Share This Page

Pa. scores 'victory,' gets portion of tobacco settlement restored

| Thursday, April 10, 2014, 11:18 p.m.

A Philadelphia judge on Thursday restored about $120 million of tobacco settlement money that an arbitration panel struck down, though state officials could not say how it might affect program funding.

The ruling by Common Pleas Judge Patricia McInerney means Pennsylvania's portion of tobacco settlement money will shrink by about $60 million, from about $335 million annually to about $275 million, the state Attorney General's Office said. An arbitration panel in September reduced the amount by about $180 million.

McInerney declined the state's request to restore the full portion, instead reducing the severity of the cut.

Since an initial settlement with three top cigarette makers in 1998, companies have made annual payments to help pay tobacco users' medical costs and fund programs to help users quit.

“While we were not able to win the entire amount, we are excited for this victory and what it means for the future of important smoking cessation, medical research and health programs that depend on this money,” Attorney General Kathleen Kane said in a statement.

Settlement participants Philip Morris USA Inc., R.J. Reynolds Tobacco Co. and Lorillard Tobacco Co. challenged whether the state collected money from sales of products made by competitors that didn't join the pact. The settlement entitles participating companies to cut their payments if they lose market share.

Philip Morris and R.J. Reynolds spokesmen declined to comment. They wouldn't say whether the companies would appeal. A Lorillard spokesman could not be reached.

Spokesmen for Gov. Tom Corbett and Kane credited bipartisan work in winning back a portion of the money. Corbett's spokesman Jay Pagni said it's too early to say how the $60 million drop would affect program funding.

“We view today's ruling as a positive step in continued support of health-related programs funded by the (tobacco settlement),” Pagni said. “We'll be looking for the final disposition and look to restore program funding, as appropriate, upon that final disposition.”

The payment dispute with tobacco companies centers on whether Pennsylvania fully followed the agreement. Specifically, the sides tussled over whether Pennsylvania must collect taxes on products such as roll-your-own cigarette tobacco.

The Tobacco Master Settlement Agreement shields participating manufacturers against state lawsuits. Firms challenged 35 states over their 2003 compliance.

Bobby Kerlik is a Trib Total Media staff writer. Reach him at 412-320-7886 or bkerlik@tribweb.com.

TribLIVE commenting policy

You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.

We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.

While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.

We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers

We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.

We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.

We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.

We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.