High Court still pondering tobacco laws

By Steve Korris | Oct 6, 2006

WASHINGTON, D. C. – After wrestling with a monumental decision over tobacco laws for a week, Justices of the U. S. Supreme Court decided to keep wrestling.

They set an Oct. 6 reconference on tobacco, closed to the public.

They did not reach consensus at a closed conference Sept. 25.

Attorneys general of 31 states with matching tobacco laws have asked the Justices to block a Sherman Act antitrust trial in federal court in New York.

The Justices can allow District Judge John Keenan to conduct a trial about laws the states passed to carry out the national tobacco settlement of 1998, or they can certify the case for their own review.

Grand River Enterprises Six Nations Limited, Nationwide Tobacco and 3B Holdings brought the suit against the states.

Grand River, a Canadian tribal company, makes cigarettes.

Nationwide Tobacco, a company in the state of Washington, distributes cigarettes made in the Philippines.

3B Holdings, also of Washington, makes loose tobacco.

They alleged that states force them to establish escrow accounts because they did not sign the master settlement agreement.

They sued in New York because states and tobacco companies negotiated for five months in New York

If Justices send the case back to Keenan, he will not hold the trial he expected to hold.

Keenan dismissed all states but New York, ruling that the location of negotiations was coincidental and fortuitous.

Grand River appealed, and in September 2005 judges of the Second Circuit ruled that Keenan could not dismiss the other 30 states.

Chief Judge John Walker Jr., wrote, "We note that New York would not ordinarily be the proper forum to challenge another state's legislative and executive action."

He wrote, "It is a rare event for the representatives of various sovereign states to assemble purposefully in New York to attempt to jointly settle related lawsuits and to agree to then pass individual state statutes."

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