Petition for Writ of Certiorari — R.J. Reynolds Tobacco Company, et al., Petitioners v. Cheryl Searcy, as Personal Representative of the Estate of Carol LaSard

No.

IN THE

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_______________

R.J. REYNOLDS TOBACCO COMPANY AND

PHILIP MORRIS USA INC.,

Petitioners,

v.

CHERYL SEARCY, AS PERSONAL REPRESENTATIVE OF

THE ESTATE OF CAROL LASARD,

Respondent.

_______________

On Petition For A Writ Of Certiorari

To The United States Court Of Appeals

For The Eleventh Circuit

_______________

PETITION FOR A WRIT OF CERTIORARI

_______________

MICHAEL A. CARVIN

YAAKOV ROTH

JONES DAY

51 Louisiana Avenue, N.W.

Washington, D.C. 20001

Counsel for Petitioner

R.J. Reynolds Tobacco Co.

MIGUEL A. ESTRADA

Counsel of Record

AMIR C. TAYRANI

BRANDON L. BOXLER

GIBSON, DUNN & CRUTCHER LLP

1050 Connecticut Avenue, N.W.

Washington, D.C. 20036

(202) 955-8500

mestrada@gibsondunn.com

Counsel for Petitioner

Philip Morris USA Inc.

[Additional counsel listed on signature page]

QUESTION PRESENTED

The Florida Supreme Court has devised a new,

class-action-specific doctrine of claim preclusion in order to facilitate the classwide adjudication of inherently individualized claims. Under this unprecedented approach to preclusion, the members of an issues class can rely on the class jury’s findings to establish elements of their claims in individual suits

against the class-action defendants without having to

show that the class jury actually decided those issues

in their favor. For preclusion to apply, it is sufficient

that the class jury might have decided those issues.

According to the Eleventh Circuit, the Florida Supreme Court’s unorthodox approach to the preclusive

effect of class-action findings is consistent with due

process because the defendants had notice and an “opportunity to be heard” in the class proceedings.

The question presented is whether the Due Process Clause is violated by a rule that permits plaintiffs

to invoke a prior jury’s findings to establish elements

of their claims without showing that those elements

were actually decided in their favor in the prior proceeding, based merely on the fact that the defendant

had an opportunity to be heard on those issues in the

prior proceeding and the possibility that the relevant

issues might have been decided in the plaintiffs’ favor

in that proceeding.

ii

PARTIES TO THE PROCEEDING AND

RULE 29.6 STATEMENT

The caption contains the names of all the parties

to the proceeding below.

R.J. Reynolds Tobacco Company is a wholly

owned subsidiary of R.J. Reynolds Tobacco Holdings,

Inc., which is a wholly owned subsidiary of Reynolds

American Inc., which in turn is an indirect, wholly

owned subsidiary of British American Tobacco p.l.c., a

publicly held corporation.

Philip Morris USA Inc. is a wholly owned subsidiary of Altria Group, Inc. No publicly held company

owns 10% or more of Altria Group, Inc.’s stock.

iii

TABLE OF CONTENTS

Page

QUESTION PRESENTED...........................................i

PARTIES TO THE PROCEEDING AND

RULE 29.6 STATEMENT .................................... ii

TABLE OF APPENDICES ........................................ iv

TABLE OF AUTHORITIES ........................................ v

OPINIONS BELOW .................................................... 1

JURISDICTION .......................................................... 1

CONSTITUTIONAL

AND

STATUTORY

PROVISIONS INVOLVED .................................... 1

STATEMENT .............................................................. 1

REASONS FOR GRANTING THE PETITION ....... 19

I.

THE ELEVENTH CIRCUIT’S “OPPORTUNITY

TO BE HEARD” STANDARD CONFLICTS

WITH LONGSTANDING COMMON-LAW

REQUIREMENTS AND THIS COURT’S DUEPROCESS PRECEDENT .................................... 20

A. The “Actually Decided” Requirement

Is

Universally

Accepted

And

Constitutionally Mandated Where

Preclusion Is Applied To Issues ............ 21

B. The Eleventh Circuit’s “Opportunity

To Be Heard” Standard Does Not

Comport With Due Process ................... 24

II. THE QUESTION PRESENTED HAS FARREACHING

CONSEQUENCES

FOR

THOUSANDS OF PENDING CASES AND FOR

FUTURE ISSUES CLASS ACTIONS.................... 32

CONCLUSION .......................................................... 34

iv

TABLE OF APPENDICES

Page

APPENDIX A: Opinion of the United States

Court of Appeals for the Eleventh Circuit

(Sept. 5, 2018) ...................................................... 1a

APPENDIX B: Order of the United States

District Court for the Middle District of

Florida Denying Defendants’ Renewed

Motion for Judgment as a Matter of Law

(Sept. 11, 2013) .................................................. 44a

APPENDIX C: Order of the United States

District Court for the Middle District of

Florida Denying Defendants’ Motion for a

New Trial (Sept. 12, 2013) ................................. 60a

APPENDIX D: Constitutional and Statutory

Provisions Involved ............................................ 78a

v

TABLE OF AUTHORITIES

Page(s)

Cases

Ashe v. Swenson,

397 U.S. 436 (1970) .............................................. 23

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

611 F.3d 1324 (11th Cir. 2010) ............................ 10

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

576 F. Supp. 2d 1328 (M.D. Fla. 2008) ............... 10

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

884 F.3d 1068 (11th Cir. 2018) .......... 14, 17, 24, 26

Burlen v. Shannon,

99 Mass. 200 (1868) ............................................. 21

City of Sunland Park v. Macias,

75 P.3d 816 (N.M. 2003) ...................................... 26

Cromwell v. Cty. of Sac.,

94 U.S. 351 (1876) ................................................ 22

De Sollar v. Hanscome,

158 U.S. 216 (1895) .................................... 3, 22, 26

Dodge v. Cotter Corp.,

203 F.3d 1190 (10th Cir. 2000) ............................ 26

Dowling v. Finley Assocs.,

727 A.2d 1245 (Conn. 1999) ................................. 26

Duchess of Kingston’s Case (H.L. 1776),

in 2 Smith, A Selection of Leading

Cases on Various Branches of the

Law 425 (1840) ..................................................... 21

Engle v. Liggett Grp., Inc.,

945 So. 2d 1246 (Fla. 2006) ........................... 2, 8, 9

vi

Ettin v. Ava Truck Leasing, Inc.,

251 A.2d 278 (N.J. 1969)...................................... 23

Fayerweather v. Ritch,

195 U.S. 276 (1904) ........................ 3, 19, 23, 25, 31

Gordon v. Gordon,

59 So. 2d 40 (Fla. 1952) ....................................... 10

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

857 F.3d 1169 (11th Cir. 2017) ........... 2, 12, 13, 23,

28, 29, 31, 32

Honda Motor Co. v. Oberg,

512 U.S. 415 (1994) ............................ 19, 20, 24, 27

Kremer v. Chem. Constr. Corp.,

456 U.S. 461 (1982) .............................................. 20

Liggett Grp. Inc. v. Engle,

853 So. 2d 434 (Fla. Dist. Ct. App. 2003) .............. 8

Logan v. Zimmerman Brush Co.,

455 U.S. 422 (1982) .......................................... 3, 26

Long v. Baugas,

24 N.C. (2 Ired.) 290 (1842) ................................. 22

Nevada v. United States,

463 U.S. 110 (1983) .............................................. 27

Packet Co. v. Sickles,

72 U.S. (5 Wall.) 580 (1866) ................................. 21

People v. Frank,

28 Cal. 507 (1865) ................................................ 21

Philip Morris USA v. Williams,

549 U.S. 346 (2007) .............................................. 26

vii

Philip Morris USA, Inc. v. Douglas,

110 So. 3d 419 (Fla. 2013) ............ 5, 6, 7, 8, 11, 12,

19, 28, 29

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

214 So. 3d 590 (Fla. 2017) ................................... 29

Richards v. Jefferson Cty.,

517 U.S. 793 (1996) ................................................ 1

Russell v. Place,

94 U.S. 606 (1876) ...................................... 3, 22, 26

Seaboard Coast Line R.R. v. Indus.

Contracting Co.,

260 So. 2d 860 (Fla. Dist. Ct. App. 1972) ............ 10

Steam-Gauge & Lantern Co. v. Meyrose,

27 F. 213 (C.C.E.D. Mo. 1886) ............................. 21

Taylor v. Sturgell,

553 U.S. 880 (2008) .............................................. 24

United States v. Patterson,

827 F.2d 184 (7th Cir. 1987) ................................ 26

Wal-Mart Stores, Inc. v. Dukes,

564 U.S. 338 (2011) ................................................ 1

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

734 F.3d 1278 (11th Cir. 2013) ............................ 13

Wolff v. McDonnell,

418 U.S. 539 (1974) .............................................. 20

Statutes

28 U.S.C. § 1254(1) ...................................................... 1

28 U.S.C. § 1738 .................................................... 1, 20

viii

Rules

Fed. R. Civ. P. 23(c)(4)................................................. 9

Fla. R. Civ. P. 1.220(d)(4)(A) ....................................... 9

Other Authorities

American Law Institute, Principles of the

Law of Aggregate Litigation (2010) ..................... 32

Restatement (Second) of Judgments

(1982) .................................................................... 22

Charles A. Wright et al., Federal

Practice and Procedure (3d ed. 2018) .................. 32

Charles A. Wright et al., Federal

Practice and Procedure (2d ed. 2002) .................. 22

PETITION FOR A WRIT OF CERTIORARI

R.J. Reynolds Tobacco Co. and Philip Morris USA

Inc. (“PM USA”) respectfully submit this petition for

a writ of certiorari to review the judgment of the U.S.

Court of Appeals for the Eleventh Circuit.

OPINIONS BELOW

The opinion of the Eleventh Circuit is reported at

902 F.3d 1342. Pet. App. 1a. The district court’s posttrial orders are unreported but are electronically

available at 2013 WL 4928230, id. at 44a, and 2013

WL 5421957, id. at 60a.

JURISDICTION

The judgment of the court of appeals was entered

on September 5, 2018. The jurisdiction of this Court

is invoked under 28 U.S.C. § 1254(1).

CONSTITUTIONAL AND STATUTORY

PROVISIONS INVOLVED

The Fifth Amendment to the United States Constitution and the Full Faith and Credit Act, 28 U.S.C.

§ 1738, are reproduced in the appendix to this petition. Pet. App. 78a.

STATEMENT

The Florida courts have condoned a constitutional

farce unparalleled in Anglo-American legal history.

Although this Court has repeatedly granted review in

the past to guard against abuses of the class-action

device, see Wal-Mart Stores, Inc. v. Dukes, 564 U.S.

338, 367 (2011), and “extreme applications” of preclusion doctrines, Richards v. Jefferson Cty., 517 U.S.

793, 797 (1996), the constitutional deficiencies in

those earlier cases pale in comparison to the spectacle

2

currently playing out in Florida, where courts are using the combination of a retroactively certified issues

class action and a radical, heretofore-unknown doctrine of “offensive claim preclusion” to facilitate the

imposition of hundreds of millions of dollars in judgments against petitioners and other defendants. In so

doing, the Florida courts have provided a roadmap for

other lower courts eager to use class actions to adjudicate inherently individualized claims long thought unsuitable for classwide resolution.

To be sure, this Court has had several prior opportunities to intervene in this “Engle progeny” litigation

but has denied petitions challenging the sweeping

preclusive effect that the Florida state and federal

courts have given to the jury’s findings in Engle v. Liggett Group, Inc., 945 So. 2d 1246 (Fla. 2006) (per curiam), a class action brought on behalf of Florida

smokers. In the earlier Eleventh Circuit cases in

which the defendants sought certiorari, the court of

appeals claimed that the Engle jury had actually decided issues common to all class members. See, e.g.,

Graham v. R.J. Reynolds Tobacco Co., 857 F.3d 1169,

1182 (11th Cir. 2017) (en banc), cert. denied, 138 S. Ct.

646 (2018). That was untrue, but if it were true, there

would be no due-process objection to treating those

findings as preclusive in subsequent trials.

But the Eleventh Circuit has since dropped that

pretense altogether. Confronted with class members’

claims for fraudulent concealment and conspiracy to

fraudulently conceal—which were not at issue in Graham—the court has now squarely held that the defendants may be deprived of their property even

though no jury may ever have actually decided all the

elements of those claims in the plaintiff’s favor. Due

process is satisfied, according to the Eleventh Circuit,

3

so long as the defendant had an “opportunity to be

heard” on those issues. Pet. App. 18a (emphasis

added).

Accordingly, unlike the earlier petition in Graham, this petition presents a clean and straightforward legal question: Does the Due Process Clause require that an issue have been actually decided by a

factfinder in prior litigation before it is treated as conclusively established, or, as the Eleventh Circuit has

now held, is it enough that the defendant had an opportunity to present its side of the dispute?

The answer is equally straightforward. Until the

Florida state and federal courts charted their unconstitutional course, it was universally acknowledged

that a party seeking to have an issue treated as resolved based on the outcome of a prior proceeding

must show that a factfinder in the previous case actually decided that “‘precise question.’” E.g., De Sollar

v. Hanscome, 158 U.S. 216, 221-22 (1895) (quoting

Russell v. Place, 94 U.S. 606, 608 (1876)). This “actually decided” requirement rests on the most basic requirement of due process: Before defendants can be

deprived of their property, plaintiffs must prove each

element of their claims. See Logan v. Zimmerman

Brush Co., 455 U.S. 422, 433 (1982). This Court has

squarely held that the “actually decided” requirement

is so fundamental that it is mandated by due process.

See Fayerweather v. Ritch, 195 U.S. 276, 298-99, 307

(1904).

The deprivation of petitioners’ due-process

rights—the imposition of liability without any assurance that respondent proved each element of her

claims—is manifest in this case, where respondent relied exclusively on the preclusive effect of the Engle

4

jury’s generalized findings to establish the conduct elements of her claims. On her concealment and conspiracy claims, for example, she alleged that her

mother, a deceased smoker, had been deceived by petitioners’ statements about the health risks and addictiveness of so-called “low-tar” cigarettes, but she was

not required to prove that those statements were

fraudulent, relying instead on the findings of the

Engle jury. The Eleventh Circuit panel acknowledged

that respondent did not “offer any evidence” that the

Engle jury actually “based its finding of concealment

. . . on [petitioners’] conduct regarding the marketing

of low-tar cigarettes.” Pet. App. 17a. And it noted

that, in light of the “multiple acts of concealment . . .

presented to the Engle jury” and the Engle jury’s “general finding[s],” it is “difficult to determine whether

the Engle jury’s basis for its general finding of concealment was the particular concealments regarding lowtar/low-nicotine cigarettes” at issue in this case. Id.

at 19a. The panel nevertheless affirmed the judgment

because petitioners had been afforded notice and an

“opportunity to be heard” in Engle. Id. at 18a-20a.

To restore the due-process constraints on state

preclusion standards—and to deter other courts from

using unprecedented preclusion rules to facilitate the

classwide adjudication of individualized claims—this

Court should grant review in both this case and Philip

Morris USA Inc. v. Boatright, which raises the same

question in a case from Florida state court. The practical implications of the Florida courts’ evisceration of

the constitutional limits on preclusion are staggering.

The decertified Engle class action has spawned thousands of individual claims, approximately 2,300 of

which remain pending in Florida courts. Although

only 10% of those cases have been tried, petitioners

and the other defendants in those cases have already

5

been subjected to judgments in excess of three-quarters of a billion dollars. This Court should grant review to put a stop to the serial due-process violations

being committed by Florida’s state and federal courts.

A. The Engle Case

1. The Engle class action began in 1994 when six

individuals filed a complaint in state court in Miami

seeking billions of dollars in damages from petitioners

and other tobacco companies. The class ultimately

certified encompassed all “Florida citizens and residents,” “and their survivors, who have suffered, presently suffer or have died from diseases and medical

conditions caused by their addiction to cigarettes that

contain nicotine.” Philip Morris USA, Inc. v. Douglas,

110 So. 3d 419, 422 (Fla. 2013).

Over the defendants’ objections, the Engle trial

court adopted a complex three-phase trial plan, under

which the jury would make findings in Phase I on purported “common” issues relating to the defendants’

conduct and the general health effects of smoking.

Douglas, 110 So. 3d at 422. In Phase II, the jury

would apply its Phase I findings to the claims of three

individual class members and assess punitive damages for the class. Id. In Phase III, new juries would

apply the Phase I findings in deciding the claims of

the other individual class members. Id.

During the year-long Phase I trial, the class advanced a host of disparate factual allegations attacking the defendants’ products and conduct over the

span of five decades, including many allegations that

pertained to only some cigarette brands or only some

periods of time. For example, to support its strict-liability and negligence claims, the class asserted that

some cigarette brands used genetically engineered

high-nicotine tobacco, that other brands used filters

6

that contained harmful components, and that the ventilation holes in “light” or “low tar” cigarettes were improperly placed. See, e.g., Douglas, 110 So. 3d at 42324; Engle Class Opp. to Mot. for Strict Liability Directed Verdict at 3; Engle Tr. 11966-71, 16315-18,

27377, 36349-55, 36479-85, 36729-32.1

The theories underlying the class’s fraudulentconcealment and conspiracy to fraudulently conceal

claims were equally varied. As class counsel explained during trial, those claims were based on

“thousands upon thousands of statements about” cigarettes. Engle Tr. 35955. The class’s concealment and

conspiracy evidence addressed the defendants’ alleged

failure to disclose, among other things, information

about the disease-causing compounds in cigarette

smoke, id. at 36720-24, the addictive nature of nicotine and its alleged manipulation by the defendants to

increase addictiveness, id. at 36483-85, and the identity and health effects of cigarette additives, id. at

36703-05.

There was no suggestion that each of the class’s

theories related to all class members or to all of the

defendants’ products. To the contrary, class counsel

asserted that it was “a fallacy that every common issue has to apply to one hundred percent of the class

members.” Engle Tr. 24417-18.

At the conclusion of Phase I, the class made a critical strategic decision: It sought and secured a verdict

form that asked the jury to make only generalized

findings on each of the torts at issue. Douglas, 110 So.

3d at 424-25. The defendants objected on the ground

that the jury’s responses, if favorable to the class,

1 A DVD containing the Engle record materials cited herein is

part of the record below.

7

would be too general to be used by subsequent juries

resolving the claims of individual class members, who

smoked different cigarettes at different times, and

who were exposed to different advertising and other

tobacco-industry statements. Id. at 423; see also

Engle Tr. 35915-15. The trial court nevertheless sided

with the class and accepted its non-specific verdict

form. See Douglas, 110 So. 3d at 423.

The verdict form given to the Engle jury does not

reveal which of the class’s many theories of liability

the jury accepted, which it may have rejected, and

which it may not even have reached. Instead, it establishes, at most, that each defendant committed unspecified tortious acts at unspecified times during the

five decades covered by the trial. On the class’s strictliability claim, the verdict form simply asked whether

each defendant “placed cigarettes on the market that

were defective and unreasonably dangerous.” Douglas, 110 So. 3d at 424 (internal quotation marks omitted). Similarly, on the class’s negligence claim, the

verdict form asked whether each defendant “failed to

exercise the degree of care which a reasonable cigarette manufacturer would exercise under like circumstances.” Id. at 425 & n.3 (internal quotation marks

omitted). As formulated, these questions compelled a

“yes” response if the jury agreed with any of the class’s

various theories of defect and negligence.

The verdict-form questions on the class’s concealment and conspiracy claims were, if anything, even

more problematic. Not only did those questions fail to

require the jury to identify the specific ground for any

affirmative finding, but they also presented the jury

with alternative theories of concealment and conspiracy—asking whether the defendants concealed mate-

8

rial information about the “health effects” or “addictive nature” of smoking—without requiring the jury to

identify whether it adopted one or both theories when

it responded affirmatively. Douglas, 110 So. 3d at

424.

The jury answered all of these questions with a

simple “yes,” leaving the parties with no hint as to the

specific grounds for its findings. Douglas, 110 So. 3d

at 423.2

In Phase II-A, the same jury determined individualized issues of legal causation as to three named

plaintiffs, found liability as to each, and awarded

those three plaintiffs compensatory damages. Engle

Phase II-A Verdict Form. In Phase II-B, the jury

awarded a lump sum of $145 billion in punitive damages to the class as a whole. Engle, 945 So. 2d at 1257.

Before Phase III commenced, the defendants appealed.

2. The intermediate appellate court reversed,

holding that the case could not be maintained as a

class action and that the punitive-damages award was

both premature and excessive. See Liggett Grp. Inc.

v. Engle, 853 So. 2d 434, 441-42 (Fla. Dist. Ct. App.

2003), approved in part and quashed in part, 945 So.

2d 1246 (Fla. 2006).

On further review, the Florida Supreme Court

agreed that the punitive-damages award could not

stand because no jury had made a liability finding in

2 The Engle jury made only two findings that are specific

enough to have meaningful, and constitutional, application in

progeny cases: (1) that smoking is a medical cause of twenty specific diseases; and (2) that cigarettes containing nicotine are addictive. Engle, 945 So. 2d at 1276-77.

9

favor of the class. Engle, 945 So. 2d at 1262-63. The

court also concluded that “continued class action

treatment” was “not feasible because individualized

issues such as legal causation, comparative fault, and

damages predominate.” Id. at 1268. Based on “pragmatic” considerations, however, the court further

ruled, sua sponte, that some of the issues in Phase I of

Engle were appropriate for class-wide adjudication

under Florida’s counterpart to Federal Rule of Civil

Procedure 23(c)(4), which permits class certification

“‘concerning particular issues.’” 945 So. 2d at 1268-69

(quoting Fla. R. Civ. P. 1.220(d)(4)(A)). The court retroactively certified the case as an issues class action,

and stated that class members could “initiate individual damages actions” within one year of its mandate

and that the “Phase I common core findings . . . will

have res judicata effect in those trials.” Id. at 1269.

B. The

Florida

Supreme

Decision In Douglas

Court’s

1. Pursuant to the Florida Supreme Court’s invitation, thousands of individuals alleging membership

in the Engle class filed claims in Florida state and federal courts. Approximately 2,300 of these Engle progeny cases remain pending. In each of these cases, the

plaintiffs assert that the Engle findings relieve them

of the burden of proving that the defendants engaged

in tortious conduct with respect to themselves or their

decedents and that it is therefore unnecessary for

them to prove those elements at trial.

In the immediate aftermath of Engle, state and

federal courts struggled to give effect to the Florida

Supreme Court’s “res judicata” language without contravening settled Florida preclusion law or depriving

defendants of their due-process rights. The first federal district court to consider the issue concluded that

10

due process prevents plaintiffs from relying on the

Engle findings to establish elements of their claims

because the findings are “equivalent to saying that the

Defendants did something wrong without saying exactly what the Defendants did wrong and when.”

Brown v. R.J. Reynolds Tobacco Co., 576 F. Supp. 2d

1328, 1342 (M.D. Fla. 2008), vacated on other grounds,

611 F.3d 1324 (11th Cir. 2010).

On appeal, the Eleventh Circuit also recognized

the difficulties with giving broad preclusive effect to

the Engle findings, explaining that, to establish any

factual issue under Florida preclusion law, Engle

progeny plaintiffs must “show with a ‘reasonable degree of certainty’ that the specific factual issue was

determined in [their] favor” in Engle. Brown v. R.J.

Reynolds Tobacco Co., 611 F.3d 1324, 1335 (11th Cir.

2010) (quoting Seaboard Coast Line R.R. v. Indus.

Contracting Co., 260 So. 2d 860, 862 (Fla. Dist. Ct.

App. 1972)). The court emphasized that “Florida

courts have enforced the ‘actually adjudicated’ requirement with rigor.” Id. at 1334 (quoting Gordon v.

Gordon, 59 So. 2d 40, 44 (Fla. 1952)). Having concluded that Florida preclusion law so clearly imposed

this “actually decided” requirement, the Eleventh Circuit deemed it unnecessary to consider whether federal due process did so as well. See id. Although the

court remanded to afford the plaintiff an opportunity

to demonstrate that the issues on which she sought

preclusion had actually been decided against the defendants in Engle, it expressed skepticism that any

Engle progeny plaintiff could satisfy the “actually decided” requirement. See id. at 1336 n.1 (Anderson, J.,

concurring) (“The generality of the Phase I findings

present plaintiffs with a considerable task.”); id. at

1336 n.11 (majority opinion adopting concurrence).

11

2. In Philip Morris USA, Inc. v. Douglas, the Florida Supreme Court agreed with Brown’s understanding of Florida issue-preclusion law but nevertheless

rejected its ultimate conclusion that Florida law required plaintiffs to satisfy the “actually decided” requirement in Engle progeny cases. It reached this result by devising a previously unknown doctrine of offensive claim preclusion that permits plaintiffs to rely

on the Engle findings to establish the conduct elements of their claims without demonstrating that the

Engle jury actually decided those elements in their favor. 110 So. 3d at 435.

At the outset of its analysis, the Florida Supreme

Court recognized that the Engle class pursued multiple alternative theories of liability, including “brandspecific” theories that applied to only some cigarettes

smoked by some class members. Douglas, 110 So. 3d

at 423. The court acknowledged that the Engle findings would therefore be “useless in individual actions”

if plaintiffs invoking their preclusive effect had to

show what the Engle jury “actually decided,” as issue

preclusion requires. Id. at 423, 433.

To salvage the utility of the Engle findings, the

Florida Supreme Court held that the doctrine of

“claim preclusion” (which it also referred to as “res judicata”) applies when individual class members sue on

the “same causes of action” that were the subject of an

earlier issues class action. Douglas, 110 So. 3d at 432

(emphasis omitted). Under this novel doctrine of offensive claim preclusion, the court stated, preclusion

is applicable to any issue “which might . . . have been”

decided during the class phase. Id. at 433 (emphasis

added; internal quotation marks omitted). It was

therefore “immaterial” that the “Engle jury did not

make detailed findings” specifying the basis for its

12

verdict. Id. It was sufficient that the Engle jury

“might” have rendered its findings on a basis pertinent to the smoking history of the plaintiff or decedent

in a given progeny case. Id. In other words, any finding that the Engle jury might have made against the

defendants could be invoked as preclusive in subsequent Engle progeny actions.

The Florida Supreme Court further held that this

claim-preclusion rule comports with due process. The

court reasoned that “the requirements of due process”

in the claim-preclusion setting are only “notice and

[an] opportunity to be heard”—regardless of what the

jury in Engle may or may not actually have decided—

and found that truncated standard satisfied based on

the defendants’ opportunity to present a defense in

the class proceedings and (on issues not deemed resolved by Engle) in the plaintiff’s Engle progeny case.

Douglas, 110 So. 3d at 431 (emphasis added).

C. The Eleventh Circuit’s Decision In

Graham

In Graham, the en banc Eleventh Circuit concluded in a divided opinion that it is consistent with

due process to afford preclusive effect to the Engle

jury’s defect and negligence findings. 857 F.3d at

1185. Notwithstanding Douglas’s unambiguous holding that “claim preclusion” is the proper framework

and that analyzing the Engle findings under “issue

preclusion” principles would render them “useless,”

110 So. 3d at 433, the Eleventh Circuit majority insisted that the Florida Supreme Court had applied issue-preclusion principles and had determined in

Douglas that the Engle jury had actually decided “that

all cigarettes the defendants placed on the market

were defective and unreasonably dangerous” when returning its strict-liability and negligence verdicts,

13

Graham, 857 F.3d at 1182; see also Walker v. R.J.

Reynolds Tobacco Co., 734 F.3d 1278, 1287-88 (11th

Cir. 2013) (earlier panel opinion applying same reasoning), cert. denied, 134 S. Ct. 2727 (2014).

The en banc majority found support for this conclusion in its own review of the Engle record and its

own determination of the issues actually decided by

the Engle jury. See Graham, 857 F.3d at 1182 (“After

reviewing the Engle trial record, we are satisfied that

the Florida Supreme Court determined that the Engle

jury found the common elements of negligence and

strict liability.”). The Graham court thus effectively

circumvented the constitutional issue by construing

the Engle jury’s defect and negligence findings, as a

factual matter, as bearing upon the claims of all class

members.

Three judges dissented. Judge Julie Carnes wrote

that the Engle findings “are too non-specific to warrant them being given preclusive effect in subsequent

trials” and that “defendants’ due process rights were

therefore violated.” 857 F.3d at 1191. Judge Wilson

agreed. Id. at 1314. And in a 227-page dissent, Judge

Tjoflat “detail[ed] layer upon layer of judicial error

committed by numerous state and federal courts, culminating finally with the Majority’s errors.” Id. at

1214.

Petitioners sought review in this Court. In opposing certiorari, the plaintiff in Graham maintained

that the en banc Eleventh Circuit had correctly determined that “the factual predicates for liability were

proven at trial in Engle.” Br. in Opp. at 19, Graham,

No. 17-415 (capitalization altered). The plaintiff

urged the Court to deny review by invoking “this

Court’s normal reluctance to disturb findings of fact.”

14

Id. at 20. The Court denied review. 138 S. Ct. 646

(2018)

D. The Eleventh Circuit’s Decision In

Burkhart

A few months later, a panel of the Eleventh Circuit addressed the same due-process question with respect to the Engle concealment and conspiracy

claims—which had not been at issue in either Douglas

or Graham—and concluded in Burkhart v. R.J. Reynolds Tobacco Co., 884 F.3d 1068 (11th Cir. 2018), that

“treating as preclusive the Engle jury’s findings as to

the conduct elements of” those claims “does not violate

due process.” Id. at 1091.

But whereas the en banc court in Graham had

based its decision on a factual interpretation of the

Engle jury’s defect and negligence findings, the

Burkhart panel relied on a legal determination about

the requirements of due process. The panel held that

the “‘Due Process Clause requires only that the application of principles of res judicata . . . affords the parties notice and an opportunity to be heard.”’ 884 F.3d

at 1092 (emphasis added); see also id. at 1093 (“[T]he

due process question depend[s] upon an analysis of

the defendant’s opportunity to be heard in Engle.”).

The panel did not claim that the Engle jury had actually decided the issues relevant to the conduct elements of the plaintiff’s concealment and conspiracy

claims—e.g., that the tobacco-industry statements on

which the plaintiff allegedly relied were in fact fraudulent. Instead, according to the panel, all that mattered was that the defendants had received the requisite “opportunity to be heard” during Engle because

they “had the opportunity to argue the conduct elements of the concealment . . . claims,” “had the opportunity to protest the jury instructions,” and “enjoyed

15

the benefit of appellate review” of those instructions.

Id. at 1093. These opportunities—along with the defendants’ “right to litigate the causation and reliance

elements” of the concealment and conspiracy claims in

individual class members’ cases—satisfied the panel

that the defendants received the requisite due process, even if the Engle concealment and conspiracy

findings are so “ambiguous” that it is impossible to determine the theories on which they rest. Id. at 1092,

1093.

E. The Proceedings In This Case

1. Respondent filed this Engle progeny action

against petitioners alleging that her mother,

Carol LaSard, died from lung cancer caused by smoking. Respondent claimed that her mother was an

Engle class member, and asserted causes of action for

strict liability, negligence, fraudulent concealment,

and conspiracy to fraudulently conceal. The district

court ruled that, if respondent proved Engle class

membership (i.e., that Ms. LaSard was addicted to cigarettes containing nicotine and that her addiction was

a legal cause of her lung cancer), she would be entitled

to invoke the preclusive effect of the Engle findings to

conclusively establish the conduct elements of her

claims. Dist. Ct. D.E. 49.

At trial, respondent’s evidence focused on petitioners’ marketing of low-tar cigarettes, the type

smoked by Ms. LaSard. During opening statements,

for example, respondent’s counsel argued that, “instead of telling Americans that . . . low tar cigarettes

are not any safer, the cigarette companies . . . made a

choice . . . to lie about those things.” Trial Tr., Vol. 1

AM at 55:20-25. Counsel further argued that, if petitioners had told “the truth” about low-tar cigarettes,

16

“then Carol [LaSard] would have known what she was

smoking.” Id. at 58:20-25.

Respondent’s witnesses also focused on low-tar

cigarettes. One witness, for example, claimed that

Ms. LaSard smoked low-tar cigarettes because “she

thought they were healthier” based on “ads.” Trial

Tr., Vol. 3 AM at 70:3-22. Respondent likewise testified that Ms. LaSard smoked “low-tar cigarettes” because “she believed they were better and safer for

her.” Trial Tr., Vol. 2 PM at 134:20-135:5.

The jury was not required to find, however, that

petitioners’ low-tar cigarettes contained a defect, that

their conduct with respect to low-tar cigarettes was

negligent, or that they fraudulently concealed, or conspired to fraudulently conceal, material information

about low-tar cigarettes. The jury was instead instructed that it “must” accept the Engle jury’s findings

that petitioners engaged in these various forms of tortious conduct. Trial Tr., Vol. 5 AM at 79:2-83:10.

The jury found that Ms. LaSard was an Engle

class member and returned a verdict against petitioners on all four claims. Pet. App. 6a. It awarded respondent $6 million in compensatory damages, and

also awarded $10 million in punitive damages against

each petitioner. Id. Respondent was permitted to recover punitive damages only on her claims for concealment and conspiracy; she was not permitted to recover

punitive damages on her strict-liability and negligence claims. Id. The jury apportioned 40% of the

fault to Ms. LaSard, but the district court did not apply the jury’s comparative-fault finding to offset the

damages award, concluding that the claims for concealment and conspiracy were not subject to apportionment. Id. The district court did, however, remit

17

the compensatory damages to $1 million and the punitive damages to $1.67 million against each petitioner. Id. at 7a.

2. Petitioners appealed, and the case was fully

briefed and argued prior to the Eleventh Circuit’s en

banc decision in Graham regarding the strict-liability

and negligence claims. After that decision, the panel

in this case issued an order directing the parties to

address a series of questions regarding respondent’s

concealment and conspiracy claims; the questions

principally concerned whether “the theory of concealment on which [respondent] focused” at trial was the

same as the “specific acts of alleged fraudulent concealment that underlaid the Engle plaintiffs’ claim”

during the Phase I proceedings. Order of Jan. 19,

2018 at 4, 5. Before the completion of briefing on those

questions, however, another panel of the Eleventh

Circuit issued its decision in Burkhart holding that

due process permits Engle class members to rely on

the Phase I findings to establish the conduct elements

of their concealment and conspiracy claims. 884 F.3d

at 1092.

Bound by Burkhart, the panel affirmed. It

acknowledged that the Engle class had advanced “numerous theories of concealment . . . at the Engle trial,”

Pet. App. 12a, and that the Engle jury’s “general finding did not indicate which acts of concealment may

have underlain their finding versus which allegations

of concealment they might have rejected,” id. at 19a.

As a result, the panel explained, it is “difficult to determine whether the Engle jury’s basis for its general

finding of concealment was the particular concealments regarding low-tar/low-nicotine cigarettes” that

were the focus of respondent’s case at trial. Id. In

fact, the panel continued, respondent did “not argue,

18

or offer any evidence to support an argument, that the

Engle jury necessarily based its finding of concealment against the tobacco company defendants on the

defendants’ conduct regarding the marketing of lowtar cigarettes,” and the panel “therefore ha[d] to assume that the Engle jury did not actually decide that

question.” Id. at 17a. The panel thus identified the

relevant legal question as whether, “for purposes of

granting preclusion consistent with the due process

clause,” it is “enough that a defendant had a right to

be heard on a plaintiff’s claims in a first action, if ultimately one is unable to discern what the jury actually decided in making its findings on those claims.”

Id. at 19a.

The panel nevertheless held, with evident reluctance, that it was “bound to follow” Burkhart as circuit

precedent. Pet. App. 20a. In so ruling, the panel recognized that the Burkhart panel did not attempt to

examine the Engle record to identify the basis of the

concealment and conspiracy findings, as the court had

attempted to do for the defect and negligence findings

in Graham, but had instead deemed it constitutionally sufficient that “the Engle defendants had notice

and an opportunity to be heard regarding” the concealment and conspiracy claims. Id. at 18a-19a.

The Searcy panel concluded “that the [Burkhart]

panel’s rejection of a due process challenge to the application in progeny cases of the Engle jury findings

regarding concealment claims was categorical.” Pet.

App. 20a. Thus, even if “one is unable to discern what

the [Engle] jury actually decided in making its findings on” the concealment and conspiracy claims, id. at

19a, the court was “required to reject [petitioners’] . . .

due process argument,” id. at 20a. The court emphasized that Burkhart “ends any debate in this court as

19

to whether the Engle jury findings related to the concealment claims are to be given preclusive effect. The

answer is: they will.” Id.

REASONS FOR GRANTING THE PETITION

The Eleventh Circuit has guaranteed “arbitrary

and inaccurate adjudication,” Honda Motor Co. v.

Oberg, 512 U.S. 415, 430-31 (1994), by sanctioning

Florida’s novel rule of preclusion that prevents a defendant from disputing any issue that “might . . . have

been” decided in favor of the plaintiff in a prior proceeding, Philip Morris USA, Inc. v. Douglas, 110 So.

3d 419, 433 (Fla. 2013) (emphasis added; internal quotation marks omitted). In affirming the constitutionality of that rule, the Eleventh Circuit applied an “opportunity to be heard” due-process standard that departs from centuries of common-law authority limiting the availability of preclusion to issues that were

actually decided in a prior proceeding. That “opportunity to be heard” standard also squarely conflicts

with this Court’s decision in Fayerweather v. Ritch,

195 U.S. 276 (1904), which held that the “actually decided” requirement is constitutionally mandated and

that, standing alone, the “opportunity to present” an

issue is not a constitutionally sufficient basis for precluding a party from contesting that issue in subsequent litigation. Id. at 299, 307.

Put simply, it violates due process to conclusively

presume that an element of a plaintiff’s claim is satisfied, and thus to preclude a defendant from contesting

that element, unless some adjudicator has so found.

Yet, the decision below sanctions a regime under

which the Engle plaintiffs are permitted to prevail—

and deprive the defendants of their property—based

on the mere possibility that a jury “might . . . have”

20

found that the defendants committed tortious acts

against them.

It is hard to conceive of a more blatant departure

from principles of fundamental fairness or—given the

more than $800 million in judgments already paid by

the Engle defendants and the 2,300 cases that remain

to be tried—a more consequential one.

I.

THE ELEVENTH CIRCUIT’S “OPPORTUNITY TO BE

HEARD”

STANDARD

CONFLICTS

WITH

LONGSTANDING COMMON-LAW REQUIREMENTS

AND THIS COURT’S DUE-PROCESS PRECEDENT.

Under the Full Faith and Credit Act, federal

courts are required to give the Engle Phase I findings

the same preclusive effect they would receive in a

Florida state court, 28 U.S.C. § 1738, unless the Florida Supreme Court’s expansive conception of the “res

judicata effect” of those findings violates due process,

see Kremer v. Chem. Constr. Corp., 456 U.S. 461, 481

(1982).

By adopting an “opportunity to be heard” due-process standard, the Eleventh Circuit has made it possible for Engle progeny plaintiffs to deprive petitioners

of their property without any assurance that they

have ever successfully proven the essential elements

of their claims in any proceeding—and despite the

possibility that the Engle jury may even have resolved

some of those elements in petitioners’ favor. The

“whole purpose” of the Due Process Clause and its “actually decided” requirement is to protect against this

type of “arbitrary deprivation[ ] of liberty or property.”

Oberg, 512 U.S. at 434; see also Wolff v. McDonnell,

418 U.S. 539, 557-58 (1974).

21

A. The “Actually Decided” Requirement

Is Universally Accepted And Constitutionally Mandated Where Preclusion

Is Applied To Issues.

1. The common law has long required that a party

seeking to establish an issue based on the outcome of

a prior proceeding demonstrate with reasonable certainty that the finder of fact in the prior proceeding

actually determined the issue. Thus, since at least the

18th century, courts have consistently refused to apply issue preclusion where a verdict from a prior suit

might have rested on a ground other than the one on

which preclusion is sought. That rule originated with

early English authorities, which held that a judgment

is not “evidence” of “any matter to be inferred by argument from [it].” Duchess of Kingston’s Case (H.L.

1776), in 2 Smith, A Selection of Leading Cases on

Various Branches of the Law 425 (1840).

American courts uniformly followed this rule from

the time of the Founding, through the ratification of

the Fourteenth Amendment, and beyond. See, e.g.,

Packet Co. v. Sickles, 72 U.S. (5 Wall.) 580, 591-93

(1866). As one state supreme court explained in the

mid-19th century, “according to all the well considered authorities, ancient and modern,” the “inference”

that an issue was decided in prior litigation had to “be

inevitable, or it [could not] be drawn.” Burlen v. Shannon, 99 Mass. 200, 203 (1868); see also Steam-Gauge

& Lantern Co. v. Meyrose, 27 F. 213, 213 (C.C.E.D. Mo.

1886) (Brewer, J.). Thus, where “it be doubtful upon

which of several points the verdict was founded, it will

not be an estoppel as to either.” People v. Frank, 28

Cal. 507, 516 (1865). In other words, “a verdict will

not be an estoppel[ ] merely because the testimony in

the first suit was sufficient to establish a particular

22

fact”; instead, “[i]t must appear, that was the very

fact, on which the verdict was given, and no other.”

Long v. Baugas, 24 N.C. (2 Ired.) 290, 295 (1842) (emphases added).

As early as 1877, this Court explained that “the

inquiry must always be as to the point or question actually litigated and determined in the original action,

not what might have been thus litigated and determined.” Cromwell v. Cty. of Sac., 94 U.S. 351, 353

(1876) (emphases added). Preclusion is therefore unavailable where “several distinct matters may have

been litigated, upon one or more of which the judgment may have passed, without indicating . . . upon

which the judgment was rendered.” Russell v. Place,

94 U.S. 606, 608 (1876). In De Sollar v. Hanscome,

158 U.S. 216 (1895), for example, this Court held that

a prior judgment did not establish that the defendant

had assented to a contract because, although the trial

judge in the prior proceeding instructed the jury that

assent was “‘the chief question for your consideration,’” the prior jury could have resolved the case on

alternative grounds. Id. at 219. The central requirement, the Court explained, is “that it is certain that

the precise fact was determined by the former judgment.” Id. at 221 (emphases added).

Modern practice is equally settled. With the exception of the Engle progeny litigation, the traditional

rule has been followed uniformly by the federal and

state appellate courts.3 Thus, if a prior “judgment

might have been based upon one or more of several

grounds, but does not expressly rely upon any one of

3 See, e.g., 18 Charles A. Wright et al., Federal Practice and

Procedure § 4420 nn.1, 13 (2d ed. 2002); Restatement (Second) of

Judgments § 27, reporter’s note, cmt. e (1982).

23

them, then none is conclusively established under the

doctrine of collateral estoppel, since it is impossible for

another court to tell which issue or issues were adjudged.” Ettin v. Ava Truck Leasing, Inc., 251 A.2d

278, 287 (N.J. 1969) (internal quotation marks omitted); see also Ashe v. Swenson, 397 U.S. 436, 444

(1970).

2. “The universality of the actually decided requirement is no accident; the requirement helps facilitate due process.” Graham v. R.J. Reynolds Tobacco

Co., 857 F.3d 1169, 1216 (11th Cir. 2017) (en banc)

(Tjoflat, J., dissenting). Unless a prior factfinder actually decided an issue in the plaintiff’s favor, treating

that issue as conclusively established is an obvious violation of due process because a defendant cannot be

deprived of property when no adjudicator has found

every element necessary for liability.

In Fayerweather v. Ritch, 195 U.S. 276 (1904), this

Court confirmed that the “actually decided” requirement is constitutionally mandated. In that case, a

federal court dismissed a suit on the ground that the

plaintiffs’ claims were precluded by a prior state-court

judgment. The plaintiffs maintained that the state

court had not decided the relevant issues. By statute,

this Court’s jurisdiction depended on whether the

plaintiffs’ challenge to the preclusion ruling presented

a constitutional issue. See id. at 297-98. The Court

held that it had jurisdiction, explaining that it would

violate due process to give “unwarranted effect to a

judgment” by accepting as a “conclusive determination” a verdict “made without any finding of the fundamental fact.” Id. at 297, 299.

Although the Court upheld preclusion on the particular facts of Fayerweather—finding that the ques-

24

tion on which preclusion was sought had been “considered and determined” in the prior suit, 195 U.S. at

308—it confirmed as a constitutional rule that where

testimony was offered at the prior trial upon

several distinct issues, the decision of any one

of which would justify the verdict or judgment,

then the conclusion must be that the prior decision is not an adjudication upon any particular issue or issues, and the plea of res judicata must fail.

Id. at 307.

The Court has continued consistently to apply the

“actually decided” requirement in its subsequent preclusion decisions. See, e.g., Taylor v. Sturgell, 553

U.S. 880, 892 (2008).

B. The Eleventh Circuit’s “Opportunity

To Be Heard” Standard Does Not Comport With Due Process.

According to the Eleventh Circuit, “for purposes of

giving res judicata effect to Engle findings, due process is satisfied so long as the defendants had notice

and an opportunity to be heard on the claims at issue.”

Pet. App. 18a (citing Burkhart v. R.J. Reynolds Tobacco Co., 884 F.3d 1068, 1092 (11th Cir. 2018)). The

Eleventh Circuit’s holding that an “opportunity to be

heard” is a constitutionally sufficient basis for applying preclusion to a disputed factual issue cannot be

reconciled with Fayerweather or with the settled common-law authority confirming that the “actually decided” requirement is mandated by due process. See

Oberg, 512 U.S. at 430 (the “abrogation of a well-established common-law protection against arbitrary

deprivations of property raises a presumption that

[the] procedures violate the Due Process Clause”).

25

It also defies common sense. The opportunity to

defend, to be meaningful at all, must come with an assurance that the defense was actually adjudicated.

Depriving a defendant of property without actually

deciding that it is liable is hardly justified by the fact

that the defendant was allowed to contest liability in

a prior proceeding that did not ascertainably adjudicate liability.

1. The Court made clear in Fayerweather that

merely affording a party an opportunity to be heard in

a proceeding is not a constitutionally sufficient justification for using the outcome of that proceeding as a

basis for precluding the party from disputing issues in

subsequent litigation. Rather, as the Court explained,

due process requires both that the party “had an opportunity to present” the issue and that “the question

was decided” in the prior proceeding. 195 U.S. at 299;

see also id. at 297 (a court may “give the parties interested the fullest opportunity to be heard, and yet it

might be that its final action would be inconsistent

with [due process]” (internal quotation marks omitted)). Thus, it is not enough that the defendants had

an opportunity to be heard in Engle; what matters is

whether the issues that they are prohibited from contesting in each Engle progeny case were actually decided in the plaintiff’s favor in Engle. If they were not,

then the defendant’s opportunity to be heard in Engle

is insufficient to support the constitutionality of the

judgment in the class member’s individual Engle

progeny case. Indeed, the annals of cases rejecting

preclusion claims are replete with instances in which

the adequacy of the parties’ opportunity to litigate in

the prior proceeding was unquestioned, yet the court

26

refused to permit the application of preclusion to disputed factual issues.4 At the same time, one would

search in vain for a single case, until the Engle litigation, in which issue preclusion has been justified

simply on the ground of a full and fair opportunity to

litigate in the prior proceeding.

Furthermore, contrary to the Eleventh Circuit’s

reasoning, see Burkhart, 884 F.3d at 431, the fact that

progeny plaintiffs must still prove some elements of

their claims (such as class membership and damages)

in their individual suits scarcely justifies relieving

them from proving other elements. Due process requires plaintiffs to prove every element of their claims

before depriving defendants of their property, see Logan v. Zimmerman Brush Co., 455 U.S. 422, 433

(1982), and requires affording defendants “an opportunity to present every available defense,” Philip Morris USA v. Williams, 549 U.S. 346, 353 (2007) (emphasis added; internal quotation marks omitted). Neither

of those requirements is met in Engle progeny litigation.

To be sure, claim preclusion can be applied without regard to what was actually decided in the prior

proceeding and upon a showing of nothing more than

that the procedures that produced the judgment in the

prior proceeding met minimum constitutional requirements—i.e., notice and an opportunity to be

heard. But that is because claim preclusion is a rule

against claim-splitting. It operates to bar a plaintiff

4 See, e.g., De Sollar, 158 U.S. at 221-22; Russell, 94 U.S. at

609; Dodge v. Cotter Corp., 203 F.3d 1190, 1198-99 (10th Cir.

2000); United States v. Patterson, 827 F.2d 184, 189-90 (7th Cir.

1987); Dowling v. Finley Assocs., 727 A.2d 1245, 1251-53 (Conn.

1999); City of Sunland Park v. Macias, 75 P.3d 816, 820-21 (N.M.

2003).

27

from pursuing additional litigation where there has

been a final judgment on the same or a sufficiently related claim. See Nevada v. United States, 463 U.S.

110, 129-30 (1983). In such circumstances, the precise

course of litigation that led to the final judgment is

irrelevant; all that matters is that the proceeding met

basic requirements of notice and opportunity to be

heard, so that it was capable of producing a constitutionally valid judgment.

Where, as here, however, a plaintiff wishes to continue—rather than bar—further litigation on a claim

and seeks to preclude litigation on an issue relevant

to that claim, the fact that the defendant had an opportunity to be heard on the issue in an earlier proceeding, no matter how extensive, is constitutionally

meaningless absent a clear showing that the issue

was actually decided.

2. The Eleventh Circuit’s holding that the Engle

defendants’ “opportunity to be heard” is a constitutionally adequate ground for giving the Phase I findings their “res judicata effect” under Florida law has

profound consequences for the fundamental due-process rights of Engle defendants. Affording full faith

and credit to the Florida Supreme Court’s unorthodox

approach to claim preclusion necessarily invites “arbitrary and inaccurate adjudication,” Oberg, 512 U.S. at

430-31, because Engle defendants are being deprived

of their property without any court’s having determined that the plaintiffs actually proved each element

of their claims.

On the strict-liability and negligence claims, the

Florida Supreme Court acknowledged in Douglas that

the Engle class had alleged numerous “brand-specific”

and type-specific alternative theories of defect in the

28

Phase I trial—theories that did not apply to all cigarette brands, all class members, or all time periods.

110 So. 3d at 423. For example, the class claimed that

“‘levels of nicotine were manipulated, sometimes by

utilization of ammonia . . . and sometimes by using a

higher nicotine content tobacco’”; that “‘some cigarettes were manufactured with the breathing air holes

in the filter being too close to the lips’”; and that “‘some

filters being test marketed utilized glass fibers that

could produce disease.’” Id. at 423-24 (emphases

added) (quoting directed-verdict order). In light of the

alternative theories pursued by the class and the generality of the verdict-form questions, the Florida Supreme Court conceded that the Phase I findings would

be “useless in individual actions” under Florida law’s

issue-preclusion principles. Id. at 433.

Under the Florida Supreme Court’s new claimpreclusion standard, however, respondent was permitted to rely on the preclusive effect of the Engle

findings to establish that the specific cigarettes Ms.

LaSard smoked contained a defect and that petitioners’ conduct with respect to Ms. LaSard was negligent.

Respondent was permitted to invoke the “res judicata

effect” of those findings even though there is no way

to know whether the Engle jury actually decided those

issues in her favor. That means no court has ever determined that respondent has proven each essential

element of her strict-liability and negligence claims to

any finder of fact. See Graham, 857 F.3d at 1260

n.183 (Tjoflat, J., dissenting) (“That a defendant sold

some negligently produced, defective, and unreasonably dangerous cigarettes of an unspecified brand at an

unspecified point in time [is] not probative as to

whether [a particular Engle class member’s] injuries

29

were caused by the defendant’s negligent conduct or

unreasonably dangerous product defect(s).”).5

It is equally impossible for Engle progeny plaintiffs to establish whether the Phase I jury actually decided anything relevant to their individual concealment and conspiracy claims. The impossibility of that

task results both from the disjunctively worded verdict-form questions in Phase I of Engle—which do not

identify whether the jury’s verdicts rested on the concealment of information about the “health effects” of

cigarettes, the “addictive nature” of cigarettes, or

both—as well as from the various distinct theories of

concealment and conspiracy pursued by the Engle

class. Those theories included, for example, allegations that defendants concealed information in a variety of different formats, such as product advertisements disseminated by the defendants themselves,

5 In Graham, the Eleventh Circuit stated that the Florida Supreme Court had examined the Engle trial record and determined that the “jury decided common elements of the negligence

and strict liability of the tobacco companies for all class members,” 857 F.3d at 1182—namely, that “all of the companies’ cigarettes cause disease and addict smokers,” id. at 1176. But Graham’s suggestion that the defect and negligence findings rest on

the determination that all cigarettes share a common defect is

impossible to reconcile with Douglas’s description of the alternative theories of defect and negligence pursued by the class, its

conclusion that the findings would be “useless” if the “actually

decided” requirement were applied, 110 So. 3d at 433, and the

Florida Supreme Court’s subsequent decision confirming the impossibility of determining whether the defect and negligence

findings rest on an all-cigarettes theory, see R.J. Reynolds Tobacco Co. v. Marotta, 214 So. 3d 590, 601-02 (Fla. 2017) (reasoning that the findings do not rest “solely on the inherent dangers

of cigarettes” because the jury heard evidence of other theories).

30

Engle Tr. 36479-86, white papers generated by tobacco-industry organizations, id. at 36707-09, and

congressional testimony and other public appearances

by the defendants’ executives, id. at 36710-12, 3745758, and on a variety of subjects, such as the health

risks and addictiveness of low-tar cigarettes, id. at

36351-52, and the alleged use of ammonia to increase

the potency of nicotine, see id. at 36483-85.

As the Eleventh Circuit panel acknowledged in

this case, “multiple acts of concealment had been presented to the Engle jury, and their general finding did

not indicate which acts of concealment may have underlain their finding versus which allegations of concealment they might have rejected,” which creates a

“difficult[y]” in “determin[ing] whether the Engle

jury’s basis for its general finding of concealment” was

the same theory of “low-tar” fraud pursued by respondent. Pet. App. 19a. Indeed, because the Engle

verdict form does not reveal which categories of allegedly concealed information formed the basis of the

jury’s findings, it is possible that the Engle jury rejected (or never reached) the class’s allegations about

low-tar cigarettes and instead based its findings on

the concealment of information about brands of cigarettes that Ms. LaSard never smoked. And even if the

Engle jury did find that petitioners concealed information about low-tar cigarettes, the jury may have

found that the concealment occurred only in connection with advertisements that Ms. LaSard never saw,

or industry-organization publications that she never

read, or public appearances by company executives of

which she was unaware.

Fayerweather—along with the centuries of common-law authority on which it rests—leaves no doubt

31

that applying preclusion in these circumstances is unconstitutional because the specific theory of concealment and conspiracy on which respondent relied in

this case is at most one of the “several distinct issues”

on which the Engle verdict might be based. 195 U.S.

at 307.

*

*

*

The Eleventh Circuit’s decision rests on an unprecedented conception of due process and the limits of

preclusion. While the en banc court’s earlier decision

in Graham rejected petitioners’ due-process challenges on fact-specific grounds—what the court believed the Engle jury had actually decided—Burkhart

and this case make clear that the Eleventh Circuit is

no longer purporting to limit Engle preclusion to issues supposedly decided by the Engle jury. Thus, the

only question for this Court is now a purely legal one:

whether affording a party an “opportunity to be

heard” on an issue is constitutionally sufficient to preclude that party from disputing the issue in a subsequent proceeding even where it is impossible to determine whether the issue was actually decided in the

prevailing party’s favor. By discarding the “actually

decided” requirement in favor of requiring no more

than a mere “opportunity to be heard,” the Eleventh

Circuit has opened the door to due-process violations

on a massive scale. The Court should grant certiorari

to put an end to this dangerous experimentation with

fundamental due-process rights and correct the “layer

upon layer of judicial error” committed by Florida’s

state and federal courts in the Engle litigation. Graham, 857 F.3d at 1214 (Tjoflat, J., dissenting).

32

II. THE QUESTION PRESENTED HAS FAR-REACHING

CONSEQUENCES FOR THOUSANDS OF PENDING

CASES AND FOR FUTURE ISSUES CLASS ACTIONS.

The practical impact of the question presented is

extraordinary. Approximately 2,300 Engle progeny

cases remain pending in Florida courts. Several hundred of these cases have already been tried to verdict—resulting in more than $800 million in judgments paid by the Engle defendants—and the Florida

courts are continuing to try an average of at least two

new Engle progeny cases each month. Every one of

those cases raises the same threshold due-process

question presented here. Thus, in the absence of this

Court’s intervention, the due-process violation that

occurred in this case will be almost endlessly replicated, with virtually unprecedented financial consequences.

The consequences also extend beyond the Engle

progeny setting. In class actions across the country,

courts are relying on unorthodox procedural devices to

simplify litigation for plaintiffs, often “to the unique

detriment of . . . unpopular defendants.” Graham, 857

F.3d at 1288 n.265 (Tjoflat, J., dissenting). In particular, like the Florida Supreme Court in Engle, lower

courts are increasingly utilizing the issues class device, see American Law Institute, Principles of the

Law of Aggregate Litigation ch. 2 (2010); 7AA Charles

A. Wright et al., Federal Practice and Procedure

§ 1790 & nn. 18-20 (3d ed. 2018), to bypass well-established and constitutionally compelled restraints on

the arbitrary deprivation of property. Although lower

courts are free to certify issues classes, this Court

should grant review to make clear that due process

prohibits federal courts from giving full faith and

credit to the outcome of such proceedings where a

33

state court has attempted to make an end-run around

basic constitutional protections by using the combination of issues classes and novel rules of preclusion.

The prior denials of certiorari in other Engle progeny cases are no barrier to review here. This is the

first petition seeking review of the Eleventh Circuit’s

conclusion—announced for the first time in Burkhart

and confirmed in this case—that an issue may be

deemed conclusively established consistent with due

process so long as the defendant had an opportunity

to be heard on the issue, regardless of whether the issue was actually decided. The plaintiff in Graham

successfully argued against review in this Court by

emphasizing the fact-bound nature of the task of determining what the Engle jury actually decided. That

task is irrelevant now. The question presented here

is a purely legal one: Does due process require an actual decision on issues before those issues may be

given preclusive effect in subsequent litigation, or is it

sufficient that a party had an opportunity to be heard?

This petition—and the companion petition filed

today in Philip Morris USA Inc. v. Boatright—represent the Court’s first opportunity since Burkhart was

decided to resolve the question presented. It is now

clear that neither the state nor the federal courts in

Florida maintain even a pretense that any jury actually has decided—or will be required to decide—all the

elements of Engle progeny plaintiffs’ claims. Instead,

they deem it sufficient that the issues relevant to a

progeny plaintiff’s individual smoking history might

have been decided in Engle and that the defendants

had an opportunity to be heard on those issues. Imposing liability without requiring an actual decision

in plaintiffs’ favor on each element of their claims is a

34

blatant deprivation of the defendants’ property without due process of law.

CONCLUSION

The Court should grant the petition for a writ of

certiorari along with the petition in Philip Morris

USA Inc. v. Boatright.

Respectfully submitted.

MICHAEL A. CARVIN

YAAKOV ROTH

JONES DAY

51 Louisiana Avenue, N.W.

Washington, D.C. 20001

Counsel for Petitioner

R.J. Reynolds Tobacco Co.

MIGUEL A. ESTRADA

Counsel of Record

AMIR C. TAYRANI

BRANDON L. BOXLER

GIBSON, DUNN & CRUTCHER LLP

1050 Connecticut Avenue, N.W.

Washington, D.C. 20036

(202) 955-8500

mestrada@gibsondunn.com

ANDREW L. FREY

LAUREN R. GOLDMAN

MAYER BROWN LLP

1221 Avenue of the Americas

New York, N.Y. 10020

(212) 506-2500

Counsel for Petitioner

Philip Morris USA Inc.

November 19, 2018