Court Orders Tobacco Company to Honor Florida’s Historic Tobacco Settlement

Attorney General Pam Bondi today announced a major ruling in a case involving Florida’s historic tobacco settlement agreement. The litigation centers around R.J. Reynolds Tobacco Company’s sale of three iconic cigarette brands, Winston, Kool and Salem, along with a legacy Lorillard Tobacco Company brand, Maverick, to Imperial Tobacco Group in June 2015 for $7 billion.
From the time of the tobacco settlement in 1997 through 2015, RJR paid the state tens of millions of dollars annually for these cigarette brands in compliance with the historic settlement. After the June 2015 sale, RJR stopped making payments on these brands, costing the state an estimated $30 million a year in perpetuity.
“Today’s ruling will ensure Florida’s landmark tobacco settlement is honored and our state receives the money it is owed,” said Attorney General Bondi. “My office is committed to pursuing all appropriate remedies when companies try to evade their monetary obligations to the State of Florida.”
RJR’s refusal to pay the agreed to settlement money led to Attorney General Bondi filing an enforcement motion on Jan. 18, 2017. The enforcement motion was the subject of a three-day bench trial before the Honorable Jeffrey Dana Gillen on Dec. 18-20. Judge Gillen today ruled that “Reynolds is still obligated to make the payments pursuant to the Florida Agreement.”
After the entry of the order requiring RJR to make all of the payments to Florida for the past and future sales of these cigarettes, the next step in the lawsuit will involve RJR and ITG providing the necessary information to accurately calculate the amounts owed pursuant to reporting requirements under the settlement agreement.
To view a copy of the trial court’s order granting the enforcement motion, click here.
The historic 1997 settlement resolved Florida’s landmark 1995 lawsuit against RJR and the other major tobacco companies seeking relief from decades of past unlawful actions relating to the marketing and sale of cigarettes. The annual, perpetual payments compensate Florida for the past and future public health care expenses from its citizens’ consumption of the settling defendants’ cigarettes.