Massachusetts settles $600 million in disputes with tobacco manufacturers

Massachusetts’ attorney general has reached a $600 million settlement with major tobacco manufacturers, resolving some of the state’s complaints about how much tobacco companies owe him under a 1998 master settlement with the industry.

While the producers paid the state millions each year under the master agreement, the state claimed that certain producers withheld hundreds of millions of dollars because of a contractual adjustment. The disputes went to arbitration, which has now resulted in the state winning $600 million.

The settlement resolves seven of the past annual disputes, and the agreement should increase the speed with which additional disputes are settled, according to the attorney general.

In addition to the $600 million that will be paid to the Commonwealth’s general fund this fiscal year, tobacco companies will make additional payments totaling tens of millions of dollars each year going forward. The agreement also calls for the companies to retain less money in future years based on a contractual adjustment in the MSA. Accordingly, Massachusetts should receive larger and more consistent annual payments in the future.

“The nation’s major tobacco manufacturers have marketed smoking products to youth for decades — and this settlement is evidence of our continued commitment to holding these companies accountable for their actions that have caused irreparable harm to public health and safety,” said Attorney General Andrea Joy Campbell. .

Gov. Maura Healey said she was proud to have worked on the case against “Big Tobacco” when she was attorney general to help end manufacturers’ use of harmful and deceptive marketing practices and “undermining public health for decades” .

The MSA was a deal with major tobacco companies in which they agreed to stop marketing their products to children, end other harmful marketing practices, and pay states billions of dollars each year to offset the medical costs of smoking. Since the inception of the MSA, Massachusetts has received annual payments from major tobacco companies totaling hundreds of millions of dollars for past and ongoing smoking-related medical costs.

The Truth Initiative, a public health organization created under the MSA, says that the MSA has been effective in reducing smoking, especially among young people. Between 1998 and 2019, cigarette consumption in the US fell by more than 50%. During the same period, regular smoking among high school students dropped from 36.4 percent in 1997 to six percent in 2019.

Also, according to the Truth Initiative, more than two million high and middle school students used e-cigarettes in 2023. In April 2023, as part of the $462 million multistate settlement against JUUL for its role in the youth vaping epidemic at nationally, Massachusetts received $41 million. .

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