Lawsuits rarely go to trial in The Republic of the Marshall Islands (RMI), but if they do, the claims are criminal and typically straightforward -- livestock theft is common. Certainly, the balmy one-courthouse town of Majuro, the country's capital, had never seen anything like the $4.6 billion lawsuit brought by the RMI government in 1997 against Big Tobacco. And this spring, the health care costs case might see the first civil jury trial in the history of RMI as an independent state.
John Phillips is trying to prevent that. The Seattle-based litigation partner at San Francisco's Heller Ehrman White & McAuliffe, along with Gregory Stone at Los Angeles' Munger, Tolles & Olson, represents lead defendant Philip Morris Companies Inc. Phillips wrote the brief that dealt a blow to the plaintiffs in February, when the trial judge dismissed 10 of 11 motions brought against the New York-based company on summary judgment. Justice H. Dee Johnson Jr., a former Dallas trial judge who relocated to Majuro to become its sole judge, wrote that he found no evidence of damages. Due to errors made by the plaintiffs' chief health costs expert, Dr. Vincent Miller, the judge concluded, the plaintiffs' $4.6 billion claim is baseless. "Dr. Miller has torpedoed this lawsuit as surely as if he had used dynamite on it," wrote Johnson. To Phillips, it was the "kind of ruling you sometimes dream about."
Phillips, 46, has defended Philip Morris in several suits, including the Washington state attorney general's case that was resolved in the high-profile universal tobacco settlement in 1998. Since then, others seeking to sue Big Tobacco for smoking-related health care costs have faced Phillips. Early last year, he won dismissal of a billion-dollar suit brought by health care management company Regence BlueShield. Phillips also won dismissal of several similar suits filed by Native American tribes. The plaintiffs in these cases, says Phillips, "try to develop an economic model that tries to show the social cost to smoking. That gets very complicated."
In the RMI case, Miller determined the percentage of the government's health care costs that stemmed from illness attributable to smoking by surveying the population. But his report, submitted to the court in May 2000, was mathematically flawed. Phillips discovered the error that summer. Knowing that Miller might try to use another method to prove the same point, he got Miller to admit during an August deposition that if his survey results were inaccurate, the use of data from a different country would also be inappropriate. But just two months later, Miller submitted a second report, this time relying on data from a U.S. survey -- the very kind of survey that Phillips had gotten him to say would be invalid in the RMI. The backtracking wasn't lost on the judge. "To no one's surprise," wrote the judge, "defendants have … suggest[ed] none-too-gently that this is balderdash. The court agrees."
Still, the suit drags on: The plaintiffs, represented by Suzelle Smith and Don Howarth of Los Angeles' Howarth & Smith, have appealed Johnson's ruling to the RMI Supreme Court (there is no appellate court in the RMI). Phillips, meanwhile, has appealed over a so-called remoteness claim, which deals with whether a third party should get to sue for health care costs for smokers in the first place.
"[Phillips] is a worthy adversary," says plaintiffs' counsel Smith, whose firm was part of the Castano group in New Orleans, which in 1998 brought the first nationwide class action against Big Tobacco. But "we think he's dead wrong on the law," she says. Smith admits that Miller made a miscalculation, but she thinks that he and other experts should be permitted to testify before the RMI Supreme Court. She has also asked the court to hear arguments on the remoteness claim.
Although it's possible that smoking-related illnesses have ended up costing the RMI government a lot of money, says Phillips, the ultimate question for a payer of health care services comes down to the evidence: "How do you prove it?" It's a question he bets the plaintiffs still can't answer.
