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Tobacco deal may be near
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November 10, 1998: 6:58 p.m. ET
State attorneys general close to reaching $200B accord with industry
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NEW YORK (CNN) - A settlement between the tobacco industry and state attorneys general is near, sources close to the talks said Tuesday.
Reports that a deal has been struck, however, are premature, according to Christine Gregoire, attorney general for the state of Washington.
"No deal is done," she said from her hotel room in New York City Tuesday night. "I'm not saying we're not going to get there but, at this point, it's not done."
Gregoire had just arrived in the city and was on her way to the law offices of Wachtel, Lipton to continue discussions, she said.
She and attorneys general from seven other states have been negotiating with the tobacco industry for five months in an effort to resolve outstanding state lawsuits seeking to recover the costs of smoking-related Medicaid expenses.
According to sources close to the talks, a deal is near for about $200 billion over 25 years. So far, Mississippi, Florida, Texas and Minnesota have reached individual deals worth a total of $36 billion.
The remaining 38 states would have a week from the time a deal is offered to them to decide whether to join, the sources said.
The discussions have centered on a settlement that would represent about half of the $368.5 billion the industry offered June 20 last year. That deal foundered after health interests demanded more concessions.
The next offer, being negotiated by Gregoire, is expected to contain few of the health provisos that the June 20 deal had, according to one source.
"It's mostly about money. Not much health stuff," he said.
"These guys [the state attorneys general] have been persuaded to throw in the towel," said Richard Daynard, of the Tobacco Products Liability Project at Northeastern University in Boston.
Daynard pointed out that the industry has settled every state case that has gone to trial "for big bucks, and these guys [the state attorneys general] are all running scared. It makes no sense."
He also criticized the secrecy under which the deal has been negotiated.
"Given the fact that the public health community is being deliberately excluded, this certainly suggests the deal is very bad from a public health point of view," Daynard said.
The eight states whose attorneys general have been meeting with the industry in recent weeks in New York are from North Carolina, North Dakota, Colorado, New York, California, Washington, Oklahoma, and Pennsylvania.
"It'll be interesting to see" whether the remaining states that have filed suits against the industry sign on to the proposed deal, Daynard said.
"Though it's been carefully designed to minimize public scrutiny and opposition, it may mount anyhow," he said. "The AGs may begin to wonder why they're signing onto this thing."
Steve Duchesne, a representative of the tobacco industry, declined comment on the reports. 
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