In 1998, the big tobacco companies entered into a $250 billion settlement with trial lawyers and the attorneys general of 46 states. Big Tobacco agreed to pay this vast sum, plus $14 billion extra in lawyers’ fees to politically-connected trial lawyers, in exchange for protections against competition from little tobacco companies (which are forced to make escrow payments on every cigarette they sell in competition with Big Tobacco) that are not part of the settlement.
To justify giving the trial lawyers this absurd amount of money (and giving the tobacco companies protection against competition that would otherwise violate the antitrust laws), supporters of the settlement claimed it was for a good cause: funding smoking cessation programs.
For example, Brooke Masters’ Spoiling for a Fight: The Rise of Eliot Spitzer (2006), describes the 1998 settlement as a deal that “won billions of dollars” for “smoking cessation programs.”
But in reality, little money from the tobacco settlement has gone to smoking cessation programs, and the settlement allows states to use it for any purpose.
Now, the Campaign for Tobacco Free Kids has come out with a study showing just how little is being spent on smoking cessation programs. It’s called “A Broken Promise to Our Children: The 1998 Tobacco Settlement Eight Years Later” (Dec. 6, 2006).
In tobacco lawsuits, it’s the interest of the trial lawyers, not public health, that comes first.