Tobacco Documents Online

"Suing Tobacco Firms Said to Be Not Worth the Trouble [Study]" Washington Times (07/13/94) P. A10; Taylor, Ronald A. State lawsuits against tobacco companies to recover the health costs of smoking-related diseases will bring scant relief to taxpayers, according to John Berthoud, who authored a study for the Common- wealth Foundation of Virginia. "States will not get anywhere near the return they claim," he said. When states pay health care costs from the federal Medicaid program, they must reimburse the federal government part of the money. Medicaid pays about 61 percent of the average state's cost. Under federal law, the U.S. government would receive a large portion of any jury awards against tobacco companies in state lawsuits seeking to recover the costs of providing for residents with smoking-related illnesses. Lawyers' fees could also take another 20 percent to 30 percent of the court award. "if they win ... the return to states from the actual litigation will be much less than advocates are touting," the study says. "More States Plan to Sue for Costs of Smoking" Christian Science Monitor (07l12/94) P. 6; Scherer, Ron Several states are considering filing lawsuits against the tobacco industry to recover growing Medicaid expenses. On May 26, Florida Governor Lawton Chiles signed legislation allowing the state to sue on behalf of all Medicaid patients who smoke. On Monday, Massa- chusetts Governor William Weld signed a budget bill that also includes a section allowing the state to sue the tobacco companies for health costs. "The language was disappointing relative to what we proposed, but Attorney General Scott Harshbarger supports the concept," Says Thomas Green, first assistant attorney general. While many of the states are considering specific legislation to permit the lawsuits, Mississippi is employing existing state laws. "We are saying to the tobacco companies, pay your fair share of the costs," says Trey Bobinger, an attorney general spokesman. "Editorial: Tobacco 'Criminal!s"' Advertising Age (07104/94) Vol. 65, No. 28, P. 13 The editors of Advertising Age address the much-publicized anti- tobacco debate. According to the editors, legislators seeking to be re-elected this November are looking for an issue people will take definite and passionate sides on, and in this election, the subject is smoking. If Attorney General Janet Reno is persuaded to use the Racketeer Influenced & Corrupt Organizations Act against tobacco companies, the editors reason that the names of all the states who benefited from the tobacco taxes they've collected will also be I

included. The federal programs benefiting tobacco farmers should also be held accountable, according to the editors, as well as the Agriculture Department and Congress itself. What's really at the heart of the matter for legislators, the editors conclude, is not doing the best thing, but doing the best thing for the legislators. "Business Roundup: Food Lion Irks Cigarette Makers With Employee Smoking Ban" Washington Times (07/13/94) P. B7 In Raleigh, N.C., tobacco industry officials are urging growers to protest the Food Lion supermarket chain's decision to ban employee smoking at all company buildings effective September 1. Lisa Eddington, managing director for the Tobacco Growers information Committee, says that "we're hoping the tobacco growers and supporters who shop at Food Lion will make themselves known." A Food Lion memo, which Eddington says was provided to her office anonymously, read as follows: "Effective September 1, 1994, it shall be the policy of Food Lion to prohibit employee smoking at all locations, including stores, distribution centers and the office." The memo was signed by Gene McKinley, Food Lion vice president of human resources. Spokesman Mike Mozingo was not available for comment Tuesday afternoon. "Because Food Lion is based and founded in North Carolina, we feel this sends the wrong message to other corporations across the country because they're attacking tobacco in a tobacco state," said Eddington, who stopped short of calling the action a boycott. "That's up to the consumer,"-she said. "We're trying to make sure growers are informed." "Company News: American Brands to Sell Dollon & Aitchison" The New York Times (7/13/94) P.D3 (Bloomberg Business News) American Brands Inc. said yesterday that it would sell Dollond & Aitchison Group P.L.C. to a management group led by CVC Capital Partners Ltd. for $146 million. Dolland & Aitchison, a unit of American Brands' Gailaher Ltd. group of companies, is the largest retail optical group in England and, with its operations in Italy, Spain and Ireland, is the second largest in the world. The agreement also includes the Keeler companies, which make optical instruments. American Brands said the sale was another step in its restructuring. Assuming completion of the sale and the pending sale of the American Tobacco Company, American Brands will have divested itself of $3.5 billion in operations since 1987. Related Story: The Wall Street Journal, P.B3. I