A divided Supreme Court set aside on Tuesday a $79.5 million punitive damages award won by a longtime smoker's widow against Altria Group Inc.'s Philip Morris unit.

Marlboro and other cigarettes are seen inside a supermarket in New York in a 2004 file photo. A divided Supreme Court set aside on Tuesday a $79.5 million punitive damages award won by a longtime smoker's widow against Altria Group Inc.'s Philip Morris unit, which owns the Marlboro brand. REUTERS/Shannon Stapleton

By a 5-4 vote, the high court ruled the giant tobacco company could not be punished for harm to other smokers in a case involving Mayola Williams, an Oregon woman whose husband died of lung cancer in 1997 after smoking for more than 40 years.

The case had been closely watched by business groups who wanted the high court to impose new constitutional limits on punitive damages designed to punish and deter misconduct. The court last placed limits on such awards in 2003.

Businesses have long complained that punitive damages are skyrocketing out of control, can be arbitrary and encourage frivolous lawsuits. Lawyers for those who have been injured defend big awards as a way to get companies to fix harmful product defects.

Justice Stephen Breyer said for the court majority that Philip Morris could not be punished for the harm to those who were not parties in the lawsuit.

He said a punitive damages award based in part on a jury's desire to punish a defendant for harming those who are not parties to the lawsuit amounted to a taking of property from the defendant, violating constitutional due process rights.

Breyer said the court did not address the question of whether the award in this case was constitutionally excessive.

© Reuters 2007

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