Columbian Tobacco Company Has Debts to Tennessee

The debt to state from a cigarette manufacturer

A South American cigarette maker is sued by the general Tennessee’s attorney, because the company didn’t make the required payments asked from law. The Columbian cigarette company, Procesadora Nacional Cigarillera S.A, was involved in a lawsuit. It was found that this tobacco company owes the state $300,000 for their cigarette selling in 2009.

The state says that the money had to be paid to a written account to help Tennessee pay for all the costs that were used to treat smokers. In 1998 the fourth biggest tobacco companies from the whole country signed with Tennessee and other 45 countries, a legal settlement agreement regarding the state lawsuits over smoking-related illnesses and deaths.

Tennessee has received more than $1.5 billion, since 2000, from those companies that agreed to sign settlement agreement. This agreement expires in 2025. The settlement money are used in some states for anti-smoking programs, which are helping people to quit smoking or to pay the farmers that offset tobacco crop losses.

The Tennessee state was criticized because all the payments go directly into the state’s general fund, where it is paying for the government’s operations. The agreement has restricted the promotion, marketing and advertising of cigarettes. It ordered the country’s biggest tobacco companies to pay to states the set costs based on cigarette sales. All these money will be spent on smoking-related health care.

Deputy Attorney General John Sinclair sustained that in exchange for this action states give up to claims that cigarette making companies had violated the consumer protection law.

There are smaller companies like Procesadora Nacional Cigarillera S.A, which are not part of the original settlement and they don’t have to follow the same rules. But if there are other companies that want to get a license to sell their tobacco products in Tennessee, they have to pay into separate accounts.

Sinclair declared that only 23 smaller companies pay into some accounts quarterly. If there is a situation when the state wants to sue any company for tobacco impact payments, they should seek access to the money that is in those accounts.

Tennessee is trying to convince a judge to force Procesadora Nacional Cigarillera S.A, known as Pronalci, which makes Poker brand cigs, to pay the whole amount of money into an account.