Already a Bloomberg.com user?
Sign in with the same account.
News: Analysis & Commentary: TOBACCO
FANNING THE FLAMES FOR A TOUGHER TOBACCO DEAL
Minnesota's AG rallies critics in Congress and heads for court
As Florida Governor Lawton M. Chiles prepared to address a Palm Beach courtroom on Aug. 25 to announce an $11.3 billion settlement with the tobacco industry, Minnesota state officials anxiously huddled around a TV set in the St. Paul capitol building. The Florida deal, including steep financial penalties and advertising curbs, was patterned on the proposed $368.5 billion "universal" settlement announced in June. And coming just seven weeks after a similar agreement in Mississippi, it seemed to be a sign that the states--and eventually Congress--were inclined to support the June pact.
But that's not what the people in front of the TV in the Minnesota capitol had in mind. These earnest staffers work for Minnesota Attorney General Hubert H. Humphrey III, the AG who has been the most outspoken critic of the tobacco settlement as now envisioned. He is joined by members of Congress and several health groups that object to various aspects of the agreement, ranging from the amount of money Big Tobacco should shell out to the limits it places on U.S. Food & Drug Administration regulation of nicotine. These critics hope either to kill the settlement or at least to strengthen its health provisions as the pact percolates through Congress in upcoming weeks.
They may still have a strong hand to play, thanks to Humphrey. The Minnesota suit, seeking to recover the cost of caring for Medicaid patients suffering from smoking-related illnesses, is slated to go to trial on Jan. 19. It now seems as if it will be very difficult for Congress to finish work on the deal by then.
If he goes to trial first, Humphrey promises to dish out precisely what the industry hoped to avoid by settling in Florida and Mississippi: an ugly trial with massive negative publicity. Indeed, many of the state AGs who drafted
the pact are "very concerned" that Humphrey's courtroom attack would put the industry in such a bad light that it could torpedo the entire deal, says James Tierney, a former Maine attorney general who is a consultant to the state AGs suing the industry.By Richard A. Melcher in St. Paul, with bureau reportsReturn to top
Hurdles for the Tobacco Pact
BIGGER BUCKS: The proposed settlement calls for an industry payout of $368 billion. Minnesota Attorney General Hubert H. Humphrey III wants at least $600 billion.
FDA FREEDOM: Under the existing pact, the FDA has to jump through a variety of legal hoops to regulate nicotine. Humphrey and many health advocates oppose any limits on the agency's power.
DOCUMENT DISCLOSURE: Deal critics seek complete disclosure of all of the industry's internal memoranda. The tobacco accord preserves attorney- client privilege in some cases.
PENALTY PROVISIONS: Humphrey and other opponents want to increase the penalties against tobacco makers if teen smoking doesn't decrease sufficiently.Return to top