Debate and Issues Index

draft settlement

Preempting Local Government Civil Suits


Preemption of local governments' ability to regulate tobacco companies behavior has long been a priority of the tobacco companies. The proposed multi-state settlement attempts to bar certain kinds of civil suits brought by "political subdivisions," although it is unclear whether the state attorneys general have the authority to settle such claims. The Minnesota settlement does not preempt any local government civil suits, including suits to recover health care costs and civil suits to enforce local laws against the tobacco companies.

The proposed multi-state settlement says that, to the extent a state attorney general has such authority, local governments cannot bring the following types of claims against tobacco defendants (including manufacturers, their agents and attorneys, distributors and retailers):

"for past conduct, all civil claims (including those seeking damages, civil penalties, or any other relief) that are in any way related to the use, sale, distribution, manufacture, development, marketing or health effects of, exposure to, and research or statements about tobacco products (except for claims for outstanding liability under existing licensing fee laws or existing tax laws)"

for future conduct, the proposed settlement releases "only those monetary Claims directly or indirectly based on, arising out of or in any way related to, in whole or in part, the use of or exposure to Tobacco Products . . ." including all future claims for reimbursement of health care costs associated with the use of or exposure to tobacco products.

If an Attorney General does not have the authority to release local government claims and a local government and wins a judgment or settlement against a tobacco defendant, the amount of the recovery will be taken out of the state's settlement share.

The proposed state settlement should not prohibit local lawmakers from maintaining or bringing their own suits to recover tobacco-caused health care costs, nor should it limit the ability of local governments to implement and enforce stronger tobacco control laws in the future.


Why does the multi-state settlement propose to limit the ability of local governments to sue the tobacco companies for their health care expenditures related to tobacco?

Does the Attorney General have the authority to restrict these types of civil cases by local governments?

According to the agreement, if an AG does not have the authority to release local government claims, and a local government sues and wins money from the tobacco companies, the amount of the local government's recovery will be taken out of the state's settlement share.

If local suits can't be preempted and some local governments suit is successful, how much could this reduce the state's share? Could the state end up with nothing?

Isn't the state's settlement already only a fraction of the state's tobacco-related Medicaid costs? Doesn't a provision requiring that any local recoveries against tobacco companies be taken from the state share of the settlement protect tobacco companies and require state taxpayers to further subsidize the tobacco companies' liabilities?

Would the multi-state settlement interfere with the ability of local governments to seek civil penalties to enforce local ordinances actions against tobacco defendants, including tobacco manufacturers and retailers -- for example, local advertising restrictions or local consumer protection laws? What are the "monetary Claims" that can be brought against tobacco defendants in the future, and what future claims cannot be brought, by state and local governments?

For more information, contact Robert Weissman, Essential Action, 202-387-8030.