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High Court Rejects Smokers’ Bid for Share of Settlement

Bloomberg News

The U.S. Supreme Court said Monday that it would not hear arguments from onetime smokers who sought a share of the $246 billion in payments that tobacco companies must make under their 1998 settlements with the states.

The justices refused to revive three lawsuits filed in West Virginia, North Carolina and South Carolina. The suits were among at least eight around the country claiming that the federal Medicaid statute entitles sick smokers to some of the settlement money.

Every court to consider the issue, including the U.S. 4th Circuit Court of Appeals in the latest case, has rejected the smoker claims. The Supreme Court has refused four times this year to intervene on behalf of the Medicaid patients.

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Medicaid, the joint federal-state health-care program for the poor, lets states sue third parties to get reimbursement for health-care expenses.

At the Supreme Court, in the case of Strawser vs. Atkins, smokers led by West Virginian Lois Strawser argued that patients are entitled to any tobacco company payments that exceed the amount spent on health care by the states and the federal government.

The justices made no comment in rejecting the appeal. West Virginia, North Carolina and South Carolina all urged the high court not to get involved.

The 1998 settlements let Philip Morris Cos., R.J. Reynolds Tobacco Holdings Inc. and other cigarette makers resolve state government claims for the costs of treating sick smokers.

In addition to paying $246 billion over 25 years, the companies agreed to reduce marketing and work to reduce youth smoking.

Individual smokers still may file their own suits against tobacco companies. In the biggest defeat for the industry so far, cigarette makers are appealing a $145-billion jury award to a class of Florida smokers.


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