Liggett May Hand Over ‘Explosive’ Papers

WASHINGTON —  The nation’s state attorneys general are close to a tobacco settlement with Liggett Group Inc. that would include the handing over of potentially damaging documents against the tobacco industry, key negotiators said Wednesday.

Mississippi Atty. Gen. Michael Moore told Reuters that the deal could come as early as tody but that it had not been hammered out completely as of Wednesday night.

“We’re very close, but we still have negotiating to do. If we do this deal it will be explosive,” he said.

Moore is in Washington for the spring meeting of the National Assn. of Attorneys General. Attorneys involved in negotiations with Liggett have been in continuous meetings since Tuesday night separately from the association’s formal gathering.

Moore denied news reports that the deal had been finalized. “As of right now, there is no deal,” he said.

Steve Berman, a Seattle lawyer involved in the talks, also said there was no agreement. “We’ve been dating, going to the prom, but there is still no ring,” he said.

The talks, which involve Liggett’s proposal to turn over sensitive tobacco documents, heated up last week ahead of the first anniversary of Liggett’s historic break with the industry to become the first cigarette company to settle smoking litigation.

Reuters reported last week that a deal could come as soon as late this week.

On March 13, 1996, the company, which is owned by Bennett LeBow’s Brooke Group agreed to settle a federal class action in New Orleans, and two days later it reached an accord with five states that sued the industry to recoup Medicaid health-care costs of smokers. The federal class action has since been thrown out by an appeals court.

Since last year, a total of 22 attorneys general, as well as the lieutenant governor of Alabama, have filed Medicaid suits against the tobacco industry. Because of this, LeBow has been negotiating a broader agreement that would satisfy a larger number of states.

“We’re hoping for a unanimous deal,” Moore said.

Sources said a key part of the settlement would be LeBow’s offer to turn over potentially damaging documents about the entire industry and the prospect that Liggett employees or former employees would testify against other companies.

LeBow would naturally want as many states as possible to agree to drop their suits against Liggett before he would turn over the papers.

Some states, in particular Minnesota, have previously raised doubts about the proposed settlement. Hubert Humphrey, Minnesota’s attorney general, did not arrive at the attorneys general meeting until Wednesday night.

While sources are optimistic a settlement will soon be reached to end more state suits against Liggett, they said the larger tobacco companies have made no effort to negotiate directly with the attorneys general or lawyers representing other plaintiffs suing the industry.

They said that if any such industrywide settlement were possible, it would not be for a very long time.