Brown & Williamson Tobacco Corp. v. Gault

627 S.E.2d 549, 280 Ga. 420, 2006 Fulton County D. Rep. 711, 2006 Ga. LEXIS 163
CourtSupreme Court of Georgia
DecidedMarch 13, 2006
DocketS05Q1465
StatusPublished
Cited by43 cases

This text of 627 S.E.2d 549 (Brown & Williamson Tobacco Corp. v. Gault) is published on Counsel Stack Legal Research, covering Supreme Court of Georgia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Brown & Williamson Tobacco Corp. v. Gault, 627 S.E.2d 549, 280 Ga. 420, 2006 Fulton County D. Rep. 711, 2006 Ga. LEXIS 163 (Ga. 2006).

Opinions

HUNSTEIN, Presiding Justice.

In 1997 the State of Georgia brought suit in the Superior Court of Fulton County against a number of cigarette manufacturers, including Brown & Williamson (“B&W”), asserting product liability claims and seeking compensatory and punitive damages “to restore to the State’s treasury those funds spent [by the State] for tobacco attributable health care costs.” The parties settled the case one year later when the tobacco companies paid the State of Georgia $4.8 billion. The Master Settlement Agreement, which was approved by the superior court, provided, inter alia, that “no part of any payment under this Agreement is made in settlement of any actual or potential liability for . . . enhanced damages.” It also provided that the State agreed to “absolutely and unconditionally release and forever discharge all released parties from all released claims that the releasing parties directly, indirectly, derivatively or in any other capacity ever had, now have, or hereafter can, shall or may have.”

The agreement defined “releasing parties” in pertinent part as “persons or entities acting in a parens patriae, sovereign, quasi-sovereign, private attorney general, qui tarn, taxpayer, or any other capacity ... to the extent that any such person or entity is seeking relief on behalf of or generally applicable to the general public ... as opposed to solely private or individual relief for separate and distinct injuries.” It also defined both “released claims” and “claims.” “Released claims” were defined, in part, as being “directly or indirectly based on, arising out of or in any way related, in whole or in part, to (A) the use, sale, distribution, manufacture, development, advertising, marketing or health effects of’ tobacco. The definition of “claims” included “liabilities of any nature including civil penalties and punitive damages.”

Clara Gault Freeman died of lung cancer in 2001. Plaintiffs Willie Gault, the administrator of the deceased’s estate, and Danny Freeman, the deceased’s widower, brought this product liability action against B&W in Fulton County seeking compensatory and punitive damages. B&W removed the case to the United States District Court for the Northern District of Georgia and moved for summary judgment, asserting that plaintiffs’ punitive damages claim is barred by the doctrine of res judicata. Thereafter, the district court certified this question:

Does the doctrine of res judicata bar individual Georgians from seeking punitive damages against [B&W] when the Attorney General of Georgia, suing on behalf of the State of [421]*421Georgia, released [B&W] from all future punitive damages claims related to the manufacture or use of tobacco products by signing the Master Settlement Agreement?

See 1983 Ga. Const., Art. VI, Sec. VI, Par. IV (conferring in this Court jurisdiction to answer question of law from “any state appellate or federal or district or appellate court”). For the reasons that follow, we answer the question in the affirmative.

The doctrine of res judicata prevents the re-litigation of all claims that have already been adjudicated, or that could have been adjudicated, between identical parties or their privies in identical causes of action. OCGA § 9-12-40. In order for the doctrine to apply, three prerequisites must be satisfied: (1) identity of the parties or their privies; (2) identity of the cause of action; and (3) previous adjudication on the merits by a court of competent jurisdiction. Gunby v. Simon, 277 Ga. 698, 699 (594 SE2d 342) (2004); Waldroup v. Greene County Hosp.Auth., 265 Ga. 864 (1) (463 SE2d 5) (1995). See Davis and Shulman’s Ga. Practice & Procedure (2001 ed.), §§ 27-3, 27-4. We find these prerequisites are satisfied under the facts of this case.

1. Res judicata applies only to the parties to the prior suit and those in privity with them. OCGA § 9-12-40. It is undisputed that plaintiffs were not parties in the action between the State and B&W. Thus, we must consider whether they were in privity with the State.

A privy is generally defined as “one who is represented at trial and who is in law so connected with a party to the judgment as to have such an identity of interest that the party to the judgment represented the same legal right. [Cits.]” Butler v. Turner, 274 Ga. 566, 568 (1) (555 SE2d 427) (2001). In this case, privity is alleged to exist through application of the doctrine of parens patriae. The doctrine of parens patriae grants standing to a state to sue on behalf of its citizens. See Alfred L. Snapp & Son, Inc. v. Puerto Rico, 458 U. S. 592, 600 (102 SC 3260, 73 LE2d 995) (1982). The State can, as parens patriae, maintain an action on behalf of its citizens to seek compensation for sovereign or quasi-sovereign claims, but it may not represent its citizens’ private interests. Id. at 607. This means that the State and its citizens can be privies only with regard to public claims; they cannot be privies with regard to private claims.

These principles were elucidated in Satsky v. Paramount Communications, 7 F3d 1464 (II) (B) (10th Cir. 1993), in which the court determined that plaintiffs and the State of Colorado were privies for “common public rights,” but were not in privity when it came to “purely private interests.” Id. at 1470. In making that determination, the court explained:

[422]*422“There is no definition of‘privity’which can be automatically applied to all cases involving the doctrines of res judicata and collateral estoppel,” [cit.], since “privity depends upon the circumstances.” [Cit.] “Privity may ... be established if the party to the first suit represented the interests of the party to the second suit.” [Cits.]
The [U. S.] Supreme Court has recognized the “right of a State to sue as parens patriae to prevent or repair harm to its ‘quasi-sovereign’ interests.” [Cit.] “In order to maintain [a parens patriae] action, the State must articulate an interest apart from the interests of particular private parties, i.e., the State must be more than a nominal party. The State must express a quasi-sovereign interest.” [Cit.] . . . Although the [U. S.] Supreme Court has not expressly defined what is a “quasi-sovereign” interest, it is clear that a state may sue to protect its citizens against “the pollution of the air over its territory; or of interstate waters in which the state has rights.” [Cit.] It is equally clear, however, that a state may not sue to assert the rights of private individuals. [Cits.]

Id. at 1468-1469. In those instances where a state has standing to maintain an action as parens patriae, the resulting judgments have been held to be binding on the citizens of the state as privies for purposes of res judicata. See, e.g., City of Tacoma v. Taxpayers of Tacoma, 357 U. S. 320, 340-341 (78 SC 1209, 2 LE2d 1345) (1958); Satsky, supra, 7 F3d at 1470; Vacco v. Reebok Intl., 96 F3d 44, 48 (2d Cir. 1996);Alaska Sport Fishing Assn. v. Exxon Corp., 34 F3d 769 (III) (A) (9th Cir. 1994) (per curiam).

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Cite This Page — Counsel Stack

Bluebook (online)
627 S.E.2d 549, 280 Ga. 420, 2006 Fulton County D. Rep. 711, 2006 Ga. LEXIS 163, Counsel Stack Legal Research, https://law.counselstack.com/opinion/brown-williamson-tobacco-corp-v-gault-ga-2006.