ALTRIA TO APPEAL NEW YORK RULING
Altria Group, Inc. has indicated that it will seek to overturn
the class certification granted in a lawsuit against the largest
tobacco companies.
In a ruling Sept. 25, a federal judge in New York allowed the plaintiffs'
suit to go forward as a class action. A trial date of Jan. 22, 2007,
has been set.
Known as the Schwab case, the lawsuit is similar to other recent
cases. It accuses the tobacco companies of seeking to defraud the
public into believing that "light" cigarettes were less
dangerous than regular cigarettes. The suit alleges that a conspiracy
among the largest companies sought to hide the truth about "light"
cigarettes from the public during the period 1971-2004 and seeks
$120-$200 billion in damages.
Altria has indicated it will seek to have the class certification
overturned through an interrogatory appeal to the 2nd Circuit Court
of Appeals and feels comfortable that such appeal will be granted
based on similar rulings on "lights" cases elsewhere.
While holders of tobacco settlement bonds will want to keep their
eye on this case, it is unlikely to affect the tobacco companies'
ability to meet their obligations under the Master Settlement Agreement.
Most experts believe the Schwab case will eventually fail, based
on the findings in other courts on similar cases.
9/27/06
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