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Tobacco companies and states reach agreement over payments

Settlement ends dispute dating back to 1998

Big Tobacco companies including Philip Morris USA and R.J. Reynolds Tobacco Co. announced last week that they had reached an agreement with several states in a long-running dispute that dates back to 1998. For almost 15 years, 17 states and Big Tobacco have been at odds over how much the tobacco companies should pay as required under the landmark 1998 anti-smoking agreement, which required tobacco companies to help cover health bills of sick smokers.

Under the new settlement, the 17 states will share $4 billion in disputed payments, and manufacturers will receive credits against payments made in the future. For years, the tobacco companies have disputed the amount of payments they owe to states.

"This agreement resolves disputes with a large group of states on financial terms that are fair to the parties and in a way that we believe will lead to a better method for resolving these issues in the future," Denise Keane said in a statement. Keane is the executive vice president and general counsel of Altria Group, which owns Philip Morris.

The settling parties include Alabama, Arizona, Arkansas, California, Georgia, Kansas, Louisiana, Michigan, Nebraska, Nevada, New Hampshire, New Jersey, North Carolina, Tennessee, Virginia, West Virginia and Wyoming—as well as Washington, D.C. and Puerto Rico.

Read more about this settlement on Thomson Reuters.

For more Big Tobacco news on InsideCounsel, see:

Judge tells Big Tobacco to disclose deception on packaging

Big Tobacco doesn’t want to admit wrongdoing

D.C. Circuit rules against graphic tobacco label requirements

NYC can’t force displays of graphic anti-smoking ads

D.C Circuit hears graphic tobacco label case

Judge says Big Tobacco’s free speech rights were violated

Graphic cigarette warning labels blocked

5 tobacco companies sue FDA over ad requirements

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