Wednesday, 10 June 2009

Tobacco Money

Forty nine states reached agreement regarding money from Big Tobacco in and around 1998, as did their private counsel lawyers. The industry agreed to pay the legal fees in one of two ways, a 'liquidated' upfront, bilaterally negotiated payment, or an arbitrated amount which would be paid pro rata out of the $500,000,000 a year maximum that had been set aside by the plaintiffs.
Twenty one states' counsel shared $625m in liquidated payments, out of a court "Model Fee Paying Agreement" allocated total of $1.25bn, the remaining 50% being shared amongst the arbitration-awarded counsel, at $125m per year, starting Dec 2004 thru 2008.
The twenty eight remaining quibbles of lawyers shared $14.2bn, the lion's share going to Florida ($3.4bn, 30% of the state's total award), Texas ($3.3bn out of $15.3bn) and Mississippi ($1.4bn out of $4bn total, 35%).

Thus, MS lawyers receive about a million dollars a week for twenty eight years, ending around 2026, plus $12.5m more annually from 2004 till last December.

Like all good stats, these are simplistic, probably misleading and ignore complicated inter state/firm arrangements, the like of which provoked the rancour in the Scruggs v Wilson case.
They do, however, give a scale against which to measure the lengths that will be gone to to protect this income. For example, by using this very reasonable service, Mississippian lawyers could wipe out the entire population of Dallas in ten months and still have change.


  1. "A million dollars a week for twenty eight years."

    This post is truly astounding.

  2. Love that "light up" image. Makes me want to inhale.

  3. "Tainted Tobacco Money"History will show it has a curse on it. Those that give it to family, those that turned on family, those that intertwined lives that can never be unraveled.

  4. How much? That can't be right surely?

  5. How much do the state governments pull in a week? How much do the state health programs receive? The lawyers gambled and upfronted the money. The biggest winners: the states and taxpayers.