Hawaii due big
tobacco payoff

The payment to the state could be
as high as $60 million per year

By Mike Yuen
Star-Bulletin

Each year into perpetuity, the tobacco industry could be writing a check of $40 million to $60 million to the state of Hawaii.

That could be the state's share of the $368 billion that the tobacco industry -- blamed for causing 400,000 deaths annually -- has tentatively agreed to pay to settle a lawsuit by Hawaii and some 40 other states.

The settlement still must be approved by Congress.

State Attorney General Margery Bronster yesterday said the estimate of Hawaii's share is based on discussions she had with other state attorneys general during a recent meeting of the National Association of Attorneys General in Jackson Hole, Wyo.

"We're still in the talking stages but we're talking ranges," Bronster said.

The $40 million to $60 million is based on what Hawaii would get if $4 billion were distributed to the states in the first year, Bronster said.

Each year, the payout by tobacco companies would be adjusted and the revision would likely be upward, Bronster added.

"In later years, we will be talking about a $15 billion a year payout. We don't know how much of that will go to the state," Bronster said.

Gov. Ben Cayetano and state health officials have said that funds from the settlement will be used to support the state's anti-smoking campaigns and public health programs.

The money will also be used to reimburse the state for smoking-related illnesses.

Another issue discussed by state attorneys general during their summer meeting was enforcement of the settlement with cigarette companies.

"Because we're one of the earlier-suing states, we will be able to enter into a consent decree with the tobacco companies," Bronster said. "We'll be able to enforce this regardless of what later changes may be made."

Bronster also said the two private attorneys hired by the state to handle its interests in the tobacco lawsuit -- Gary Galiher of Honolulu and Ron Motley of Charleston, S.C. -- will get about 18 percent of Hawaii's recovery or what may be ultimately worked out by Congress as part of a national settlement.

But their attorneys' fees will be paid by the tobacco companies. "It is sort of like a 'loser pays' kind of situation," Bronster said. She stressed that the legal fees will not come out of the state general fund or from Hawaii's settlement. "That's important. It'll save the state lots of money," she added.

In addition to the payout, the tobacco industry's preliminary agreement with the suing states and anti-smoking interests calls for cigarette companies to accept harsher warnings on cigarette packs and severe advertising restrictions. In return, the industry would be freed from class-action lawsuits but not individual claims. The industry also would not have to apologize for past behavior.

Cayetano, who hailed the preliminary settlement when it was announced two weeks ago, yesterday said he wouldn't mind seeing smoking completely banned.

Cigarettes are a major contributor to illnesses, he said.

But, Cayetano conceded, he is unlikely to see a tobacco ban in his lifetime.