Posted on 03/28/2006 6:43:55 PM PST by SheLion
WASHINGTON
A legal battle may be looming between states, including North Carolina, and tobacco companies over money owed from a landmark 1998 settlement agreement. What's at stake could be more than $1 billion.
An economic consulting firm determined late Monday that the agreement between the cigarette companies and the states was a "significant factor" in contributing to a loss of market share for the companies that signed on to the settlement.
The report stated that the agreement, which imposed numerous marketing limits on the companies and required billions of dollars in payments to states, led to the erosion of their market share to smaller manufacturers that didn't sign on and generally sell discount cigarettes.
That finding is one of several determinations that would be necessary for the tobacco companies to reduce their annual payments to states under the agreement.
The No. 1 cigarette maker, Philip Morris, declined Tuesday to comment on whether it will seek to have its payments reduced.
But Iowa Attorney General Tom Miller and Idaho Attorney General Lawrence Wasden released a joint statement Tuesday saying the finding by the Brattle Group, a consulting firm tasked by both sides with looking into the issue of eroding market share, should not lead to a reduction in payments. The two head the tobacco committee for the National Association of Attorneys General.
Miller and Wasden said the reduction - an estimated $1.2 billion - could only occur if states have failed to enforce statutes that require cigarette makers that aren't part of the settlement to put money in escrow accounts to meet any future legal obligations.
The attorneys general say states are enforcing those statutes.
"As a result, the settling states believe that it would not be appropriate to withhold any portion of the April 17 payment," the statement said. About $6.5 billion is due to the states on that date.
It will be interesting to see the out-come of this.....
The smae ambulance chasers that sued the tobacco companies will now sue the states. Can't we ship these weasels to France.
I WISH!!!
If this had REALLY been about "secondhand smoke" and the "health hazards" of smoking, tobacco would have been banned a long time ago. Unfortunately, this was all about MONEY. Only MONEY. MONEY for greedy lawyers and disgraceful politicians. Nothing more. Shame on you America for allowing this legalized extortion to occur.
You got THAT right!!!
Maybe it has come to the point where the companys are losing on cigs anyhow. Maybe a spite would be to give them away free and stick it to them all. Most companies have diversified anyway and tobacco is not a major part of their bottom line...
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