State resolves settlement with tobacco companies

A years-long negotiation to resolve a decade-old dispute with tobacco companies about implementation of the 1998 Tobacco Master Settle­ment Agreement has finally been completed, Kansas Attorney General Derek Schmidt said Monday.

In 2012, Kansas and 19 other states reached an agreement in principle, set forth in a term sheet, to settle the dispute that had been lingering for more than a decade.

Other states later joined the term sheet, bringing the total number of settling states to 26, including Kansas.

But the term sheet contained broad statements of agreement, not the many important details about permanently settling the dispute for past years.

Last month, Kansas and the other states reached final agreement with the tobacco companies on the detailed settlement agreement, and that settlement agreement now has been formally executed and has entered into force.

It replaces the term sheet and governs the covered actions of the parties going forward.

“This tedious negotiation has produced a workable product that will put Kansas on solid footing to comply with the MSA going forward,” Schmidt said. “We will work with our partners in state government to diligently enforce our obligations under this settlement and under the original MSA.”

Kansas has been operating under provisions of the term sheet since it was executed, and therefore has been complying with the main terms of the new settlement agreement.

Kansas already has taken major steps to come into compliance, including legislation enacted in 2015 that altered how cigarette sales are accounted for in the state, and negotiation and approval of compacts with the four resident Indian tribes to account for tobacco sales on tribal lands.

A copy of the new settlement agreement is available at

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