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Montana Attorney General Tim Fox announced Monday that by the end of 2020 the state will recover $53.5 million from tobacco companies that have been withholding money owed to the state during a years-long legal battle.

The money is part of a settlement to a lawsuit filed by the Montana Office of Consumer Protection in 2018 demanding that the companies uphold their end of a 1998 settlement requiring tobacco companies to pay the states where their products are sold a certain amount of money.

In Montana, that money is earmarked for tobacco quit programs, public health programs, and the Children’s Health Insurance Program, or CHIP, as well as the state’s general fund.

The total value of the settlement is estimated at $100 million.

“At the heart of this lawsuit is a Montana principle: A deal is a deal,” Fox said from Helena during a livestreamed press conference. “The defendants reneged on the deal from the get-go. This settlement holds them accountable.”

Tobacco can only be legally sold in Montana if it is approved by the state Department of Justice and included on the state Tobacco Product Directory. That directory includes products manufactured by the brands colloquially called “Big Tobacco,” like R.J. Reynolds Tobacco Company, which alone lists 23 different brands on the state register.

That company and others, like American Tobacco Corp. and Brown and Williamson Tobacco Corp., are required to pay the state of Montana annually an amount determined by an independent auditor to offset the harm tobacco causes. For Montana, that amount is generally between $3 million to $4.5 million.

But the companies argued that Montana wasn’t properly enforcing its tobacco laws as a way to avoid paying that money.

“The tobacco companies had absolutely no evidence to the effect that the state was not diligently enforcing its tobacco laws, and therefore had no basis on which to withhold these payments for all these years,” Fox said.

Also included in the settlement is a prohibition outlawing the tobacco companies from withholding the money again and barring the companies from filing complaints that the state isn’t enforcing tobacco laws without new evidence until 2030.

Those two factors, coupled with the backpay from 2005 to the present, make the settlement worth an estimated $100 million. That money will boost the state’s public health budget during a time when public health is incredibly important, Fox said.

Fox, in his final year as Montana’s attorney general, said that the settlement is the largest the state’s Office of Consumer Protection had ever worked on, and he thanked several attorneys and previous Montana attorneys general for their work in the legal battle, including outgoing Gov. Steve Bullock, who previously served as attorney general.

“Frankly, it’s a great way to go out as Montana’s attorney general,” said Fox, who will be replaced by Attorney General-elect Austin Knudsen in January 2021.

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Melissa Loveridge can be reached at or at (406) 582-2651.

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