge,

211 F.3d 194 (4th Cir. 2000) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Cromling v. Pittsburgh L.E.R. Co.,

327 F.2d 142 (3rd Cir. 1963) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

Curbelo v. Ullman,

571 So. 2d 443 (Fla. 1990) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27, 28

District of Columbia Court of Appeals v. Feldman,

460 U.S. 462 (1983) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Engle. v. Liggett Group, Inc.,

945 So. 2d 1246 (Fl. 2006) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . passim

Erie R.R. Co. v. Tompkins,

304 U.S. 64 (1938) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18, 33

Exxon Mobil Corp. v. Saudi Basic Industries,

544 U.S. 280 (2005) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19, 20

Federated Dept. Stores, Inc. v. Moitie,

452 U.S. 394 (1981) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28, 30

Fehlhaber v. Fehlhaber,

681 F.2d 1015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27, 28

Gonzalez v. State,

617 So. 2d 847 (Fla. 4th DCA 1993) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

Hopkins v. Lee,

19 U.S. (6 Wheat.) 109 (1821) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28

In Re Al-Sedah,

347 B.R. 901 (N.D. Ala. 2005) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

In Re Candidus,

327 B.R. 112 (E.D.N.Y. 2005) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

In Re Flury,

310 B.R. 659 (M.D. Fla. 2004) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

In Re May,

321 B.R. 462 (N.D. Ohio 2004) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Kremer v. Chemical Construction Corp.,

456 U.S. 461 (1982) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24, 28

Lance v. Dennis,

546 U.S. 459 (2006) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18, 22

Marrese v. Am. Acad. Orthopaedic Surgeons,

470 U.S. 373 (1985) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Matsushita Elec. Indus. Co. v. Epstein,

516 U.S. 367 (1996) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

Montana v. United States,

440 U.S. 147 (1978) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

Palmer & Cay, Inc. v. Marsh & McLennan Companies, Inc.,

404 F.3d 1297 (11th Cir. 2005) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

Parklane Hosiery Co. v. Shore,

439 U.S. 322 (1979) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4, 35

Remo Hotel, L.P. v. City and County of San Francisco,

545 U.S. 323 (1980) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

R.J. Reynolds Tobacco Co. v. Engle,

672 So. 2d 39 (Fla. 3d DCA 1996) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

R.J. Reynolds Tobacco Co. v. Engle,

128 S. Ct. 96 (2007) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3, 4, 9

Rooker v. Fidelity Trust Co.,

263 U.S. 413 (1923) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Santiesteban v. McGrath,

320 So. 2d 476 (Fla. 3d DCA 1975) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

Semtek Int'l Inc. v. Lockheed Martin Corp.,

531 U.S. 497 (2001) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . passim

Thatch v. Missouri Pacific R.R. Co.,

362 N.E.2d 1064 (Ill. App. 1977) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

Trejo v. Denver & Rio Grande Western R.R. Co.,

568 F.2d 181 (10th Cir. 1977) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

United States v. Weiss,

467 F.3d 1300 (11th Cir. 2006) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

United States v. Mendoza,

464 U.S. 154 (1984) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

United States v. Moser,

266 U.S. 236 (1942) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

STATUTES

28 U.S.C.

§ 1257 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . passim

§ 1738 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . passim

OTHER AUTHORITIES

Peto R, Lopez AD, Boreham J, Thun M, Heath C, MORTALITY FROM TOBACCO IN

DEVELOPED COUNTRIES: INDIRECT ESTIMATION FROM NATIONAL VITAL STATISTICS,

Lancet 1992: 339:1268-78. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

THE HEALTH CONSEQUENCES OF SMOKING: NICOTINE ADDICTION: A REPORT OF THE

SURGEON GENERAL. Washington D.C. Government Printing Office, 1988. (DHHS

publication no. (CDC) 88-8406) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12, 36 37

Cohen C, Pickworth WB, Henningfield JE, Cigarette smoking and addiction. Clin

Chest Med 1991 Dec;12(4):701-10 (1991) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Benowitz NL, Henningfield JE, Establishing a nicotine threshold for addiction.

The implications for tobacco regulation. N Engl J Med 1994 Jul 14;331(2):123-5

(1994). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12, 13

ALAN BRANDT CIGARETTE CENTURY: THE RISE, FALL, AND DEADLY PERSISTENCE

OF THE PRODUCT THAT DEFINED AMERICA (2007) . . . . . . . . . . . . . . . . . . . . . . . . 13

Smoking and Health, a Report of the Surgeon General, DHEW Pub. No. (PHS) 79-

50066 (1979) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

Reducing the Health Consequences of Smoking, 25 Years of Progress, a Report of

the Surgeon General, DHHS Pub. No. (CDC) 89-8411 (1989) . . . . . . . . . . . . . . 37

1 MIS C E LL A N E O U S N O T A TIO N

The appellees, defendants below, will be referred to collectively as

“Tobacco” or “Tobacco defendants” or “defendants.” Exhibits are identified as

Ex. ___ at ___. All emphasis in quotations is supplied unless otherwise noted.

Internal ellipses and internal quotes are sometimes omitted from quotations for

readability. The District Court’s Opinion is noted throughout as Brown v. R.J.

Reynolds Tobacco Co., 576 F. Supp. 2d 1328 (M.D. Fla. 2008).

2 JU RIS DIC TIO N AL S T A T E M E N T

Pursuant to 28 U.S.C. §1292(b), this Court permitted an appeal to be taken

from the interlocutory order filed by the District Court, Middle District of Florida

(Schelsinger, J.).

3 ST A T E M E N T R E G A R DIN G O R A L AR G UM E N T

Appellants request oral argument on all points.

1

4 ST A T E M E N T O F IS S U E S P R E S E NT E D F O R R E VIE W

1. Consistent with 28 U.S.C. § 1257, may a district court, purporting to act

pursuant to its case management authority, review and in effect reverse a final

judgment of the Florida Supreme Court?

2. Consistent with 28 U.S.C. § 1738, may a district court hearing a state law

claim under diversity jurisdiction, refuse to give the same full faith and credit to

a final judgment of the Florida Supreme Court as would have been given by a state

court hearing the same case?

3. May a federal district court in a diversity action, consistent with Semtek

Int'l Inc. v. Lockheed Martin Corp., 531 U.S. 497 (2001), substitute its own

preclusion standard for that of a State supreme court?

4. Given that individual causation remains to be adjudicated, did the District

Court act prematurely in condemning the Engle v. Ligget Group, Inc., 945 So. 2d

1246 (Fla. 2006) proceeding in toto, rather than attempting to apply the Engle

findings in a constitutional manner to individual follow-on cases?

2

5 ST A T E M E N T O F TH E C AS E5.1 OverviewThis appeal arises from a collateral challenge to the final determination of

the Florida Supreme Court in the tobacco litigation known as Engle. v. Liggett

Group, Inc. 945 So. 2d 1246 (Fl. 2006). The questions presented concern the

finality that must be afforded state court judgments in subsequent state law cases

brought into federal court under diversity jurisdiction.

In this case, a state court tried to judgment the claims of three individual

smokers and a class of all smokers in the state of Florida. The jury found for all

three individual plaintiffs and for the class as a whole. Subsequently, the Supreme

Court of Florida upheld the verdicts of two of the individual plaintiffs (the third

was barred by the statute of limitations), mandated certain classwide findings

should be given preclusive effect in subsequent individual trials of class members,

and prospectively decertified the class on the grounds that individual

determinations of specific causation and damages could not be established on a

classwide basis.

The Florida Supreme Court directed that the remaining individual claims

could be pursued in subsequent litigation. The Court further ruled that certain

generalized findings of fact concerning the tobacco defendants would be deemed

final in any subsequent claims brought by individual smokers. The defendants

sought certiorari review in the U.S. Supreme Court, which was denied. R.J.

3

Reynolds Tobacco Co. v. Engle, 128 S. Ct. 96 (2007).

Undisputed is the fact that the claims of two plaintiffs were tried to

judgment and affirmed all the way up the appellate ladder in the state court

system. As part of that judgment, even apart from any classwide determination,

the Florida Supreme Court upheld the trial court's determination that, inter alia,

smoking cigarettes causes certain cancers, that nicotine is addictive, that the

defendants were negligent in the manufacture and distribution of cigarettes, that

cigarettes were a defective product, and that defendants obscured this information.

Under Parklane Hosiery Co. v. Shore, 439 U.S. 322 (1979), this is entirely

consistent with settled principles of issue preclusion.

Under Semtek, a federal court sitting in diversity must be governed by state

law in determining the preclusive effect of prior judgments. But beyond the legal

rules, the findings themselves are unexceptional. Indeed, many correspond to

findings of other courts and even acknowledgments on the websites of tobacco

companies today. The Florida state courts have understood the clear command of

the Florida Supreme Court on the finality to be given these elements of general

(non-specific) causation and have scheduled trials on specific causation and

damages in individual cases. In a group of cases removed to the Middle District

of Florida, however, the district court, sitting in claimed diversity jurisdiction, not

only refused to give full faith and credit to the holding of the state Supreme Court,

it arrogated to itself the power effectively to reverse the Florida Supreme Court

4

and render its judgment a nullity.5.2 The Engle proceedingsFiled in 1994, Engle was certified in Florida Circuit Court as a national

class of plaintiffs injured by diseases and medical conditions caused by addiction

to cigarettes. On interlocutory appeal, the Court of Appeal, Third District of

Florida, approved the certification (limited to Florida) and found “the basic issues

of liability common to all members of the class will clearly predominate over the

individual issues.” R.J. Reynolds Tobacco Co. v. Engle, 672 So. 2d 39, 41 (Fla. 3d

DCA 1996), rev. den’d, 682 So. 2d 1100 (Fla. 1996).

On remand, the trial court divided the case into three “phases” that would

all be part of the same cause of action. In Phase I, the jury would decide “common

issues” relating to Tobacco’s conduct and the general health effects of smoking.

If the jury found in favor of the class in Phase I (e.g., that cigarettes were

defective), it would then proceed to Phase II, which had two components. In

Phase II-A, the jury would decide whether the conduct of Tobacco caused injury

to three individual plaintiffs and, if so, what their damages were. A Phase II-B

trial would then be held to determine the amount of punitive damages to be

assessed against Tobacco. The third phase, Phase III, was to consist of a series of

subsequent trials with new juries wherein specific causation and damages (actual

and punitive) would be determined for the rest of the plaintiffs in the class.

Plaintiffs in Phase III would then be entitled to apply the Phase I findings as

5

established “facts” on the common questions that had been tried in Phase I. The

three phase process, with res judicata application of findings to the third phase,

was conceived and approved by Florida courts from the outset. With this plan in

place, the class action proceeded to Phase I.5.3 The Engle verdictTrial on the factual issues common to the class (Phase I) began in July, 1998

and ended a full year later. In November, 1999, the Phase II-A trial for three

individual plaintiffs began on issues of specific causation and damages, and it

ended several months later with verdicts in favor of each of these plaintiffs. The

punitive damages trial (Phase II-B) began in May, 2000 and ended in July, 2000,

again with a verdict in favor of plaintiffs.

The Engle Phase I trial produced testimony from hundreds of witnesses on

behalf of plaintiffs and of Tobacco, including former Surgeons General, tobacco

company executives, worldwide experts on tobacco disease and addiction, tobacco

company researchers, historians, consumer expectation experts, and many more;

it generated a library full of once-secret tobacco industry documents showing the

inside story of how the tobacco industry committed criminal negligence in the

marketing and design of its product.

Phase I concluded with a jury verdict convicting the tobacco interests. The

jury found, inter alia,

* (Finding 1) “smoking cigarettes cause[s]” a variety of enumerated diseases(general causation of disease);

6

* (Finding 2) “cigarettes that contain nicotine [are] addictive or dependenceproducing (addictive nature of nicotine)”; * (Finding 3) Tobacco “place[d] cigarettes on the market that were defectiveand unreasonably dangerous” (liability for defect,); * (Finding 4a) Tobacco “conceal[ed] or omit[ted] material information, nototherwise known or available, knowing the material was false ormisleading, or failed to disclose a material fact concerning or proving thehealth effects and/or addictive nature of smoking cigarettes” (fraudulentconcealment); * (Finding 5a) Tobacco entered “into an agreement to conceal or omitinformation regarding the health effects of cigarette smoking, or theaddictive nature of smoking cigarettes, with the intention that smokers andmembers of the public rely to their detriment” (conspiracy to conceal);* (Finding 6) Tobacco sold or supplied “cigarettes that were defective in thatthey were not reasonably fit for the uses intended” (liability for defect); * (Finding 7) Tobacco sold or supplied cigarettes that, at the time of sale orsupply, did not conform to representations of fact made by defendants(express warranty); and * (Finding 8) Tobacco “failed to exercise the degree of care which areasonable cigarette manufacturer would exercise under like circumstances”(negligence).5.4 The Florida Supreme Court’s “pragmatic solution”On final appeal to the Florida Supreme Court, the Court reversed a common

punitive damage award, upheld the verdicts of two of the individual plaintiffs (the

third was barred by the statute of limitations), but prospectively decertified the

class on the grounds that individual determinations of specific causation and

damages could not be established on a classwide basis. Engle, 945 So. 2d at 1269,

1277. The Court recognized that damages and causation would need to be

7

assessed in further proceedings by other juries. Recognizing the impossibility of

re-trying thousands of liability cases, the Court announced its “pragmatic

solution.” Florida law would permit the common findings to be “retained” in

follow-on damage actions:

The pragmatic solution is to now decertify the class, retaining thejury’s Phase I findings . . .. Class members can choose to initiateindividual damages actions and the Phase I common core findingswe approved will have res judicata effect in those trials.

Engle, 945 So. 2d at 1269.

After losing the appeal in the Florida Supreme Court, Tobacco sought

rehearing. Tobacco therein asserted the same arguments that it had raised earlier

(the same as it would later raise in the U.S. Supreme Court and in the District

Court below). The motion for rehearing was denied. 5.5 Petition for certiorari reviewAfter the Florida Supreme Court decision and denial of rehearing, Tobacco

sought certiorari to the Supreme Court of the United States, arguing, among other

things, the same constitutional infirmities it argued before and later argued in the

District Court. In its petition Tobacco invoked jurisdiction under 28 U.S.C.

§1257(a) and stated that the Florida Supreme Court’s decision affirming the

judgment on the Phase I findings was “final for purposes of section 1257.”

Tobacco defendants’ previously filed Petition for Certiorari in Engle, attached as

Exhibit A at 2. The principal point in Tobacco’s petition, which is virtually

identical to the primary question raised in its Rule 16 motion, was as follows:

8

Whether the due process clause prohibits a state court from givingpreclusive effect to a jury verdict when it is impossible to discernwhich of numerous alternative grounds formed the basis for thejury’s finding of wrongful conduct.

Exhibit A at i.

Tobacco went on in the petition to argue that there were “fundamental

defects” in the Engle judgment that would “contaminate” all Phase III cases

(Exhibit A at 3); that “giving res judicata effect to [the Phase I] findings violates

a basic due process rule” (Exhibit A at 3); that “due process prohibits giving

preclusive effect to verdicts that are too general to reveal the actual facts that were

decided” (Exhibit A at 12); and that immediate review was required (Exhibit A at

18). The Supreme Court denied certiorari on October 1, 2007. R.J. Reynolds

Tobacco Co. v. Engle, 128 S. Ct. 96 (2007).

The following table shows the identity between the claims raised by way of

certiorari and the ruling of the court below:

Arguments AgainstPreclusion

Tobacco Cert. Pet.Arguments

District Court Ruling

Basis for Preclusion. “The preclusion rulinghere . . . abandon(s) thedeeply rooted principlethat a determination in anearlier proceeding cannotbe given preclusive effectin a later case unless ‘it iscertain that the precisefact was determined bythe former judgment.’”

“[I]t would be improperto apply issue preclusionin cases where it isimpossible to determinewhat issues were actuallydecided in priorproceedings.” Brown v.R.J. Reynolds TobaccoCo., 576 F. Supp. 2d1328, 1341 (M.D. Fla.

9

Exhibit A at 12. 2008). Insufficiency of EnglePhase findings.

Highly generalized anddecidedly ambiguousnature of the Phase Ifindings. Exhibit A at16-17.

“The apparent flaw withthe jury form, and anyverdict delivered from theform, is its nonspecificitywith respect to what actsor omissions committedby what Defendantbreached what duty towhich Plaintiff causingwhat injury.” Brown, 576F. Supp. 2d at 1342.

Product defect findingsinsufficient as a matterof law.

“As to product defect, forinstance, the jury foundsimply that ‘all of thedefendants sold orsupplied cigarettes thatwere defective,’ withoutrevealing either thenature of the defect orwhich of the manycigarette models sold atdifferent times weredefective.” Exhibit A at16.

“The jury verdictindicates that eachDefendant manufactureda defective product atsome point in time, yet itfails to specify whatdefect was supported bythe evidence.” Brown,576 F. Supp. 2d at 1343.

Due Process limits onPreclusion.

“[T]he ruling conflictswith long-standing anduniversally acceptedlimitations on the use ofissuepreclusion—limitationsthat this Court has held tobe required by dueprocess.” Exhibit A at 3.

“’Extreme applications’of preclusion law ‘may beinconsistent with afederal right that isfundamental incharacter.’” Brown, 576F. Supp. 2d at 1345.

5.6 Follow-on cases and removalThe Florida Supreme Court extended the statute of limitations for follow-on

actions until January 11, 2008. On or before that date approximately 8,000 cases

10

were filed statewide, and over 4,000 in Duval County Circuit Court. Over 4,000

cases were subsequently removed as “mass actions” to the District Court under

the Class Action Fairness Act. 5.7 Rule 16(a) ruling and appealAfter removing the follow-on cases, Tobacco applied to the District Court

below to in effect sit as a further appellate court. Tobacco’s “Rule 16” motion

proffered identical arguments to those advanced and overruled in the state rulings

and the denial of the certiori petition. As before, Tobacco argued that the Florida

Supreme Court’s preclusion rulings deprived them of due process because they

lacked specific reference to individual acts or individual smokers. The District

Court agreed and held that the very findings the Florida Supreme Court required

to be carried forward may not be given preclusive effect in any proceeding to

establish any element of an Engle plaintiff’s claim.

Of significance the District Court appeared not to conduct any analysis of

the feasibility of applying the Florida Supreme Court’s findings to individual

follow-on cases. Rather the District Court simply negated the significance of the

entire Engle opinion. This appeal followed.

6 F A C T S

Plaintiffs are members of the Engle class, defined in general as Florida

citizens suffering from one or more enumerated cancers and other diseases caused

11

by addiction to nicotine in cigarettes. They brought claims against various

defendants who designed, manufactured, and marketed cigarettes, based on

negligence, strict liability, and intentional torts.

The problem of nicotine addiction in causing disease has been well

recognized. In industrialized countries tobacco-induced deaths make up at least

35% of all fatal conditions in males ages 35 to 69. Between 40% and 50% of

regular cigarette smokers will eventually be killed by cigarette smoke. Tobacco

smoke as an individual health problem is unparalleled, as over a quarter of a

billion people will be killed by smoking, which is about one-fifth of all persons

now alive in developed countries. Peto R, Lopez AD, Boreham J, Thun M, Heath

C, MORTALITY FROM TOBACCO IN DEVELOPED COUNTRIES: INDIRECT ESTIMATION

FROM NATIONAL VITAL STATISTICS, Lancet 1992: 339:1268-78. Nicotine addiction

is a true drug addiction in the league of cocaine and heroin. In delivering nicotine

addiction, numerous cancers, and cardiovascular diseases in one package, the

modern cigarette is recognized universally as the largest preventable cause of

disease in America. See generally Department of Health and Human Services,

Public Health Service. THE HEALTH CONSEQUENCES OF SMOKING: NICOTINE

ADDICTION: A REPORT OF THE SURGEON GENERAL. Washington D.C. Government

Printing Office, 1988. (DHHS publication no. (CDC) 88-8406). Cohen C,

Pickworth WB, Henningfield JE, Cigarette smoking and addiction. Clin Chest

Med 1991 Dec;12(4):701-10 (1991). Statement on Nicotine Containing Cigarettes

12

by David A. Kessler, M.D., Commissioner of Food and Drugs before the

Subcommittee on Health and the Environment, U.S. House of Representatives,

March 25, 1994. Benowitz NL, Henningfield JE, Establishing a nicotine threshold

for addiction. The implications for tobacco regulation. N Engl J Med 1994 Jul

14;331(2):123-5 (1994).

The role of the cigarette industry in causing the epidemic of tobacco disease

has been well documented. In the postwar period it conducted a campaign of

scientific fraud, strongarm media influence, disingenuous lobbying, and

misleading advertising, while perfecting its products’ delivery of nicotine to

ensure repeat customers. See generally, ALAN BRANDT CIGARETTE CENTURY:

THE RISE, FALL, AND DEADLY PERSISTENCE OF THE PRODUCT THAT DEFINED

AMERICA (2007) (see also www.cigarettecentury.com).

7 ST AN D A R D O F R E VIE W

This Court reviews de novo a district court's decision regarding the

applicability of preclusion. U.S. v. Weiss, 467 F.3d 1300, 1308 (11th Cir. 2006).

13

AR G UM E N T

1 SUMM A R Y O F AR G UM E N T

In rejecting wholesale the Florida Supreme Court's ruling on the preclusive

effects of Engle, the District Court violated three separate commands, all of which

are designed to preserve the uniformity of treatment of state court judgments in

subsequent state and federal proceedings. First, under 28 U.S.C. § 1257, federal

courts are not permitted to sit in appellate-style review of state court judgments

except through certiorari review by the U.S. Supreme Court. Second, under 28

U.S.C. § 1738, federal courts are obligated to give state court judgments the same

preclusive effect as would a state court hearing the same action. Finally, as set out

in Semtek, federal common law also directs that federal courts apply the preclusion

rules of the state in which they sit. Together the statutory and federal common law

command that there be uniformity in the preclusive effect given to a state court

judgment and that the standard of preclusion be set by state law. The ruling below

violated each of these commands.

Next, the District Court’s ruling was premature and ignored that the

constitutional challenges raised will evaporate when the findings are applied to

individual cases. The general findings of misconduct or negligence can be

constitutionally applied because the follow-on cases will of necessity inquire,

under the requirement of causation, into the individual links between the

14

misconduct (towards the public in general) and the individual plaintiff’s

knowledge and situation. The will also inquire into the links between the defects

(common to all cigarette products) and the individual’s smoking patterns, disease

process and addiction.

In summary three doctrines rooted in the law of jurisdiction and judgments

establish that the District Court misstepped in finding a constitutional violation

here. First, because the Florida Supreme Court itself considered and rejected the

constitutional argument embraced by the District Court, the District Court's

revisitation of that argument was foreclosed by preclusion. Second, a

constitutional challenge to the proper operation of the Florida Supreme Court's

order – an order directed squarely at further proceedings involving these very

parties – necessarily entails a collateral attack on that order. Such a collateral

attack can succeed, however, only if the challenged order was issued in the

absence of notice or subject-matter or personal jurisdiction. No one can argue or

has argued that the "fundamental unfairness" rationale on which the District Court

relied falls into any of these specific categories. Finally, the District Court's

consideration of the defendants' Due Process claim violated the long-established

Rooker-Feldman doctrine. That doctrine teaches that, when a litigant claims a

state Supreme Court ruling involves a misapplication of federal-law, the sole relief

afforded by federal statute is an appeal to the United States Supreme Court. In

fact, the defendants did seek certiorari from the Engle ruling in the Supreme

15

Court without success, and the District Court erred in giving them a second bite

at federal court review of their due process argument via removal of this case to

federal court.

2 IN TR O D U C TIO N

The fundamental issue in this appeal is the limited role of the lower federal

courts in applying state law. Procedurally, they are courts of original, not appellate

jurisdiction, and cannot under 28 U.S.C. §1257 and the Rooker-Feldman doctrine

entertain a review of matters decided, or those inextricably intertwined with

matters decided, in prior state court proceedings. Substantively they are bound to

follow the law of the jurisdiction in which they sit, as fully as are the lower state

courts.

The Florida Supreme Court in Engle set out the law of Florida as it applies

to phased class actions that are prospectively decertified for individual damage

actions: in Florida individual follow-on cases may partake of factual findings

made in the previous class litigation, even as these findings are necessarily general

in nature. All Florida courts, and Erie-bound federal courts within Florida, are

pledged to follow. Any federal constitutional challenge to this state law was

limited by 28 U.S.C. §1257 to a petition to the Supreme Court of the United

States. As the petition was denied, so was further federal review of state

substantive law, whether on due process or other grounds.

16

The District Court below undertook a de novo analysis of substantive due

process as it applies to state law preclusion doctrines. The analysis sought out

cases over a hundred years old, and as well cited overruled, pre-Engle state law.

With respect to the learned Court, such analysis was in error. First, the District

Court lacked jurisdiction under § 1257 to conduct substantive due process analysis

because the preclusion doctrine was the heart and soul of, and thus inextricably

intertwined with, the Florida Supreme Court’s Engle decision. Second, if the

analysis could be conducted at all, the District Court was required to apply the

governing law of the relevant jurisdiction, which was stated beyond question in

the same Engle opinion. Finally, although not subject to review, the wisdom of the

state law announced in Engle was undeniable, the findings were scientifically

indisputable, application of the common findings to individual cases would be

feasible, and the entire process envisioned by the Florida Supreme Court furthered

the public policy of the state.

Appellants therefore submit that the ruling below violates two statutory

restrictions on the power of a federal court. First, under 28 U.S.C. § 1257 any

claimed federal constitutional challenge to the final ruling of the Florida Supreme

Court lies exclusively with the certiorari powers of the U.S. Supreme Court. The

District Court's willingness to entertain a challenge on exactly the same issues

previously presented to (and rejected by) the U.S. Supreme Court is statutorily

prohibited and must be reversed. Second, the District Court refused to give the

17

final decision of the Florida Supreme Court the same full faith and consideration

as would a state court. This not only violates the principles of Erie R.R. Co. v.

Tompkins, 304 U.S. 64 (1938), in inviting forum shopping of the sort seen here,

but it runs afoul of the statutory obligations of the Full Faith and Credit Statute,

28 U.S.C. § 1738.

Each statutory violation requires reversal. Combined, the ruling below is

a flagrant violation of core federalism values and statutorily-codified limitations

on the powers of federal courts.

3 TH E DIS T RIC T C O U R T C O MMITT E D L E G AL E R R O R B Y A S S UMIN G TH EA U TH O RITY T O R E V E RS E A FIN A L R U LIN G O F TH E F L O RID A S U P R E M E C O U R T

The fundamental error of the court below lies in its presumption that it had

authority to review the ruling of the Florida Supreme Court for federal

constitutional invalidity. Under 28 U.S.C. § 1257, that power is exclusively

reserved to the U.S. Supreme Court: "Final judgments or decrees rendered by the

highest court of a State in which a decision could be had, may be reviewed by the

Supreme Court by writ of certiorari . . ." As the U.S. Supreme Court emphasized

only two Terms ago,

This Court is vested under 28 U.S.C. § 1257 with jurisdiction overappeals from final state-court judgments. We have held that thisgrant of jurisdiction is exclusive: "Review of such judgment may behad only in this Court." . . . Accordingly, under what has come to beknown as Rooker-Feldman doctrine, lower federal courts areprecluded from exercising appellate jurisdiction over final state courtjudgments."

18

Lance v. Dennis, 546 U.S. 459, 463 (2006) (citations omitted) (emphasis in

original). The purpose of the Rooker-Feldman doctrine is to preserve the integrity

of state court judgments, absent federal review by the U.S. Supreme Court. As the

Court further stated in Exxon Mobil Corp. v. Saudi Basic Industries, 544 U.S. 280,

284 (2005), the aim is to bar federal district courts from entertaining cases

brought by state-court losers complaining of injuries caused by state-court

judgments rendered before the district court proceedings commenced and inviting

district court review and rejection of those judgments.

Under this Court's well-established criteria, Rooker-Feldman is a bar to

relitigation of state law rulings where: (1) the party in federal court is the same

as the party in state court; (2) the prior state-court ruling was a final or conclusive

judgment on the merits; (3) the party seeking relief in federal court had a

reasonable opportunity to raise its federal claims in the state-court proceeding; and

(4) the issue before the federal court was either adjudicated by the state court or

was inextricably intertwined with the state court's judgment. See e.g., Amos v.

Glynn County Bd. of Tax Assessors, 347 F.3d 1249, 1265 n.11 (11th Cir.2003).

There can be little dispute that the tobacco defendants meet all these criteria as the

losing party in a conclusive state-court ruling in which the issues of their conduct

were fully litigated.

The Tobacco defendants are affirmatively “seeking relief in federal court”

because they took the steps necessary to remove the cases from state to federal

19

court. By removing, it is clearly “seeking relief in federal court.” Beeler

Properties, LLC v. Lowe Enters. Residential Investors, LLC, Case No. 07-00149,

2007 WL 1346591 (D. Colo. May 7, 2007) (“From a jurisprudential perspective,

it makes no difference in application of the Rooker-Feldman doctrine whether

jurisdiction is invoked by the filing of a complaint or a notice of removal.”). See

also, Brown & Root, Inc. v. Breckenridge, 211 F.3d 194 (4th Cir. 2000) (Court

held that Brown & Root’s federal arguments were “nothing more than an attempt

to seek review of the state court’s decision by a lower federal court” and affirmed

the dismissal under the Rooker-Feldman doctrine). This result is entirely

consistent with the structure of § 1257, which makes no distinction between

plaintiffs or defendants; it simply gives a state court loser the right under certain

circumstances to have the judgment it lost reviewed by, and only by, the U.S.

Supreme Court. While the cases have mostly held that a "plaintiff" cannot refile

a case in federal court that was previously lost in state court, that is simply the

usual fact pattern. A defendant may be equally a loser in state court, who removes

the state court case and “seeks relief” in federal court. Thus the Supreme Court in

Exxon Mobil defined Rooker-Feldman as applying to "state court losers" and the

"losing party in state court," thereby eschewing any reading that would limit the

application to either "plaintiffs" or "defendants." Exxon Mobil, 544 U.S. at 284,

1 See In Re Al-Sedah, 347 B.R. 901, 904 (N.D. Ala. 2005); In Re Candidus, 327B.R. 112, 119-21 (E.D.N.Y. 2005); In Re May, 321 B.R. 462, 467 (N.D. Ohio2004); In Re Flury, 310 B.R. 659, 661-62 (M.D. Fla. 2004).

20

291.1

In the instant case the District Court arrogated to itself the power to review

de novo the exact federal constitutional issues previously presented for certiorari

review to the U.S. Supreme Court. As set out above in the comparative table,

even a cursory examination of the language of the defendants' petition for

certiorari and the district court's Rule 16 ruling reveals that there were two bites

at this federal apple.

For the district court, Rooker-Feldman could be sidestepped because the

losing defendant in the state court action was not the complaining plaintiff seeking

relief in federal court. Brown, 576 F. Supp. 2d at 1336 n.14. Insofar as this is an

observation about how cases are usually postured, it is true that the statutory

prohibitions of § 1257 are most clearly developed when a losing state court

litigant directly commences suit in federal court seeking to be released from a

binding state court judgment. Such a federal plaintiff runs into the specific

prohibition encompassed under the Rooker-Feldman doctrine preventing federal

review outside the Supreme Court’s certiorari jurisdiction. Nonetheless, nothing

in the statutory language of § 1257 or in any case law limits the statutory

prohibition to the particular procedural posture of who filed suit in federal court.

The great principle of Federalism is too important to be set aside depending on

21

which party is involved.

The District Court’s restricted reading of Rooker-Feldman misses the

broader sweep of § 1257, which mandates that the only form of review available

is by the U.S. Supreme Court. As the Court held in District of Columbia Court of

Appeals v. Feldman, 460 U.S. 462, 482-83 (1983), the case that completed the

jurisdictional doctrine, “A United States District Court has no authority to review

final judgments of a state court in judicial proceedings. Review of such decisions

may be had only in this Court. . . . Lower federal courts possess no power

whatever to sit in . . . review of state court decisions.” As summarized in the

Court’s most recent examination of § 1257, the statutory prohibition turns not on

the procedural posture of the case in federal court but applies categorically “where

a party in effect seeks to take an appeal of an unfavorable state-court decision to

a lower federal court.” Lance, 546 U.S. at 466 (emphasis added).

The District Court erred by concluding that, since the Rule 16 motion by the

tobacco defendants did not meet its crabbed definition of Rooker-Feldman, there

was no statutory obstacle to its plenary review – and rejection – of the ruling of

the Florida Supreme Court. In effect, § 1257 became only a procedural bar to the

District Court assuming subject matter jurisdiction if the tobacco defendants had

affirmatively filed suit in federal court. In the context of removal to federal court

by the tobacco defendants, the District Court effectively declared the statute as

having no application.

22

This ruling is wrong and stands in marked contrast to the Court’s clear

holding in Rooker v. Fidelity Trust Co., 263 U.S. 413, 415-16 (1923):

If the constitutional questions . . . actually arose in the (statecase), it was the province and duty of the state courts to decidethem; and their decision, whether right or wrong, was anexercise of jurisdiction. If the decision was wrong, that did notmake the judgment void, but merely left it open to reversal ormodification in an appropriate and timely appellate proceeding.Unless and until so reversed or modified, it would be an effective andconclusive adjudication. Under the legislation of Congress, no courtof the United States other than this Court could entertain aproceeding to reverse or modify the judgment for errors of thatcharacter. To do so would be an exercise of appellate jurisdiction.

Once freed from the strictures of § 1257 and Rooker-Feldman, the District

Court proceeded to review the entirety of the Florida state record as if it were an

appellate tribunal. Under the rubric of not according “preclusive effect to a

constitutionally unsound judgment,” the district court found that Florida procedure

violated due process, even down to reversing the Florida Supreme Court’s rulings

on the effect of curative instructions for allegedly improper behavior by counsel.

Brown, 576 F. Supp. 2d at 1346-47. This is clear legal error.

4 TH E DIS T RIC T C O U R T C O MMITT E D L E G AL E R R O R B Y F AILIN G T O GIV E TH ER U LIN G O F TH E F L O RID A SU P R E M E C O U R T TH E S AM E F ULL F AITH A N D C R E DITA S IT W O U L D H A V E R E C EIV E D IN F L O RID A S T AT E C O U R T S4.1 Full Faith and Credit requires a district court’s treatment ofstate law to be equivalent to a state court’s

Under the “Full Faith and Credit Act,” 28 U.S.C. § 1738, state court

judgments "shall have the same full faith and credit in every court within the

23

United States . . . as they have by law or usage in the courts of such State . . . from

which they are taken." Allen v. McCurry, 449 U.S. 90, 96 (1980). Emphatically,

the United States Supreme Court has held, “a federal court must give the judgment

the same effect that it would have in the courts of the State in which it was

rendered.” Matsushita Elec. Indus. Co. v. Epstein, 516 U.S. 367, 369 (1996). The

usual situation involves a “judgment” but the Act refers more broadly to “judicial

proceedings.” As the Matsushita court further stated:

The Full Faith and Credit Act mandates that the judicialproceedings of any State shall have the same full faith and creditin every court within the United States as they have by law orusage in the courts of such State. ... Federal courts may not employtheir own rules in determining the effect of state judgments, but mustaccept rules chosen by the State from which the judgment is taken.”

Matsushita Elec. Indus, 516 U.S. at 373.

The import is unmistakable: "Congress has specifically required all federal

courts to give preclusive effect to state-court judgments whenever the courts of the

State from which the judgments emerged would do so." In order to ensure the

objective of uniform treatment of state judgments,

It has long been established that § 1738 does not allow federal courtsto employ their own rules of res judicata in determining the effect ofstate judgments. Rather, it goes beyond the common law andcommands a federal court to accept the rules chosen by the Statefrom which the judgment is taken.

Kremer v. Chemical Construction Corp., 456 U.S. 461, 481-482 (1982).

As a result, "the [Full Faith and Credit] statute directs a federal court to

refer to the preclusion law of the State in which judgment was rendered."

24

Marrese v. Am. Acad. Orthopaedic Surgeons, 470 U.S. 373, 380 (1985). Under

this principle the District Court was bound by the state law of Florida in its

application of preclusion principles.

The most recent on-point appellate decision on Florida’s doctrine of res

judicata is Engle making that decision not only the factual source of the res

judicata findings, but also the source of the law this Court is Erie-bound to follow.

Thus when this Court follows the Engle court’s literal statements that the findings

are to be given “res judicata effect,” this Court is not simply giving full faith and

credit to the courts of Florida, it is also following the law of Florida as defined by

the Florida Supreme Court. “[T]he Supreme Court of Florida is infallible-at least

as to matters of Florida law.” Gonzalez v. State, 617 So. 2d 847, 849 (Fla. 4th

DCA 1993).

The District Court erred in refusing to apply now-settled Florida preclusion

law on due process grounds. First, the Florida Supreme Court considered and

rejected the same due process argument accepted by the District Court. In

particular, contrary to the District Court's reasoning, it makes no difference that

the previously adjudicated question involved an application of law or a federal

constitutional matter. See, e.g., Remo Hotel, L.P. v. City and County of San

Francisco, 545 U.S. 323, 326 n.6 (1980) (reiterating rule that preclusion arises

"once a court has decided an issue of fact or law"); Montana v. United States, 440

U.S. 147, 157 (1978) (applying preclusion because "[n]o different constitutional

25

challenge is at issue in this litigation"). In short (and independently of the

previously discussed Rooker-Feldman doctrine), the District Court's revisitation

of the previously decided due process question was foreclosed because "the

question expressly and definitively presented in this case is the same as that

definitely and actually litigated and adjudged' . . . in state court." Montana, 440

U.S. at 157 (quoting United States v. Moser, 266 U.S. 236, 242 (1942)).

The Florida Supreme Court's opinion in Engle reveals on its face that that

court envisioned that the findings it "approved" would have a significant and

meaningful impact in follow-on actions, so as to facilitate a "pragmatic" resolution

of remaining disputes. The District Court, however, denigrated the Florida

Supreme Court’s "pragmatic" approach, and denied the liability findings

specifically approved by the Florida Supreme Court any practical effect

whatsoever. In doing so, the District Court violated both its statutory duty to

afford the juridical pronouncements of the Florida Supreme Court the same full

faith and credit they would "have by law … in the Courts of such state from which

they are taken," 28 U.S.C. § 1738, and overlooked the core commands of Erie.

Telling in this regard is the application of the Florida Supreme Court’s

order that has occurred in the Florida state courts in the wake of Engle. Florida

courts have concluded that the approved findings must and will play a significant

role in follow-on actions, just as the Florida Supreme Court intended. These

actual rulings by actual state courts powerfully illustrate the legal effect of the

26

Florida Supreme Court ruling "in the Courts of such state" for purposes of 28 USC

§ 1738. No less powerfully, these state court rulings – because they contrast so

dramatically with the order under review here reveal why that Order offends the

"twin aims of Erie" – namely "discouragement of forum shopping and avoidance

of inequitable administration of the laws" in the state and federal judicial systems.

In short, the District Court erred in its purported application of Florida law.

The District approached this question by a consulting very general principles of

law developed in lower Florida court decisions and non-Florida authorities.

Working with these materials, the District Court wove together an analysis that,

among other things, declared the Florida Supreme Court's ruling in Engle to be a

"judicial edict." An “edict” from the Florida Supreme Court is binding on Florida

law.

The District Court ruled that according the jury's liability findings the

significant and meaningful effect that the Florida Supreme Court in actuality

meant for them to have would produce "arbitrariness" violative of the

requirements constitutional due process. The Florida Supreme Court rightly

concluded, however, that carrying forward the approved findings to the follow-on

actions comported with "common sense and logic." Giving jury findings an effect

consistent with "common sense and logic" does not entail arbitrariness or a

violation of the Due Process Clause.

Judgments cannot in general be set aside unless they fail to comply with

27

minimal due process. “Minimal due process” requires (i) proper notice, (ii) service

of process, and (iii) a court of competent jurisdiction. Curbelo v. Ullman, 571 So.

2d 443, 445 (Fla. 1990) (“where a court is legally organized and has jurisdiction

of the subject matter and the adverse parties are given an opportunity to be heard,

then errors, irregularities or wrongdoing in proceedings, short of illegal

deprivation of opportunity to be heard, will not render the judgment void”);

Fehlhaber v. Fehlhaber, 681 F.2d 1015, 1027 (5th Cir. Unit B 1982).

Furthermore even an “‘erroneous conclusion’ reached by the court in the

first suit does not deprive the [party] in the second action ‘of their right to rely

upon the plea of res judicata. . . . A judgment merely voidable because based upon

an erroneous view of the law is not open to collateral attack, but can be corrected

only by a direct review and not by bringing another action upon the same cause.’”

Federated Dept. Stores, Inc. v. Moitie, 452 U.S. 394, 398 (1981). This rule, which

predates the Republic, “has found its way into every system of jurisprudence, not

only from its obvious fitness and propriety, but because without it, an end could

never be put to litigation.” Hopkins v. Lee, 19 U.S. (6 Wheat.) 109 (1821).

Tobacco had all of the basic due process required by Kremer, Fehlhaber,

and Curbelo throughout every part of the Phase I proceedings. Tobacco had the

“opportunity to be heard” and heard again.

Indeed, for two separate reasons, it would violate principles of due process

to leave District Court's Order in place. First, such a result would strip the

28

plaintiffs of "vested rights" conclusively determined in a prior proceeding –

indeed, a proceeding that lasted many years -- in which these very defendants

could and did fully contest every claim and every victory of every plaintiff at

every step of the way. Second, as shown above, upholding the District Court order

would produce profoundly inequitable treatment for these plaintiffs vis a vis

identically situated class members whose claims are now being adjudicated in

Florida state courts. Such far-reaching disparate treatment with respect to

precious and hard-won state law rights would not only violate the Erie doctrine;

it also would offend the principle of equal treatment made applicable to federal

authorities by the Full Faith and Credit Act. 4.2 There is no ambiguity in the decision of the Florida SupremeCourt, and Florida courts have uniformly applied itThere can be little dispute about what the controlling Florida law is on the

preclusive effects of Engle. In its concluding paragraph, the Florida Supreme

Court directed that, "Individual plaintiffs within the class will be permitted to

proceed individually with the findings set forth above given res judicata effect

in any subsequent trial between individual class members and the defendants,

provided such action is filed within one year of the mandate in this case." Engle,

945 So. 2d at 1277. Those findings were set forth in the jury’s answers to

questions 1, 2, 3, 4a, 5a, 6, 7 and 8 and, said the Court, could “stand.” Engle, 945

So. 2d at 1255. Then, in discussing how the Phase I findings would be used, the

court held:

29

The pragmatic solution is to now decertify the class, retaining thejury’s Phase I findings . . .. Class members can choose to initiateindividual damages actions and the Phase I common core findingswe approved will have res judicata effect in those trials.

Engle, 945 So. 2d at 1269. Then, for a third time, the Court used “res judicata”

when it concluded that:

Individual plaintiffs within the class will be permitted to proceedindividually with the findings set forth above given res judicataeffect in any subsequent trial between individual class members andthe defendants, provided such action is filed within one year of themandate in this case.

Engle, 945 So. 2d at 1277. “Res judicata” under Florida law is then defined by

the Florida Supreme Court as follows:

The doctrine of res judicata serves an important purpose in thejudicial system of this state. The foundation of res judicata is thata final judgment in a court of competent jurisdiction is absoluteand settles all issues actually litigated in a proceeding as well asthose issues that could have been litigated.

Engle, 945 So. 2d at 1259.

Florida state courtshave not had difficulty applying what one court has

termed the "unmistakable" holding of the Florida Supreme Court: "The Engle

Court's ruling that the Phase I findings were to have a ‘res judicata effect' in future

trials is an undeniable precedent this Court must follow. As such, those common

core findings in Engle are not to be re-litigated in this case or other cases pending

in this Circuit." Gelep v. R.J. Reynolds, Tobacco Co., No. 98-006584CI (Fla. Cir.

Ct. Jan. 15, 2009), Order on Defendants’ Motion to Determine the Preclusive

Effect of the Engle Phase I Findings, attached as Exhibit B. See also In re Engle

30

Progeny Cases Tobacco Litig., Case No. 08-CA-80000 (Fla. Cir. Ct. May 8,

2008), Order Regarding the Effect of the Engle Phase I Findings on Pending

Cases, attached as Exhibit C ("all issues which were or which might have been

litigated and determined in Engle are preclusively established in every Engle

progeny case").

Because there must be an end as well as a beginning to litigation, res

judicata is considered a “rule of fundamental and substantial justice, of public

policy and private peace” which “should be cordially regarded and enforced by the

courts.” Federated Dep't Stores, Inc. v. Moitie, 452 U.S. 394, 401 (1981). “Public

policy dictates that there be an end of litigation; that those who have contested an

issue shall be bound by the result of the contest, and that matters once tried shall

be considered forever settled as between the parties.” Baldwin v. Traveling Men’s

Ass’n, 283 U.S. 522, 525-26 (1931). It is the public policy of Florida, declared by

the Florida Supreme Court, that Engle Phase I have preclusive effect, and that

Engle Phase III trials be on limited issues. 4.3 If Tobacco had prevailed in Phase I, there is little question classmembers would be unable to relitigate their causes of actionThe failure of Tobacco’s argument is brought into focus by examination of

the converse situation, i.e. what would have happened if Tobacco had won Phase

I. If Tobacco had prevailed in Phase I, it is undeniable that class members would

be unable to bring individual suits, because their “cause of action” against

Tobacco was tried by representation in Phase I. Had the jury answered “no” on the

31

general verdict, individual class members would find their suits for defect,

negligence, and fraudulent concealment barred. These suits would be barred

regardless of what specific defects, acts of negligence, or concealed items an

individual plaintiff could allege. Alleging specific defects would be meaningless,

because the cause of action against Tobacco was tried on their behalf by class

representatives. All matters that relate to that cause of action and that were

actually tried, or could have been tried, would be determined by Phase I.

Indeed, Tobacco wanted to ensure this result, as it believed (or at least

announced its belief) that it would win Phase I. In fact, Tobacco stated its wish

to be bound:

We expect to win the case. When we win the case I want to be ableto say, ‘You’re bound by it.’ . . . I want them bound.

Defendants have the legitimate and understandable desire to ensurethat when defendants prevail in this case, the absent classmembers will be bound.

Engle Class Response Br. in Opposition to Petition for Cert., Case No. 06-1546,

2007 WL 2363238 *1, *17 n.22 (filed Aug. 15, 2007), attached as Exhibit D.

If the “absent class members” would be bound (and we agree they would),

should not Tobacco be bound as well?

5 TH E DIS T RIC T C O U R T E R R E D IN S U B S TITU TIN G ITS O WN P R E C LU SIO NS T A N D A R D F O R TH A T O F TH E ST A T E SU P R E M E C O U R T

In essence the District Court decided that the Florida Supreme Court erred

in its interpretation of Florida preclusion law, and that some transcendent legal

32

principles should apply instead: "the Engle . . . court's description of the Phase I

findings as ‘res judicata' must be disregarded as imprecise phasing – a lapsus

calami, as it were. Assuredly, the Florida Supreme Court meant to command that

the findings be given collateral estoppel effect." Brown, 576 F. Supp. 2d at 1340

n.19. Drawing on a wide array of sources – ranging from the Restatement

(Second) of Judgments) to centuries-old cases to earlier Florida intermediate

appellate court cases, including the very intermediate appellate court decision that

was reversed in Engle itself – the District Court below decreed its power to set

aside the ruling of the Florida Supreme Court in favor of a federal common law

of its own creation: "this Court is constitutionally bound to strictly apply the

doctrine of issue preclusion consistent with its common law origins." Brown, 576

F. Supp. 2d at 1344 n.24, 1346.

Such contemptuous disregard of the Florida Supreme Court on a matter of

Florida law, and the corresponding exaltation of abstract federal common law for

diversity cases, is hard to fathom seventy years after Erie v. Tompkins. Quite

simply, the Florida Supreme Court can define its preclusion doctrine such that

"common core findings . . . will have res judicata effect," or it can term it

"collateral estoppel" – or, for that matter, it can call it "blue turnips." This is a

matter of state law and the Florida Supreme Court is the final arbiter of, and

infallibly defines, Florida state law.

The District Court's ruling cannot withstand scrutiny under Semtek

33

International Inc. v. Lockheed Martin Corp., 531 U.S. 497 (2001). The question

presented in Semtek was the claim preclusive effect of a federal court judgment in

a diversity case. The Court held that, even for judgments issued by a federal court,

the preclusion rule to apply would be determined by state and not federal law, lest

the divergent standards be an invitation to the very forum shopping that Erie

sought to avoid. Semtek, 531 U.S. at 504. In announcing the preclusive effects

of federal court judgments, the Supreme Court held that preclusion rules presented

"a classic case for adopting, as the federally prescribed rule of decision, the law

that would be applied by state courts in the State in which the federal

diversity court sits." Semtek, 531 U.S. at 508. Accordingly, the District Court's

reliance on federal common law to trump state preclusion law is not even a proper

statement of what such federal common law would be. Under Semtek, the federal

common law of preclusion is the law that would control in the state courts, absent

some independent federal interest. As this Court has interpreted Semtek:

Under federal common law, an enforcing court should apply the lawof the state courts in the state where the rendering federal court sits,unless the state's law conflicts with federal interests. This rule,according to the Supreme Court in Semtek International Inc.,achieves the aims of Erie by discouraging forum shopping andencouraging a uniform administration of law."

Palmer & Cay, Inc. v. Marsh & McLennan Companies, Inc., 404 F.3d 1297, 1310

(11th Cir. 2005).

The District Court embarked on an extended disquisition on the “real”

meaning of “res judicata” and “collateral estoppel,” drawing on cases from many

34

jurisdictions as well as on Florida intermediate appellate court cases that preceded

Engle, including the very intermediate appellate court decision that was reversed

in Engle itself. Brown, 576 F. Supp. 2d at 1338-44 n. 24. In the same antiquarian

spirit, the lower court cited nineteenth and early twentieth century cases for the

proposition that “this Court is constitutionally bound to strictly apply the doctrine

of issue preclusion consistent with its common law origins.” Brown, 576 F. Supp.

2d at 1346.

The U.S. Supreme Court holds a different view. In Semtek the Court noted

that the term “judgment on the merits,” a key concept in the law of issue

preclusion, “has gradually undergone change.” Semtek, 531 U.S. at 502. Rather

than stoutly resisting that change, it ruled that, even in a case where the first

decision was reached by a federal diversity court, the applicable preclusion rule

is “the law that would be applied by state courts in the State in which the

federal diversity court sits.” Semtek, 531 U.S. at 508. Indeed, the lower court’s

attempt here to constitutionalize the common law origins of the law of judgments

would have invalidated the Supreme Court’s own policy-based discarding of the

classic mutuality requirement for the use of collateral estoppel in federal court,

first in the context of defensive collateral estoppel, Blonder-Tongue Laboratories,

Inc. v. Univ. of Illinois Foundation, 402 U.S. 313 (1971), and then in that of

offensive collateral estoppel, Parklane Hosiery Inc. v. Shore, 439 U.S. 322 (1979).

Furthermore, an examination of contemporary federal preclusion law would

35

find nothing extraordinary in the ruling of the Florida Supreme Court and no

conceivable federal interest running contrary to the uniform administration of the

law. The tobacco defendants were the losing party in a case tried to judgment

before a jury. Even apart from the class claims, the defendants lost conclusively

to two of the plaintiffs on the merits of just what is at issue here: the causal role

of tobacco in cancer; the pattern of behavior of the tobacco defendants; the

defective nature of cigarettes, etc. What possible interest – federal or state – could

possibly be advanced by having to relitigate in each individual case whether or not

cigarettes cause cancer?

Having lost on the merits on these points, the tobacco defendants are in a

posture no different from the losing party in Parklane. There the Court found no

constitutional obstacle to having losing parties "be precluded from relitigating

facts resolved adversely to them in a prior . . . proceeding with another party . . ."

Parklane, 439 U.S. at 326. See also United States v. Mendoza, 464 U.S. 154

(1984) ("[O]nce a court has decided an issue of fact of law necessary to its

judgment, that decision is conclusive in a subsequent suit based on a different

cause of action involving a party to the prior litigation"). In Parklane, the

defendants lost a prior case to the SEC and a subsequent jury was to be instructed

that, as the prior court had found, their proxy statement was false and misleading.

That presented no constitutional problem in its application. Florida juries can

equally be instructed that the public statements of the tobacco defendants were

36

false and misleading. Indeed, that is what Semtek requires.

6 TH E C O MM O N F A C TS F O U N D B Y TH E F L O RID A SU P R E M E C O U R T AR E U N E X C E P TIO N A L , A C C U R A T E , AN D S CIE N TIFIC A LLY V ALID

Far from being exceptional, the Engle findings themselves are quite

unremarkable. Tobacco defendants have themselves admitted many of them. For

example, Philip Morris now admits on its website that all cigarettes cause cancer

and other diseases, that cigarette smoke from any cigarette is addictive:

PM USA agrees with the overwhelming medical and scientificconsensus that cigarette smoking causes lung cancer, heart disease,emphysema and other serious diseases in smokers. Smokers are farmore likely to develop serious diseases, like lung cancer, thannon-smokers.

There is no safe cigarette.

PM USA agrees with the overwhelming medical and scientificconsensus that cigarette smoking is addictive. It can be very difficultto quit smoking, but this should not deter smokers who want to quitfrom trying to do so.

http://philipmorrisusa.com/en/cms/Products/Cigarettes/Health_Issues/default.aspx(accessed 1/28/2009).

The scientific basis for the findings of addictiveness and of disease

causation is not subject to doubt. See generally Smoking and Health, a Report of

the Surgeon General, DHEW Pub. No. (PHS) 79-50066 (1979); The Health

Consequences of Smoking, Nicotine Addiction, a Report of the Surgeon General,

37

DHHS Pub. No. (CDC) 88-8406 (1988); Reducing the Health Consequences of

Smoking, 25 Years of Progress, a Report of the Surgeon General, DHHS Pub. No.

(CDC) 89-8411 (1989).

7 TH R O U G H TH E R E Q UIR E M E N T S O F IN DIVID U A L C AU S A TIO N , AN D TH R O U G HP E R E MP T O R Y IN S TR U C TIO N S , TH E E N G L E FIN DIN G S C AN B EC O N S TITU TIO N ALLY AP P LIE D T O IN DIVID U A L C AS E S7.1 The District Court acted prematurely in condemning all thefindings for all follow-on cases

The court below condemned the Engle proceedings prematurely and

categorically. In so doing it accepted Tobacco’s arguments that the general nature

of the findings could not be constitutionally applied. However, the District Court

jumped the gun. There was no attempt to apply the findings to any individual.

Because causation will involve the interaction of the general findings with the

individual facts, such inquiry will not run afoul of any constitutional due process

concerns.

Time and again, the Supreme Court has held that, absent extraordinary

circumstances, courts should assess the constitutionality of challenged rules on "as

applied," rather than "facial," grounds. The District Court violated this principle

because it wielded a meat-axe in attacking whatever constitutional problems the

Florida Supreme Court's ruling might in the future present. Proper constitutional

methodology requires a case-specific inquiry as to whether following the res

judicata rule declared by the Florida Supreme Court would offend due process "as

38

applied" to the particular issues, the particular facts, and the particular jury

instructions presented by a particular class member's case.

7.2 Common findings are expected in common issue trials, andEngle approved this practice for Florida lawBefore addressing the specifics, we note that it can be no surprise that the

common factual findings approved by the Florida Supreme court were general.

There could be no other result of a common issues trial, and Florida law, as

expressed in Engle, approves such trials.7.3 The District Court erred in accepting Tobacco’s arguments thatgeneral findings could never be applied under any circumstancesThe District Court accepted the idea in effect that all common issues trials

are constitutionally infirm, especially in the case of tobacco, going so far as to

disagree with the certification of the class. Brown, 576 F. Supp. 2d at 1344, n.24.

The District Court found:

Indeed, as the Engle II court [which is the intermediate appellatecourt the Florida supreme Court overruled in Engle] stated: "[i]n theyears since initial affirmance of certification [of the Engle class] in1996, virtually all courts that have addressed the issue haveconcluded that certification of smokers' cases is unworkable andimproper." 853 So. 2d at 443-44 (collecting cases). A primary reasonfor denying certification in such cases is because such claims fail tomeet the commonality, typicality and predominance requirements ofFederal Rule of Civil Procedure 23(a)(2), (3), or its various stateanalogues, making them unmanageable, inefficient andfundamentally unfair. The same principles of fundamental fairnessmilitating against certifying such a class equally support this Court's

39

finding that the Phase I verdict may not be used to establish anyelement of Plaintiffs' claims.

However class certification is a state court matter finally and was conclusively

resolved in favor of certification. The District Court took no evidence on whether

tobacco cases lend themselves to class treatment, accepting Tobacco’s arguments

that, in effect, circumstances of disease and smoking vary so tremendously among

potential plaintiffs that common issues are essentially nonexistent. In fact, the

important, operative facts and legal theories are entirely common, as the Florida

courts have found, after taking extensive evidence on the issue of commonality

and typicality. 7.3.1 It is a permissible factual finding that cigarette brands do not materiallydiffer in their ability to cause diseaseThere are two areas of generality involving the contested findings. (Tobacco

does not contest the findings that cigarettes cause the enumerated diseases, and

that cigarette smoke is addictive.) The first area of concern is that the findings

appear to apply to all cigarette brands. This seemed to be a concern of the Court,

but it should not have been. The Florida Supreme Court, having reviewed the

voluminous trial record, accepted that the Engle jury found that the defect proved

by the plaintiffs, rooted as it was in the addictive liability of nicotine, extended to

all brands. The defendant Tobacco companies were certainly able to mount a

defense of a certain brand or type of cigarette. (In fact, in the Engle proceedings,

the Tobacco defendants did successfully mount a causation challenge for a type

40

of lung cancer, known as bronchioloaviolar cancer, and jury accepted this.) If

such defense had succeeded, the jury could have exempted the defect finding for

that brand.

That no brand was found nondefective reflects the reality that neither the

cigarette companies nor any legitimate scientific authority even suggests that there

are brands of cigarettes that are materially different in their impact on human

health. All cigarettes, i.e. tobacco rods wrapped in paper, share exactly the

hazards that caused the diseases complained of: addictiveness of nicotine, the

characteristic plant alkaloid synthesized by the tobacco plant and carcinogens and

pathogens that are produced by the burning of the tobacco leaf. Even the website

of Philip Morris explicitly admits that no type of cigarettes is safer than any other

type, nor is any type less addictive than any other:

The terms "Light," "Ultra Light," "Medium" and "Mild" do NOTmean that the product is safer. These terms, or descriptors, are usedto describe strength of taste and flavor.

Smoking brands using descriptors such as "Light," "Ultra Light,""Medium" and "Mild" will NOT help a smoker quit smoking. If asmoker is concerned about the health effects of smoking, the bestthing to do is quit.

Brand descriptors such as "Light," "Ultra Light," "Medium" or"Mild" do NOT communicate the amount of tar, nicotine or otherconstituents in smoke a smoker may inhale when smoking.

As of today, there is no cigarette on the market which public healthorganizations endorse as offering "reduced risk." If smokers areconcerned about the risks of cigarette smoking, the best thing to dois quit. There is no safe cigarette.

41

See Philip Morris website, cited supra.

The “brand variety” issue, therefore is a parade of horribles argument that

the cigarette company defendants well know, and even admit, is fallacious. Their

brands may differ in “taste” or the in the marketing images they use, but they all

cause the same cancers and they all are addictive. (However, regardless of the

general findings of defect, individual plaintiffs must still prove that the defect

caused their injuries, as we discuss below.)7.3.2 It is a permissible factual finding that the cigarette companies actednegligently in the marketing of their product to the general publicThe second concern of lack of specificity is related to the conduct of the

defendant tobacco companies. The Court below accepted the argument that the

findings of negligence and misconduct without further definition could not

withstand constitutional scrutiny. This as well was an incorrect response to a

parade of horribles argument accepted without factual support.

In fact, although the full story of the misconduct of the cigarette industry

would of course fill an enormous volume of information (the Engle trial was

reportedly the longest in history in making the effort to actually write this

volume), there are parts of the story that can apply to everyone. For example,

when confronted with scientific evidence of the hazards of cigarettes in the 1950's,

the companies suppressed and distorted the scientific research. These clandestine

activities were of course not directed against any individual smokers, but they had

a general effect on the public. All of this and more was evaluated by the Engle

42

jury, who concluded that the cigarette companies had acted improperly in the

marketing of their products to the public in general.7.3.3 Application of general findings to specific circumstances is anticipatedwhen causation is considered in the follow-on casesGiven that the defendants’ conduct was judged to be negligent in toto, that

finding is easily applied to individual cases. The Florida Supreme Court

decertified the class to permit follow-on cases where the matters of individual

causation and damages would be considered. Causation is where the “big story”

of the cigarette industry’s conduct meets the individual plaintiff’s story. The

plaintiff’s burden is to show that the defect or the misconduct caused the injuries

complained of. The jury is to be instructed that cigarettes were found to be

defective, and that the conduct of the defendants was found to be negligent.

Whether such defect or negligence was in fact the cause of any damages is for the

individual juries to consider. Far from not getting their day in court, the cigarette

defendants can and will argue that their negligent conduct did not cause any harm

to the plaintiff, because the plaintiff was fully apprised in the hazards of their

product. They can also argue that the plaintiff was not addicted, and/or did not

suffer from any disease related to cigarettes. None of these arguments are in any

way contradictory to the Florida Supreme Court findings, which should be read

to the jury and considered established.

When the role of causation in evaluating individual issues is understood, the

parade of horribles over the generality of the findings (a necessary consequence

43

of any classwide trial) evaporates. The Engle findings can be, consistent with

Florida law, preserved and enforced in the follow-on cases. The defendants were

negligent and cigarettes were defective. Whether that misconduct or defect

affected the individual, remains to be tried. Of course some specifics may be

required to establish this. Yet the District Court’s opinion does not grapple with

the nuts-and-bolts problem of applying the findings to individuals, or even

conclude, after that attempt, that such a process is impossible. 7.4 Appropriate peremptory instructions will permit the DistrictCourt to apply the Engle findings to individual casesHaving made the decision on its own or as a result of an appellate court

mandate – the District Court may fashion peremptory instructions for the second

jury that explain the application of the findings. See e.g., Santiesteban v.

McGrath, 320 So. 2d 476 (Fla. 3d DCA 1975) (containing peremptory instruction

finding liability but instructing jury to decide comparative negligence); Trejo v.

Denver & Rio Grande Western R.R. Co., 568 F.2d 181, 184-85 (10th Cir. 1977);

Cromling v. Pittsburgh L.E.R. Co., 327 F.2d 142, 152-53 (3rd Cir. 1963); Thatch

v. Missouri Pacific R.R. Co., 362 N.E.2d 1064, 1068-70 (Ill. App. 1977)

(providing suggestion on how the trial court should draft an appropriate jury

instruction when only comparative fault and damages are at issue).

Lower state courts have fashioned appropriate peremptory instructions for

Engle Phase III cases. Judge Levens found “Phase I finding #1 will conclusively

establish . . . that smoking cigarettes causes a variety of diseases and medical

44

conditions” and proposed this jury instruction:

The court has determined and now instructs you, as a matter of law,that smoking the Defendant(s)’ cigarettes causes [one or more of theenumerated medical conditions suffered by the Plaintiff].

For causation, Judge Levens proposed this jury instruction:

The court has determined and now instructs you, as a matter of law,that the Defendant(s) was (were) negligent in the manufacture andsale of the cigarettes smoked by the Plaintiff, and that thosecigarettes were defective and in an unreasonably dangerous conditionto the Plaintiff.

The first issue for your determination on the Plaintiff’s negligenceclaim is whether smoking cigarettes manufactured and sold by theDefendant(s) was a legal cause of injury or damage to the Plaintiff.

Exhibit C at 2-3.

Whether a federal court sitting in diversity ultimately follows Judge Levens’

proposed instructions or drafts its own, a federal court faithfully applying the

preclusion law of the State can surely craft instructions that will adequately inform

the jury of the Engle Phase I findings and of what additional facts they will have

to decide.

8 C O N C LU SIO N

The District Court's ruling on the merits of the due process argument offend

the law of judgments and jurisdiction because:

(1) the District Court proceeding involved a de facto appeal of the Florida

Supreme Court's due-process ruling, notwithstanding the Rooker-Feldman

and §1257 requirement that such claims of state Supreme Court error be

45

brought, and be brought only, to the Supreme Court of the United States;

(2) governing principles of issue preclusion foreclosed the District Court from

again deciding the due process argument light of the Florida courts' earlier

consideration and rejection of the same argument in a proceeding that

involved exactly these same parties;

(3) the District Court's ruling wrongly vindicated a collateral attack on a now

final Florida Supreme Court judgment even though that judgment was

entered by that Court in an action unmarred by any flaw in either in

personam jurisdiction or notice or opportunity to be heard; and

(4) the District Court purported to read Florida law to strip a Florida jury's

"common liability findings" of all later effect, even in the face an express

declaration, by the Florida Supreme Court in applying Florida law, that

those findings should have "res judicata effect."

The District Court erred in declaring that the Florida Supreme. Court.'s res

judicata ruling was so fundamentally flawed that it violated federal due process

principles when the District Court's supporting analysis:

(1) entirely ignored the "common sense" basis on which the Florida Supreme

Court's ruling rightly rested; and

(2) equated supposed common-law preclusion rules with fundamental

constitutional requirements in the teeth of contrary United States Supreme

Court precedent.

46

The District Court erred when it evaluated the effect of the Florida Supreme

Court's res judicata ruling prematurely and on a woodenly "facial," rather than

properly case-specific "as applied" basis because:

(1) the Court did not attempt to apply the general classwide facts found by the

Florida Supreme Court to individual cases in the exercise of its case

management authority, but instead attacked and rejected the classwide

findings in toto;

(2) the requirements of individual causation imply that general facts found by

the first jury will of necessity be applied in a specific and individual basis,

so that challenges to the application of a given general fact can be made at

that time;

(3) if the defendants have, as they will in individual trials involving causation,

ample opportunity to litigate the effect of any general fact on the particular

individual involved there can be no due process violation; and

(4) adequate peremptory instructions can assist follow-on juries in applying

general facts found by the Florida Supreme Court to individual causation

determinations.

For the foregoing reasons, the order of the District Court should be vacated

and the cause remanded to the Court for further proceedings, including case

management of individual or groups of cases in an effort to determine procedures

wherein the Florida Supreme Court's intent to permit certain generalized facts to

47

apply, may be realized, and the litigation may proceed and conclude within a

reasonable timescale considering the age and infirmity of the class members.

Date: February 2, 2009 Respectfully Submitted,/s/ Norwood S. WilnerSamuel Issacharoff Norwood S. Wilner40 Washington Square South FL. Bar No. 0222194New York, NY 10012 Stephanie J. HartleyFL. Bar No. 0997846Frank Fratello, Jr.FL Bar. No. 046100Wilner Block, P.A.444 E. Duval Street, 3 FloorrdJacksonville, FL 32202

Case No. 08-16158-CCCERTIFICATE OF COMPLIANCE WITH FRAP32(a)(7)(B)1. This brief complies with the type-volume limitation of Fed.R.App.P32(a)(7)(B) because this brief contains 11,551 words, excluding the parts of the briefexempted by Fed.R.App.P. 32(a)(7)(B)(iii).2. This brief complies with the type face requirements of Fed.R.App.P.32(a)(5) and the type-style requirements of Fed.R.App.P. 32(a)(6) because this briefhas been prepared in a proportionally spaced typeface using Word Perfect in TimesNew Roman 14.

Case No. 08-16158-CCCERTIFICATE OF SERVICEI HEREBY CERTIFY that the original and six copies of the “Initial Brief ofAppellants” were dispatched for filing via UPS Overnight Delivery and that copies ofthe original were served upon:

Dana G. Bradford, II, EsquireSmith, Gambrell & Russell, LLP50 N Laura Street, Suite 2600Jacksonville, FL 32202Attorneys for defendant R.J. Reynolds Tobacco Company individually and assuccessor by merger to the Brown and Williamson Tobacco Corporation and theAmerican Tobacco Company and Philip Morris USA, Inc.James B. Murphy, Jr., EsquireJoshua R. Brown, EsquireShook, Hardy & Bacon, LLP100 N Tampa St, Suite 2900Tampa, FL 33602Attorneys for defendant R.J. Reynolds Tobacco Company individually and assuccessor by merger to the Brown and Williamson Tobacco Corporation and theAmerican Tobacco Company, Philip Morris USA, Inc. and Lorillard TobaccoCompanyStephanie E. Parker, EsquireJohn F. Yarber, EsquireJones Day1420 Peachtree St NE, Suite 800Atlanta, GA 30309-3053Attorneys for defendant R.J. Reynolds Tobacco Company individually and assuccessor by merger to the Brown and Williamson Tobacco Corporation and theAmerican Tobacco Company

Kenneth J. Reilly, EsquireShook, Hardy & Bacon, LLP201 S Biscayne Blvd, Suite 2400Miami, FL 33131-4332Attorneys for defendant Philip Morris USA, Inc.Kelly Anne Luther, EsquireClarke, Silvergate & Campbell, PA799 Brickell Plaza, Suite 900Miami, FL 33131Attorneys for defendant Liggett Group, LLC formerly known as Liggett Group, Inc.and Vector Group, Ltd., LLC.Franklin J. BurrP O Box 789Dunedin, FL 34697-0789Pro Se Appellanton this 2 day of February, 2009.nd/s/ Norwood S. WilnerNorwood S. WilnerOne of the Attorneys for Plaintiffs/Appellants