The Vector Group has announced that it and its Liggett Group tobacco subsidiary have reached a comprehensive settlement resolving most of the individual Engle progeny tobacco litigation cases pending in Florida.
The Engle progeny cases stem from a 2006 Florida Supreme Court decision that decertified a class action but allowed former class members to file individual lawsuits and rely on general findings from the first class action.
“Under the settlement, which does not require court approval, more than 4,900 of the approximately 5,300 individual Engle plaintiffs will be dismissing their claims against Vector Group and Liggett,” Vector said in a statement.
“The company [Vector] expects to incur an after-tax charge of $53 million in the third quarter of 2013 related to the settlement agreement. Pursuant to the terms of the agreement, Liggett will pay a total of $110 million (or a present value, net of income taxes, of $53 million), with approximately $61 million ($38 million, net of income taxes) to be paid in a lump sum, and the balance of approximately $49 million (or a present value, net of income taxes, of $15 million) to be paid over 15 years.
“The settlement is expected to be finalized within 90 days and is contingent upon delivery of the required settlement documents by plaintiffs’ attorneys.”
“We are pleased to reach this landmark settlement, which prudently resolves substantially all of the Engle progeny cases pending against us,” said Bennett S. LeBow, chairman of Vector Group’s board of directors. “The Engle progeny cases have been the biggest litigation overhang on our company in the last decade, and this settlement substantially reduces the ongoing litigation risks, as well as related legal fees and expenses, of these cases.”
Category: Breaking News