An article by the Troutman Sanders tobacco practice appears in the December issue of Smokeshop Magazine. The article, titled “Disputed 2003 MSA Payments Resolved,” discusses the recent rulings of the arbitration panel regarding the “diligent enforcement” dispute that erupted between Participating Manufacturers and governments of MSA settling states. The full text of the article can be found here.
Although twenty of the settling states and several PMs had resolved their dispute by early 2013, there were still several states that could not reach an agreement. A three-person arbitration panel was appointed in order to resolve the dispute, and on September 11, 2013 the panel handed down their ruling. The arbitrators found that nine states – New York, Iowa, Ohio, Washington, Colorado, Illinois, Oregon, North Dakota and Maine – had correctly enforced the escrow obligation. However, six other states – Indiana, Missouri, Pennsylvania, Maryland, Kentucky and New Mexico – had not, and therefore would bear the brunt of the negative adjustment for the PMs’ disputed 2003 payments.