Many senators and attorneys general have announced renewed efforts to protect the money won through state tobacco settlements from the federal government.

Under the federal government's reasoning it can lay claim to more than half of both the $40 billion won by four states and the $206 billion the industry says it will pay to the other 46 states. This claim is based on a law that allows the U.S. government to share in the proceeds whenever states recover money through overpayments or fraud in the Medicaid system. "We worked long and hard to get this money for our respective states. Fair is fair," said Ohio's attorney general, Betty Montgomery. Some senators such as Kay Bailey Hutchinson and Bob Graham have proposed legislation to bar the federal government from taking any of the state money. "The Johnny-come-lately attempt to share the spoils of their victories puts these initiatives at risk," said Graham. Washington Attorney General Christine Gregoire insisted that the states would not compromise saying, "The first time a penny is deducted from the states we'll precipitate state lawsuits."

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