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New Jersey, California sue tobacco companies over settlement payouts

[JURIST] The attorneys general of New Jersey and California [JURIST news archives] said Tuesday that they will file a lawsuit against tobacco manufacturers over payments they allege are due to them under the 1998 Master Settlement Agreement (MSA) [text]. New Jersey Attorney General Zulima Farber [official profile] said the state's lawsuit [NJ AG news release] against R.J. Reynolds and Lorillard [corporate websites] requests a court order recognizing that the state has diligently enforced its tobacco litigation statute [text], which requires that any disputed payments be paid into an escrow account until the issue is resolved. New Jersey is seeking payments that R.J. Reynolds and Lorillard have placed into a disputed-payment account and that the companies say they do not owe due to lost business. AP has more.

In California, Attorney General Bill Lockyer [official profile] has asked a federal court [complaint, PDF; news release] to reject attempts by the top three tobacco companies to take back $154.3 million paid to the state. In both cases, the tobacco companies are arguing that they owe reduced sums because they lost market-share to discounters who did not sign the agreement. The states have countered that they have recovered payments from discounters who did not sign the MSA, making the settlement enforceable. Reuters has more.

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