NEW YORK, March 21 (Reuters) - A California jury's $1.7 million award to a cancer-striken ex-smoker and her husband is the industry's first loss to a plaintiff who began smoking after warning labels began appearing on cigarette packs, and it could be a pr

Jurors in the Whiteley case are set to return to the courtroom Tuesday morning to start hearing evidence in the punitive damages phase of the trial against Philip Morris Cos. Inc. and R.J. Reynolds Tobacco Holdings Inc. The jurors will hear evidence for two to three days and will not decide an amount until Friday, Credit Suisse First Boston tobacco analyst Bonnie Herzog said in a research note. ``Given the pro-plaintiff anwers to the special verdict form questions, we believe the punitive damage amount could be substantial,'' Herzog said. ``The most disturbing aspect of this loss is that this is the first time the companies lost a case where the plaintiff started smoking after the federal mandated cigarette warnings began appearing on packages,'' Herzog said. ``Although we expect Philip Morris and R.J. Reynolds to appeal this verdict, we are not confident that it will be overturned considering there is nothing significant that occurred during the trial that highlights the companies have a strong case for appeal,'' she said. Herzog said tobacco stocks would face pressure for several weeks. In early trading on the New York Stock Exchange, Philip Morris shares were down 9/16 at 19-3/8, and RJR shares were off 1/4 at 16-1/4.

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