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Montana Sues Big Tobacco Over Unpaid Settlement Money

Montana is suing several tobacco companies for allegedly withholding millions of dollars owed the state under a landmark tobacco settlement agreement.

Montana Attorney General Tim Fox said enough is enough. Fox, who’s seeking the Republican gubernatorial nomination, announced Monday his office is suing several tobacco companies for allegedly withholding $43 million from Montana.

"And we will not let them get away with it," he said.

Twenty two years ago, Montana and every other U.S. state and territory reached an agreement with the nation’s largest tobacco companies. The deal resolved suits filed to cover the costs of caring for sick smokers.

It stipulated that the cigarette makers pay the states over $200 billion and agree to marketing restrictions to curb youth-oriented advertising. In exchange for annual payments, Montana agreed to end its lawsuit.

But the state asserts the defendants, including Philip Morris, R.J. Reynolds and Brown & Williamson, now regularly claim baseless disputes to avoid paying Montana millions of dollars. The suit says the companies refuse to pay, forcing Montana to litigate each dispute and creating a lengthy backlog.

The claim says that even if Montana wins a dispute, the tobacco companies refuse to pay until similar disputes are resolved with other states. Tim Fox asserted the companies are intentionally dragging their heels to avoid paying what’s owed Montana.

“We also have a set of statutes called the False Claims Act that provides for stiff penalties for companies who try to avoid paying money they owe the state," Fox said. "The tobacco companies have violated these laws, and we will not let them get away with it. A deal is a deal.”

The tobacco payments help fund smoking cessation programs as well as children’s mental health initiatives, Medicaid, the Children’s Health Insurance Program and communicable disease programs.

Fox does not anticipate a quick end to the dispute, saying he expects the tobacco companies will delay, stall and deflect the lawsuit for as long as possible. The suit was filed Friday in Lewis and Clark County District Court.

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