Wednesday, November 11, 1998

Hawaii may join
$200 billion
tobacco agreement

By Craig Gima


A settlement of state lawsuits against tobacco companies is expected to be unveiled Friday, according to a spokeswoman for state Attorney General Margery Bronster.

If Hawaii joins in the $200 billion deal, the state's share could be $879 million or more, said Cynthia Quinn, a special assistant to Bronster.

"Negotiations have been ongoing for the past couple of weeks," she said. "It's pretty serious. It's as close as it's ever been."

Even if the final details of the settlement are not completed, an announcement of some kind is expected, Quinn said.

Negotiators for four tobacco companies and eight states are expected to brief 38 other states on the details of the agreement, after which Hawaii will have a week to decide if it will agree to the deal.

The size of the settlement will depend on how many states join, according to a Bloomberg News report. Mississippi, Florida, Texas and Minnesota have reached individual settlements.

The news report said the tobacco companies have agreed to pay as much as $200 billion over 25 years to states seeking to recover Medicaid costs for treating ill smokers.

The companies have also agreed to tear down cigarette billboard ads, pay more than $1 billion for anti-tobacco ads, halt distribution of merchandise with tobacco logos and fund a national foundation devoted to reducing smoking by teenagers.

The agreement could be the largest civil settlement in U.S. history and would free tobacco companies of their most serious legal challenges.

Tobacco stocks yesterday rose because of the development.

The proposed settlement is not as sweeping as the failed $368.5 billion accord reached in June last year. Unlike that deal, which fell apart in Congress, the settlement with states would not have to be approved in Washington.

Quinn said if Hawaii decides not to join the settlement, the state is prepared to go forward with its lawsuit, scheduled to begin next September.

Ronald Motley, a mainland attorney, and local attorney Gary Galiher and his firm are assisting the state with the lawsuit.

Their fees would be paid for out of a separate settlement for attorneys' fees and not with the money for states, Quinn said.

Under the state constitution, money from the settlement would go to the state's general fund and the Legislature would then decide how it would be spent.

"The next step would be to get together with public health people to decide on what the best proposal would be to take to the Legislature so the money will be well spent," Quinn said.

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