Tribes Can’t Sue for Share of Tobacco Settlement Funds

The 9th U.S. Circuit Court of Appeals in San Francisco ruled Monday that a group of American Indian tribes do not have the right to sue tobacco companies for a share of the 1998 national tobacco settlement, the San Francisco Chronicle reports. Under the "landmark" deal, the tobacco industry agreed to pay $206 billion to 46 states for smoking-related health care costs. In a 1999 lawsuit, 20 tribes sued the tobacco companies for more than $1 billion, claiming that the industry had "illegally excluded" the tribes from the settlement. The tribes said that although the census data used to determine states' share of the settlement included two million American Indians, they "were excluded from the payouts" (Chiang, San Francisco Chronicle, 7/17). According to the suit, excluding the tribes "amounted to racial discrimination." The AP/Arizona Daily Star reports that the 46 state attorneys general did not include the tribes "because they were not a party to the original suits" settled under the agreement (Kravets, AP/Arizona Daily Star, 7/17). On Monday, the federal appeals court "tossed out" the lawsuit, ruling that the tribes had no right to sue "because they had not been harmed by the pact." Judge Robert Boochever wrote in the decision, "We conclude that the tribes did not show injury in fact based on their alleged exclusion from negotiation of the MSA (Master Settlement Agreement)." The appeals court ruling upheld U.S. District Judge Marilyn Hall Patel's 1999 decision dismissing the suit.

The plaintiffs, which included tribes from California, Nevada, Washington and other states, also claimed that a provision in the settlement that required tobacco companies to stop billboard advertising -- which tribes said would force them to remove ads from reservations and trust lands -- violated tribal sovereignty. However, the federal appeals court ruled the tribes "hadn't come up with any evidence of actual or threatened enforcement of the advertising ban on their land" (San Francisco Chronicle, 7/17). The tribes also said that tobacco companies raised cigarette prices to fund the settlement, a "hike" that Indian smokers must pay (AP/Arizona Daily Star, 7/17). The judges pointed out that states would use settlement funds to benefit all residents, including American Indians. John Phillips, a lawyer representing Philip Morris Cos., said that he "expected" the decision, citing Patel's "strongly written" ruling. William Audet, the attorney representing the tribes, said, "We're disappointed in the ruling, and we're considering our options at this point" (San Francisco Chronicle, 7/17).