Corbett Files Appeal on
Behalf of Tobacco Farmers
Pennsylvania, along with Maryland, is appealing a December 2008 decision by the North Carolina Court of Appeals that allowed three major tobacco companies to cease making required payments to tobacco farmers.
Attorney General Tom Corbett's office appealed to the North Carolina Supreme Court on January 20, against the decision that allowed Philip Morris USA, Inc., R.J. Reynolds Tobacco Company, and Lorillard Tobacco Company to cease annual payments to Pennsylvania and Maryland farmers under the National Tobacco Grower Settlement Trust agreement.
"We feel it is important to pursue this case on behalf of our farmers," Corbett said. "We are asking the North Carolina Supreme Court to force tobacco companies to live up to their original agreement."
Corbett said that according to the original terms of the agreement, tobacco companies still owe about $9 million to Pennsylvania farmers through 2010.
Corbett said that the Trust Agreement between the tobacco companies and tobacco-grower states was intended to address the economic consequences of the 1998 Master Settlement Agreement (MSA), which mandated that tobacco companies make annual payments to the states and refrain from certain marketing practices. However, there is a provision in the Trust Agreement that states that the trust agreement payments could end in the event of federal legislation benefiting farmers.
The tobacco companies contended that they no longer have to make annual payments to farmers as a result of the implementation of the Fair and Equitable Tobacco Reform Act (FETRA) in 2004.
Though FETRA benefited other tobacco growing states, farmers in Pennsylvania and Maryland do not receive funds through the legislation. When the tobacco companies stopped paying, Maryland and Pennsylvania pursued action in North Carolina court.
Attorney General Tom Corbett's office appealed to the North Carolina Supreme Court on January 20, against the decision that allowed Philip Morris USA, Inc., R.J. Reynolds Tobacco Company, and Lorillard Tobacco Company to cease annual payments to Pennsylvania and Maryland farmers under the National Tobacco Grower Settlement Trust agreement.
"We feel it is important to pursue this case on behalf of our farmers," Corbett said. "We are asking the North Carolina Supreme Court to force tobacco companies to live up to their original agreement."
Corbett said that according to the original terms of the agreement, tobacco companies still owe about $9 million to Pennsylvania farmers through 2010.
Corbett said that the Trust Agreement between the tobacco companies and tobacco-grower states was intended to address the economic consequences of the 1998 Master Settlement Agreement (MSA), which mandated that tobacco companies make annual payments to the states and refrain from certain marketing practices. However, there is a provision in the Trust Agreement that states that the trust agreement payments could end in the event of federal legislation benefiting farmers.
The tobacco companies contended that they no longer have to make annual payments to farmers as a result of the implementation of the Fair and Equitable Tobacco Reform Act (FETRA) in 2004.
Though FETRA benefited other tobacco growing states, farmers in Pennsylvania and Maryland do not receive funds through the legislation. When the tobacco companies stopped paying, Maryland and Pennsylvania pursued action in North Carolina court.
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