Monday, July 21, 2014

$23.6 billion?

(CNN) -- A Florida jury awarded a widow $23.6 billion in punitive damages in her lawsuit against tobacco giant R.J. Reynolds Tobacco Company, her lawyer said.

Cynthia Robinson claimed that smoking killed her husband, Michael Johnson, in 1996. She argued R.J. Reynolds was negligent in not informing him that nicotine is addictive and smoking can cause lung cancer. Johnson started smoking when he was 13 and died of lung cancer when he was 36.

The jury award Friday evening is "courageous," said Robinson's lawyer, Christopher Chestnut.

In a statement, J. Jeffery Raborn, vice president and assistant general counsel for R. J. Reynolds, said, "The damages awarded in this case are grossly excessive and impermissible under state and constitutional law.

"This verdict goes far beyond the realm of reasonableness and fairness and is completely inconsistent with the evidence presented," said Raborn. "We plan to file post-trial motions with the trial court promptly and are confident that the court will follow the law and not allow this runaway verdict to stand."

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The parent company of R.J. Reynolds (Reynolds American) earned $1.7 billion in 2013 on revenue of $8.2 billion.  The company has $18.0 billion in assets, $11.5 billion in liabilties, for $6.5 billion in stockholder's equity.  So it would essentially be impossible for the company to pay that much.  The $23.6 billion would put Cynthia Robinson at no. 15 on the Forbes 400 just behind Jeff Bezos, Larry Page, and Sergey Brin.  And ahead of such notables as Carl Icahn, George Soros, Mark Zuckerberg, Steve Ballmer, Phil Knight, Michael Dell, Paul Allen.

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