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RJR: Tobacco deal 'dead'
Other cigarette makers also expected to withdraw
April 8, 1998
Web posted at: 1:59 p.m. EDT (1759 GMT)In this story:
WASHINGTON (CNN) -- RJ Reynolds cannot support tobacco legislation now moving through Congress, but the cigarette-maker still stands by a deal it negotiated with state attorneys general last June, the company's chairman said Wednesday.
Four other major tobacco firms -- Philip Morris, Lorillard, Brown and Williamson and U.S. Tobacco -- were expected to announce their own pullouts.
"Today, it is very clear to me that we have failed in our effort to achieve a comprehensive resolution of the contentious issue surrounding tobacco in our country," RJR Chief Executive Officer Steven Goldstone said in a speech at the National Press Club.
"The extraordinary settlement reached on June 20th last year that could have set the nation on a dramatically new and constructive direction is dead," he said.
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At issue: Impact of bill before Congress
Goldstone said there was "no process which is even remotely likely to lead to an acceptable comprehensive solution this year." Such a solution, he said, would have to acknowledge that tobacco companies "have a legitimate right to exist in our country."
Goldstone said that the opportunity to implement a comprehensive tobacco settlement "has been lost" because the Clinton administration, while publicly praising the deal, "took it apart privately piece-by-piece."
Tobacco legislation approved last week by a congressional committee, and now moving toward a vote in the Senate, would go much further than last June's $368 billion deal.
The bill, sponsored by Sen. John McCain, R-Arizona, would require the nation's tobacco companies to pay $516 billion over 25 years and curb their marketing practices.
It also calls for fining companies billions of dollars if teen smoking rates do not fall significantly.
The bill would give tobacco companies less protection against lawsuits by sick smokers than they had won in the earlier deal they negotiated in the hope of settling 40 state lawsuits.
Clinton reacts to the news in Chicago It was unclear if the decision by the cigarette-makers to withdraw from the deal was permanent or part of an effort to pressure Congress to change the proposed legislation.
Clinton comments
President Clinton said Wednesday he hoped RJR and the other companies would reconsider. But, the president added, it was critical for Congress to act on the issue regardless of their position.
"I've been working for two years on this and I don't intend to stop now," Clinton said in Chicago, where he was visiting a school to promote his education policy.
"I think we've got an excellent chance of passing a good piece of legislation to dramatically reduce smoking by young people and save lives. I don't think there is very much in it for RJR or anybody else to walk away, so I hope they will reconsider that," Clinton said.
Correspondents Wolf Blitzer and John King contributed to this report.
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Related stories:
- AllPolitics/TIME - Harsh words, strewn chairs and tobacco's lost G.O.P. friends mark a difficult negotiation - April 6, 1998
- AllPolitics - Clinton says it is in tobacco's interest to back McCain bill - April 3, 1998
- Tobacco firms post internal documents on Internet - February 27, 1998
- Clinton to recommend sharing tobacco money with states - January 12, 1998
- Clinton will try to save tobacco deal - September 15, 1997
Related sites:
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- RJ Reynolds Tobacco Company
- Tobacco Resources on the Internet - Northern California Association of Law Libraries
- Major legal cases and court coverage of tobacco lawsuits around the world - HealthWatch.org
- Additional related sites - "Tobacco Under Attack" special section
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