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California to join Liggett settlement; Mississippi trial delayed

April 4, 1997

LOS ANGELES (AP) _ California, which remained on the sidelines as 22 other states sued tobacco companies, will be able to share in settlement money promised by the Liggett Group, Attorney General Dan Lungren said Thursday.

``This historic settlement is extraordinary in that California did not even have to sue Liggett in order to strike this agreement,″ Lungren said.

Meanwhile, the first scheduled trial in a series of state lawsuits seeking to recoup the cost of smoking-related health care was pushed back a month, and the city of San Francisco settled an individual lawsuit with Liggett.

Lungren, a Republican, has refused to join the other states in suing the tobacco industry, despite pressure from Democrats and anti-smoking activists, saying that state law prohibits California from suing.

The law exempts from liability the manufacturer of a product that ``is inherently unsafe and is known to be unsafe by the ordinary consumer″ and specifically mentions tobacco.

At a news conference, Lungren urged state lawmakers to repeal the law and allow California to pursue further legal action. Bills to do that are being considered in the state Assembly and Senate.

The settlement with Liggett also gives California access to key internal tobacco documents from the company, which could provide evidence that the industry targeted minors and manipulated nicotine levels.

Lungren’s opponents praised the settlement Thursday, while denying that Lungren deserves any credit.

``This settlement comes in spite of Lungren’s efforts not to sue his buddies in the tobacco industry,″ said Senate President Pro Tem Bill Lockyer, D-Hayward.

``I almost have to laugh,″ said Mary Adams, vice president of public affairs for the American Heart Association, calling him ``duplicitous.″

The March 20 settlement ended Liggett’s liability in 22 state lawsuits seeking to recover Medicaid money spent treating sick smokers. And, pending a judge’s approval, it also would end all smokers’ lawsuits against the firm, now and in the future.

In the original settlement, Liggett agreed to label its cigarettes addictive, admit they cause cancer and pay $25 million now and 25 percent of its pretax profits for the next 25 years.

Liggett represents 2 percent of the tobacco market. Based on Liggett’s 1995 income, $575,000 a year would be divided among the Medicaid funds of the states that settled with Liggett and the smokers who also sued Liggett.

Asked how much money the settlement would mean for California, Lungren said: ``You are probably not looking at a great deal of money. It’s the best that could be done under the circumstances.″

Lungren said the agreement would be finalized next week.

In other related developments Thursday:

_ Liggett reached tentative settlements with 13 California counties that sued to recoup smoking-related health costs.

_ Liggett agreed to turn over internal documents to San Francisco Thursday, settling the city’s lawsuit to recover smoking-related health costs. City Attorney Louise Renne said she doesn’t expect to see any money from the settlement, but that the paperwork would support future lawsuits.

_ A Mississippi judge Thursday postponed until July 7 the start of that state’s trial against the tobacco industry. A trial in Florida is scheduled for August and Texas’ case is slated for September.

_ Vermont state Treasurer James Douglas urged his state to divest $21 million in tobacco stocks from state pension funds. Vermont has not joined in any suits against the industry.