Court Opinion

ID: 9963802
Source: CourtListenerOpinion
Date Created: 2024-04-26 13:03:06.882537+00
Date Added: 2024-06-11T08:25:00.587059
License: Public Domain

DISTRICT COURT OF APPEAL OF FLORIDA
                       SECOND DISTRICT

     R.J. REYNOLDS TOBACCO COMPANY f/k/a RJR Nabisco, Inc.,
individually and as successor by merger to Brown & Williamson Tobacco
Corp., individually and as successor by merger to The American Tobacco
 Company, individually and as successor to Lorillard Tobacco Company,

                               Appellant,

                                    v.

        LAURA J. GIAMBALVO, as personal representative of the
            Estate of Salvatore Giambalvo, Jr., deceased,

                                Appellee.

                            No. 2D2022-3194

                             April 26, 2024

Appeal from the Circuit Court for Pinellas County; Patricia Muscarella,
Judge.

Troy A. Furhman and Marie A. Borland of Hill Ward Henderson, Tampa;
and Jason T. Burnette and Brian C. Lea of Jones Day, Atlanta, Georgia,
for Appellant.

David J. Sales and Daniel R. Hoffman of David J. Sales, P.A., Sarasota;
Gary M. Paige and Cassandra Lombard of Gordon & Partners, P.A.,
Davie; and James W. Gustafson, Jr., of Searcy Denney Scarola Barnhart
& Shipley, P.A., Tallahassee, for Appellee.

BLACK, Judge.
     In this Engle1 progeny case, R.J. Reynolds Tobacco Company
appeals from the final judgment entered in favor of Laura Giambalvo, as
personal representative of the Estate of Salvatore Giambalvo, Jr. We
agree with Reynolds that its motion for directed verdict on the Estate's
conspiracy to fraudulently conceal claim should have been granted. The
final judgment is reversed in part, and the case is remanded for
reduction of the compensatory damages in accordance with the jury's
apportionment of fault and a new trial on the punitive damages claim.
     In this wrongful death action against Reynolds, the Estate, alleging
that Salvatore Giambalvo, Jr., was a member of the Engle class, asserted
claims of negligence, strict liability, fraudulent concealment, and
conspiracy to fraudulently conceal. At trial, the jury returned a verdict
finding that Mr. Giambalvo was a member of the Engle class and that the
Estate had proven the negligence, strict liability, and conspiracy to
fraudulently conceal claims. However, it rejected the Estate's fraudulent
concealment claim, finding that Mr. Giambalvo did not rely to his
detriment on a statement made by Reynolds.2 The jury awarded a total
of $7,000,000 in compensatory damages, apportioning 50% fault to
Reynolds and 50% fault to Mr. Giambalvo. The jury also awarded
$8,495,000 in punitive damages. Judgment against Reynolds was
entered accordingly.

     1 Engle v. Liggett Grp., Inc., 945 So. 2d 1246 (Fla. 2006).

     2 The jury was properly instructed on the reliance element.     See R.J.
Reynolds Tobacco Co. v. Whitmire, 260 So. 3d 536, 539-40 (Fla. 1st DCA
2018); see also R.J. Reynolds Tobacco Co. v. Prentice (Prentice I), 290 So.
3d 963, 965-66 (Fla. 1st DCA 2019), approved by 338 So. 3d 831, 842
(Fla. 2022).

                                     2
     Reynolds moved to set aside the judgment in accordance with the
motion for directed verdict it had made during trial but which had not
been ruled upon by the trial court.3 As it had during trial, Reynolds
asserted that the Estate had failed to present evidence of Mr.
Giambalvo's reliance on a statement by Reynolds or a tobacco-industry
coconspirator. Reynolds accurately set forth the law requiring the Estate
to prove detrimental reliance in order to prevail on its conspiracy to
fraudulently conceal claim. See Hess v. Philip Morris USA, Inc., 175 So.
3d 687, 698 (Fla. 2015). It then identified testimony supporting its
contention that the Estate had failed to meet its burden.
     After the motion had been filed but before the trial court ruled on
it, the Florida Supreme Court issued Prentice v. R.J. Reynolds Tobacco
Co. (Prentice II), 338 So. 3d 831 (Fla. 2022). Reynolds supplemented its
motion to set aside the judgment, arguing that Prentice II "remove[d] all
doubt that Reynolds [was] entitled to a directed verdict where the
Estate's evidence did not satisfy the supreme court's definition of the
reliance element applicable to conspiracy claims in Engle progeny cases."
     A hearing was held, and the trial court reserved ruling and asked
the parties to submit proposed orders. Ultimately, the court denied
Reynolds' motion. In the order of denial, the trial court cited testimony
including Ms. Giambalvo's recollection that Mr. Giambalvo did not
believe the warning statements on cigarette packages, 4 her testimony as
well as the adult children's that Mr. Giambalvo told them that the
"toxins" and "stuff" in his cigarettes were not getting into his lungs

     3 Reynolds alternatively moved for new trial.

     4 In fact, Ms. Giambalvo testified that her husband told her "[y]ou

can't believe everything you read" about the warning labels.

                                      3
because of the filters in the cigarettes he smoked, and the Estate's
expert's testimony regarding the "pervasive and misleading advertising
campaigns perpetuated" by tobacco coconspirators. The court rejected
Reynolds' arguments that "[w]ith only generalized evidence about
widespread advertising, a plaintiff cannot 'prove a causal connection
running from an Engle defendant's statement or statements, to the
plaintiff's beliefs about the health effects or addictiveness of smoking
cigarettes, to the plaintiff's injury,' " quoting Prentice II, 338 So. 3d at
837, and that "[a plaintiff's] false belief stemming from another source
cannot provide a basis for holding an Engle defendant liable for
conspiracy."
      Our review of a trial court's denial of a motion to set aside the
judgment in accordance with the motion for directed verdict is, like our
review of the denial of a motion for directed verdict, de novo. Walerowicz
v. Armand-Hosang, 248 So. 3d 140, 143 (Fla. 4th DCA 2018) (citing
Aragon v. Issa, 103 So. 3d 887, 888 (Fla. 4th DCA 2012)); see Philip
Morris USA Inc. v. Holliman, 374 So. 3d 87, 92 (Fla. 3d DCA 2022) (citing
R.J. Reynolds Tobacco Co. v. Rouse, 307 So. 3d 89, 92 (Fla. 3d DCA
2020)). A directed verdict should only be granted "where no proper view
of the evidence could sustain a verdict in favor of the nonmoving party."
R.J. Reynolds Tobacco Co. v. Whitmire, 260 So. 3d 536, 538 (Fla. 1st DCA
2018) (first quoting Owens v. Publix Supermarkets, Inc., 802 So. 2d 315,
329 (Fla. 2001); and then citing Fla. R. Civ. P. 1.480).
      In Prentice II, the supreme court "resolve[d] a district court conflict
over what proof is required to prevail on the reliance element of [an Engle
plaintiff's] fraudulent concealment and conspiracy claims—a
disagreement that ha[d] led to divergent jury instructions in Engle
progeny cases." 338 So. 3d at 834. The court held that "an Engle

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progeny plaintiff must prove reliance on a statement that was made by
an Engle defendant (for a concealment claim) or a co-conspirator (for a
conspiracy claim) and that concealed or omitted material information
about the health effects or addictiveness of smoking cigarettes." Id. In
reaching that conclusion, the court reiterated that the Phase I Engle
findings—those findings "related 'exclusively to the defendants' conduct
and the general health effects of smoking' "—do not satisfy the reliance
element of fraudulent concealment claims.5 Id. at 835-36 (quoting Engle
v. Liggett Grp., 945 So. 2d 1246, 1256 (Fla. 2006)). This includes the
Phase I finding that the tobacco coconspirators "agreed to conceal or
omit information regarding the health effects of cigarettes or their
addictive nature with the intention that smokers and the public would
rely on this information to their detriment." Id. at 835 (quoting Engle,
945 So. 2d at 1257 n.4). The court further held that an Engle progeny
plaintiff's burden as to the reliance element of a fraudulent concealment
claim "is to prove that the defendant's fraudulent conduct—as defined in
Engle—caused the plaintiff to form a false belief about the health effects
or addictiveness of smoking cigarettes and then to act to his detriment."
Id. at 840.
      As relevant to our decision, Prentice II states that "reliance requires
the plaintiff to have 'received, believed, and acted upon' a

      5 The fraudulent concealment claims referenced in Prentice II

include both fraudulent concealment and concealment conspiracy, and
the court treated the "claims interchangeably." 338 So. 3d at 837.
Additionally, the Prentice II court's statement and decision not to review
Reynolds' challenge to the res judicata effect of the Phase I findings
preclude our review of the same argument raised by Reynolds in this
appeal. We note only that Prentice II applied the supreme court's prior
holdings giving res judicata effect to the Phase I findings without
endorsing them or questioning their correctness. 338 So. 3d at 836-37.

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misrepresentation by the defendant." 338 So. 3d at 838 (quoting John
C.P. Goldberg, Anthony J. Sebok & Benjamin C. Zipursky, The Place of
Reliance in Fraud, 48 Ariz. L. Rev. 1001, 1007 (2006)). "[W]hat matters
for purposes of reliance is that the plaintiff be able to prove a causal
connection running from an Engle defendant's statement or statements,
to the plaintiff's beliefs about the health effects or addictiveness of
smoking cigarettes, to the plaintiff's injury." Id. at 837. That is, "[t]he
element of reliance overlaps with (and may be considered a form of) the
usual requirement in tort that a defendant's wrong be a factual or 'but
for' cause of the harm that the plaintiff suffered." Id. at 838 (quoting
Restatement (Third) of Torts: Liability for Economic Harm § 11 cmt. a
(Am. L. Inst. 2020)).
      During trial, Ms. Giambalvo testified, as did the three adult
children of Mr. and Ms. Giambalvo and Mr. Giambalvo's cousin. Though
they each presented testimony concerning Mr. Giambalvo's addiction to
cigarettes, none of them testified that Mr. Giambalvo relied upon
statements from tobacco coconspirators when he chose to begin smoking
or at any point during his decades of smoking. When Ms. Giambalvo
was asked during trial whether she was aware of Mr. Giambalvo "ever
seeing or hearing or relying on any information from" the "various
tobacco industry organizations that have been talked about in the trial,"
she responded, "No." When she was asked whether she was aware if Mr.
Giambalvo had ever seen, heard, or relied on any of the "statements that
[the Estate's expert] talked about," she responded, "No." Ms. Giambalvo
further testified that she was not aware of her husband ever making any
smoking decision based on any action of a tobacco coconspirator. Each
of the children testified similarly, as did Mr. Giambalvo's cousin. In
addition, Mr. Giambalvo's cousin testified to the approximate age at

                                      6
which Mr. Giambalvo began smoking, initially "sneaking" cigarettes from
his parents who had "always" smoked. She testified that many of Mr.
Giambalvo's family members smoked, including five brothers and sisters,
and that she had no recollection of Mr. Giambalvo reading the newspaper
or watching the news at around the time he began smoking. And while
she recalled that cigarettes were advertised on television when she and
Mr. Giambalvo were growing up, her testimony was that she and Mr.
Giambalvo saw those advertisements at a point in time after Mr.
Giambalvo began smoking. That was the extent of her testimony
regarding Mr. Giambalvo receiving tobacco coconspirators' statements.
     None of the witnesses testified, for example, that Mr. Giambalvo
viewed "false and misleading statements about dangers associated with
smoking" on television or otherwise, much less that "he expressed his
belief after [viewing such statements] that cigarettes were not bad for
you." Cf. Holliman, 374 So. 3d at 93. And while Ms. Giambalvo testified
that Mr. Giambalvo had once spoken of filtered cigarettes, she did not
testify that Mr. Giambalvo smoked filtered cigarettes because of tobacco
coconspirators' statements.6 Cf. Philip Morris USA Inc. v. Cuddihee, 338
So. 3d 444, 447 (Fla. 1st DCA 2022) ("Decedent's daughter expressly
identified tobacco advertisements as the source of the information
prompting Decedent's switch to Merits because he used words 'almost
match[ing] verbatim' the language of the advertisements. Other evidence
showed that Decedent was on Appellant's mailing list and personally
engaged with Appellant's various marketing campaigns by signing up for
promotions, returning postcards, filling out surveys, and maintaining a

     6 We decline to address Reynolds' argument that the word "filter" on

cigarette packaging is not, in and of itself, a fraudulent statement
pursuant to Prentice II.

                                     7
jar full of cigarette coupons distributed by Appellant." (alteration in
original) (footnote omitted)); R.J. Reynolds Tobacco Co. v. Hamilton, 316
So. 3d 338, 342 (Fla. 4th DCA 2021) ("Certainly, individualized reliance
can be inferred from circumstantial evidence showing Mrs. Hamilton was
exposed to tobacco industry statements and believed filtered cigarettes
were safer.").
      The Estate "presented evidence of the decedent's smoking history,
and presented extensive expert testimony regarding the tobacco
companies' misleading and pervasive campaign"; however, it "presented
inadequate evidence from which the jury could infer" that Mr. Giambalvo
relied on coconspirators' statements. See Whitmire, 260 So. 3d at 539.7
The Estate failed to present evidence that a tobacco coconspirator's
"fraudulent conduct—as defined in Engle—caused the [decedent] to form
a false belief about the health effects or addictiveness of smoking
cigarettes and then to act to his detriment." See Prentice II, 338 So. 3d at
840 (emphasis added); see also Cuddihee, 338 So. 3d at 446 (discussing
Whitmire and stating that the court "reversed an Engle plaintiff's verdict
because the detrimental reliance evidence failed to connect any
misleading statements made by tobacco companies with real-life smoking
decisions made by the decedent smoker" where "the plaintiff's witnesses
couldn't say whether the decedent smoker had paid any attention to

      7 To the extent that previous decisions of this court are not

factually distinguishable and fail to require an Engle plaintiff to prove
that he "received, believed, and acted upon the [Engle defendants']
statements," Prentice II's disapproval of this court's opinion in Philip
Morris USA Inc. v. Duignan (Duignan II), 338 So. 3d 308 (Fla. 2d DCA
2022), also disapproves those cases. See Prentice II, 338 So. 3d at 840,
843.

                                      8
misleading statements made by tobacco companies, [such that]
detrimental reliance wasn't proven").
     Even where the evidence is sufficient to establish that an Engle
plaintiff received statements from a tobacco coconspirator that omitted
material information, in the absence of evidence that he both believed
and acted upon those statements, "those statements could not have
harmed the plaintiff" and the plaintiff has failed to establish reliance.
Prentice II, 338 So. 3d at 840. In this case, there was no evidence—direct
or circumstantial—that Mr. Giambalvo acted upon a statement by a
tobacco coconspirator when he began smoking at the age of twelve or
thirteen8 or when he began smoking filtered cigarettes. Cf. id. Given the
supreme court's repeated statement that reliance requires a
misrepresentation to have been "received, believed, and acted upon," we
conclude that no proper view of evidence in this case supports a verdict
in the Estate's favor on its conspiracy to fraudulently conceal claim.
     Finally, we recognize that while Prentice II "resolve[d] a district court
conflict over whether an Engle progeny plaintiff must prove reliance on a
statement," it did "not address how the plaintiff may prove such
reliance." 338 So. 2d at 837 n.2. We likewise do not address how
reliance may be proven. We hold only that reliance was not proven in
this case, through inference or otherwise, given the supreme court's
"flesh[ing] out what" it means for an Engle plaintiff to "prove detrimental
reliance in order to prevail on [a] fraudulent concealment claim[]." See
Prentice II, 338 So. 3d at 837.

     8 In reaching this conclusion, we make no determination as to

whether the television advertising Mr. Giambalvo and his cousin watched
at some uncertain point in their youth were "statements that omitted
material information." See Prentice II, 338 So. 3d at 840.

                                      9
      Because the trial court should have granted Reynolds' motion for
directed verdict on the conspiracy to fraudulently conceal claim, we
consider Reynolds' arguments that the negligence, strict liability, and
conspiracy to fraudulently conceal claims are inextricably intertwined
such that a new trial is required on the remaining two claims.9 As we
did in Philip Morris USA Inc. v. Duignan (Duignan III), 370 So. 3d 978,
984-86 (Fla. 2d DCA 2023), we conclude that a new trial is not
warranted. The conspiracy claim is independent from the negligence and
strict liability claims. See id. at 984 (quoting R.J. Reynolds Tobacco Co.
v. Prentice (Prentice I), 290 So. 3d 963, 971 (Fla. 1st DCA 2019) (Makar,
J., dissenting)). And as was the case in Duignan III, the order of verdict
form interrogatories supports that conclusion.
      A new trial is, however, required on punitive damages. Again, our
decision in Duignan III is instructive. "[A] demand for punitive damages
is 'not a separate and distinct cause of action; rather it is auxiliary to,
and dependent upon, the existence of an underlying claim.' " Duignan III,
370 So. 3d at 987 (alteration in original) (quoting Soffer v. R.J. Reynolds
Tobacco Co., 187 So. 3d 1219, 1221 (Fla. 2016)). Here, the jury was
asked to determine whether the Estate was entitled to punitive damages
in a separate interrogatory on the verdict form, and the jury later
awarded punitive damages in a second phase of trial. To determine both
entitlement to punitive damages and amount of those damages, the jury
was instructed to consider the conduct of Reynolds within the tobacco-
industry conspiracy that harmed Mr. Giambalvo. In closing arguments

      9 As to Reynolds' argument that an error in admitting

demonstrative aids as substantive evidence requires reversal of the
negligence and strict liability claims, any such error was harmless in this
case and we decline to address the argument further.

                                      10
in both phases of trial, the Estate argued that the jury should rely on
evidence of the conspiracy in determining punitive damages. We cannot,
therefore, conclude that there is no reasonable possibility that the
conspiracy to fraudulently conceal claim contributed to the verdict on
punitive damages. See Duignan III, 370 So. 3d at 987.
      The final judgment is reversed in part. On remand, the trial court
is directed to enter a verdict in Reynolds' favor on the conspiracy to
fraudulently conceal claim, to reduce the amount of compensatory
damages pursuant to the jury's apportionment of fault to Mr. Giambalvo,
and to hold a new trial on the issues of entitlement to and amount of
punitive damages.
      Affirmed in part, reversed in part, and remanded.

VILLANTI and LaROSE, JJ., Concur.

Opinion subject to revision prior to official publication.

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