The $350 million settlement of a landmark flight attendants' lawsuit over secondhand smoke shows the tobacco industry wants to settle out of court rather than risk facing juries, industry analysts say.
"It's the third major case that they've settled in four months," said Richard Daynard, who heads the Tobacco Products Liability Project at Northeastern University, which advocates litigation against cigarette firms.
"You're talking about an industry that's on the run. They're obviously dead scared of ever letting a jury consider the evidence against them. They'll do anything to stop them."
Analyst Tim Swanson of the brokerage firm A.G. Edwards said the announcement was positive for the industry, which is trying to persuade Congress and the White House to approve the $368 billion national settlement with state attorneys general seeking to recoup the costs of treating sick smokers.
"I think this is a clear sign that the tobacco companies are motivated (to settle)," Swanson said. "I think it should be considered a public relations victory for them."
Cigarette makers said in August they agreed to an $11.3 billion settlement of a lawsuit filed by Florida seeking reimbursement for the public costs of treating sick smokers. In July, the industry settled a similar case filed by Mississippi for $3.4 billion.
"The whole approach of the industry was to vigorously fight and oppose everything, and now there's just been a huge change," said Jean Eggen, a professor of law at Widener University in Delaware and an expert on such cases.
Texas and Minnesota are the next two states up in court against the industry. Texas's $14 billion lawsuit is scheduled for trial Oct. 27, and speculation has been rampant that the cigarette firms want to settle.
Minnesota's case, touted by anti-tobacco forces as being backed up with evidence especially damaging to the industry, is set for trial early next year.
Under the settlement of the flight attendants suit announced Friday, tobacco firms will pay $300 million to create a health-research foundation. They also agreed to pay about $50 million in legal and court costs.
But Friday's plaintiffs -- thousands of flight attendants who claim they were made sick by breathing secondhand tobacco smoke on passenger jets -- will get no money under the deal and are banned from suing for punitive damages, something questioned by some legal experts.
"So, a plaintiffs' attorney, he's going to get $46 million for making the class members worse off," said John Coffee, a professor at Columbia University Law School and expert on class-action suits. "Because after this settlement, they (the flight attendants) will have very little leverage in an individual trial because they can't threaten punitive damages."
The flight attendants also gave up the class-action status they won after years in court.
The contingency fees paid to plaintiffs' lawyers in product liability suits typically are pegged to the punitive damages they hope to win for their clients. Without the prospect of such damages, legal experts said it was difficult to imagine many attorneys taking on flight attendants' individual cases.
Coffee also noted that the settlement, which puts $300 million into a foundation, still allows the cigarette industry to claim that it never has paid any money to individuals suing over cigarette health risks.