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• Commonwealth Brands Disputes Spitzer's, Other AG's Comments; Company Renews Call for States to Enforce Tobacco Settlement 

Spencer Coates, Chairman of Commonwealth Brands, today offered the following statement to clarify the record after comments made by the Attorneys General of New York, Connecticut, Arkansas and Virginia in response to Commonwealth's announcement of June 16. In that announcement, Commonwealth described its legal challenge to these four states, and New Mexico, on its failure to enforce the 1998 Tobacco Industry Settlement.

New York:

The Office of Attorney General Eliot Spitzer issued the following statements under his name, in response to our motion for arbitration. The statements are inaccurate and misleading, and require a response.

Spitzer: "The allegation that New York is not enforcing the MSA is baseless."

Coates: "The issue here is the lack of enforcement of the escrow statutes that the MSA requires states to enact and enforce or face severe penalties. Mr. Eliot Spitzer's office has initiated exactly ZERO enforcement actions against renegade tobacco companies (the Non-Participating Manufacturers) for failure to pay into escrow as required by the statutes. Meanwhile, they have scooped up at least 8%, and by many indications even 10-15% of the market. In fact, according to a recent survey in the Daily News, some one-third of New York smokers admit that they have paid no taxes on their cigarettes. That means they have not paid excise taxes, and it's a pretty fair bet those companies have not paid funds into the tobacco settlement. Last year New York State received $797 million in revenues from the tobacco companies. The MSA provides for significant reductions in MSA payments to states that fail to enforce."

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