DOJ: News Release

McGrath: Montana to get $7.2 Million More from Tobacco Settlement

HELENA – Attorney General Mike McGrath announced Thursday that the largest tobacco manufacturer remaining outside the tobacco settlement negotiated in 1998 has agreed to join that settlement. Vibo, which does business as General Tobacco, sells a number of cigarette brands such as Bronco, GT One, Silver and Champion to Montana consumers.

Participating manufacturers make substantial payments to the states and, as a result of today’s agreement, General Tobacco will make an immediate payment of $78 million to all of the participating states.

“The state will get an immediate cash payment of $322,329,” McGrath said. “And over the next decade, General Tobacco will pay Montana an additional $7.2 million.”

“By joining the Master Settlement Agreement, General Tobacco also has agreed to abide by the important public health provisions contained in the settlement,” McGrath said. “We can certainly put this additional funding to good use fighting tobacco addiction and tobacco-related illnesses.”

Participating manufacturers under the agreement are bound by a wide array of restrictions on the advertising, promotion and marketing of cigarettes, including outright bans on targeting youth, outdoor advertising, and distribution of any merchandise advertising a cigarette brand. Since the tobacco settlement took effect, youth smoking rates nationally have dropped by more than 25 percent and overall smoking has declined nearly 20 percent.

“A good share of the reason behind General Tobacco’s decision is the work states like Montana have done to fully enforce the regulations imposed on tobacco companies outside the agreement,” McGrath said. “Without our diligent enforcement of these regulations, Montana could lose its entire payment under the settlement.”

McGrath also said today that he would be asking the legislature to continue its support for the regulatory work necessary to make sure nonparticipating tobacco manufacturers meet their legal and financial obligations, by authorizing staff to continue Montana’s enforcement efforts.

Under existing market conditions, the agreement with General Tobacco is expected to be worth $1.7 billion to the states over the next 10 years. General Tobacco (Vibo) is the exclusive U.S. importer of cigarettes from Protabaco, S.A., of Bogota, Colombia, and today’s agreement binds Protabaco to sell all of its cigarettes in the U.S. through Vibo and in accordance with the agreement.

The Master Settlement Agreement was originally signed by 46 states and the major tobacco companies in November 1998. Since that time, more than 40 other companies have joined the agreement.

Share this!

Subscribe to our RSS feed. Tweet this! StumbleUpon Reddit Digg This! Bookmark on Delicious Share on Facebook