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                                  CA: San Nrancisco Sues BarForNot Complying Wftti Smoking Ban

             I n a move gaarantesd to get the              Quote of the week :                      timeto cradc down on noncompliers
               attention of snoking ban violators in                                                "There are other ca3es we are
            San Frandso,. Californiabars dty               "I think it's a waste of                 investigating ;" sheconfirmed . "It is
            offidalsfilej alawsuit onJuly 13               tax dol I ars to have the ci ty          always our hope that owners compl y
            agai nst apub i n the Marina District for                                               with the l arv, but thae are a fe+v
            repestedly fa li ng to hsed wernirUC sthsd
                                                           policing peoplewho                       reoaldtrants" Thelaw,whichwas
            itwasrotoomplyirgwiththelaw. The               smoke i n bars" - bar                    a9opted f our yeers Ego to proted
            off ice of City Attorney Louise Reme           patron Tom Grieco                        empl oyees f rom envi romental
            filedthesuit-thefirstof itskindin                                                       tabroco smoke (ETS) Eecposure i n the
            Califorrra- against Tim Dda"ey, o,vner of Delaiey's                  workpl aoe, requii res anpl oyers to post "no smdci rx~'
            Pub, Renne asserted thad heelth off i d d s hai gi vsn the           signs and as C auskomers to rot smoke Meanavly I e ber
            pub f ive warrbngs and onedtetion beforethe dty                      pafrons and proprie'ors acpressed synp arthy for
            ded ded to a;t. "We haJ gotten to the pd nt where it                  DslaiW . Fellouv bar ouvner Jay R riceSated, "When
            wastimetoteketough aXion ;" siid Renne.                              wetri ed to enforoethe Iav, our bud rtess droppeii by
            "[Delaney's] conti nued to f lout the lanr aid rrade it              30 percent . Can you afford to l ose tt><Q? I thi nk it's
            d ear that they had no i ntaiti on of oonplyi ng                     unfair. You're asking meto dose my doors ." An
            whi#suever ." Thedty isseeking $2,500 for ea:h                       anarymous pairon attributed the re cent crac cdown on
            allegedvidation-anamountthatoouldtotal asmuch                        "health-f resk yuppies' bant on i nposi rg thei r odvn
            es$12,500, Despite San Frandsco Cironide survey                      standards on others (San Frand soo Chroni d e 7/14) .
            results i ndioding that the State emoki ng ban was beirig                                             (sselnCart onp3ge2)
            routi rdy ignored by dty bars, Renne vowed that it is
                                                             In Washington
                                       Legal Experts Say Time Running Out For Federal iLawsuit

            A group of I egal expe ts and attorr
                                       r             ey s oontend that
                 the Federal governmeit i s runr>i ng out of ti me to
                                                                                 I i mitellions- such as radceteeri ng and od I us on amax .,i
                                                                                 manufaxurers-toscpire "Thisoouldreaalt inthe
            fileitslawsuitagainstthetdbacooindustry . The                        Iossto taxpayers of tens if not hundreds of bi l 11 ons of
            warru ng, wltidi was submitted to the Department of                  ddlars-smplyasaby-productof dday infilinga
            Juslice s (DOJ) tobacco task                                                                    larvsuit."
            force in April, eYimalesthat                                                                    The group conpri ses suoh l egal
            the agaicy has until Augast 10                            HIGHLIGHTS                            luminaries as Notre Dame Iaw
            to file suit or risk having the            1 : Rio &jit Targets U .S Corrpanie> . . . . . ..W2  professor Robe1 Blakey, a .thor
            casethrown out of court . "The             2. ORTrust FundbUit Dismiwed . . . . . . . . . pape4 of the nati on's RI CO la,v and
            I orx,ier the United Stales ddays          3: NC Tac BrE)EkGivet Go Atead . . . : . : .paM 5    former DOJ attorney, and
            in filing sait, thegreeler the             4. ArdystsRe,rie,v2093             :,', . . . :page7 Harvard l arv profesror Laurerxe
            risk that thetobaxo industry                                                                    Tri be Thei r merno h ghl i ghts
            would prerai I on an argument that the d a ms for past                 eventsonwhichvariousstatutesof Iimitationsmight
            damages are ti me-barred," wrotethegroup, which also                   bebased, ircluding nerv FDA regulations in August
            assartsthaf the DOJ is al I orJi ng s grr f Icait statutes of                                              (sse Fetaral on page 4)

                     TORQOM6NE"ANTS                                t"xxr*t 1915                               F'.0, Wk Wt9
                      A+a.'~3:A.'~A17 M , I NC,                                                         MNCEr(?a, N .dt3waaM
                       TW (" 2754M                                                                          FAX : ( '£) 2'1M79

 70036 8897
                                                                                   WA: Supicme Cowt Upholds Workplace
         I n Cout conti rxaed f rom M 1                                            Smoking Ban
         Rio Suft Taigets U.S . Companies
                                                                                   W     iii onStale's SupremeCourtupheldalower
         B razi I's Ri oondeJanlyei13rothStateatexn of four Texas
           announced Ji                   af
                                                government                              oourt dedaon on July 8 banni rg smoking i n the
                                                                                   workplace. I n its 7-2 dedsion, the Court rejected
         lawyers had f i led a Iarusuit on its bFhalf agair>st U .&                oontentions by dgarette maiufact urersth d the State
         maxifa;,turers to reca.p health costs associated with                     Department of Labor & I ndustri e ; used "vi rtud I y
         treafingdlegedsmokirxfrelatedillnesses. "For                              unbrided authority" aid'questio nable sdence in
                                                                                   effortsto regul l eprivafe bus ness. Theagency was
         strsfegic reasons' government attorr ey Jose Calisto                      wd I withi n its rights when it impos ed the rules i n an
         Ushoa Ribe ro ded ined to say i n whidi Startethesuit
                                                                                   effort to protect the health of workers, the Court found .
         wasfiled . Philip MorrisCos Inc . (PM) and RJ
         Re,mdds Tobacco Hddi rlgs Corp . (RJR) are among                          ° Chocsi ng rat to ' rd nvent the wheel' and i nstea d
                                                                                  relyir Kj upon existir g [seoondhand smoking] studies
         the fifteen maxaf acturers nerned i n the suit, whidi
         oonprise°dl theAmericancempanieswho, either                              that are di rectly on poi rrt appeers to us to be a
         di redly or i rd redly, ha te caused the goverrmeit of                    reasonabl e dscison and the compaii es c annot pdnt to
         Rio to inaar oosts in publ ic heelth care," s3id RibE i ro.               aca;e e cpl ani ng wfry the d epa rtmeit should not be
                                                                                   ableto make it ;' determi ned Justice Gerry AIexarcler.
         Although no spedfic amount of danag es was nzmed,
         Rio de Jaiei ro is expeded to calculdethe oosts                           The regulations, which are more stringEnt than Federal
         asscdsfed with such i I Inessss over °the I ast 20 or 30                  standa'ds, ban smdcir g in el I offioes except for those
                                                                                   with dedipted smoking roomswith outsdeverds
         years." R o governor Anthony Garoti nho, meer vohi I e,                   Currentl y the only other Statewith such stringeit
         sal d i n a radi o i ntervi ero that he was hopef ul a                    snoki rg regul adions is Mayland, where oourts hare
         settlen>ant could be readh ed arxi aitidpafed that the                    alreadyupheldtheStete'srules D epa tmentof Labor
         Stetewould reosive aqxoxi mately $10 billior *L
         Deote Bra?il Health Mir i ster Jose Serra s                               & I ndustries direxor Gary Moore i :pplaxfed the rul i r g
         oonsderationof aIawsuit ag ainst U .S manufact urers                      and sad, "This is aegiificant win for Washington
                                                                                   workers, and we're gratified to hare been in the
         I ast year, no I egal adi on has been taken [ Dow Jxtes                   foref ront of the sHort to protect workers from the
         7/14) .
                                                                                   heelth hazard repres?nted by errvironmental tdbaoeo
                                                                                   smokd' (AP7/9) .
         LA: Industiy Vfctorious In Gilboy Trial
         T wo days after bei ng de21t a litigation blow i n
                                                                                   FL: Engle Hearing Set For July LS
             Rorida, dgarettemsrxafadurerswerefound
         i nnooent of r>egligerxe i n the cass of deoee9ed smd<er                  E (R,I?)
                                                                                      r gl e et al . vs RJ ReV ral ds Td)axo Compaiy
                                                                                               et d . jurors had their return to court pit off
         Rdbert Gilboy, whodiedcar>cer-freein 1993 . After
                                                                                   when Mi arni-Da9e County Ci rcult J.adge Rdb at Kaye
         Iassthan oneda,+ of deliberafions, thejury determirei
                                                                                   postponed ahearingtoschedulethestat of phasetwo
         that therewas i nsufficdent eridenoeto support the
                                                                                   until July 15. Judge Kaye- who is expected to
         Gilboy fariily'sdaimsthat hewas'addided' to
         srraki ng and could not quit - even afta he was                           a'tnounoewhether the perd ty pha3e of thetri al will
                                                                                   resume i n two weeks or two months- del ayed the
         di agnosed wi th calxer aid had urxiergone bra n
         surge y. "Despiterepeaded 211egaticns, thejury                            hesrir>g dueto adsath in his fami Iy . Onoe adate is
                                                                                   ested ished, jurors wi II be re sponsble f or assess r>g
         dwioud y reoognized that thiswas a case aba .rt ai
         i ndividuel who dhose to srrakefor many yeers and                         darr age aruardsfor the ni ne i rxGviduals who r epresait
                                                                                   theplantiff das; Amongthegroupisped'iatridan
         whowas welI a,vareof therisksasscddedwiththe
         behwior," stsfed American Tdbacco Company                                 Howard Engle, whose ernpfrysf :rnawas dI egedy
         (Brovn& WiIliamsonTdbaocoCorp.) attorne,                                  caused from asmoking habit hebeg an in medical
                                                                                   school to mas c the stench of rotti r g coapsas (CN N
         Gordon 9nith . Plaintiff attorney 9een Fagan
         attributed the courtroom Icss to State District Judge                     7/12, Reuters 7/13) .
         Mike Caldwd I's refusal . to al low a doctor'stesti moiy
         to be i ntroduoed, evidenoe he dai ms may haoe s,vayed                    Engle : A Closer Look
                                                                                    I nanopinionpnoepublishedbytheLosAngeles
         j ury opinion . It was not i mmediately known whether
                                                                                     Tirreson1ly 11, RapperdineUniversty law
         thefamily would appeal thededson (Reuters7/9, AP
         7/9) .                                                                    professor Ridiard J . Cupp, Jr . ecpressed Hsbelief thaf
                                                                                   the daed c "moral ity play" exHbited I n Miami's Engl e
                                                                                   et d . vs RJ Re,rr>dds Tdbacoo Company et d . tri al
                                                                                   createdquiteadilemiaforjurors That quandary,

         2                    -v~~ P.O. Box 8D19 ; Pri noelort N .d OB,543 ; 80427Cr4900 ; 60&275637TJ (f ec) ; tniaMmaorg            TW99-29

`70036 8898
            feelsCupp, will beseen repeartedly inoourtroorrt ;              aYorreVs axoss the nation view themsslves as a"de
            natiornwideforyearstooam Becauseof areDent                      fado f ourth braidi of government" : one where
            stri ng of perceived wrongs by the i ncLstry, the               members are not suhj ed to thedisdosure rul es axi
            culpebility and responsihility of smd<ers hastaken a            blind trusts thd ere expeded of ssrators, chief jul ioas
            badc seet i n tri al s of 1 de R ori da arxf dher states hsve   and pred denls, gd paid a Id bettsr thai the other
            adopted the concept of "oomparafive' assumVion of               tt>rea, are excl uded from publ i c scruti ny axf do not
            risk, thereby allowi rg jurorsto aadd an al I-or-nothing        hateto rdy upon eledionsto mantain their posts [Los
            dedson . If it isdetermined that theblarneisthefault            ArxlelesTimss7/11, WSJ7/12] .
            of both pali es, moneta°y awards can be reduced
            withoul lxing oompletely eliminated . Thepursuit of             CA: Medicaid Patients Seek Settlement Share
            j ustice, says Cupp, requi re ;theahi I ity to balanoethe            x if niaMedicadraypientsfiledala .vsuitin
            moral failirgsof bothsdea Thatsaid, thelaw                           Los Argdes County Slipsri or Court on J~dy 13
            professor bdieresthat plaintiffs' attorneVstntdbaooo            seeki ng aportion of the State's $25 bi II ion tobacoo
            litigati on cases would henef it from ad<nowledgi rig that      settlement proceeds. Theplantiffshadeapplied for
            their d ierds share in the blame and encauragej urorsto         d ass-a .,ti on status on bshd f of tens of thousands of
            awa°d only partiel oonpensation based on that shared            cisahled a-td low-irtcorne Medicaid pdierrtswho have
            blame. Inthosestuations saidCupp,jurorsare                      been or wi I I be treEted f or al l eged smoki rx,}rel ated
            unlikely to award ful I damages regardl ess of the legal        111 nessss, stated thei r attorney John Rowel I . The suit
            approadl, sc it would stand to reason that operil y             azxases Gorernor Gray Davis (D) of earmarki rtg $562
            admitti rg that tha r d i aits do not deseve ful l              mi IliontotheStatdsgeneral f und f or the 1999-2000
            oorrperisati on mi gM I ess3n j urors' di sl i ke f or the-n,   fisd year without cortsideri rxJ the rights of the
            On J.aly 12, the Wd I Street Journal took adoser look           Medicaid redpients. Theplaintiffseontendthey are
            attheEnglejury. Theauthoroonterx9sthatduringthe                 aititled to aiy furxis remaring after the State recoups
            initial jury seledion last summer, attorneys f requentl y       the mortey it spent treeti ng those typea of illnem
            used the excusethat j urors had opi nionsthat oould be          Attorney Gensrd Bi I I Lodrya spdcesnan Nathan
            oord dered as prej udicad agai nst the plai rrtiffsto           Baranki n ded i ned to oomment on the suit exoept to
            dismissthem from the pod . A former smoker's                    say, "There is legiti mate and vigorous ddatetaki ng
            contEnti on that, " I j ust thi nk peopl e are and hare beai    plae i n stadehaises aoross the courrtry, i n local
            well awareof thedetrirnalsof smdcing. . . Tocorne               governments throughout Cd iforrti a, and i n the state
            badc after the fa:t, I f i rxi thd sonewftat ri dicul ous"      Capitd here i n SaxamEnto about the bat use of the
            apparentlytypifiedthatdleged'prejudioe,' saidthe                [sEttlemeit] procee;ts" 9milar lavasuitsharebeen
            aathor. "It would seEm peoplewith a'bias' shaed by              filed i n at least three other States (BIoomberg News
            avery large share d the American public can be                  7/13) .
            derred the right to serve s mply becaasethe syste-n
            doesn't wait their kind of opinion refleded in the              OR: Ruting Against State Law May Prove
            eventual dedson;' rea;istheartide "That renders                 Beneficial For Williams Family
            nor>9ertse any assation that the sx jurors Ieft on the
            panel wereInaiysensetypir,~ of Amerir,a, Roridian
                                                                            T  hefamily of a, deoeased smoker Jam
                                                                                 Williams, whowon arecord $79 .5 million in
            or ere7 M i ami an ssnti ment ." R ai nti f f attorrey          punitivedamages from dgarette makers in March orty
            StadeV Rosenblatt'stadic of f i I I i ng the courtroom          to have it cut in hdi two months Iader, may not haveto
            with'sympathdic' dteidees- repletewith                          remit 60 percent of the award tothe Statethaiksto a
            wheeldhai rs, vdce boxes and oxygen tart<s-                     court ruling on July 7. MultnomshCountyGrcuit
            reportecily had its de si red affed on not only j urors but     J.dge Jenice Wi Ison ruled that the law dedgrtating 60
            reporterscoveringthetrial, d ai msthea.rthor. It is r»t         percex of punitivedamages i n produd l iab l ity
            known, horvever, how many of ttbsecourtroom                     la+us.®tsto aSdecrimevidimsoanper>sation furxi is
            2ttendeeswere a ct ual Iy valid plrontiffs i n the c ase        urconstitutional . Wilsonfourxithatthelawamounts
            "I ridaed, f rustrsted defense attorr eys had no way to         to I ittle morethan a~i il legal "taki rg"- and tt :at the
            quel ion the spectdors to e stablish whether the,+ eren         goverrrneit does riot have the right to confiscate
            qualified as n embe s of theda%" the a-tide pd nted             privetepropertywithoutjustoonpensation . Whileit
            out . The i ndustry had an equal I y had ti me d bj edi ng      is li kely that the rul i ng wi l l not affed prerious cass i n
            to what they da med were atterrpts to play the'rao3             which the pl ai ntiff did rot fight the Setd s portion, it
            c a 'd,' apertieulariytoudiysubjedgiventhestrong                may bode wetl for the Wi I I iamsf arnily - they are
            minoritymzkeupof thejury . Based upon the Engle                 curremly appeal i rig both the redudion of the punitive
            trid and othersd IatQ theartidesuggeststhat                     award aid the Statd s share (Oregoni ai 7/8) .

            TW99-29                 -v.+"1 P.O. Box 09 ; R'irDston, N .J. 08543; 6D32754900 ; 609-275,8379 (taq ; trra@Lrraa'g 3

 70036 8899
                                                                         craloulating these damages weighed heaoily in favor of
         MI: B&W N amed Defendant In °`Wmngfut                           barri ng the heslth trust f urds' adi ons," stataf the
         Death" Lawsuit                                                  appeels oourt . The suit, brought by the Oregon
          I n court documents f 11 ed two weeks V, Brown &               Laborers-Employers Heelth & Welfare Trust Furxt, the
            Williamson Tobaxo Corp . (B& W) contends that it             PlumbersStearnfitters& ShipfittersRetireeHedth&
         isnotreqxnsbleforthe1996deathof Kent rrt                        Welfare PI an and other trust f unds, slleged that the
         Mi i smoker Mary Bedce't, adedicated Pail Mall                  manufadurers had defraude9 the publ ic regarck ng the
         smoker . I n a Iawsait f i Ied agai rst the company,            purported'risks' of srraking, which allegedly
         Beckett's four sons and daughter d ai m that her death          pretented the funds from successf ul ly redud ng
         from lur>g diseasetied to emphysemawascaused                    smoki rxJ rates anong thd r participants Commenti rg
         "sdely by [B&W's] negligenve ." In adCiition, the               on the court's dedsion, exeoutivevi ce president and
         maiufaoturer fa led to disdose purported heelth                 general ccursel for RJ ReynoldsTdbacoo Cornpany
         hazards assod aied with smoki ng i n thei r marketi ng of       (RJR) Charl es BI ixt stated, "ThEse rulings show that
         PaII MalIs . Bedcett'sdildrenares3eking$14 .25                  these lawsuits are awaste of j udid al ti me and taxpayer
         mill ion in the suit : $4 mi Ilion f or thei r mothsr's pai n   money . The opi ni on aapports the bel i ei thd thi rd•
         aid suffering and "wrongful deeth ;' $250,000 for               party cases of thistype are based on contrived leggal
         medrai costs and burisl eKpsnses, and $10 mi I I ion for        theorias that don't des?rveto betried in court"
         B&W's"egregioud' caidud . B&W'sattorneys                        (Bloomberg Neros7/14, PR Newswi re 7/14) .
         adcnowl eJged that although studies hate suggested
                                                                         Court Gives Maishall Islands Suit Green Light
         that "smoking isacauseof dissase in humans. . .Brown
         & WII1iamisonknowsof no way to verif y that
         smoking isacauseof any particular person'sa-Iverse
                                                                         A    la,vsuitfiledin 1997bytheMarshdl Islands
                                                                             sseking up to $100 mi I lion from f iveAmericen
         heal th" The compeny has asked a Grand Rapi ds                  tobxbo conpani es was gi ven the go aheai to proceed
         F'etteral j udge to movethe casq from Kerit County              by the oountry's High Court, Radi o Neav Zeal aid
         Circuit Court to U .S, Disfric4 Court . Urrversty of            rq)orted on Jjly 15. The High Coui rejeded amotion
         Midhi gan Law 8chool professor KyleLoguebelieves                by theoompaniesto dismissthe case ; that dedsicn is
         that thediangeof venue"won't makethat mudi of a                 ecpxted to be appeal ed to the ceuntry's Slpreme
         differeioa Thereal question isho,v ajury reaolsto               Court . Thesuit, wltidi rlamesAmerican Tobaxo
         thecasd' (Grand Rzpids Press 7/14) .                            Compaiy, Brown & Wi I 11 arson Tobacco Corp .
                                                                         (B& W), Phi11 p Morris Cos. I nc. (PM), Philip Morri s
         OR: Appeals Court Upholds Dismissal Of                          Products, axi RJ Reyndds Tobacco Company (RJR),
         Tnrst Fund Lawsuit                                              was the fi rst f11 ed by a non-U .S. govErnrnent to recoup
                  .Lly 14, aFederal appeeiscourt in r~Q,n                money spat tre3ting alleged smoking-related
         O n   upheld an earlier dxison by a lower court to              illresses In Decenber 1998, HighCourt CHef Justice
         di smiss a Iavsuit brought agd r>st dgareLte                    Dani el Cadra f ound thal al though the conpani es do
         manufacturers by agroup of State-basa9 heelth trust             rxk hare offices i n the Id a-ils and sell ther products
         f urxfs . The Fbrtl and p2nel of the 9th Ci rcuit Court of      through distributors, "inlight d thedistributorsHp
         Appeal s ruled that therewas no cf red link between the         agreemerrts, the manuf adurer def erdants cannot d a m
         suit'sdlegationscF compary misocinduct and alleged              they didnot'foreged dgarEttesreachingtheMarshail
         smoking-rel ated i I I ness heaith care costs i rxx.irred by    Isla"xis [andj thay did rxk purposEfully dired their
         thefurids "Theclfficultyinaso3rtarlingthedamagEs                productsto thisforum" (BBC Worldwide Monitoring
         attributableto thetobaxo corrpanies alleyed                     7/15, WA98-50) .
         wrorigful conduct anid the oorrplexity i rNdved in

         Federal conti nued f rom po 1                                   [theAugust 10deadine] haslegal significarioeforthe
                                                                         tobacoolarosuit" InaJdition,DCJoffidalssslditis
         1995thsd defiried r9cotineasadrug. Further, thelegd
                                                                         Iikely that the Federal suit wi I I be based upon the
         ccpe"tsdam that the limitations start courting when it          Medicare Reoovery Act Thaf wil I nd enhanoethe
         isdeterrrwned that thegovernrnent should hate known
                                                                         suit's prosperxs, stated the l egd eKpais, s nce that
         "through duediligenod' and not when the
                                                                         act's statute of I i mitations e9cpired last yar (Medi a
         manuf a:,turers naV have 21I eged y' i d ursd' a party .        Generd Nenrs3ervice7/11) .
         Lawyers for the DOJ, howerer, disagree on theti me
         limit . "We'velookedattheissue," staied DOJ
         spdceawomai Chris Watney . "We do not believethat

         4            - .+"'* P.O Box8119; Riraaion, N .J.0854,3 ; 60&2754900 ; BD&27G8379(fec) ;trr99maorg

 70036 8900
            N C : Legislature Appmves Tax Break For                        VNI : Finns' Tobacco Lawsuit Recoids Released
            Manufactureis                                                  On July 12, Wis>orsn AttorneyGsneral Janes
            T he North Carolina Legidature ovewhel mi ngly
                approved a corporate I ncome tax bredc f or the
                                                                                 Doyle made publ ic for the first time reoords
                                                                           documenti ng ti me aid expere9 reoords f or thethree
            8tete s two reed ng dgarette manufaJturers to sell             law firmsthat nggotiated the Sate'stobacoo Iaavsuit .
            thei r products overseas The bi 11, speerheaded by             Acoordi ng to the documents, a'torreys f or the f i rms
            Senator Lirxia Garrou (D-Forsyth) and approred 108-9           worked atotal of 24,733 hours on the case Based
            by the Houss on J.aly 14, czpsthetax breaksfor Philip          upon thdr payment of $75 mi I I ion, the per hour rate
            MorrisCcs (PM) and RJ Re,+nddsTobaxo Comparry                  amounts to aplxoxi maiel y $3,032 an hour . The
            (RJR) at $6 mill i on per yeer or half of ther annual tax      eocte'tigve psperwork acoounts haw thef irms spent
            bi l l s, whi &wEr amoun( i s l ess Thi s year the total tax   ti meworking on the cass, raigi ng from telephone ralls
            breskswi l I cometo approxinratdy $9 mi ll ion .               to me6ti ngs and reseeroh . The rel ease of the
            Aocord ng to Garrou, the n>easure"isto encourage               documents di d riot sati sf y ereryone; howerer . ° If
            them to stay i n bus ness aid to i ncreasethei recport         those hours i nd uded scretari al ti me, i nvestigators
            bus ress. The more dgarettes they sd I, the more we            ti mq pardegal ti me, I sti I I thl nk that thefigure is
            keep our currant jobs ax .f i rtcreasethe usage of             exoessve ;' deraared Senate Preddent Fred Risser (D-
            tdbaccogrownin NorthCarolina" It iseYimdedthal                 MaJison), one of three Iawmakers who are seeki ng to
            some 1,400 jobs i n the 8tae 2re s-ippl ied by both            have the dgarette maxafacture•s pay the Stale, whi di
            conpari a& W hi l e the bi l l was anbraced by most            would then oompensatethe attorreyswith a
            legidators, afeN questioned it . "I saVtoyouthisisa            "reasanabl e' hourly fee aid givethe remander back
            wel f are payment to big corporationsthat we redly             tothe9tstetreasury. Attorney David Rottier, apa~tner
            shouldn't be malcing;' stated Representative Pail              at one of the Iao fi rms in question, contende•1 that the
            Luebke (D-Durham) . Representative Leo Daughtry                $75millionisjustifiabla "HaJwelosttheca ;eafter
            (R-Johrr,ton) disagreed and said, "Thetru(h isthat             years of work and mi I I ions of dd Iars in ecpenses, do
             Philip Morris isthe largest tacpayer i n the United           you thiric thelegiedorswould bevoluntarily
            States" BobHdl,theresearchdirectcrof aChapet                   suggestingthetwebepaid? I don'tthiricso," he
            Hi l l carnpalgn reform group, al so oitidzed the              stated. °That's why other l aN fi rms turned do,vn the
            proposal . He suggeated that a oonf I i d of i rterest         apportunity to do the sarne cass" Meanwhi l e, an
            eoci sts because Garrou's husbaid i s a managi ng partner      attorney representi ng three neuvspapers i n a I awsuit
            with a law firm that works for RA. Garrou, howerer,            whidh attenpted to foroethe State to relem the firms
            deni ed any oonnecti on be(ween the bi I I ard her             reoords suggested on J;al y 13 that the case may be
            husberxi'spoetionwiththefirm . Meanvuhile,                     oard ng to a d ose. Rdbert Dreps, ettorrey f or The
            legidzrtivebill drafterswarnsd iawmakersthatthe                Capital Times, Milwaukee,burnal 9Entinel arxlthe
            S(atecennot limit thetax break to orly dgzrettes               Wisconsin StEteJournal, oaifi rmsd that ° We re
            produoed in North Cardina A U .S. 9aprerneCourt                dscussingwiththesoecial counsel [about] obtaning
            ruling saysttrat prefererttial tax treatment cannot be         someadditional informaliontohelpusunderstandthe
            appl ied only to corrWi esthat do bus nass witlyn the          reoDrdstheVdstributed . If we reableto reaohan
            State In aJCition, legidsdivereswderscautioned                 agreernent,thsnwell bedismissi rgthesuit" (AP
            that the bi II nay also vid ate international I av ard the     7/12, 7/13, TW99-26) .
            General Agresrrient on Tariffs and TraJe by
            subsdiang ev.ports Thebill oould motivzdeother                 CA: NewspaperArgues Settlement Frmd
            oouitries that produoe dgarettes to petiti an the U .S.        Priority Should Be Healthcare
            government to either stop thetaoc breeks or givethem
            thetaK breeksaswell . Rega•dleas, thebill now moves
            on to Governor J m Hun( (D) for his sgnature
                                                                               ikeni rig O=
                                                                           L settlernent windfalCuntywinr9 ngprioritys tobaxothe Los
                                                                                                 I to
                                                                                                      . Californi a

                                                                           AngelesTimesarguesth2¢ "thefirst
                                                                                                              the lottery,
                                                                                                                       of the
            (Raleigh Neus & Observer 7/9, Dow .bnes 7/15,                  [funds] sfiould behealthcare" ThepapEr notesthat
            TW99-28) .                                                     other proposalsfor useof themoney, amountingto
                                                                           perhaps $30 mi I I i on per year for 25 years, ind ude
                                                                           payi ng off the county'sdeb( i ncurred during the
                                                                           strugg! eto emerge f rom the December 1994

            TW99-29                 -vr"* P.O. Box 8D13 Ri rqetm, N .d O854,3; 608-2754900, 909-27583TJ (fac) ; trr>aatnaorg 5

 70036 8901
         bankruptny . This proposel is pra,,)ourxled by county               Ianrauit resurfz :ed, former StateAttorney General
         Chief Exea.rtive0ffiar Jan Mittermeer aid ChieF                     Wi nston Bryant ded ared ° pd nt-bl a~ik" that the
         Flrrandal Officer Gary Burton, who also believethe                  sgrtetureonthedocumentwasnothis Inaletter
         money can badc a bond issuethat would bui Id aj 61                  del ivered on Jul y 12 to hi s suocsssor, Attorney
         andotherfadlities Thoughtherplanhasreceived                         General M ark Pryor, Wi nston oontende;t that he nerer
         support,thepape'callsit"fla .ved ." Asawedthy                       indiceted othawisaduri ng aJine 7 mesting with
         counry, residenis may Iose sght of the fax thal                     Depuly Attorrey General Sanmye Taylor axJ two
         healthoareisaproblemforthoselessfortunate. The                      other Stateoffidds "Ms Taylor andthestaff
         United Way reported that about 15,000 dtildren under                a`torneysweretdd poi nt-blank thai I did not sgn the
         181ive in poverty, many without insuranoe                           oontract aid further thal I did not dire :t anyoneelseto
         FurthermorQ mary fall intothecztegory of the                        sgn it," wrote Brya~it, who was cf sputi ng Tayl or's
         "worki ng poor" who make too much money to qu21 ify                 reoent assertion that he ha9 refused to say if the
         for thecounty'sverson of Medicaid, but rat enough                   sgrtstureonthedocument wasactudly hisor rxR . "I
         to pay thei r own insurarbe. Theoounty Hedthcare                    was tdd at [theJ.ane7 meeting] that they had dready
         Agency waspartiatarly hard hit by the 1994                          oompared the sigr>atureon the contract with ve id
         bankruptcy, and i t i s hard pressed to support the                 si grratures of mi ne axi ha1 cond uded that the
         doctors and private hospital s that treat the poor .                sigr>durewas not nni r>B." Bryant went on to say that,
         Bdsteri ng its f undi ng isthe most appropriate use of              "Thecons amswas th2t sxneaie in the altorney
         tdkvoo settlement f unds, argues theTi meS beoai .tse               gsneral's office had sgned my rameto salisfy
         "theStates, indudingCalitornia, suedthetcb~.^ixo                    Arkaw LegidativeCour d l requiremerrtsthat
         oonpar es to get reoorrpense for the oosts i ncurred                cartra;tscor>ddered by it besgrad by rt Ieast ore
         treeting those with smoki ng-qused ilinesses. . .                   party." At i ssue i s a dsn>ard by Li ttI e Rod< zttorr>a,+
         [F]ai rnessdictatesthat f>aalth issues be at thetop of              Gan eCauley th at hisfirm, Milberg Weissof
         thelisP" [LosAngelesTines7/11] .                                    Cal ifornia, be awarded $243 mi I lion of the State s
                                                                             $1.62 bill ion tobaxo settlement for its work in the
         MS: AG Candidate Requests Legal                                     r>agotiations. Currait AG Pryor, howe,rer, conlexis
         Fee Disclosure                                                      that snoehisprede .^essor rever listed Milberg Weiss
              isdsdMi Attorney General candd at e Mark                       and others as a`.torneys of record they are theref ore not
              Gariga (R) filed an opei reco rds request on Jily
              ddamsthat legal feesreatedtotheStates
                                                                             aititled to any oompensation . In March Pryor filed a
                                                                             motion to preverrt the a`.torreysfrom recdving
         tobaxo I a+usuit be made publ ic . Garriga a~ced that               paymait of aiy ki nd, whether f rom the i rxlustry or the
         Attorr ey G3nerd MikeMoorerelea3einformation                        Stata "The [privde attorneysJ ddn't have acontract,
         regar di ng how much money earh I awyer who                         and they did not represent the State," Pryor spokesm2n
         partidpatedinthe1994suitismaking. Anarbitration                     MikeHodsonEacplainedatthetirneofthefiling . "We
         panel awarded the 2ttorne y s $1 .4 bi I I i on i n De ce rber,     will disputethe, deserveany legal fee Theworkthey
         ai arrrount that will beoompletely furxled by dgarette              cfdwasinantidpationof acontraot . It isourbdief
         manuf a:1 u rers (A P 7/9) .                                        that work done in a7tidpation of aoortraJt is not
                                                                             reooverable" Thecontract'svalidity axf whether or
         AK: Fomier AG Claims He Never Signed                                rxR the State is obliged to pay thefees will be
         Contiact Hiring Firms                                               dEtemined by Pulaski County Chaioellor Mackie
            ix weeks efter a 1997 agreerreit oontrxtirig a                   Pf eros i n atrial eated to begi n on August 10
               iforr9a lav fi rm to work on Arkansas tobacoo                 (Arkarua; Demoaaf-Gazette 7/13, TW99-24) .

                                                           Product Liability
                     Report Suggests utsun3nce Cos . May Have To Reimburse Manufactureis For Claims

         A British tobaxo i ndustry arral yst suggested i n a                ecdude- health 11 ebi I ity risks assod ated with
              July 8 report that both U .S axi Europeen                      smoki ng . Acoordi ng to the report, ° a I arge vol ume of
         i nsuraxe companies may haieto re mburse tdxrooo                    oomprehensive geieral I i abi I i ty i nsuranoe coverage
         oompanieathe money they havespent in oorrpe,sation                  wassdd to North American tdbaoco maxafadurers
         daimsandssftlementsstaledde Paul Hodgssof                           us ng acd udons of dubious efficacy ;' whi le older
         Schrodersstatedthi# in many instancestheinsurar-oe                  pdidesshowed "an aloseioeof relera~rt gucdusor>s,
         provided to tobaaoo menufxturers between 1966 and                   poor ddinitionsand a°ribiguouspdicy limits" The
         1996 speafirul Iy covered - or did not completely

         6      -W"*              P.O Box e019; Pirbelor4 N .J. 08513; 673275490D; 6032758379 (fmQ ; tn~o~fmaorg                 TW99-29

 70036 8902
            papa' d sc said that rrenuf adurers would starx3 to            marketingof fireerms. Thegod of thesuit, wltichwa;
            benefit by filing for rambursement in sudi cases               ecpeded to be fi Ied i n Broddyn Federal Court in New
            8ome of the i nsurance oorrpani es menti oned i n the          York sanetimethesameweak, isto foroegun mske°s
            report i r>vlude Lloyd's of London, Zurich Fi rrandd           to inprovetheir maiitoring of purdasesand
            Services, St . Paul Cos Ir>vI and Liberty Mutual . In a        distribution of guns Aooordingtothecountry's
            staternerrt on July 9, St . Pa .il Coa de"ti ed haoi ng ary    largest dvil rightsgrouppreadent, Kweisi Mfume,the
            tobaxo-relatedddms "St . Paul didissueone                      suit wi I I sedc no mortetary damages bul I nsteaa "wi I I
            tobaooo hedth liabl I ity pol icy i n the mid•1970s,"          seek to impisrneit spedfic dvx,les i n the
            eonoededaconpaiyspdces,voman . "Itwasadaims                    mznufacturi ng and distribution practicesto promote
            madepdicy. Noddmswereerer filed onthst                         more responsbi I ity aid aocountabilitl!' withi n the
            pol icy . . .We do not have aiy tdacco•relaled dai ms          i rxiustry . The NAACP i s al so seefci rg the marclailory
            that we are aroere of" Although a spdcesrnan for               i nd uson of safety enhaxentents such as trigger Iod<s
            Li be ty Mutusl ded ined to comment he asserted that           and aban on e3oaxfay firearmsszlesat gun shows
            the compaiy has no ultimate 11 sbiI ity for tobacoo-           Although spedfic menufxturerswere not ramed,
            related d d ms (Fleuters 7/9) .                                NAACP attorney Deni se Dunleavey sad that there
                                                                           wi l l be over 100 oompani es l i sted as def erdants i n the
            NAACP To File Suit Against Gun Makers                          suit . ChdrmanJulian Bond attributed the
            T    he Nalional Assoaation for theAdvanowneft of
                Cdored Feopl e(NAACP) amounoed at its 90"'
                                                                           organizali on'sded s on to fi le suit to stalisticsthat
                                                                           AfricanFAmericas between the Wof 15 a-d 24 are
            annual ocrnreition onJuly 12that itwill pursue a               fiveti mes more I i kely than wHtesto be inj ured by
            IaNsuit ao rst gun ma7ufa,turers, importersaid                 firearms (CNN 7/12) .
            distributors in an effort to restrict the sal e and

                                                         Corporate Finance
            Genend CYgar Releases 2Q99 Results                             demand . ThebrandsGerteral Glgarintroducediniste
            O n,taly 14Gensral Ggzr Hddings, Inc, announced                1998, Macmudo Robust, Boliva axi Don Sebastian,
                 that f or the second quater of 1999 i noome f rom         are sel I i ng wel I . The recentl y I aundied marketi ng
            oordi nuirtg operations was $2,384,000 (9o per cN Iuled        program, the Fve Slar General Plan , hasprovided
            share) on sales of $35,122,000, canpared to like 1998          encouragi ng ree^ults ancf ha ; al I owed the eonpany to
            i r>cane of $4,805,000 (17~ per d I uted share) on sal es      inaemeitsshdf preseraealtheretal lerel ." Mr.
            of $44,104,000. The oompeny' s riot i noome f or the           Cullman went on to say that "thesdeof the Ma;s-
            qua ter was $97,575,000 ($3 .60 per di I uted ahare),          Market Cigar bus ness currently is di I utive to eernings .
            wluch indudssthenet gain of $94,402,0D0 ($3 .48 per            Haverer, it wiIl sllow General 0gar to f oaas on
            dilutedshere) onthessleof itsMasgMarkEt Cigar                  apanding itspowerful portfdio of premium dgar
            busir>es, as wd I as the inoorne from disoontinued             brands, whare, in the Iong-term we bel ieve we can
            operati ons of $789,000 (30 per cf I uted share) . I noorne    creetethe greated val ue for our shsreholdars'
            from oorrtinui rig operationsduring the sixth month            (BusnessWre7/14) .
            peri od of 1999 was $4,875,000 (18¢ per d I uted share)
            on sell es of $69,232,000, corrpared to the s xth month        Analysts Review 2Q99
            period d 1998 incorneof $11,690,000 (410 per diluled
            sh2re) on ssl es of $93,258,000 . The conpany' s net
                                                                           A coordi ngofto1999, oonti reriaHs of thencreases axnn
                                                                                                      nued price i

            i r>cornefor the sx month period of 1999 was                   the maj or U .S dgarette manufa:turers resulted i n
            $101,541,000 ($3.74 per d luled share), which                  weaker cortsumption rsles and softer profits Unit
            i nd udesthe gain on saleand the resalts of the                vd ume for the total i rxfustry dropped about 10 psroent
            discontinued operati ons, conpared to 51 o per diluted         duringthethreemonthsendingJune30, 1999-a
            share i n 11 ke 1998. Free dent and CEO Edgar                  s gni f i cant dtange f rom hi stori c growth rales of 2
            Culiman, Jr . canmentedthat General Cigar's Io,ver             percenk . " I thi nC tH s has been another chal I ergi ng
            resultsf rom conti nuing opsraticns reflected °softress        qua-ter j ust likethe f irst ;' dedared GoldmanSarhs &
            in the prsrmi um dgar bud ness and the redudion of             Co .andystMarcCohen . Thequailerwasdschearily
            invsntory lerels by retd lerswho had axrtirwed to              i rrpa;ted by i ndustry payments towerd the nsli onal
            purdhase high quantities of dgars through the 1998             tobacoosettlement . Althoughinitial s3ttlement
            sscaxf quaier I n antidpation of i naeases i n consumer        payments areoauidered regular busness experses,

            TW99-29 -w-")~ P.O. Box 8D19, Prinoeton, NJ. 0&543 ; 609-2754900 ; 6`JB-27Er837rJ (fsc) ; tmaCstmaorg                     7

 RJR0000001 523015961
 70036 8903
         mauifa;turers have oonti nudly inaea3ed dgarelte               pirpoi nted to its dder oansumer profile, agroup which
         prioesto hdp offset litigation costs . Analystswith            tertds to svitch to cheeper brands when pri ces go up .
         First Call Corp. largely agreethat Philip MorrisCos .          The company is al so i n the midst of drangi ng its
         (PM) wi I I earn 85¢ per share f or 2099, as opposed to        marketing imagefor itsbrands "TI1i#'sparticularly
         826 i n 2Q98 . The i mproremait was attri buted to the         diffia,it to do when consumers are foa .si ng on
         compaiy'sfoodbusness PM'sinterrafional tobaaco                 pridng ;" ad<nowledged Adelman . OneU .S. oompaly
         businessdid not farequiteaswdl : Cohen estimates               tf>af seamsto bethrivi rg i n thecurrent eoaiaruc
         thet the ur9t should post operati rig incomeof ahoaat          envi ronrnent i s smokel es; toba= marxaf acturer UST
         $1 .25 bi I 11 on, compared to $1 .3 bI I i on i n 2098. RJ    Inc. AccordingtoAdelman, theoanpaiy'sunit
         ReynddsTdbacoo Hddi ngs Cap, (RJR) was more                    vd ume rose between 0 .5 peroent aid 1 peroent duri ng
         rqatively impaoted by prioe i rxreases. Morgan                 the seoond quater whi 1e net i rtoome dimbed
         Stanley Dean Wi'tter analyst David Adelman reports             approxi matel y 2 percent, from $119 .1 million to
         that RJR's operati ng i noorne dropped 22 peroe7t to           $121 .6n911ion, TheGreernridi,Conrtscticut-based
         $319 million (85¢ per sha'e), whi le urtit vdumefel113         UST i s profiti ng f rom better retai l executi on "a
         pero3nt i n 2W, i n add tion to a 14 perarrt dedine i n        bud er nero produd pipeline, theanalyst sdd [Dow
         the prevl ous quarter . Part of RJR s dexease can be           Jones; 7/14] .
                                              Marketing & Distribution
                                      CA: PM Files Second Suft Over Giay Madcet Cigarettes

               lipMorrisCos. (PM) filedalawsuit inSan Jose,             eonlplai nts weget is significant over thi s issue . .,
             C,al ifornia Federd court on ,LIy 8agai nst seren          because d packej ng issues or the taste is not the
         stores and four i rxlviduals diargirg them with sell i rg      same~" said Pfel, addi ng that cons .imsrs ere I ikely to
         "gray market" versionsof MarIborodgarettes The                 be daoeived by the products, wNch serves to "e
         suit requeststhat thecourt prohibit the defendants             PM's reputation. One of the def e-idants naned i n the
         f rom sellirig the d garettes, whi di are ded grtated for      sui t, store owner Al Cote, contexied that he has been
         export only but are i rtstead sold in the United 8tates.       selling thegray market dgarettesfor sevarel months
         PM i s el so seeki ng conlpensati on f or tradertlark          axi neva recei ved any oonpl a nts " I cal I ed the
         dilution, trademark infringement and unfalr                    government agendesthat I could and they ssld it was
         oonpetiti on . PM spokeanan M i ke Pf ei I asserted that       dc ;' hessid. PM'slegal actioncornesfourmonlhs
         the produds dffer in qud ity, warnirig lahels and often        dter itfiled asimilar suit agai rtst retailersin Kentudcy
         haveinferior pad< :aging. "Thenumber of cansumer               a•td I rd aia (AP 7/8) .

                                   Use Accommodation & Restrictions
         NH : Inmates Petition Couri:To Halt                            right to smdce and that corrections offidals haoe the
         Smoking Ban                                                    authoritytoissuetheban . Thesmokingbanwas
         T Prison filed acourt pEtition reoerttly requeding
            wenty-two i nmeles of the NeN Ha Mshire S2te                adopted in an effort to creefe a healthier errvi ronment .
                                                                        Governor JsenneShaheen (D), Corredions
         that the pri sort's smd<i rg ban - schecLl ed to take          Depa-tmerrt Canmissoner Henry Ridey aidthe
         ef f ed Sspte-nber 1- be stopped be;,wse it i s a              pri sori s North Unit msnager John Mati n a-e naned i n
         violdionoftheirrights Theinmalesmdntainthatthe                 the petiti on (AP 7/9) .
         ban is"purely apunistiment" aid that whiletdbaco
         use is not spedf icalIy guaranteed under the                   AK Countdown To Statewide School
         Coristituti on, the pri son exouraged them to snoke by         Smoking Ban
         supplyirgdgarettes, Thepetition,filedinMerrimadc
         County Skiperior Court, adcsthe court to issue a
                                                                        T eadhers andgrourxiswfll be f ng ere•rtsf on Ark~
                                                                                       pareMs atteidi
                                                                                                       orbi dden rom
         temporary restrai ni ng order agai rtst the pri son so thal    smoki ng or chew i ng tdaaxo beg nrb ng Augusl1,
         tdbaoco ussmay still beallowed inthe"outsdepuhlic              thenkstoarew Siatelanr . Unlikepriorprovisons
         ai r spaoes" withi n the wal I s aid on pri son grounds .      whi ch al I owed school boards to deai griate smoki ng
         Theirmatesdaimtheyfiledthepetitiononbehalf of                  areaa the ba-t makestoba xo use i I Iegal on d I publ ic
         all current srraki ng prisoners aswdl asthose who wi l l       sdiool grounds. Thos3caxp in violetion of the
         beirxxroerafeda!thefadlityinthefutura TheSt2te,                meaa .irecould face rrusderneanor fi nes between $10
         meaiwhile, oontendsthat the i m-ges hare no Iegd               and $100, The I a d s god , a mordi r g to its sponsor

         8                  -vY. P.O. Box 8019 ; Priraetor~ NA 08543 ; 6DIt2754900 ; BDI3-2758379 (fa) ; TW99-29

            SlateEdurdion Soard memUer JIm McLarty, isto                       Manufaoturers around theworld contend that the
            keep studenfsfroms+noking . "Itseamed tobealittle                  WHO should not have the Whority to enact
            bit of spedcing out of both sdes of your mouth to say              reottrictions on its produds British American Tobaxo
            ' You can't do it, but wecan' type thi ng ;' he said. "It          (BAT) Chai rn1an Marti n Broughton told the
            was pri marily to set agood acalple"                               oon>paafy's sharehddas this spri ng that the WHO is
            Thus fa• there has been I ittle protest to the I aw, but           attempti ng to i nypose wettern anti-smdci ng attitudes
            that is expected to diange onceteschers return in the              on dereloping countrieswith more importait heelth
            fdl . CardynCraft,whofrequentsoneschod tosee                       oonoerns "The WHO seemsto have been hijacked by
            her grarxicla#iter'sgannes, vdoed her oppostion to                 zedots i n its desireto s3t itself up as sone sort of
            the ban. " I' m a smoker, e1d I don't thi rtc there staul d        super-nanny ;" Broughton ded ared, ad-Ji ng that the
            be smoki rB i n sctools, but I' m tdki ng about basebalI           WHO'sdiief goal of youlh smoking oouid bedealt
            games, footbal I ganles and outs de of bascetbel I                 with by local lavs (AP 7/12) .
            ganes," shesaid . "I think it'skind of slly . Wdve                 OR: Veto Expected Forladen Down
            slways gone outsde the gym to snokke, but now you                  Tobacco Bill
            won't be pErnutteJ to dothat:" Craft's husbald,
            Pbi nsett County Judge Bi I I Crdt, bel i eees there wi I I be
                                                                               A    n oMHous31>i II origi rdly dEagned to craok
                                                                                    down on thesde of "gray market" or for export
            problanswiththenerulaw . "If thayoouldenforoeths                   orty dgarettesf w es cErta n death when it is harxled to
            law, it might bedifferent ;" hestated . "But they                  Governor bhn Kitzhzber (D) becam of aflurry of
            qnnot. And when you hare a I aw that you' re not                   arnexknaits twced onto it 2t the l ast mi nute The f i rst
            going to enforce because it's i rnpossbleto elforoe,               amendme nt amed at peialiang n>inorscaaght
            then we retelli rig our d1i Idre"t, ' You pidc axi dloose          illegallypurd>asingdgarettes Butthemost
            the I aws you want to obey,' ard we must not have                  controvere al acICfi ti on qme on ,bl y 13 when
            thd" (AP7/13) .                                                    rettaarant and bar owners suooeeded with a mewe
                                                                               that wouid reod<e local gorerrrnents' right to ban
            WHO World Tobacco Treaty May Thicaten                              sraki ng i n I curxfes and tavans Oregon Restauralt
            Overaeas Expansion                                                 Assodstion lobbyist Bill Pory dedared, "SYraking is
                 ooordi ng to theA ssod ated Press, the                        a I egal tt:tivity, a1d we operate I egal busi rwsqs~'
            A    inplementationof agld.xN tdbaooocontrol treaty                where customers should reta n the right to dhoose
            by the year 2003 oould negatively i nyaot U .S.                    whether they walt to st i n a smoky erNi ronntent or
            rn<roxrfacturers, who haoeturned to expa>9 thei r                  not . "Let'sfaceit ;" adCted Perry, "thssearen't stNetic
            oversees nrarket i n the wake of anti-tobacoo senti ment           d ubs" Representative Babara Ross ( D-Corval I i s)
            Stated de The treety, which was simheaded by the                   cGsagreed and sdd, "Weshould leavethisto lod
            World Heelth Orgenization (WHO) in May, was                        oommurrties. . .tomaketheirovunde:isons." The
            derelaped i n an effort to exert greater oontrd over the           Senate Publ ic Affai rs Committeedid not share Ross's
            advertisng, marketing a1d taxa[ion of tobacoo                      opi ni on however, and recormiaided passam of the
            productsworldrvide TheWHOgstimatesthat                             bill and forwarded it to the Jdnt Ways and Meens
            approxi matel y one-thi rd (1 .1 bl I I I on peopl e) of the       Carrnitteefor review . A policy aJviser for Kitzhaber
            worl d s pc p ul di on over age 15 smokes nearl y 800              i ntimated that the bi l l will rnoet l i keay bevdoed i n its
            mi I 11 on of thosesmoke°s red de i n derdopi ng                   current form . "Thegovernor ha;continually
            oamtriesthat havefew or no restrictiors The                        suppated I ad goverrments ri ght to regul ate i ndoor
            organization alsopd nted to a3 .2 peroent i ncreaai n              srraking ;" stated Steve Marks (Oregonian7l14) .
            worldMdecons.imption asaoamfor oonoern .
                                                                  Excise Taxes
                                                         Indians Benefit From CAieaper Sales

                  ith aruling on a la+vsuit
            W storeownersaganst Ineianpitting conveni enoe
                                            natiorn' siores
            acpe,ted soon, tax-f reedgarette sales on Ndive
                                                                               enforce it beausethe nations are sovereigi entities
                                                                               Tha soverei gnty, aocordi ng to the Federati on of Tax
                                                                               Adrinistr2tors, Fas causea Arizonato loeeout on
            American land arebeirg dosely sautirfzed .                         approxi matel y$16,4 mi l 11 on i n tdkaooo taxes per year .
            A lthough States have a l egal ri ght - reDognized by the          Roridawasdeprivai of about $15 .9 million and
            U.S. Sl,iprerne Court - to require I ndian nations to              Kanws $1 .6 nillion.
            oolled and pay &atetaxes on reservation sales of                   Ne,u York Stafe, theste of the laAraait in progress,
            gasolineandtdbaccoto ran-Indiare, they cannot                      Ioses 2rt Iee,t $200 mi I I ion each year i n annual tac

            TW99•29                  w.+"* P.O. Box 8019 ; FYi rpHton, N .J. 08543; 809-2754900 ; 609-2758379 (f ac) ; trr~,'a~lmaorg 9

'70036 8905
         reverxae, staQed Neaa York Assodetion of ConveniEnoe                 dgarettes f rom I ndiarrun aroke shcps and grocery
         Stores attorney Davi d Cterubl ri The assod ati on and               sloreson ressivation land snoeJanuay .
         its rlational headquaters filed the suit in an atteyrpt to           Thetax-exernpt sdes problan is not restrided to in
         conri ncethe Stateto enforce taxation on the I ndia~i                pErson sal es on! y, howerer . I rxli an avned and
         sales Arguments i n thethreeyear old suit were heard                 operated Internet weW tes are f lourishing, with the
         in April ard adedson ispending .                                     number established by Seneca retailers alonetripl i ng
         I n order to ool I ect tobaooo twes, other States hare               inthelastyear . Thestesoffercansunersnamabrand
         made conpects with i rxfividual tribes redcing i n their             dgazettestcv-free, something New York State
         boundaries Some, induding New York, were                             Assemblyman Jeffrey KI ein is atte°rpting to stop .
         unsuxessf ul i n erkxti rig ary taw agreenleits with the             KI ei n, who i s al so oonoerned abaA mi nors axess to
         Indians. Manyofthetribesoonprisngthelroquofs                         such onl i ne salas, has proposed legidation that would
         oonfedaracy, for eKample, vienred thetax isstae as                   ban d garette sales on the I nternet unIem the retai Ier
         havi rg moreto do with thei r sovereignty then dd Iars               agrees to pay State ta(es (AP 7/11) .
         lost. Regardles4someStatesaredaterminedto
         abolishthetax-freesdes SateLiquorCortrol Board
         agents in Washirx,fton seized neerly 8,500 cartons of
                                                                                                                          Ava Gaaser
                                                                                                                       Issaes Analysr
                                                                                                                        Ava&una .org

         10                -v.+), P.O. Box 8019; Prirastor~ N .J. 08W; 609-275490(1 ; 60&275&i79 (tao ; tn>ea Lmaorg         11N9a29


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