Tobacco Settlement Challenge Rejected by U.S. Supreme Court
12/02/02
Washington, Dec. 2 (Bloomberg) -- The U.S. Supreme Court said it won't hear arguments from onetime smokers who sought a share of the $246 billion in payments tobacco companies must make under their 1998 settlements with the states.
The justices refused to revive three suits filed in West Virginia, North Carolina and South Carolina. The suits were among at least eight around the country claiming the federal Medicaid statute entitles sick smokers to some of the settlement money. The states had invoked the Medicaid law in their suits.
Every court to consider the issue, including the 4th U.S. Circuit Court of Appeals in the latest case, has rejected the smoker claims. The Supreme Court has refused four times this year to intervene on behalf of the Medicaid patients.
Medicaid, the joint federal-state health care program for the poor, lets states sue third parties to get reimbursement for health-care expenses.
At the Supreme Court, smokers led by West Virginian Lois Strawser argued that patients are entitled to any tobacco company payments that exceed the amount spent on health care by the states and federal government.
The justices made no comment in rejecting the appeal. West Virginia, North Carolina and South Carolina all urged the high court not to get involved.
The 1998 settlements let Philip Morris Cos., R.J. Reynolds Tobacco Holdings Inc. and other cigarette makers resolve state government claims for the costs of treating sick smokers.
In addition to paying $246 billion over 25 years, the companies agreed to scale back marketing and take steps to reduce youth smoking.
Individual smokers can still file their own suits against tobacco companies. In the biggest defeat for the industry so far, cigarette makers are appealing a $145 billion jury award to a class of Florida smokers.