Tobacco firm wins payout appeal

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The US Supreme Court has thrown out a ruling that tobacco firm Philip Morris must pay $79.5m (£40.7m) in punitive damages after the death of a smoker.

The narrow verdict is seen as good news for large firms seeking to limit the payouts that can be awarded by juries.

The court decided 5-to-4 that the earlier ruling must be overturned.

It said the jury had not been told that it could only fine the firm for harm done to the plaintiff, not to other smokers whose cases were not before it.

Restrictions demanded

The case was brought by Mayola Williams, whose husband Jesse died of lung cancer in 1997 after smoking for 40 years.

Ms Williams sued the cigarette manufacturer for fraud on behalf of her husband.

She had claimed that the jury decision was right because it had punished Philip Morris for a "massive market-directed fraud" over many years - misleading people into thinking cigarettes were not dangerous or addictive.

Ms Williams had argued that her husband had believed tobacco companies when they said the product was safe.

Her payout had earlier been upheld by the Oregon state Supreme Court.

In the appeal, Philip Morris said the jury should only have been allowed to punish it for the harm done to Mr Williams and not to other smokers.

Philip Morris also asked the court to decide whether the payout had been "constitutionally excessive", but the judges made no comment on this.

A number of organisations, including the National Association of Manufacturers and the Chamber of Commerce have called for greater restrictions on the sums which can be ordered in damages.