UST Loses Costly Appeals Court Ruling

UST Inc. must pay $1.05 billion to Conwood Co. for monopolizing part of the smokeless tobacco market, a U.S. appeals court ruled.

Conwood, maker of Kodiak brand snuff tobacco, sued UST in 1998. Greenwich, Conn.-based UST makes the Copenhagen and Skoal brands of snuff, a ground-up moist tobacco that users place between the lip and gum.

Closely held Conwood told jurors that UST, which controls about 77% of the snuff market, thwarted competition through exclusive arrangements with retailers and vandalized or removed Conwood store displays.

The three-judge panel of the U.S. 6th Circuit Court of Appeals in Cincinnati upheld a trial judge’s decision to triple a $350-million jury award against UST in February 2000.

UST fell $2.66 to $37.95 on the New York Stock Exchange.