State Settles With Two Tobacco Companies

PRESS RELEASE

Jackson, MS- Attorney General Jim Hood announced today a settlement of Mississippi’s claims against R. J. Reynolds Tobacco Company (RJR) and Brown and Williamson Tobacco Corporation (B&W) for $15 million.

“Several years ago, we discovered that Brown and Williamson manufactured cigarettes for a company called Star Tobacco, but failed to pay what they were required to pay us under the original 1997 tobacco settlement agreement,”  said Attorney General Hood.  The original settlement requires the company to pay Mississippi for every cigarette it makes and ships to the state.  Brown and Williamson dodged this payment by manufacturing cigarettes for Star Tobacco. The company then sold those cigarettes to Mississippians without paying the state.

“During the investigation of Brown and Williamson’s conduct, we also discovered other instances where RJR/B&W tobacco companies shortchanged the State of Mississippi,” said Attorney General Hood.  The $15 million represents principal and interest on what R. J. Reynolds and Brown and Williamson’s companies should have paid years ago.  The lawsuit was brought at no cost to the State, as the tobacco companies agreed in 1997 to the pay the State attorneys’ fees anytime it becomes necessary to go to court to enforce the settlement. Attorney Lee Young of Pascagoula led a team of private counsel with many years of experience taking on Big Tobacco.

“The 1997 settlement with the tobacco companies is perpetual, and contributes on average over $100 million per year to the State’s health care budget,” said Attorney General Hood. “I will continue to closely monitor the tobacco companies and hold them accountable for their actions.”