Big Tobacco Settles Florida Lawsuits For $100 Million

(RTTNews) - U.S. tobacco giants have reached a tentative settlement totaling about $100 million to resolve hundreds of lawsuits in the Florida that date back to May 1994. The settlement resolves pending lawsuits, known as Engle progeny lawsuits, in U.S. federal courts that are yet to be tried.

The tentative agreement is subject to final approval and will not become final unless all plaintiffs agree to participate or the parties reach an alternative agreement.

Meanwhile, all trials against the tobacco companies in federal courts are stayed pending final approval of the agreement.

Three of the largest U.S. tobacco companies, Reynolds American, Inc. (RAI), Altria Group, Inc. (MO) and Lorillard, Inc. (LO), have agreed to pay a total of $100 million to settle a class-action suit bought by about 400 smokers in the state of Florida.

Under the terms of the agreement, Reynolds American's R.J. Reynolds and Altria's Philip Morris USA will pay $42.5 million each to resolve the federal cases, while Lorillard will pay $15 million.

Another tobacco company Liggett Group had earlier reached a $110 million settlement in 2013 to resolve more than 3,000 state and federal suits in Florida.

A Florida jury had in May 2000 slapped the defendants with record $145 billion in damages. However, the companies argued that it was too general and that the penalty too excessive. The ruling was eventually reversed by the Supreme court in 2006.

"We view the federal Engle progeny cases as a unique set of litigation, and the opportunity to resolve them on favorable terms is in the best interests of the Company and its shareholders. We will continue to vigorously defend ourselves in all current and future Engle progeny cases pending in the Florida state courts," said Ronald Milstein, Lorillard's executive vice president and general counsel.

The settlement does not apply to the cases pending against R.J. Reynolds, Philip Morris and Lorillard in the state courts across Florida. More than 9,000 suits are filed in federal and state court.

"With respect to the cases pending in state court, we will continue to defend them vigorously, which includes appealing adverse verdicts," said Jeff Raborn, vice president and assistant general counsel for R.J. Reynolds.

The Engle progeny cases were filed in the form of a class action in May 1994 on behalf of Florida residents, and survivors of Florida residents, who were injured or died from medical conditions allegedly caused by addiction to smoking.

The lawsuit alleged that cigarette makers had misled consumers about the dangers of their products. The case got its 'Engle' name as a Florida smoker named Howard Engle filed the initial class-action suit.