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Federal District Court Dismisses MSA Challenge
RICHMOND, VA (March 30, 2005) -
A judge in the U.S. District Court for the Northern District of California has granted the defendants motion to dismiss a suit that challenged the validity of the Master Settlement Agreement (MSA) between 46 states and several major cigarette manufacturers.
The court disagreed with the plaintiffs allegation that the agreement, and the related escrow statutes, stifled competition and prevented cigarette companies who are not parties to the agreement from growing. The suit named the attorney general of California, Philip Morris USA and other cigarette manufacturers as the defendants. This is the latest in a string of unsuccessful challenges to the Master Settlement Agreement at the state and federal level.
Contrary to the plaintiffs allegations, competition in the tobacco industry has increased in the years following the signing of the Master Settlement Agreement, said Denise Keane, Philip Morris USA senior vice president and general counsel.
Since the agreement was signed in 1998, the competitive nature of the marketplace has allowed new tobacco manufacturers to gain market share, including taking share from manufacturers who participated in the settlement.
We believe the judges opinion is consistent with a long line of cases concluding that the MSA and its implementing laws are lawful and we believe the opinion will stand as an important precedent in these matters, said Keane.
Philip Morris USA is an operating company of Altria Group Inc. For more information about the Master Settlement Agreement, Philip Morris USA, or our products, programs and positions on tobacco-related issues, please visit other sections of our website.
