Baker sues Big Tobacco

The filing contends that payments from some tobacco companies, including R.J. Reynolds Tobacco Co., were siphoned to a third party.Other companies, including Phillip Morris USA, paid the full amount they owed, but also claimed the right to offset future payments owed to the states because of market share loss, the lawsuit said. And several smaller tobacco manufacturers completely withheld the funds due last month, the filing said.

The tobacco manufacturers had argued that they shouldn’t have to pay the full tab because they lost business to rival companies not saddled with the settlement.

Thurbert Baker, the state’s attorney general, contended that the companies lost market share because they raised prices “beyond any price increase rationally related to the payment of damages under the 1998 settlement agreement.”

The state has received $141 million of the $160 million settlement funds due last month, Willard said.

The tobacco companies have to live to their agreement.  However, I’ve not liked this situation from the beginning.  I don’t smoke, and think it’s repulsive, but it’s a legal product.  If you don’t like it don’t do it, and if it’s such a danger to the public then let’s ban it, but what the Government has done is tax it, then extort huge sums of money from the companies, and now their suing again – in an election year.  This doesn’t pass the smell test Mr. Baker.

Read the rest of the story here.

9 comments

  1. atlantaman says:

    If the tobacco companies stop paying money to Georgia how is Cox going to get any television time?

  2. atlantaman says:

    It is interesting. I assume he’s doing this for some election year publicity. I’m sure it will curry favor with the bleeding hearts, but how will it play with the Agriculture Community – the crucial general election swing voters.

  3. Demonbeck says:

    I guess he feels that the historically Democratic rural vote is becoming overwhelmingly Republican these days. Perhaps this is a sample of things to come in the Democratic party.

    We have already seen Democratic leaders discussing the fact that they are contesting fewer races this cycle as a good thing. As if a move to the left would actually help the Democratic Party of Georgia.

  4. Michael C says:

    I am still apaulled that Phillip Morris is forced to air commercials telling people not to use their product. Insanity. Ansolute Insanity.

  5. Oh come on. What ever happened to “enforcing the law”? Whether Thurbert Baker agrees with the settlement or not, if they agreed to pay $X and they are paying less than $X you ask them to pay and if they say no you take them to court.

    Equating enforcing the tobacco settlement with being against tobacco farmers is quite a leap — similar to a leap one would have to make to think Perry McGuire has a shot. Sonny Perdue raised smoking taxes, is he against tobacco farmers too?

    If a car blows up and someone sues the car manufacturer, does that mean they are against the workers at Hapeville and Doraville?

  6. McCain-Rice\'08 says:

    I am all for suing the hell out of big tabacco industries and Im glad Thurbert Baker stepped up to the plate. He has been a great Attorney General, but has not been very cooprative with the Governor. I know Perry McGuire, Im not sure if he has a chance..but Im supporting him non the less.

  7. Well, I understand that Republicans would support the Republican candidate, as I would support the Democratic candidate nonetheless.

    But you make a good point, Baker has been a great AG, has defended all of the laws of Georgia whether he agreed with them or not (and in many cases we don’t even know what his personal opinion was because it wasn’t relevant to the case at hand). When Sonny said don’t enforce one law, Baker sued him saying you can’t just pick and choose or tell me what to do.

    Baker won that case, and if (very unlikely here) you have Governor Cox and AG McGuire I think Republicans will be glad Baker won that case. Regardless, it’s very likely that at some point in the future you’ll have either a Democratic Governor and/or a Republican AG. And Baker’s victory over Perdue is good for the state and good for the minority party (whichever one it will be) because a Democratic governor won’t be able to pick and choose which laws to defend and the AG (regardless of party) will have to defend them whether the governor wants him to or not.

  8. macongop says:

    First- as a laid off worker from the Brown & Williamson plant down here in Macon, I know a little more about what this is. If you read the MSA- Master Settlement Agreement with NAAG, National Association of Attorney Generals, “not the states”, you will see that NONE of this money is set in stone as to the amount paid. There are so many loop holes that all 48 AG’s agreed to with the tobacco companies. There is levels of attainment that have to be reached by each state and territory(Guam, Virgin Islands, PR). If this is not met by the State AG’s they loss money of a gradual slide. If the state do not set up the escrow accounts for payment by NON-Participating Manufactures, NPM, and reduce their sales then the payments to the states goes down. They all agreed to use an arbitrator to settle issues that come up during the next 25 years. This was done on this case and the Arbitrator ruked in favor of Big Tobacco. If you want everybody to live by the rules, you have to take the rulings wether good or bad. The state help write up this agreemnet in 1998 and signed it and trumpetted it to the heavens after it was sign as saving our children and us all. If the AG’s came make the cigarette market be 98% participating manfactures of the MSA they recieve a payment of $500 million to NAAG, not the states from the Tobacco companies also. Phillip Morris has its own advertising plan in addition to the one that is funded by the MSA. Those adds the PM runs, keeps their name infront of everybody and is great advertising for them. PM controls over 50% of the cigarette market alone and controls most aspects of the market. This whole thing is a big stunt by the AG’s to keep their names out there. When it is all said and done, I believe the Tobacco Companies will win in the courts. Most cases have gone their way when you look at the merits of wach case and take out your emotion about smoking. You can read about the whole MSA on the NAAG web site under the Tobacco Settlement icon.

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