$206 billion tobacco settlement receives unanimous support from 46 states
Updated November 20, 1998
3:33 p.m. ET
NEW YORK (Court TV) -- The $206 billion tobacco settlement has received unanimous support from all 46 states eligible for the deal, making it the largest U.S. civil settlement in history.
Delaware, Wyoming, Illinois, Massachusetts, Maryland, Georgia, Louisiana, Nevada, New Mexico, Oregon, Vermont, Connecticut, Maine, Indiana, Kansas, Virginia, and South Carolina agreed to sign the settlement that requires the tobacco companies to spend billions of dollars on research and programs aimed at discouraging smoking, especially among teenagers.
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Differences between the 1997 and 1998 tobacco deals:
By The Associated Press
Some of the differences between the just-approved settlement
between the tobacco industry and the states and a broader 1997
agreement that failed
MONETARY BREAKDOWN
New settlement:
Tobacco companies pay a total of $206 billion to 46 states by
the year 2025. Another $40 billion in separate settlements was
previously reached by four other states.
Of the $206 billion, $250 million over 10 years would go
specifically to a foundation to study how to reduce teen smoking.
Old settlement:
Tobacco companies pay $360 billion in first 25 years.
Of the $360 billion total, $50 billion is dedicated as
punishment for past industry wrongdoing. The other $310 billion
would be divided among reimbursements to states, providing free
smoking cessation programs to all smokers, anti-smoking education
and advertising and enforcement.
CIGARETTE COMPANIES' LIABILITY:
New settlement:
Industry is not protected against future lawsuits from anyone
besides state governments.
Old settlement:
Sick smokers could still sue the industry. Class-action
lawsuits are banned.
TOBACCO MARKETING:
New settlement:
No distribution or sale of apparel and merchandise with
brand-name logos, such as caps, T-shirts and backpacks.
No use of cartoon characters in tobacco ads or promotions, but
humans are allowed. No brand names at stadiums and arenas.
Billboard advertising is restricted, though some outdoor ads
are allowed.
No payment for placement of tobacco products in television
shows, theatrical performances, video games and movies.
Old settlement:
No billboards or other outdoor ads.
No humans or cartoons in ads or on cigarette pack. Black labels
on cigarette packs including ``Cigarettes are addictive'' and
``Smoking can kill you.''
Text-only ads in magazines with significant youth readership.
No brand-name sponsorship of sporting events or brand-name
promotional merchandise such as T-shirts.
No Internet advertising or product placement in movies and on
TV.
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The attorneys general who brokered the deal with the tobacco companies hailed the states' support as a victory over Big Tobacco.
"It's a great day for attorneys general," said Washington Attorney General Christine Gregoire, who led the settlement negotiations. "Joe Camel and his ilk are in intensive care and will be gone by April."
The most crucial co-signers of the agreement were Massachusetts and Maryland, who had strong cases against the industry and were considered potential defectors in the agreement.
[ Attorneys general announce $206 billion tobacco settlement]
On Nov. 19, 11 states announced their support of the settlement. Michigan, whose case against the tobacco industry was considered so strong that many believed it would reject the deal, was among those states.
Under the agreement, which was announced Nov. 16, 46 states who have not settled state claims against Big Tobacco would receive $12 billion up front over the next five years. The rest of the payments would be made until 2025. Several industry critics have condemned the deal because they feel it does not penalize the tobacco companies if underage smoking is not reduced. They also criticized the deal for not addressing federal regulation of tobacco and feel the deal is not as far-reaching as the failed $368 billion proposal in 1997.
But attorneys general from states supporting $206 billion deal say that the settlement is better than continued litigation. Georgia's attorney general echoed that argument.
"Quite frankly, there are many things that this agreement accomplishes, particularly in the public health arena, that we could not achieve through our lawsuit in Georgia," Attorney General Thurbert Baker said.
According to the settlement, Georgia would receive $4.8 billion over a 25-year period. Maine Attorney General Andrew Ketterer would receive $1.4 billion while Connecticut would get $3.6 billion.
The tobacco companies indicated they could sign the agreement on Monday, Nov. 23.
The Associated Press contributed to this report.
