WEST PALM BEACH — Florida’s Tobacco War is over, and by all accounts, the children have won. Billboards near schools that now advertise tobacco soon will warn of the dangers of smoking. And, over the next couple of years, the state will spend 200 million of Big Tobacco’s dollars on youth antismoking programs. Over the next quarter-century and beyond, the state is expected to spend billions of tobacco’s dollars on children.It’s enough to make Gov. Lawton Chiles gloat. “There’s a debt long past due for the tobacco industry to pay,” Chiles said at a news conference Monday outside the Palm Beach County courthouse. “And now they will.”With a settlement of at least $11.3 billion to be paid out over the next 25 years, and a limit on tobacco marketing and sales to youth, the major cigarette makers ended Florida’s tobacco lawsuit and started a new chapter in Florida history.
The deal sets a national precedent, marking the first time the tobacco industry has signed a binding pact to curb its marketing practices and to fund antismoking campaigns. A $3.6 billion tobacco industry settlement with Mississippi earlier this summer did not include such concessions.
Such concessions, Chiles said, show how the state won far more than it ever could at trial. A jury can’t order those measures.
“We were getting ready to give them a hell of a beating, ” Chiles said of the tobacco companies. But “they came thorough with … as much or more than we could have put forth in a trial.”
Industry analysts, however, have said that cigarette makers may lose nothing by settling. They already have agreed to a $368 billion national settlement that, if approved by Congress, will cancel most of the provisions in the Florida settlement.
The proposed national settlement includes more far-reaching concessions on marketing and youth smoking. For instance, the state’s agreement allows for vending machines in adult-only facilities, something the national agreement would eliminate altogether.
By settling the Florida case Monday, the industry shifts the focus from Palm Beach County courtroom, where Florida seemed to have a slam-dunk case, to Congress, where cigarette makers still wield terrific influence.
“I think it’s good that the states are settling and getting money right up front, because we don’t know what’s going to happen up here,” said Will Keyser, spokesman for Massachusetts Rep. Marty Meehan, chairman of the House Tobacco Task Force. “I mean, this is home-field advantage for the tobacco industry.”
Florida’s settlement, “highlights the fact that we need a national settlement, ” said John Coale, a Washington-based lawyer who helped negotiate the proposed national deal.
The national settlement establishes how the federal government will regulate nicotine and fine cigarette makers if teenage smoking doesn’t drop, things states have no authority to set, Coale said. Randolph Smoak, vice Charmin of the American Medical Association, agreed with a need for a national deal, but he called the agreement “certainly a step in the right direction.”
Thirty-seven states have lawsuits pending, with Georgia expected to file this week. Texas is the next state slated to go to trial, and officials there said Monday that Florida’s settlement had not affected their plans to begin next month. Florida, meanwhile, also said it would continue its court fight to make public about 400 confidential documents still being reviewed by state judges. Under traditional settlements, the state would have ended its pursuit of these documents.
Here’s what Florida gets in settlement:
# $75 million by Sept. 15, including $200 million earmarked for youth antismoking education on television, on billboards and in Florida schools.
# Within 5 ½ months, every tobacco billboard in Florida will come down.
# Advertising at sporting arenas and on taxis and buses will be banned.
# Cigarette vending machines will not be permitted in establishments that admit children.
Chiles and Attorneys General Bob Butterworth say, though, that what ultimately clinched the deal was the presence of real jurors in the courtroom. Jury selection was to continue this week, with opening statements planned for as early as next week.
Just three weeks ago, settlement negotiations came to an abrupt halt. At the time, Big Tobacco was offering just half the amount of money agreed upon Monday and none of the other concessions Chiles demanded.
But last Wednesday, as jury selection continued in the courtroom, the two sides signaled they were ready to discuss a settlement again. This time the industry was willing to talk about their billboard advertisements. Billboards that might attract children could go, tobacco lawyers volunteered, according to Joseph F. Rice, one of the state’s South Carolina-based attorneys.
The state held firm, though, and the industry ultimately agreed to broader restrictions on outdoor advertising. The talks lasted throughout the day Wednesday and Saturday at Butterworth’s Fort Lauderdale office.
By Sunday morning, Butterworth said, both sides were thinking about calling off negotiations. The atmosphere around the bargaining table, he said, “was getting kind of warm.” Not only was a lot at stake, the air conditioning wasn’t working.
The sticking point: The tobacco companies were insisting that if the national settlement gave Florida less than the $11.3 billion agreed to Monday, then the state would have to return some of the money it gets now.
The stalemate didn’t break, the state’s lawyers said, until Chiles and his wife Rhea joined attorneys in the library of the attorneys general’s Palm Beach office Sunday afternoon.
The governor refused to budge on the national settlement issue. His message, according to Rice, was simple: There would be no money returned.
“If you want to settle, what I get, I keep,” the governor said.
Attorneys for the tobacco industry called their CEOs to discuss the issue.
“Thirty seconds later, they came back,” Butterworth said. “The governor was able to close it. I think the industry was looking down both barrels of a shotgun and they surrendered.”