State attorneys general have hired lawyers in case major cigarette makers file for bankruptcy in the wake of multibillion dollar settlements with states.

The National Association of Attorneys General said Friday it retained a Los Angeles bankruptcy law firm to ensure states receive a combined $246 billion in tobacco settlements. ``Given the complexity and duration of the tobacco settlement, it is rational to anticipate the possibility of a bankruptcy filing or filings at some point,'' North Dakota Attorney General Heidi Heitkamp said in a statement. Under a massive deal forged in 1998, big tobacco companies must shell out $206 billion to 46 states over 25 years. Four remaining states -- Mississippi, Florida, Texas and Minnesota -- settled separately for an additional $40 billion. The nation's five biggest cigarette makers owe about $10 billion this year. They also face a potentially record-setting punitive damages award in a Miami smoker's trial wrapping up next week. The tobacco industry fears an estimated 500,000 sick Florida smokers may be awarded $300 billion. ``We've retained bankruptcy counsel to make sure that we are protected and that we can continue to hold the industry's feet to the fire to make sure they live up to the terms of the settlement agreement,'' said Brian Smith, spokesman for Washington Attorney General Christine Gregoire. The association retained the firm of Pachulski, Stang, Ziehl, Young & Jones.

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