The State of Iowa recently received a check for 466-thousand dollars in another settlement with a tobacco company. Assistant Attorney General Don Stanley says the payment is from a subsidiary of the “House of Prince,” a company that is part of the “master tobacco settlement agreement.”
Stanley says Scandinavian Tobacco was contract manufacturing cigarettes for a U.S. company that was not in the master settlement agreement and had claimed those cigarettes weren’t subject to payments. Stanley says after three years in the courts, the company agree to the payments. The company is paying a total of nearly 56-billion dollars nationwide, including Iowa’s payment.
Stanley says this appears to wrap up the legal proceedings against tobacco companies. He says Brown and Williamson, which has merged with Reynolds Tobacco, had a similar suit two years ago for contract manufacturing of cigarettes. But, Stanley says there doesn’t appear to be any other companies out there. Stanley says the most recent payment goes in with the rest of the tobacco settlement money.
Stanley says the state has secured part of its tobacco settlement payments through bonds, so 78-percent of the payment goes to help pay off the bonds and the other 22-percent goes directly to the state. Stanley says the House of Prince payment is a one-time deal. The master settlement agreement pays between 40 and 50 million dollars annually to the state.