Some states and U.S. tobacco companies settle over payments

Tue Dec 18, 2012 5:50pm EST

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Dec 18 (Reuters) - U.S. cigarette makers including Philip Morris USA and R.J. Reynolds Tobacco Co on Tuesday said they reached a settlement with 17 states to resolve a long-running dispute over the amount of payments they are required to make under the 1998 landmark anti-smoking agreement.

Under the agreement, the states will receive their portion of $4 billion in disputed payments and the manufacturers will receive credits against future payments.

The payments resulted form the 1998 national accord that obliges companies to help cover the health bills of ailing smokers.

Tobacco companies, including Marlboro cigarette maker Philip Morris, a unit of Altria Group Inc, and Camel cigarette maker R.J. Reynolds, a unit of Reynolds American Inc, have for years disputed the amount of payments they owe after losing market share to companies that did not agree to the 1998 settlement.

In addition to the 17 states, the settlement includes Puerto Rico and the District of Columbia.

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