LUNG CANCER WOMAN WINS UKP34M DAMAGES

THE US tobacco industry trembled at the prospect of an avalanche of
lawsuits yesterday after a Californian woman with terminal lung cancer won
an unprecedented $50 million (UKP34m) in punitive damages from Philip
Morris, maker of the Marlboro brand she says is killing her.

The award, granted by a jury in the San Francisco County Superior Court,
was three times higher than the amount being sought by the plaintiff's
lawyers and more than 25 times higher than any previous punitive damages
inflicted on a tobacco company.

With hundreds of similar suits pending and hundreds more expected in the
wake of the decision, the tobacco companies now risk being deluged in
expensive and potentially crippling litigation.

"This certainly confirms the industry's worst nightmare,'' said Robert
Rabin, a law professor at Stanford University.

Shares in all of America's major tobacco companies took a beating on Wall
Street. with Philip Morris falling slightly in early trading. The company's
value has plummeted 30pc since last summer.

The suit was brought by Patrician Henley, a 52-year-old business owner, who
smoked for more than 30 years before being diagnosed with lung cancer two
years ago.

She said she had genuinely believed assurances by tobacco companies that
there was no proven link between smoking and lung cancer and realised too
late, in 1994, that she had been misled.

In addition to the $50 million in punitive damages she won $1.5 million for
medical bills and curtailment of life expectancy.

Her lawyer, a well-known anti-tobacco advocate called Madelyn Chaber,
presented more than 1,000 company documents seeking to minimise or deny the
damage that smoking can cause. These included an infamous "frank
statement'' in advertisements in 1953 in which the main companies pledged
to investigate health concerns surrounding smoking.

"Our decision was based on a lot of evidence, the suppression of known
facts by Philip Morris. They had a lot of information they just didn't give
out. This jury really as a whole was very angry at the cigarette
companies,'' jury foreman George Loudis said after the award was announced.

Lawyers for Philip Morris said the decision was motivated more by emotion
than legal good sense and vowed to appeal.

"The punitive damage award of $50 million is so absurd and grossly
disproportionate to the compensatory damage award of $1.5 million as to
clearly show passion and prejudice on the part of the jury,'' said Gregory
Little, Philip Morris's Associate General Counsel.

Legal experts said yesterday Philip Morris might succeed in reducing the
damages but was unlikely to have them waived altogether - opening the
floodgates for other cancer victims to step in and make similar claims.

Ms Henley, whose cancer is in remission following a bout of chemotherapy,
was elated by the court decision and said she would donate the money to
educational programmes to deter children from smoking. "I don't touch blood
money,'' she said.

With tobacco companies under increasing commercial and legal pressure in
the United States, they have sought one-off settlements to ward off
precisely this sort of litigation. Last November they agreed to pay out
$206 billion to 46 of the 50 US states to avoid being sued for the medical
costs of treating smokers.

Suits by individuals have been relatively rare. California actually banned
such suits for 10 years but repealed the ban in 1997. At the same time the
state also outlawed smoking in all public places including restaurants and
bars.