House approves bill on tobacco settlement payments

Potential bill could speed up big tobacco settlement payments

(Pascal Le Segretain/Getty Images)

TALLAHASSEE – Florida legislation is being considered at the state capitol to speed up settlement payments from big tobacco companies.

The bill would require the industry to pay the same bond as other industries when they lose a lawsuit or appeal.

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Florida currently receives between $350,000,000 and $400,000,000 a year in tobacco settlement. Because of that, lawmakers in 2006 initiated a special law allowing the industry to put up less cash than others.

Florida Justice Associate Jimmy Gustafson said that ruling 11 years ago gives those companies, "an incentive to just keep on appealing until the last dog has died.”

Altria tobacco litagator Keith Teel told lawmakers that without the special treatment, the industry could go out of business paying to appeal it.

"The problem with a bankruptcy is that all of the payments would have gone away,” Teel said.

That statement forced Republican Rep. Sean Shaw to ask, "Are you suggesting that if this bill passes, it will affect your ability to make settlement payments?”

Teel responded, "No."

The Committee approved the bill 14-1.

Republican Rep. Jay Fant was the only one to vote no, saying, "“...we have an expectation on our funding that we will get those settlements from the tobacco companies, and there is a balance to that. I just don’t want to upset the balance.”

The hearing before the House committee was the only committee assignment in the House, so the legislation is ready for a floor vote. The legislation has yet to be heard in a Senate committee.