Colorado Atty Gen To Sue 7 Foreign Tobacco Firms
DENVER (AP)--Attorney General Ken Salazar said Tuesday he has filed a lawsuit against seven foreign tobacco companies for failing to pay their escrow obligations under a Colorado tobacco law.
The lawsuits, filed Thursday in Denver District Court, were brought under a law enacted in 1999 as part of the implementation of the national 1998 Master Settlement Agreement with the major domestic tobacco companies.
Tobacco companies that are not parties to the agreement are required to pay approximately one cent into escrow accounts for each cigarette that they sell in Colorado.
Under the state law, nonparticipating manufacturers must maintain the escrow accounts for at least 25 years in order to provide the state a source of recovery should it need to litigate with these companies.
Salazar said failure of the manufacturers to comply with the escrow funds law could result in the termination of their right to sell cigarettes in Colorado, and a penalty of up to 300% of the amount improperly held from escrow for knowing violations.
"These enforcement actions are part of ongoing necessary efforts to realize our goal of decreased tobacco use," Salazar said.
The escrow amounts currently past due total approximately $15,000.
The seven foreign tobacco companies are Apara International and Mohanlal Hargovinddas of India; Cigarrera La Moderna of Mexico; Douwe Egberts Van Nelle of the Netherlands; PT Bentoel Prima Malang and PT Perusahaan Rokok Tjap Gudang of Indonesia; and Tekel Marketing & Distribution of Turkey.
Notices of violation have also been issued to twenty other manufacturers.