3 Cigarette Makers Drop Out of Talks

Three of the five major tobacco companies that have been in litigation settlement talks with state attorneys general are refusing to return to the negotiating table when discussions resume today in New York. A source close to the talks said the attorneys general see the companies’ decision as a negotiating tactic and think the manufacturers will eventually return to the table. The source said the attorneys general decided to resume negotiations even if only two companies participate. The three are Brown & Williamson Tobacco Corp., a unit of BAT Industries; R.J. Reynolds Tobacco Co., a unit of RJR Nabisco Holdings Corp.; and United States Tobacco Co., a unit of UST Inc., according to a spokesman for the Washington state attorney general’s office. “The attorneys general have said what the states need in the areas of public health and economic issues. Only Philip Morris and Lorillard [a unit of Lowes Corp.] are willing to return to the table,” he said. The negotiations are an attempt to salvage a proposed national agreement reached in June 1997 in which Big Tobacco would have paid $368.5 billion for broad protection from liability suits. That deal collapsed in June in Congress, which had to approve it. Four states settled their lawsuits separately, so the rest of the states began direct talks with the tobacco companies in mid-July. The talks hit an impasse on certain issues three weeks ago.