The DealPlayersBackroom
What's in it for the Tobacco Industry?

The original agreement was supported by the Tobacco Industry, although they complained that certain provisions were too restrictive. Here's what's in it for the Tobacco Industry:

  • Clear Guidelines for Regulation of the Industry in the Future
  • Payments of legal judgments against the industry would be capped at $5 billion per year
  • Lawsuits are barred against persons other than tobacco manufacturers such as growers and distributors
  • The industry will pay $60 billion in punitive damages for past actions
  • The industry will pay $300 billion to settle the state Medicaid suits and other 3rd party suits or large class actions are barred in the future
  • The industry can be sued by individual smokers and they can be awarded punitive damages for future misconduct by the industry
  • There is no protection from potential criminal prosecution
  • Tobacco stock will likely rise if the deal or something similar is passed through Congress because investors hate uncertainty that comes from massive litigation, i.e. any deal is better than proceeding with the lawsuits