Petition for Writ of Certiorari — Philip Morris USA Inc., et al., Petitioners v. Richard Boatright, et ux.

No.

IN THE

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_______________

PHILIP MORRIS USA INC. AND LIGGETT GROUP LLC,

Petitioners,

v.

RICHARD BOATRIGHT AND DEBORAH BOATRIGHT,

Respondents.

_______________

On Petition For A Writ Of Certiorari

To The Florida Second District Court Of Appeal

_______________

PETITION FOR A WRIT OF CERTIORARI

_______________

ANDREW L. FREY

LAUREN R. GOLDMAN

MAYER BROWN LLP

1221 Avenue of the Americas

New York, NY 10020

(212) 506-2500

Counsel for Petitioner

Philip Morris USA Inc.

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 Florida Supreme Court, this unorthodox approach to the preclusive effect of class-action

findings is consistent with due process because the defendants had 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.

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.

Liggett Group LLC is a wholly owned, indirect

subsidiary of Vector Group Ltd. Vector Group Ltd. is

the only publicly held company that owns 10% or more

of the membership interest in Liggett. No publicly

held company owns 10% or more of Vector Group

Ltd.’s stock.

iii

TABLE OF CONTENTS

Page

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

PARTIES TO THE PROCEEDING AND

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

TABLE OF APPENDICES ......................................... v

TABLE OF AUTHORITIES ....................................... vi

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

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

CONSTITUTIONAL PROVISION INVOLVED ........ 1

INTRODUCTION ........................................................ 2

STATEMENT .............................................................. 6

REASONS FOR GRANTING THE PETITION ....... 17

I. THE

FLORIDA

SUPREME

COURT’S

UNPRECEDENTED

APPROACH

TO

PRECLUSION

CONFLICTS

WITH

LONGSTANDING COMMON-LAW REQUIREMENTS AND THIS COURT’S DUE-PROCESS

PRECEDENT ...................................................... 19

A. The “Actually Decided” Requirement

Is

Universally

Accepted

And

Constitutionally Mandated Where

Preclusion Is Applied To Issues .............. 19

B. The Florida Supreme Court’s

Departure From The “Actually

Decided” Requirement Violates Due

Process ...................................................... 23

iv

1.

The Florida Supreme Court’s

Use Of The “Claim Preclusion”

Label Does Not Change The

Due-Process Analysis ........................ 23

2.

Elimination Of The “Actually

Decided” Requirement Makes

Engle

Progeny

Litigation

Fundamentally Unfair ...................... 28

II. THE

FLORIDA

SUPREME

COURT’S

UNPRECEDENTED

APPROACH

TO

PRECLUSION

HAS

FAR-REACHING

CONSEQUENCES FOR THOUSANDS OF

PENDING ENGLE PROGENY CASES AND

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

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

v

TABLE OF APPENDICES

Page

APPENDIX A: Opinion of the Florida Second

District Court of Appeal (Apr. 12, 2017) ............. 1a

APPENDIX B: Order of the Supreme Court of

Florida Denying Review (June 22, 2018) .......... 17a

vi

TABLE OF AUTHORITIES

Page(s)

Cases

ACandS, Inc. v. Godwin,

667 A.2d 116 (Md. 1995) ...................................... 26

Air-Way Elec. Appliance Corp. v. Day,

266 U.S. 71 (1924) ................................................ 24

Allen v. Int’l Truck & Engine Corp.,

358 F.3d 469 (7th Cir. 2004) ................................ 26

Ashe v. Swenson,

397 U.S. 436 (1970) .............................................. 21

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

884 F.3d 1068 (11th Cir. 2018) .................. 6, 14, 31

Burlen v. Shannon,

99 Mass. 200 (1868) ............................................. 20

City of Sunland Park v. Macias,

75 P.3d 816 (N.M. 2003) ...................................... 27

Comm’r v. Sunnen,

333 U.S. 591 (1948) .............................................. 25

Cooper v. Fed. Reserve Bank of Richmond,

467 U.S. 867 (1984) .............................................. 26

Cromwell v. Cty. of Sac.,

94 U.S. 351 (1876) .......................................... 21, 25

Cummings v. Missouri,

71 U.S. (4 Wall.) 277 (1866) ................................. 24

De Sollar v. Hanscome,

158 U.S. 216 (1895) .................................... 2, 21, 27

Dodge v. Cotter Corp.,

203 F.3d 1190 (10th Cir. 2000) ............................ 27

vii

Dowling v. Finley Assocs.,

727 A.2d 1245 (Conn. 1999) ................................. 27

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

2 Smith, A Selection of Leading

Cases on Various Branches of the

Law 425 (1840) ..................................................... 20

Engle v. Liggett Grp., Inc.,

945 So. 2d 1246 (Fla. 2006) ......................... 4, 9, 10

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

2000 WL 33534572

(Fla. Cir. Ct. Nov. 6, 2000) ................................... 11

Ettin v. Ava Truck Leasing, Inc.,

251 A.2d 278 (N.J. 1969)...................................... 21

Fayerweather v. Ritch,

195 U.S. 276 (1904) ............ 2, 16, 18, 22, 23, 27, 31

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

857 F.3d 1169 (11th Cir. 2017) ...... 6, 13, 14, 22, 29

Hansberry v. Lee,

311 U.S. 32 (1940) ................................................ 24

Honda Motor Co. v. Oberg,

512 U.S. 415 (1994) .................................... 4, 19, 23

Liggett Grp. Inc. v. Engle,

853 So. 2d 434 (Fla. Dist. Ct. App. 2003) ............ 10

Logan v. Zimmerman Brush Co.,

455 U.S. 422 (1982) .............................................. 28

Long v. Baugas,

24 N.C. (2 Ired.) 290 (1842) ................................. 20

NAACP v. Claiborne Hardware Co.,

458 U.S. 886 (1982) ................................................ 1

viii

Nevada v. United States,

463 U.S. 110 (1983) .............................................. 25

Oklahoma City v. McMaster,

196 U.S. 529 (1905) .............................................. 25

Packet Co. v. Sickles,

72 U.S. (5 Wall.) 580 (1866) ................................. 20

People v. Frank,

28 Cal. 507 (1865) ................................................ 20

Philip Morris USA v. Williams,

549 U.S. 346 (2007) .............................................. 28

Philip Morris USA Inc. v. Douglas,

571 U.S. 889 (2013) ................................................ 5

Philip Morris USA, Inc. v. Douglas,

110 So. 3d 419 (Fla. 2013) .............. 3, 6, 7, 8, 9, 11,

12, 13, 17, 23, 26, 27, 28, 32, 33

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

138 S. Ct. 646 (2018) .............................................. 6

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

214 So. 3d 590 (Fla. 2017) ................................... 13

Richards v. Jefferson Cty.,

517 U.S. 793 (1996) ................................ 2, 4, 18, 31

Rivet v. Regions Bank of La.,

522 U.S. 470 (1998) .............................................. 25

Russell v. Place,

94 U.S. 606 (1876) ...................................... 2, 21, 27

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

902 F.3d 1342 (11th Cir. 2018) ............................ 30

Steam-Gauge & Lantern Co. v. Meyrose,

27 F. 213 (C.C.E.D. Mo. 1886) ............................. 20

ix

Taylor v. Sturgell,

553 U.S. 880 (2008) ................................................ 3

United States v. Patterson,

827 F.2d 184 (7th Cir. 1987) ................................ 27

Wal-Mart Stores, Inc. v. Dukes,

564 U.S. 338 (2011) .......................................... 2, 26

Wolff v. McDonnell,

418 U.S. 539 (1974) .............................................. 19

Constitutional Provisions

U.S. Const. amend. XIV, § 1, cl. 2 ............................... 2

Statutes

28 U.S.C. § 1257(a) ...................................................... 1

Rules

Fed. R. Civ. P. 23(c)(4)............................................... 10

Fla. R. Civ. P. 1.220(d)(4)(A) ..................................... 10

Other Authorities

American Law Institute, Principles of the

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

Coke, The First Part of the Institutes of

the Laws of England; or, a

Commentary on Littleton (London,

W. Clarke 1817) ................................................... 20

Restatement (Second) of Judgments

(1982) .................................................................... 21

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) .................. 21

PETITION FOR A WRIT OF CERTIORARI

Petitioners Philip Morris USA Inc. (“PM USA”)

and Liggett Group LLC (“Liggett”) respectfully submit

this petition for a writ of certiorari to review the judgment of the Florida Second District Court of Appeal.

OPINIONS BELOW

The opinion of the Florida Second District Court

of Appeal is reported at 217 So. 3d 166. Pet. App. 1a.

The order of the Florida Supreme Court denying review is unreported but is electronically available at

2018 WL 3090430. Id. at 17a.

JURISDICTION

The judgment of the Florida Second District Court

of Appeal was entered on April 12, 2017. The Florida

Supreme Court denied petitioners’ timely petition for

review on June 22, 2018. Although the Florida Second

District Court of Appeal “remand[ed] for the trial

court to enter an amended judgment to reflect the full

amount of the jury’s verdict” without a reduction

based on the allocation of comparative fault, Pet. App.

15a, the judgment is final for purposes of this Court’s

review, see NAACP v. Claiborne Hardware Co., 458

U.S. 886, 907 n.42 (1982) (judgment final despite remand for recomputation of damages).

On September 14, 2018, Justice Thomas extended

the deadline for petitioners to file a petition for a writ

of certiorari to November 19, 2018. See No. 18A247.

The jurisdiction of this Court is invoked under 28

U.S.C. § 1257(a).

CONSTITUTIONAL PROVISION INVOLVED

The Fourteenth Amendment to the United States

Constitution provides in pertinent part: “nor shall

2

any State deprive any person of life, liberty, or property, without due process of law.” U.S. Const. amend.

XIV, § 1, cl. 2.

INTRODUCTION

This Court has repeatedly granted review 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), that sacrifice basic constitutional protections

for the sake of efficiency. In this case, the Florida

courts compounded the due-process risks inherent in

class-action procedures and preclusion rules by 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.

The Florida courts’ unprecedented use of the

class-action device in this litigation to adjudicate

thousands of individualized tort claims by Florida

smokers rests on an equally unprecedented rule of

preclusion. For hundreds of years, the common law

has required that a party seeking to preclude litigation of an issue demonstrate that the factfinder in the

prior proceeding actually decided that “‘precise question.’” E.g., De Sollar v. Hanscome, 158 U.S. 216, 22122 (1895) (quoting Russell v. Place, 94 U.S. 606, 608

(1876)). And more than a century ago, this Court held

that such a showing is required by due process. See

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

3

(1904). The uniformity with which courts have applied this “actually decided” requirement reflects a

universal recognition that it would be fundamentally

unfair to preclude a party from litigating an issue

based on the outcome of a prior proceeding in which

the issue was not “actually litigated and resolved.”

Taylor v. Sturgell, 553 U.S. 880, 892 (2008) (emphasis

added; internal quotation marks omitted).

But this universally acknowledged rule is no

longer the law in Florida. In the name of expediency,

the Florida Supreme Court has adopted a previously

unknown rule of preclusion for issues class actions

that dispenses with the “actually decided” requirement. See Philip Morris USA, Inc. v. Douglas, 110 So.

3d 419, 432-33 (Fla. 2013). The result is that members of a Florida issues class can assert a unique form

of “claim preclusion” offensively: elements of their

claims will be deemed established in subsequent litigation as long as those issues “might . . . have been”

decided in their favor during the class phase. Id. at

432 (emphasis added; internal quotation marks omitted).

What the Florida Supreme Court calls “claim preclusion,” however, bears no resemblance to claim preclusion at common law or in any other American jurisdiction today. Claim preclusion traditionally applies only when an entire claim was previously tried

to judgment, and it bars any further litigation of the

claim by either party. In those circumstances, there

is no need to determine what questions were actually

decided in the earlier litigation; all that matters is

whether the judgment was procured in a proceeding

that met minimum constitutional requirements. But

claim preclusion has never applied, as it does now in

4

Florida, when a party seeks to preclude litigation of

certain elements of a claim that is still being tried.

In short, the Florida Supreme Court created a doctrine that exhibits none of the hallmarks of claim preclusion and virtually all the hallmarks of issue preclusion—except for the “actually decided” requirement

that due process mandates. In so doing, the court jettisoned a common-law procedure that “would have

provided protection against arbitrary and inaccurate

adjudication,” Honda Motor Co. v. Oberg, 512 U.S.

415, 430-31 (1994), and replaced it with an “extreme

application[ ] of the doctrine of res judicata, Richards,

517 U.S. at 797.

Applying the Florida Supreme Court’s novel version of claim preclusion for issues class actions, the

Florida courts in this case permitted former smoker

Richard Boatright and his wife to recover a $35 million personal-injury judgment without any assurance

that any jury had ever found that petitioners actually

engaged in tortious conduct that caused Mr. Boatright’s injuries. On the strict-liability claim, respondents were not required to prove that the cigarettes

smoked by Mr. Boatright contained a defect; on the

negligence claim, they were not required to prove that

petitioners committed negligent acts relevant to Mr.

Boatright’s smoking history; and on the fraudulent

concealment and related conspiracy claims, they were

not required to prove that any tobacco-industry statement Mr. Boatright saw or heard fraudulently omitted material information about cigarettes.

Respondents were instead permitted to establish

those elements by relying on the jury findings from a

prior issues class action, Engle v. Liggett Group, Inc.,

945 So. 2d 1246 (Fla. 2006) (per curiam), which found

that petitioners manufactured unspecified defective

5

cigarettes, undertook unspecified negligent conduct,

and engaged in (and conspired to engage in) unspecified acts of concealment at some point over a fifty-year

period. Under the Florida Supreme Court’s claim-preclusion framework, respondents were not required to

demonstrate that the Engle jury had actually decided

in their favor any of the specific issues on which their

individual claims rested, which created a serious risk

that petitioners were deprived of their property without a finding by any jury—either the jury in Engle or

the jury in this case—that they engaged in tortious

conduct that injured Mr. Boatright. It is hard to conceive of a more blatant departure from the principles

of fundamental fairness that animate due process.

The consequences of the Florida Supreme Court’s

decision to abandon the procedural safeguards of traditional preclusion law are profound: The decertified

Engle class action has spawned thousands of individual cases, approximately 2,300 of which remain pending in Florida courts. Although only 10% of these

“Engle progeny” cases have been tried, petitioners and

the other defendants in those cases have already paid

judgments totaling more than $800 million. This

Court should grant review to put a stop to the Florida

courts’ serial due-process violations, to reinforce the

longstanding constitutional limitations on preclusion,

and to prevent other state courts, which are increasingly approving the use of issues classes, from following the Florida Supreme Court’s aberrant and unconstitutional lead.

To be sure, this Court has had several prior opportunities to review the constitutionality of the preclusion standards applied in Engle progeny litigation.

See, e.g., Philip Morris USA Inc. v. Douglas, 571 U.S.

889 (2013) (denying certiorari); R.J. Reynolds Tobacco

6

Co. v. Graham, 138 S. Ct. 646 (2018) (denying certiorari). But this is the Court’s first opportunity to review an Engle progeny case arising out of a Florida

state court after the Eleventh Circuit’s decisions in

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

(11th Cir. 2017) (en banc), and Burkhart v. R.J. Reynolds Tobacco Co., 884 F.3d 1068 (11th Cir. 2018), conclusively rejecting the Engle defendants’ due-process

argument. Now that both the state and federal courts

in Florida have definitively rejected all facets of that

argument, it is manifestly time for this Court to end

the flagrantly unconstitutional Engle saga by granting the petition in this case as well as the petition that

PM USA and R.J. Reynolds Tobacco Co. are simultaneously filing today in R.J. Reynolds Tobacco Co. v.

Searcy.

STATEMENT

A. The Engle Case

1. The Engle class action began in 1994, when six

individuals filed a complaint 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.” Douglas, 110 So. 3d at 422.

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

7

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 a span

of five decades, including many allegations that pertained only to some cigarette designs and brands or at

limited times. For example, to support its strict-liability and negligence claims, the class variously asserted that some cigarette brands used genetically engineered high-nicotine tobacco; that other brands had

high nitrosamine levels, or ammonia, or higher smoke

pH than necessary; and that the filters on some cigarettes contained harmful components. See, e.g., Douglas, 110 So. 3d at 423-24; Engle Class Opp. to Mot. for

Strict Liability Directed Verdict at 3; Engle Tr. 1196671, 16315-18, 27377, 36349-55, 36479-85, 36729-32.1

The theories underlying the class’s fraudulent

concealment 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,

id. at 36483-85, the health risks and addictiveness of

low-tar cigarettes, id. at 36351-52, and the identity

1 A DVD containing the Engle record materials cited herein is

part of the record below.

8

and health effects of cigarette additives, id. at 3670305.

There was no suggestion that each of the class’s

theories related to all class members or to all of the

defendants’ products. Class counsel himself 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,

would be too general to be used by subsequent juries

trying the claims of individual class members, who

smoked different cigarettes at different times, and

saw and heard different advertising and other tobacco-industry statements. Id. at 423; see also Engle

Tr. 35915-16. 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

9

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 material 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.

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.

10

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 there had been no liability finding in

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

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

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

the Engle class filed claims in Florida state and fed-

11

eral courts. Approximately 2,300 of these Engle progeny cases remain pending in state courts across Florida.

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. In Douglas,

the Florida Supreme Court expressly considered these

questions and concluded that permitting plaintiffs to

rely on the Engle findings to establish the tortiousconduct elements of their claims does not violate due

process. 110 So. 3d at 435. In so doing, the court

adopted a new rule of offensive claim preclusion for

issues class actions and held that due process is satisfied even if essential elements of Engle progeny plaintiffs’ claims have never been actually decided in their

favor by any jury.

The plaintiff in Douglas had prevailed on his

strict-liability and negligence claims. 110 So. 3d at

425. In considering the defendants’ due-process challenge to the judgment, the Florida Supreme Court

acknowledged that the class’s theories on those claims

in Phase I of Engle “included brand-specific defects”—

i.e., defects that applied to only some cigarettes

smoked by some class members. Id. at 423. In fact,

the court quoted at length from the Engle trial court’s

ruling denying the defendants’ motion for a directed

verdict, which had recited the class’s evidence that the

defendants’ cigarettes “‘were defective in many

ways.’” Id. at 424 (quoting Engle v. R.J. Reynolds Tobacco Co., 2000 WL 33534572, at *2 (Fla. Cir. Ct. Nov.

6, 2000)).

12

The Florida Supreme Court further stated that

the Engle trial “also included proof that the Engle defendants’ cigarettes were defective because they are

addictive and cause disease,” and “included” arguments that the defendants were negligent by “fail[ing]

to address the health effects and addictive nature of

cigarettes.” Douglas, 110 So. 3d at 423 (emphasis

added). The court reasoned that these alternative

contentions could have allowed the Engle jury to decide the defendants’ “common liability to the class.”

Id.

Recognizing that the doctrine of issue preclusion

requires proof that an issue was “actually decided,”

the court concluded that, in light of the disparate theories pursued by the Engle class, the generalized

Phase I findings would be “useless” to Engle progeny

plaintiffs if that doctrine were applied. Douglas, 110

So. 3d at 433. To salvage the utility of those findings,

the court held that the doctrine of “claim preclusion”

(which it also referred to as “res judicata”) applies

when class members sue on the “same causes of action” that were the subject of an earlier issues class

action. Id. at 432 (emphasis omitted). Under claim

preclusion, the court stated, preclusion is applicable

to any issue “which might . . . have been” decided in

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 verdict. Id. It was

sufficient that the Engle jury “might” have rendered

its defect and negligence findings on a basis pertinent

to Mrs. Douglas’s smoking history. Id.

The Florida Supreme Court further held that this

claim-preclusion rule comports with due process. The

court reasoned that “the requirements of due process”

13

in the claim-preclusion setting are only “notice and

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

juries in Engle and Douglas were asked to decide—

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); see also

R.J. Reynolds Tobacco Co. v. Marotta, 214 So. 3d 590,

593 (Fla. 2017) (reaffirming that “the ‘res judicata’ effect in Engle . . . is claim preclusion, not issue preclusion”) (citing Douglas, 110 So. 3d at 432).

C. The Eleventh Circuit’s Decision In

Graham

Several thousand Engle progeny cases were filed

in or removed to federal court. In Graham v. R.J.

Reynolds Tobacco Co., 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,

Graham, 857 F.3d at 1182.

The en banc majority found support for this conclusion in its own “review[ ]” of “the Engle trial record”

14

and its own determination of the issues actually decided by the Engle jury. Graham, 857 F.3d at 1182.

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. As he explained, although the Florida Supreme

Court has adopted a claim-preclusion rationale that

the en banc majority “correctly, albeit implicitly, recognize is unconstitutional,” the majority proceeded to

apply its own rationale, which “is similarly sullied

with constitutional errors.” Id. at 1302.

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. that “treating as preclusive the Engle

jury’s findings as to the conduct elements of” those

claims “does not violate due process.” 884 F.3d 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, holding that the “Due Process Clause requires only that

the application of principles of res judicata . . . affords

15

the parties notice and an opportunity to be heard.” Id.

at 1092 (emphasis added; internal quotation marks

omitted). According to the panel, 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 the benefit of appellate review” of those

instructions. Id. at 1093.

D. The Proceedings In This Case

Respondents filed this Engle progeny action

against PM USA and Liggett seeking to recover damages for Mr. Boatright’s chronic obstructive pulmonary disease (“COPD”) and Mrs. Boatright’s loss of

consortium. Respondents claimed that Mr. Boatright

was an Engle class member, and alleged causes of action for strict liability, negligence, fraudulent concealment, and conspiracy to fraudulently conceal. The

trial court ruled that, if respondents proved that Mr.

Boatright was an Engle class member (i.e., that he

was addicted to cigarettes containing nicotine and

that his addiction was a legal cause of his COPD), he

would be entitled to invoke the preclusive effect of the

Engle findings and would not be required to prove the

tortious-conduct elements of his claims at trial. See

Trial Tr. 5100-01, 5320-25. Accordingly, the verdict

form presented to the jury did not require the jury to

find that the cigarettes smoked by Mr. Boatright contained a defect, that petitioners engaged in negligent

acts, or that they fraudulently concealed, or conspired

to fraudulently conceal, material information about

cigarettes. See R. 79:15716-26.

After respondents presented their case at trial, petitioners moved for a directed verdict on all claims, ex-

16

plaining that “federal due process [requires] the proponent of preclusion to establish that the specific issue

relevant to [her] case was actually decided in her favor

in the prior litigation.” PM USA Mot. for Directed

Verdict at 2 (citing Fayerweather, 195 U.S. at 297-98);

see also Liggett Notice of Adoption and Joinder. That

due-process requirement was not met here, petitioners continued, because it is “impossible to determine”

whether the Engle jury actually decided the conduct

elements of respondents’ claims. PM USA Mot. at 2.

The court denied the motion. Trial Tr. 4647.

The jury found that Mr. Boatright was an Engle

class member and returned a verdict against PM USA

on all four claims and against Liggett on the conspiracy claim. Pet. App. 2a, 6a.3 The jury awarded a total

of $15 million in compensatory damages, as well as

$19.7 million in punitive damages against PM USA

and $300,000 against Liggett. Id. at 6a-7a.

On appeal, petitioners argued, among other

things, that the “trial court violated federal due process by permitting [respondents] to use the Engle findings to establish the conduct elements of their claims

even though it is impossible to determine whether the

Engle jury resolved anything relevant to Mr. Boatright’s claims.” PM USA Br. 46-47 (citing Fayerweather, 195 U.S. at 307); see also Liggett Br. 1 (joining PM USA’s arguments). Petitioners acknowledged

that “the Florida Supreme Court rejected this argument” in Douglas, but explained that they “wish[ed]

to preserve it for review by the U.S. Supreme Court.”

PM USA Br. 47.

3 At the close of respondents’ case, the trial court granted Liggett’s motion for a directed verdict on all claims other than conspiracy. Pet. App. 5a.

17

The Florida Second District Court of Appeal affirmed with respect to petitioners’ appeal. The court

concluded that “the acceptance of the Phase I Engle

findings as res judicata does not violate the Engle defendants’ right to due process.” Pet. App. 14a (citing

Douglas, 110 So. 3d at 436). The court reversed on

respondents’ cross-appeal, which challenged the trial

court’s reduction of the compensatory-damages award

based on comparative fault. Id. at 15a.

Petitioners thereafter invoked the discretionary

jurisdiction of the Florida Supreme Court on the comparative-fault question. “For purposes of preservation,” petitioners also “invoke[d] the discretionary jurisdiction of the Florida Supreme Court to review th[e]

[Second District’s] decision permitting Respondent[s]

to invoke the Engle Phase I findings” and “continue[d]

to maintain that Douglas and th[e] [Second District’s]

decision in this case deny Petitioners their federal due

process rights.” Notice to Invoke at 2. The Florida

Supreme Court denied review. Pet. App. 17a.

REASONS FOR GRANTING THE PETITION

The Florida Supreme Court has devised an unprecedented approach to preclusion that authorizes

members of an issues class to invoke the class jury’s

findings in subsequent litigation to establish every issue that “might . . . have been” decided by the jury,

without any showing that those issues were actually

decided in their favor. Philip Morris USA, Inc. v.

Douglas, 110 So. 3d 419, 433 (Fla. 2013) (internal quotation marks omitted). Applying that rule to the

Engle litigation, the court held that Engle class members can rely on the Phase I jury’s highly generalized

findings to establish the tortious-conduct elements of

their claims without demonstrating that the Engle

jury actually decided that the cigarettes they smoked

18

contained a defect, that the defendants’ conduct with

respect to them was negligent, or that any advertisements or other tobacco-industry statements they saw

or heard fraudulently concealed material information

about cigarettes. The court called this “claim preclusion” in order to avoid the “actually decided” requirement of issue preclusion, which the court acknowledged could not be met due to the generality of the

Phase I findings and the various, disparate theories of

liability pursued by the Engle class. Id.

The Florida Supreme Court’s novel rule of offensive claim preclusion for issues class actions represents an “extreme application[ ] of the doctrine of res

judicata,” Richards v. Jefferson Cty., 517 U.S. 793, 797

(1996), that abandons longstanding common-law restrictions on the use of preclusion that were well-settled by the time the Fourteenth Amendment was

adopted and that are still universally followed by

every other American jurisdiction (other than the

Eleventh Circuit). It also conflicts with Fayerweather

v. Ritch, 195 U.S. 276 (1904), which holds that due

process forbids precluding litigation of an issue unless

it is clear that the issue was actually decided in a prior

adjudication. Id. at 307.

Because the Florida courts in this case were

bound to follow Douglas—and respondents were

therefore permitted to rely on claim preclusion to establish the tortious-conduct elements of their claims

at trial—there is a constitutionally unacceptable risk

that petitioners are being deprived of their property

without respondents’ having ever proven each of the

elements of their claims to any finder of fact. Preventing such arbitrary deprivations of property is precisely the reason that due process imposes the “actu-

19

ally decided” requirement on litigants seeking to establish an issue based on the outcome of a prior proceeding. The Court should not countenance that profoundly unfair outcome here—or in any of the 2,300

Engle progeny cases that remain to be tried.

I.

THE FLORIDA SUPREME COURT’S UNPRECEDENTED APPROACH TO PRECLUSION CONFLICTS

WITH LONGSTANDING COMMON-LAW REQUIREMENTS AND THIS COURT’S DUE-PROCESS PRECEDENT.

The Florida Supreme Court’s decision in Douglas

permits respondents and the thousands of other Engle

progeny plaintiffs to deprive petitioners of their property without any assurance that the plaintiffs have

ever successfully proven each of 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 is to protect against this type of “arbitrary deprivation[ ] of liberty or property.” Honda Motor Co. v. Oberg, 512 U.S.

415, 434 (1994); see also Wolff v. McDonnell, 418 U.S.

539, 557-58 (1974).

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 refused to apply issue preclusion where a verdict from a prior suit might have

20

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); see also 2 Coke, The

First Part of the Institutes of the Laws of England; or,

a Commentary on Littleton ¶ 352b (London, W. Clarke

1817) (“[E]very estoppell . . . must be certaine to every

intent, and not . . . taken by argument or inference.”).

When the Fourteenth Amendment was adopted in

1868, American courts uniformly followed this rule.

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

(1866). At that time, “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.) (this “doctrine is affirmed by a multitude of courts”). 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

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,

21

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 (1877). 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—no small exception, given the huge sums at stake and thousands

of cases involved—the traditional rule has been followed uniformly by the federal and state appellate

courts.4 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 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).

4 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).

22

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). In Fayerweather, 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 195 U.S. 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 question 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 further made clear that merely affording a party an opportunity to be heard in a proceeding

is not a constitutionally sufficient basis for precluding

23

the party from disputing issues based on the outcome

of that proceeding. 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. Fayerweather, 195 U.S.

at 299.

B. The Florida Supreme Court’s Departure From The “Actually Decided” Requirement Violates Due Process.

The Florida Supreme Court’s decision in Douglas

cannot be reconciled with Fayerweather, or with the

settled common-law requirements underpinning its

due-process holding. 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”).

1. The Florida Supreme Court’s Use

Of The “Claim Preclusion” Label

Does Not Change The Due-Process

Analysis.

On the basis of Douglas’s claim-preclusion framework, respondents and other Engle progeny plaintiffs

are permitted to rely on the Engle Phase I findings to

establish the tortious-conduct elements of their claims

without demonstrating that those issues were actually decided in their favor by the Engle jury. According to the Florida Supreme Court, it is sufficient for

claim-preclusion purposes that those issues “might

. . . have been” decided in the plaintiffs’ favor in Engle.

Douglas, 110 So. 3d at 433 (internal quotation marks

omitted).

Characterizing the result in Engle progeny litigation as an application of “claim preclusion,” however,

24

does not change the substance of what occurs or excuse Florida courts from complying with the constitutionally mandated “actually decided” requirement.

Although “[s]tate courts are free to attach . . . descriptive labels to litigations before them as they may

choose,” those labels are not binding for purposes of

determining whether state-court proceedings violate

due process. Hansberry v. Lee, 311 U.S. 32, 40 (1940).

To the contrary, this Court has an independent “duty

. . . to examine the course of procedure” in order to determine whether it satisfies “the due process which

the Constitution prescribes.” Id. That duty reflects

that the Constitution’s requirements and prohibitions

are “levelled at the thing, not the name.” Cummings

v. Missouri, 71 U.S. (4 Wall.) 277, 325 (1866).

When “tested . . . by its substance—its essential

and practical operation—rather than its form or local

characterization,” Air-Way Elec. Appliance Corp. v.

Day, 266 U.S. 71, 82 (1924), it is clear that the “claim

preclusion” invented by Douglas is issue preclusion in

every meaningful way, save for the essential protection of the “actually decided” requirement, and that it

shares none of the attributes of traditional claim preclusion. It is, after all, preclusion applied to particular

issues—the very definition of issue preclusion.

To be sure, genuine 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. That is because the consequence of claim

preclusion is to bar any further litigation of the claim,

rendering the actual grounds of decision immaterial.

But where a claim is being litigated, rather than

25

barred, the rules governing claim preclusion are entirely inapt.

No other court, state or federal, applies “claim preclusion” to issues within a partially adjudicated claim.

Claim preclusion is available only when there has

been a final judgment that “‘puts an end to the cause

of action,’” as opposed to a subset of the elements of a

cause of action. Nevada v. United States, 463 U.S.

110, 129-30 (1983) (emphasis added) (quoting Comm’r

v. Sunnen, 333 U.S. 591, 597 (1948)). A “verdict” or

“finding” that leaves issues to be determined later “is

not sufficient” for claim-preclusion purposes. Oklahoma City v. McMaster, 196 U.S. 529, 532-33 (1905).

If claim preclusion as traditionally understood did

apply here, respondents’ claims would be completely

barred because that is the necessary consequence of

claim preclusion: There is no such thing as offensive

claim preclusion. Under both ancient and modern authorities, a “claim, having passed into judgment, cannot again be brought into litigation between the parties in proceedings at law upon any ground whatever.”

Cromwell, 94 U.S. at 353 (emphasis added); see also

Rivet v. Regions Bank of La., 522 U.S. 470, 476 (1998).

Thus, when there is a final judgment disposing of an

entire claim, it makes no difference what issues were

actually decided because the judgment itself precludes any further proceedings on the claim. When

there is no final judgment as to an entire claim, in contrast, the court faced in subsequent litigation on the

claim with a request for preclusion on specific issues

must determine whether those issues have already

been resolved in earlier litigation.

The Florida Supreme Court justified its new rule

of offensive claim preclusion on the ground that

Engle—like all issues classes—was litigated as a class

26

action that presented “common issues.” Douglas, 110

So. 3d at 434. It is well settled, however, that the

same “[b]asic principles of res judicata (merger and

bar or claim preclusion) and collateral estoppel (issue

preclusion) apply” to cases tried as class actions,

Cooper v. Fed. Reserve Bank of Richmond, 467 U.S.

867, 874 (1984), and that a class action cannot be used

to alter or diminish substantive rights available to

parties in traditional individual adjudications, see

Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 367

(2011).

Not surprisingly, federal and state courts confronted with analogous certification orders recognize

that issue preclusion applies to issues classes and—

unlike Douglas—preserve a defendant’s right to have

some jury decide all the required elements of each

claim. See, e.g., Allen v. Int’l Truck & Engine Corp.,

358 F.3d 469, 472 (7th Cir. 2004) (Easterbrook, J.)

(“once one jury (in individual or class litigation) has

resolved a factual dispute, principles of issue preclusion can bind the defendant to that outcome in future

litigation” (emphasis omitted)); ACandS, Inc. v. Godwin, 667 A.2d 116, 146-47 (Md. 1995) (same). Those

cases directly contradict the Florida Supreme Court’s

new rule that claim preclusion applies to “class actions [that] are certified to resolve less than an entire

cause of action.” Douglas, 110 So. 3d at 434.

Nor is the Engle defendants’ “opportunity to be

heard” in Engle sufficient to reconcile the Florida Supreme Court’s unprecedented claim-preclusion standard with the constitutional constraints on preclusion.

Douglas, 110 So. 3d at 431-32. Under Fayerweather,

due process prohibits a plaintiff from invoking preclusion on an issue unless the defendant “had an oppor-

27

tunity to present” the issue and “the question was decided” against the defendant 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

based on the preclusive effect of the Phase I findings

were actually decided in the plaintiff’s favor in Engle.

If they were not, then the defendant’s opportunity to

be heard in Engle does nothing 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 refused to

permit the application of preclusion to factual issues

not clearly decided in that proceeding.5 At the same

time, one would search in vain for a single case, until

the Engle progeny litigation, in which issue preclusion

has been justified simply on the ground of full and fair

opportunity to litigate in the prior proceeding.

Furthermore, contrary to the Florida Supreme

Court’s reasoning, see Douglas, 110 So. 3d at 431, the

5 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).

28

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 a defendant of its 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.

2. Elimination Of The “Actually Decided” Requirement Makes Engle

Progeny Litigation Fundamentally

Unfair.

The Florida Supreme Court’s decision to jettison

the “actually decided” requirement has profound consequences for the fundamental fairness of Engle progeny trials. In light of the multiple, alternative theories of liability pursued by the Engle class—coupled

with the generality of the Phase I findings—the application of Douglas’s unorthodox approach to claim preclusion creates an unacceptable risk that Engle progeny defendants are being deprived of their property

without any jury in any proceeding having found that

the plaintiffs 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 asserted numerous “brand-specific” and type-specific alternative theories of defect in

the Phase I trial—theories that did not apply to all

cigarette brands, all class members, or all time periods at issue. 110 So. 3d at 423. For example, the class

29

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).

There is no way to know which theory or theories

the Phase I jury relied on in rendering its strict-liability and negligence verdicts because the jury’s generalized findings do not identify the theories it accepted,

those it rejected, and those it did not even reach. As

Judge Tjoflat emphasized, “[t]hat 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

were caused by the defendant’s negligent conduct or

unreasonably dangerous product defect(s).” Graham,

857 F.3d at 1260 n.183 (Tjoflat, J., dissenting). Yet,

respondents here were permitted, on the basis of

Douglas’s “might have been decided” rationale, to rely

on the preclusive effect of the Engle findings to establish those elements of their strict-liability and negligence claims, even though there is simply no way to

know whether the Engle jury found that the cigarettes

smoked by Mr. Boatright contained a defect or

whether petitioners’ conduct with respect to him was

negligent.

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

30

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 risks” of

cigarettes, the “addictiveness” of cigarettes, or both—

as well as from the various distinct theories of concealment and conspiracy pursued by the Engle class at

trial. 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,

Engle Tr. 36479-86, white papers and other materials

generated by tobacco-industry organizations, id. at

36707-09, and congressional testimony and other public appearances by the defendants’ executives, id. at

36710-12, 37457-58, 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 in cigarettes to increase the potency of nicotine,

see id. at 36483-85.

A panel of the Eleventh Circuit—although bound

by circuit precedent to reject the defendants’ due-process argument—recently acknowledged the constitutional difficulties with permitting Engle progeny

plaintiffs to rely on the class jury’s concealment and

conspiracy findings to establish elements of their

claims. As the court explained, “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 pursued by an

individual Engle plaintiff. Searcy v. R.J. Reynolds Tobacco Co., 902 F.3d 1342, 1353 (11th Cir. 2018); see

31

also id. at 1354 (rejecting the defendants’ due-process

argument based on Burkhart v. R.J. Reynolds Tobacco

Co., 884 F.3d 1068 (11th Cir. 2018)).

Accordingly, under this Court’s due-process precedent, the concealment and conspiracy findings cannot be given preclusive effect because it is impossible

to determine on which of these “several distinct issues” the Phase I jury relied when rendering its verdicts. Fayerweather, 195 U.S. at 307. For all we know,

the Phase I jury’s findings may have rested on congressional testimony by petitioners’ executives that

Mr. Boatright never saw or read about.

*

*

*

For more than a decade, Florida’s state and federal

courts have grappled with the meaning of the Florida

Supreme Court’s “res judicata” directive in Engle. Ultimately, neither the Florida Supreme Court nor the

Eleventh Circuit has been able to reconcile the broad

preclusive effect of the Engle findings with the fundamental principles of due process embodied in this

Court’s precedent and reflected in centuries of common-law jurisprudence. As the Eleventh Circuit’s recent decisions in Burkhart and Searcy make clear,

that court has now fully embraced the Florida Supreme Court’s reasoning in Douglas that a mere “opportunity to be heard” on an issue is constitutionally

sufficient to preclude a party from relitigating that issue, even if it is impossible to determine whether that

issue was actually decided in the prior proceeding.

Now that both the Florida Supreme Court and the

Eleventh Circuit have turned their backs on settled

preclusion law, this Court should grant review to extinguish this “extreme application[ ] of the doctrine of

res judicata.” Richards, 517 U.S. at 797.

32

II. THE FLORIDA SUPREME COURT’S UNPRECEDENTED APPROACH TO PRECLUSION HAS FARREACHING CONSEQUENCES FOR THOUSANDS OF

PENDING ENGLE PROGENY CASES AND FOR FUTURE ISSUES CLASS ACTIONS.

Review is warranted here due to the sheer number

of cases that are directly governed by the Florida Supreme Court’s manifestly unconstitutional application of preclusion principles. 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 staggering financial consequences.

The consequences of the Florida Supreme Court’s

decision in Douglas also extend beyond the Engle

progeny setting. Its new rule of preclusion for issues

classes—under which “claim preclusion” applies to “issues” that are litigated in class actions “certified to resolve less than an entire cause of action,” Douglas, 110

So. 3d at 434—serves as a model for other lower

courts, which have increasingly utilized 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 wellestablished and constitutionally compelled restraints

on the arbitrary deprivation of property. Although

lower courts are free to certify issues classes, this

33

Court should grant review to make clear that lower

courts are not free, as here, to make an end-run

around basic constitutional protections by using the

combination of issues classes and unprecedented rules

of preclusion to deprive defendants of their property

without any assurance that a finder of fact has found

all the essential elements of the plaintiffs’ individual

claims.

The prior denials of certiorari in other Engle progeny cases are no barrier to review here. Until recently, it remained possible that the Eleventh Circuit

would reach the correct resolution of the due-process

question without this Court’s intervention. The Eleventh Circuit’s divided decision in Graham upholding

the preclusive effect of the Engle jury’s defect and negligence findings—and its subsequent decision in

Burkhart fully endorsing Douglas’s “opportunity to be

heard” reasoning with respect to the concealment and

conspiracy findings—foreclosed that possibility. This

petition—and the companion petition filed today in

R.J. Reynolds Tobacco Co. v. Searcy—represent the

Court’s first opportunity since Burkhart was decided

to resolve the question presented. And, unlike the

earlier petition in Graham, this petition is unencumbered by the Eleventh Circuit’s factual assessment of

what the Engle jury supposedly decided in rendering

its defect and negligence findings; the Florida Supreme Court did not even purport to make such a factual finding in Douglas but instead upheld the application of preclusion to all issues that “might . . . have

been” decided by the Engle jury. 110 So. 3d at 433

(internal quotation marks omitted).

Because both the Eleventh Circuit and Florida

Supreme Court have now decisively rejected petitioners’ due-process argument and explicitly displaced the

34

“actually decided” requirement with an “opportunity

to be heard” standard, the Court should grant review

to end the Florida courts’ dangerous experimentation

with heretofore-settled principles of preclusion law.

CONCLUSION

The Court should grant the petition for a writ of

certiorari along with the petition in R.J. Reynolds Tobacco Co. v. Searcy.

Respectfully submitted.

ANDREW L. FREY

LAUREN R. GOLDMAN

MAYER BROWN LLP

1221 Avenue of the Americas

New York, NY 10020

(212) 506-2500

Counsel for Petitioner

Philip Morris USA Inc.

KAREN H. CURTIS

CLARKE SILVERGLATE, P.A.

799 Brickell Plaza

Suite 900

Miami, FL 33131

(305) 377-0700

Counsel for Petitioner

Liggett Group LLC

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.

KELLY ANNE LUTHER

ANN M. ST. PETER-GRIFFITH

KASOWITZ, BENSON,

TORRES & FRIEDMAN, LLP

1441 Brickell Avenue

Suite 1420

Miami, FL 33131

(305) 377-1666

Counsel for Petitioner

Liggett Group LLC

November 19, 2018