National Tobacco Council Urges Reasonable Appeal Bonds Requirements for Punitive Damage Verdicts
HOLLY SPRINGS, N.C., March 22 /PRNewswire/ -- North Carolina businesses involved in lawsuits with judgments in the millions and billions of dollars could face bankruptcy even before they have been able to have their appeals heard unless the current law is
``Defendants facing enormous punitive damages judgments are required to post a bond for at least the same amount as the judgment in order to be able to appeal the judgment. For companies facing the colossal monetary judgments that are common these days, this means they could be forced to file for bankruptcy before they can appeal their case,'' said National Tobacco Council President Lisa J. Eddington. ``Under current North Carolina law, multi-billion dollar judgments from other states against the tobacco industry could swiftly bankrupt the tobacco companies which, like any other industry, could not afford to post billions of dollars in bonds during the appeals process. This is an extremely harmful law which must be changed immediately to protect the people and assets of North Carolina,'' Eddington said.
In 1997, the North Carolina tobacco industry provided 242,361 jobs that enabled North Carolinians to earn over $6.9 billion in wages. In addition, the tobacco industry generated over $646 million in state and local taxes, not including the other taxes and fees, like property taxes, paid by the industry and their employees. Thousands of North Carolinians are depending upon millions of dollars provided to North Carolina by Phase 1 and Phase 2 of the Master Settlement Agreement. ``All of this economic activity would be lost if the tobacco companies were driven into bankruptcy,'' said Eddington.
Other states have taken action to protect its citizens and assets from this unfair situation that can cause the denial of due process. Legislatures in Virginia and Georgia recently passed a bill that solves this problem by placing reasonable limits on the size of appeals bonds and other states are considering doing the same. ``Similar legislation is desperately needed in North Carolina. We can't afford to deny due process to our state's tobacco companies, especially when doing so could cost the North Carolina economy so much in jobs, taxes and Master Settlement Agreement payments,'' said Eddington.
``We urge tobacco growers and supporters to contact both Governor Hunt and their members of the General Assembly to ask that every effort be made to immediately enact legislation that would provide for reasonable appeal bonds for punitive damage verdicts,'' said Eddington. ``Anyone who relies upon a viable tobacco economy in North Carolina owes it to themselves to take action on this issue,'' urged Eddington.