Tag: Master Settlement Agreement

  • ‘U.S. States Shafting Anti-Tobacco Programs’

    ‘U.S. States Shafting Anti-Tobacco Programs’

    Photo: Feodora

    Only two U.S. states—Maine and Oregon—fund their tobacco prevention and cessation programs at or above the levels recommended by the Centers for Disease Control and Prevention (CDC), according to a new report released by the Campaign for Tobacco-Free Kids (CTFK), American Cancer Society Cancer Action Network, American Heart Association, American Lung Association, Americans for Nonsmokers’ Rights and Truth Initiative.

    In fiscal year 2023, American states will collect $26.7 billion from the 1998 Master Settlement Agreement and tobacco taxes. But they will spend just 2.7 percent—$733.1 million—on tobacco prevention and cessation programs, according to the report. This is a $14.5 million increase from last year but still less than a quarter (22.2 percent) of the total funding recommended by the CDC.

    By comparison, the tobacco industry spends $9.1 billion annually to market its products in the U.S., according to the CTFK.

    “To continue driving down tobacco use, address health disparities and stop tobacco companies from addicting another generation of kids, states must step up their funding of tobacco prevention and cessation programs,” said CTFK President Matthew L. Myers.

    The report has appeared annually since the November 1998 landmark legal settlement between 46 states and the major tobacco companies, which, along with individual settlements with four other states, required the companies to pay more than $246 billion over time as compensation for tobacco-related healthcare costs. 

  • New Mexico Sues Over Tobacco Settlement

    New Mexico Sues Over Tobacco Settlement

    Photo: promesaartstudio

    New Mexico is suing over a dozen tobacco companies over payments relating to the 1998 Master Settlement Agreement, alleging conspiracy and breach of contract, reports the Albuquerque Journal, citing Attorney General Hector Balderas.

    Balderas claims that the companies have withheld portions of annual payments due under a multistate tobacco settlement. According to the attorney general, New Mexico has lost more than $84 million over the past 14 years.

    “There is no end to these baseless delay tactics, and it is time to force the tobacco companies to pay New Mexico what they owe for damages—funding much-needed health initiatives,” said Balderas.

    Companies are obligated to pay annually under the settlement, but each year, the companies file disputes that result in a percentage of the payment being withheld, which triggers an arbitration process that can take years, according to the attorney general’s office.

    The amount withheld grows each year, according to officials, and the lawsuit states that the tobacco companies do not disclose how much is withheld or where the withheld funds are held, and withholding practices can change annually.

    “This conspiracy is a calculated strategy to permanently and fraudulently decrease defendants’ contractual payments under the (settlement agreement) and to frustrate the purposes of the (settlement agreement),” the suit reads.

  • Tobacco Sued Over MSA Payments

    Tobacco Sued Over MSA Payments

    Tom Miller

    Iowa Attorney General Tom Miller accuses Philip Morris USA, R.J. Reynolds Tobacco Co., and 16 other tobacco companies of defrauding Iowa of more than $133 million, according to a lawsuit filed Thursday.

    The lawsuit stems from the 1998 Master Settlement Agreement, which requires tobacco manufacturers to pay billions annually to participating states in exchange for the states agreeing not to sue for health-related damages to citizens. The motion, filed in Polk County District Court, alleges that the companies have withheld a portion of their annual payments to Iowa in bad faith and “through a scheme of false claims and feigned ignorance.”

    The tobacco companies demand that Iowa must go to arbitration to recover each year’s withheld payment. According to Miller, it has taken years to litigate each dispute, creating a long backlog and a growing amount of withheld payments. Iowa has prevailed in every dispute, most recently in September 2021, but the companies still refused to pay the amount they withheld from Iowa.

    “We have fought, and won, these legal battles for years, and there is no end to these disputes in sight,” Miller said in a statement. “We now must escalate the matter and force the tobacco companies to pay what they owe the state of Iowa.”

    The lawsuit seeks to recover actual and punitive damages, plus attorneys’ fees and other costs. Under Iowa’s False Claims Act, the state seeks three times the amount of actual damages.

  • States Fail to Invest in Tobacco Prevention

    States Fail to Invest in Tobacco Prevention

    Photo: 3D Animation Production Company from Pixabay

    U.S. States are failing to invest proceeds from the 1998 Tobacco Master Settlement Agreement (MSA) into tobacco prevention funds, according to a new report from the Campaign for Tobacco-Free Kids (CTFK), American Cancer Society Cancer Action Network, American Heart Association, American Lung Association, Americans for Nonsmokers’ Rights, Robert Wood Johnson Foundation and Truth Initiative shows

    “This year (fiscal year 2021), the states will collect $26.9 billion from the 1998 tobacco settlement and tobacco taxes,” the CTFK wrote in a statement. “But they will spend a paltry 2.4 percent—just $656 million—on tobacco prevention and cessation programs. The total is an 11 percent decrease from last year and less than a fifth (19.8 percent) of the total funding recommended by the Centers for Disease Control and Prevention (CDC).”

    Alaska (89.7 percent), Maine (87.4 percent) and Utah (79.4 percent) are the only states to provide at least three-quarters of the CDC-recommended funding for tobacco prevention and cessation programs.

    Tobacco companies spend more than $13 to market tobacco products for every $1 the states invest to reduce tobacco use, according to the CTFK. According to the most recent data from the Federal Trade Commission (for 2018), the major cigarette and smokeless tobacco companies spend $9.1 billion a year on marketing.