COUNTY OF NEW YORK

THE STATE OF NEW YORK and DENNIS C. VACCO, Attorney General of the State of New York, for and on behalf of the PEOPLE OF THE STATE OF NEW YORK

Plaintiffs,

-against-

PHILIP MORRIS INCORPORATED; PHILIP MORRIS NABISCO HOLDINGS CORP.; R.J.REYNOLDS TOBACCO COMPANY; THE AMERICAN TOBACCO CO., INC.; AMERICAN BRANDS, INC.; BROWN & WILLIAMSON TOBACCO CORP.; LORILLARD TOBACCO COMPANY; LORILLARD INCORPORATED; LOEWS CORPORATION; UNITED STATES TOBACCO COMPANY; UST, INC.; B.A.T. INDUSTRIES, P.L.C.; BRITISH AMERICAN TOBACCO COMPANY, LTD.; BATUS HOLDINGS, INC.; THE COUNCIL FOR TOBACCO RESEARCH-U.S.A., INC.; and THE TOBACCO INSTITUTE, INC.,

Defendants.

The Ad-Hoc Coalition on the Proposed Tobacco Settlement, American Cancer Society, American Cancer Society Eastern Division, American Council on Science and Health, American Lung Association of Brooklyn, American Lung Association of Central New York, American Lung Association of Finger Lakes Region, Inc., American Lung Association of Hudson Valley, American Lung Association of Mid-New York, American Lung Association of Nassau-Suffolk, American Lung Association of Northeastern New York, American Lung Association of Queens, Coalition for a Smokefree El Barrio, Committee for a Tobacco-Free NY, Albert Einstein Cancer Center/Montefiore Medical Center, Nassau-Suffolk Tobacco Control Task Force, New York Public Interest Research Group, Smokefree Educational Services, Inc.

RUBERTI, GIRVIN & FERLAZZO, P.C.
Attorneys for American Cancer Society Eastern Division
120 State Street
Albany, New York 12207-2829
Tel. (518) 462-0300

Patrick J. McKenna, Esq., Of Counsel

Christopher P. Langlois, Esq., Of Counsel

Andrew Goldberg, Esq., New York Public Interest Research Group, Of Counsel

Dated: December 9, 1998

PRELIMINARY STATEMENT 1

THE UNPRECEDENTED MAGNITUDE OF THE PROPOSED TOBACCO SETTLEMENT REQUIRES HEIGHTENED JUDICIAL SCRUTINY AND THE APPOINTMENT OF A SPECIAL MASTER TO ADDRESS, BY PUBLIC HEARING AND COMMENT, THE SUBSTANTIAL CONCERNS IMPLICATED BY THE SETTLEMENT 8

A.The Prospective Immunity From Suits by Parties Not Represented in This Action Warrants Thorough Review 14

B.The Proposed MSA Contains Provisions Which Detrimentally Affect the Rights and Legitimate Interests of Third Parties and the General Public 18

1.Portions of the Proposed MSA are Inappropriately Vague with Respect to Manufacturer Obligations 20

2.Realization of Settlement Proceeds is Uncertain 23

3.The MSA Fails to Adequately Address the Compelling Public Interest in Supporting Prevention Efforts and Curtailing Promotion of Tobacco 25

C.This Court Should Postpone Approval of the MSA Pending an Impartial Review by a Special Master Including an Opportunity for a Fair Hearing on its Merits 27

POINT II

THE COURT SHOULD CONDITION ITS APPROVAL OF ANY SETTLEMENT ON THE INCLUSION OF A SIGNIFICANT TOBACCO CONTROL PROGRAM 30

CONCLUSION 36

In Re Agent Orange Products Liability Litigation, 597 FSupp 740

(EDNY 1984), aff’d ,818 F2d 145 (2d Cir. 1984)10

In the Matter of Colt Industries Shareholder Litigation, 155 AD2d 154, 553 NYS2d 138 (1^st Dep’t 1990), modified on other grounds, 77 NY2d 185, 565 NYS2d 755, 566 NE2d 1160 (1991)10

Eichenholtz v. Brennan, 52 F3d 478 (3d Cir. 1995)11

Flanson Realty Corporation v. Workers’ Unity House, Inc., 229 AD 179, 241 NYS 335 (1st Dep’t 1930)29

In Re General Motors Corp. Engine Interchange Litigation, 594 F2d 1106 (7^th Cir. 1979)10

General Motors Corp. Pick-Up Truck Fuel Tank Products

Liability Litigation, 55 F3d 768 (3d Cir. 1994)

cert. denied, 515 US 824, 133 L.Ed2d 45,

116 S Ct 88 (1995)11

Handschu v. Special Services Div., 605 FSupp 1384 (SDNY 1985), aff’d, 787 F2d 828 (2d Cir. 1986)11

In Re Joint E. & S. Dist. Asbestos Litigation, 982 F2d 721, 733 (2d Cir.1992)30

Lang v. Pataki, 176 Misc2d 677, 674 NYS2d 903 (Sup Ct NY County 1998)29

Masters Mates & Pilots Pension Plan and IRAP Litigation, 957 F2d 1020 (2d Cir 1992)11

Piambino v. Bailey, 757 F2d 1112 (11^th Cir. 1985),

cert. denied, 476 US1169, 106 S Ct 2889 (1986)11

In Re Traffic Executive Association-Eastern Railroads, 627 F2d 631 (2d Cir. 1980)12

Saylor v. Bastedo, 100 FRD 44 (SDNY 1983)12

United States v. Hooker Chemical & Plastics Corp., 607 FSupp1052 (WDNY 1985), aff’d, 776 F2d 410 (2d Cir. 1985)11

Warner Communications Securities Litigation, 798 F2d 35 (2d Cir. 1986)10

Weinberger v. Kendrick, 698 F2d 61 (2d Cir. 1982),

cert denied, 464 US 818, 104 S Ct 77 (1983)10, 30

Wilder v. Bernstein, 645 FSupp 1292 (SDNY 1986), aff’d, 848 F2d 1338 (2d Cir. 1988)10, 11

OTHER PUBLICATIONS

A Weak Tobacco Deal, The New York Times, November 17, 1998 20

Desperate for a Deal, Washington Post, November 20, 1998 at A29 19

Spending the Tobacco Billions, The New York Times, December 1, 1998 at A3024

Eyeing Tobacco Cash, The New York Post, November 17, 1998 23

This amicus curiae brief is submitted on behalf of the Ad-Hoc Coalition on the Proposed Tobacco Settlement pursuant to permission granted by Order of this Court dated December 2, 1998 following the Ad-Hoc Coalition’s letter request dated November 30, 1998. (Appendix A). The amicus submission date of December 9, 1998 coincides with the scheduled hearing on the proposed settlement of the action commenced by the State of New York against various tobacco manufacturers and other related entities pursuant to the terms of a Master Settlement Agreement (hereinafter "MSA"). The Ad-Hoc Coalition is comprised of a variety of organizations and individuals with unparalleled experience in dealing with the complicated issues arising from the enormous public health costs associated with smoking and the use of tobacco products. These organizations and individuals represent the most experienced and knowledgeable experts on tobacco policy in the State of New York. Many of the organizations are represented in the Commission for a Healthy New York, which is appointed by the New York State Commissioner of Health to advise the administration on tobacco prevention and control policies. Amici are thereby uniquely qualified to assist this Court in identifying various issues implicated by the proposed settlement of New York's lawsuit, which raise significant concerns as to public health and policy.

In 1994, a number of states took the unprecedented step of commencing legal actions against manufacturers of tobacco products and other related entities seeking, inter alia, money damages for the substantial public health costs incurred through Medicaid and other programs associated with the treatment and care of persons suffering from tobacco-related illnesses such as cancer, emphysema, and heart disease.

By 1997, several additional states, including the State of New York, commenced separate lawsuits against tobacco manufacturers also seeking to recover public health costs associated with tobacco-related illness. As more and more states joined in the effort to recover these enormous costs through litigation, settlement discussions on a national level between the various states and tobacco manufacturers were pursued. These settlement efforts resulted in a tentative agreement whereby the tobacco companies would have paid approximately $368 billion to the states and federal government, contingent upon federal legislation immunizing tobacco manufacturers and related entities from future suits and granting the Food and Drug Administration jurisdiction and authority to regulate tobacco-related products. This tentative settlement, however, collapsed in mid-1998 due to a lack of political support at the federal level.

In or about July 1998, after the demise of the tentative national agreement, the tobacco industry began negotiating with the Attorneys General of eight states with pending lawsuits, including New York State Attorney General Dennis Vacco.

The State of New York’s Lawsuit

The State of New York, through Attorney General Dennis Vacco, commenced the instant action against a number of tobacco manufacturers and other tobacco-related entitites on January 27, 1997. The litigation was commenced both on behalf of the State of New York and in a representative capacity on behalf of subordinate governmental entities (General Business Law Section 342-b) and "in parens patriae" on behalf of the People of the State of New York. (Original Complaint at Paragraph "16"). The original Complaint stated 19 distinct causes of action, ranging from "inducement of minors to smoke" to racketeering. The Complaint sought not only monetary relief representing past and future costs associated with providing public health care to treat tobacco-related illnesses, but also sought affirmative equitable relief directed toward preventing the further marketing, sale and distribution of tobacco products to minors. In addition, the Complaint specifically sought to require the manufacturing Defendants to take affirmative steps to "undo the harm to the public in New York State", including:

In a news release issued with the commencement of the lawsuit, the AttorneyGeneral’s Office stated that the action had been filed "against the nation’s tobacco companies, claiming that the industry deceived New Yorkers about the health effects of smoking and illegally lured millions of teenagers to take up the deadly habit." The salutary goals of the legal action in seeking to reduce and/or eliminate the high incidence of smoking among adolescents was repeatedly detailed throughout the Complaint. The introduction section of the Complaint asserted that "[m]ore teenagers smoke today than at any other time since the 1970s." (Complaint at Paragraph "2") The Complaint further averred that "[i]n fact, defendants have done nothing at all to prevent the spread of cigarette smoking addiction to children and adolescents which is of grave concern to the plaintiffs and is in total disregard of the public policy of the State of New York." (Complaint at Paragraph "3") Moreover, the Complaint directly linked the high incidence of underage smoking to the Defendants’ wrongful conduct, stating that

Defendants knowingly have placed cigarettes into the stream of commerce with the intent to have them sold to children and adolescents. Each year, defendants spend millions of dollars on marketing and public relations in New York to attract children and adolescents to begin smoking even though they are aware that the sale of tobacco products to children is illegal in the State of New York. (Complaint at Paragraph "7").

A review of the State of New York’s lawsuit and the various statements issued to the public leads to the inescapable conclusion that one of the overriding interests prompting the State’s litigation was to exact specific, affirmative restrictions against the tobacco industry’s concerted efforts to market their product to the youth of this State.

The Proposed Master Settlement Agreement

On November 16, 1998, the Office of the Attorney General announced in a press release that a tobacco settlement proposal had been reached in the State of New York’s action against the tobacco industry, negotiated by an eight-member team. The terms of the proposed settlement are set forth in the MSA which is presently before the Court.

The proposed MSA, representing the culmination of nearly five years of litigation and negotiations among the various states and tobacco industry defendants, would represent the largest settlement in national history. The potential ramifications of the proposed MSA on State of New York public health issues and policies are of equal significance. Unfortunately, none of the organizations or persons on whose behalf this amicus brief is submitted were invited to participate in the settlement negotiations or offer their valuable perspectives as to the possible implications of the settlement and its terms.

Throughout the brief, the expertise and input of the following affiants, whose affidavits are annexed hereto as Appendix "H", "I" and "J" are incorporated for the Court's consideration: Former United States Surgeon General, C. Everett Koop, M.D., former Federal Trade Commission Chairman and

Co-Director of the Advocacy Institute, Michael Pertschuk, and Harold P. Freeman, M.D., Chairman of the President’s Cancer Panel and Chairman of the Commission for a Healthy New York

The Court has been asked to approve New York State’s part of the largest civil settlement in the history of litigation. As set forth herein, amici are justifiably concerned about the implications of the proposed MSA, which was negotiated without the benefit of any input from public health organizations. As set forth in greater detail below, the terms of the proposed MSA, which were released to the general public not more than three weeks ago, have potentially far reaching and unprecedented consequences with respect to the interest of public health and the rights of third party organizations and entities such as the amici herein. The most overriding concerns are:

1. The unnecessarily short time period between the negotiation of the MSA and its submission to the Court for approval has limited any meaningful public debate or comment, both from the health community and the general public, as to the broader implications of the proposed settlement on public health policy and related interests.

1. The unquestionably broad grant of immunity offered to the tobacco defendants by the State of New York, both on its own behalf and on behalf of a number of third parties, as to both past and future conduct and damages raises significant legal and/or public concerns which must be addressed by the Court.

1. The proposed MSA is vague and indefinite concerning the obligations of the settling tobacco defendants with respect to advertising, marketing and sale restrictions, and is otherwise inappropriately indefinite as to the amount of settlement proceeds that the State may realize.

1. The proposed MSA fails to fulfill the important public interests which prompted the litigation by imposing adequate and reasonable terms aimed at reducing the use of tobacco-related products in the State, including the creation and funding of an independent statewide tobacco control program

These and other issues detailed herein raise significant concerns with respect tothe fairness, adequacy and reasonableness of the proposed MSA. These issues may only be appropriately resolved through active debate and comment among the parties to the litigation, advocates of public health, and members of the general public.

In sum, amici appreciate the fine efforts by the Office of the Attorney General to obtain a landmark settlement proposal from the tobacco industry. Indeed, they agree with the goals expressed by the original Complaint and the relief requested therein. Amici thus simply seek to implement the important policies underlying the Complaint by raising issues concerning the allocation of the monies and the implementation of a fair settlement process which insures the integrity of the public health and legal issues for future generations.

Amici accordingly request that the Court withhold any approval of the proposed MSA pending a public review period of at least 90 to 120 days in order to permit a comprehensive review of the proposed settlement terms and their likely impact on vital public interests. Amici further request that the Court appoint a Special Master to conduct an impartial review and hearing, establish a proper record and to illuminate the substantial concerns implicated by the MSA. Finally, amici strongly urge this Court to condition approval of any proposed MSA on the inclusion of a significant tobacco control program calculated to achieve New York’s stated public interest in reducing the use of tobacco-related products among its population.

THE UNPRECEDENTED MAGNITUDE OF THE PROPOSED TOBACCO SETTLEMENT REQUIRES HEIGHTENED JUDICIAL SCRUTINY AND THE APPOINTMENT OF A SPECIAL MASTER TO ADDRESS, BY PUBLIC HEARING AND COMMENT, THE SUBSTANTIAL CONCERNS IMPLICATED BY THE SETTLEMENT

The actions commenced by the State of New York and 40 other States against major manufacturers of tobacco products, as well as their agents and affiliates, are unparalleled in the history of governmental litigation. For the first time, each of the litigating states sought to hold tobacco manufacturers liable for the extraordinarily high public costs associated with tobacco-related illnesses-- estimated to be between 650 million and 1.3 billion dollars annually in New York alone. Furthermore, the State of New York also sought broad equitable relief vindicating New York’s important public interest in preventing the future proliferation of smoking among adolescents and children, requesting that the manufacturers of tobacco products be enjoined to take affirmative steps to prevent the distribution and sale of tobacco products to minors under the age of 18, including the discontinuance of all marketing efforts targeted at youth.

The proposed MSA submitted to the Court for approval by the parties is equally unparalleled in its scope and breadth. In exchange for certain payments by tobacco manufacturers and limited restrictions on certain advertising and marketing activities, the State of New York proposes to absolutely and unconditionally release, on its own behalf and that of all defined "releasing parties", all settling manufacturers with respect to a broad range of past and future claims. Once executed, the State of New York and a largenumber of other persons and entities will forever relinquish their claims against the settling manufacturers, both for themselves and future generations. It is unquestionably an Agreement which should not be entered into lightly without careful, deliberate consideration of the Agreement’s effects on the rights of both the immediate litigants and third parties.

This Court must take an active role in ensuring that the proposed Agreement submitted by the litigants is fair, adequate, reasonable and consistent with the overriding State policies on which this action was originally predicated. The Attorney General of the State of New York commenced this litigation both on behalf of the State of New York and in a representative capacity on behalf of subordinate governmental entities (General Business Law Section 342-b) and "in parens patriae" on behalf of the People of the State of New York. (Complaint at Paragraph "16"). The proposed MSA underscores the representative nature of the action, providing for a release of claims not only on behalf of the State, but also all municipal subdivisions and "persons or entities acting in a parens patriae, sovereign, quasi-sovereign, private attorney general, qui tam, taxpayer, or any other capacity, whether or not they participate in this settlement" with the limited exception of persons seeking individual or private relief. (MSA Section XII(pp)).

Given the representative nature of the original litigation and proposed release, the instant action is properly viewed as in the nature of a class action which "shall not be dismissed, discontinued or compromised without the approval of the court." (CPLR Section 908). While CPLR Section 908 does not prescribe specific guidelines for a Courtto follow in determining the merits of a proposed class settlement, State and federal case law have outlined the nature and breadth of the Court’s obligations. In the Matter of Colt Industries Shareholder Litigation, 155 AD2d 154, 553 NYS2d 138 (1^st Dep’t 1990), modified on other grounds, 77 NY2d 185, 565 NYS2d 755, 566 NE2d 1160 (1991).

STANDARD OF REVIEW

The central question raised by a proposed settlement of a class action is whether the compromise is fair, reasonable, and adequate. Weinberger v. Kendrick, 698 F2d 61 (2d Cir. 1982), cert denied, 464 US 818, 104 S Ct 77 (1983). In general, the Court’s inquiry should be directed to the likelihood of success, the extent of support from the parties, the judgment of counsel, the presence of bargaining in good faith, and the nature of the issues of law and fact. Id. The Court may also gauge the extent to which the proposed settlement advances the objectives underlying the litigation. Wilder v. Bernstein, 645 FSupp 1292 (SDNY 1986), aff’d 848 F2d 1338 (2d Cir. 1988). The burden of establishing the fairness, adequacy and reasonableness of the settlement appropriately rests on the proponents of the settlement. In Re General Motors Corp. Engine Interchange Litigation, 594 F2d 1106 (7^th Cir. 1979).

The Court’s obligations in reviewing the terms of a proposed class action settlement have been characterized as a "heavy duty" analogous to that of a "fiduciary" or "guardian" of the rights of both represented and unrepresented parties. WarnerCommunications Securities Litigation, 798 F2d 35 (2d Cir. 1986); In Re Agent Orange Products Liability Litigation, 597 FSupp 740 (EDNY 1984), aff’d, 818 F2d 145 (2d Cir. 1984); Piambino v. Bailey, 757 F2d 1112 (11^th Cir. 1985), cert. denied, 476 US1169, 106 S Ct 2889 (1986). The Court’s fiduciary obligation to ensure the fairness of the proposed agreement goes well beyond the interests of the immediate parties to the litigation. Indeed, if the rights of third parties are implicated by the proposed settlement of a class action, the fairness of the settlement to the settling parties, standing alone, is not enough to earn the judicial stamp of approval; rather the third parties’ interests must be duly considered. Masters Mates & Pilots Pension Plan and IRAP Litigation, 957 F2d 1020 (2^nd Cir. 1992); Eichenholtz v. Brennan, 52 F3d 478 (3rd Cir. 1995). It is within the Court’s discretion to reject a proposed class action settlement even if a majority of class members approve of the proposal. Handschu v. Special Services Div., 605 FSupp 1384 (SDNY 1985), aff’d 787 F2d 828 (2d Cir. 1986).

Courts have consistently reviewed proposed class action settlements not only with respect to the fairness, adequacy, or reasonableness of the proposed agreement as to the immediate parties, but also with an eye toward nonparties, particularly where important public interests are implicated. Wilder v. Bernstein, 645 FSupp 1292 (SDNY 1986), aff’d 848 F2d 1338 (2d Cir. 1988) [in reviewing proposed settlement of a class action challenging New York's statutory child care service scheme, district court had to determine that the proposed settlement did not threaten to impair delivery of child care services to children or otherwise adversely affect interests of the public at large]; United States v. Hooker Chemical & Plastics Corp., 607 FSupp 1052 (WDNY 1985), aff’d 776F2d 410 (2d Cir. 1985) [where significant public interests are at stake, court must determine whether proposed decree adequately protects public interest]; General Motors Corp. Pick-Up Truck Fuel Tank Products Liability Litigation, 55 F3d 768 (3d Cir. 1994), cert. denied, 515 US 824, 133 L.Ed2d 45,116 S Ct 88 (1995) [proposed settlement in class action rejected where, inter alia, agreement made no provision for the repair of the allegedly life threatening defect].

As set forth in detail below, the proposed MSA offered to the Court for approval by the State and the settling manufacturers raises a number of significant public policy concerns which implicate the rights and interests of a variety of public and private individuals, entities and groups. Before any approval of the proposed settlement is issued, it is incumbent upon the Court to first familiarize itself with the facts underlying the proposed settlement, the impact such a settlement might have on both State public policy and third party interests, and the legitimate concerns raised by amici and others. Only in this manner may the Court render an "intelligent comparison" as to the costs and benefits of the proposed settlement. In Re Traffic Executive Association-Eastern Railroads, 627 F2d 631 (2d Cir. 1980); Saylor v. Bastedo, 100 FRD 44 (SDNY 1983).

To that end, amici respectfully request that the Court withhold its approval or disapproval of the proposed MSA pending the appointment of a Special Master to conduct a public hearing and accept comments with respect to the potential effects of the proposed agreement on State public policy and third party interests. The brief delay in the approval process which would result from such a careful, deliberative process will not cause any prejudice, substantial or otherwise, to either the State or settling Defendants. The referral of this matter to a Special Master for the purpose of accepting public comment would, however, permit the Court to discharge its obligations under CPLR Section 908 in an educated manner calculated to ensure that the unprecedented settlement proposed by the parties does not frustrate the important public interests of the State or unjustifiably interfere with the legitimate rights of third parties.

A.The Prospective Immunity From Suits by Parties Not Represented in This Action Warrants Thorough Review.

Perhaps the most significant aspect of the proposed MSA requiring heightened judicial scrutiny is Section XII, setting forth the State’s unquestionably broad release of liability in favor of the settling manufacturers, their agents and affiliates. The grant of immunity envisioned by the MSA will serve to severely restrict not only the ability of the State of New York to vindicate the public interest through litigation, but also purports to immunize the manufacturers of tobacco products from suits by localities, other subdivisions of state governments, and other third parties seeking to act in furtherance of the public interest.

The sheer breadth of the proposed release by the State of New York under the terms of the MSA is staggering. Pursuant to Section XII(a)(1), upon final acceptance of the agreement, the State of New York "shall absolutely and unconditionally release and forever discharge all Released Parties from all Released Claims that the Releasing Parties directly, indirectly, derivatively or in any other capacity ever had, now have or hereinafter can, shall or may have."

Reference to the Definition section of the proposed Agreement (Section II)demonstrates the breadth of the release contemplated under the MSA. The definition of "Releasing Party" is not simply restricted to the State of New York, but also purports to include, "to the full extent of the power of the signatories", all political subdivisions of the State, all public entities, public instrumentalities and public educational institutions, and "all persons or entities acting in a parens patriae, sovereign, quasi-sovereign, private attorney general, qui tam, taxpayer, or any other capacity, whether or not they participate in this settlement" with the limited exception of persons seeking individual or private relief. (MSA Section II(pp)).

The breadth of this purported release raises significant questions concerning the State’s ability to issue a release on behalf of nonparties to this litigation. While the State may represent counties in a representational capacity pursuant to General Business Law Section 342-b, which permits objecting counties to opt-out of any proposed settlement, the source of the State’s purported right to represent and waive the claims of other political subdivision, from villages to school districts, is much less clear. No proposed settlement should be approved in this action absent a judicial determination of the State’s ability to waive claims on behalf of these various "represented parties."

Similarly, the State’s attempt to issue a release on behalf of "all persons" acting "in any capacity, whether or not they participate in this settlement", with the exception of suits seeking individual or private relief, again raises concerns as to the source of the State’s asserted power to grant the Defendant manufacturers the proffered immunity. It is further unclear as to the affect such a purported release would have on the rights and interests of various association and organization entities, such as many of the amiciherein, to vindicate public health policy through litigation. No settlement should be approved until the precise parameters and legality of the proposed release is determined by the Court.

The definition of "Released Parties" is equally encompassing, including not only the Defendant manufacturers but also their "affiliates, divisions, officers, directors, employees, representatives, insurers, lenders, underwriters, Tobacco-Related Organizations, trade associations, suppliers, agents, auditors, advertising agencies, public relations entities, attorneys, retailers and distributors", and may also include other manufacturers not party to the litigation to the extent they elect to participate in the Consent Decrees in the future. (MSA Section II(oo)). Judicial scrutiny is warranted to examine whether such a broad release, including in its terms not only the direct party Defendants to the action but also a wide variety of nonparty related persons and entities, is fair and reasonable in relation to the asserted benefits of the settlement to the State.

Finally, the rights which the State proposes to surrender, both on its own behalf and on behalf of the other "releasing parties" are enormous. The "Released Claims" relinquished in favor of the Defendant manufacturers and other releasees include, "for past conduct, acts or omissions (including any damages incurred in the future arising from such past conduct, acts or omissions), those Claims directly or indirectly based on, arising out of or in any way related, in whole or in part, to (A) the use, sale, distribution, manufacture, development, advertising, marketing or health effects of, (B) the exposure to, or (C) research, statements or warnings regarding Tobacco Products... or any comparable Claims which could be or could have been asserted now or in the future..." The proposed immunity goes even further, however, and also purports to release the settling Defendants from monetary claims based on "future conduct, acts or omissions" directly or indirectly based on, arising out of or in any way related to, in whole or in part, the use of or exposure to Tobacco Products manufactured in the ordinary course of business, "including without limitation any future Claims for reimbursement or health care costs allegedly associated with the use of or exposure to Tobacco Products." (MSA Section II(nn)).

The inclusion in the release of all future claims arising out of "the use of or exposure to Tobacco Products manufactured in the ordinary course of business" is of significant public interest. Under the terms of the proposed MSA, the State is waiving nearly every conceivable claim which might arise in the future, whether known or unknown, foreseen or unforeseen. Such a broad waiver would presumably include all claims related to environmental and second-hand smoke claims, notwithstanding that such claims were not part of the original lawsuit and the fact that the full health costs of such claims are not yet fully known. The State is therefore strictly limited to the settlement proceeds negotiated in the proposed Agreement, regardless of the possibility of escalating public health care costs in the future or other changed circumstances. The Court must take care to ensure that the State’s waiver of all prospective claims is truly in the best interests of future generations, and if so, must further inquire whether the settlement proceeds contemplated under the MSA are sufficient to protect against future health related costs and other unknown contingencies. In addition, the proposed MSA not only protects the interests of the settlingDefendants and the broad class of parties deemed to be "released parties", but also, in effect, protects the interests of other potential third party defendants who are not signatories to the proposed Agreement. Under Section XII (a)(4), in the event that a "releasing party" such as the State attempts to bring an action asserting a "released claim" against a person or entity not covered under the contemplated release, and that person or entity brings a third party claim in the nature of indemnification or contribution against a Defendant manufacturer or other "released party", the released party is entitled to an offset against the settlement payments to the State proposed by the MSA in the amount of any settlement or judgment rendered the third party indemnification/contribution claim. Similar offset provisions are provided in the Agreement with respect to claims against retailers, suppliers and distributors of tobacco products. Such offset provisions can only serve to dissuade the State and other "releasing parties" from vindicating the public interest in the future through actions against non-released entities for tobacco-related claims for fear that the successful recovery of a settlement or judgment will only serve to reduce the State’s share of settlement proceeds under the MSA. The provision, in effect, serves to immunize third party persons and entities who are not signatories to the proposed Agreement and who are not subject to its payment provisions or other obligations.

The overbreadth and potential unenforceability of the proposed release by the State on behalf of the variety of "releasing parties" identified in Section II(pp) of the MSA is apparently recognized by the litigants and dealt with in Section XII(b) of the proposed Agreement. Section XII(b) provides that "if a Releasing Party (or any person orentity enumerated in subsection II(pp), without regard to the power of the Attorney General to release claims of such person or entity) nonetheless attempts to maintain a Released Claim against a Released Party", and the purported release is deemed unenforceable for lack of authority, then any "released party" is entitled to an offset of future settlement proceeds in the amount of any judgement or settlement obtained. Such an offset provision again protects the Defendant manufacturers from an extremely broad class of possible plaintiffs, and further raises a potential conflict of interest on behalf of the State seeking to dissuade such future suits in order to preserve anticipated settlement proceeds. As set forth above, the proposed broad grants of immunity proffered by the State in favor of the Defendant manufacturers and various other disparate entities raise significant concerns with respect to the power of the State to tender such releases on behalf of a wide variety of entities and persons, the sheer breadth of the proposed releases (including the provisions with respect to future damages), and potential conflicts of interest relating to the offset provisions. Each of these concerns implicate the rights and interests of various third parties, including amici, who may be hindered in their efforts to promote State public policy.

Accordingly, substantial issues are raised as to whether the broad immunity contemplated under the Agreement is truly fair, adequate and reasonable under the totality of the circumstances with respect to both the parties to the litigation and third parties. These issues should be addressed by the Court prior to any approval of the MSA through the appointment of a Special Master and the conduct of a hearing with public comment.

B.The Proposed MSA Contains Provisions Which Detrimentally Affect the Rights and Legitimate Interests of Third Parties and the General Public

The instant litigation was commenced by the State of New York with the admirable goal of vindicating the State’s strong public interest in reducing the incidence of smoking and the use of other tobacco-related products among its population, particularly among adolescents. The State not only sought to recover from the Defendant manufacturers an award of damages representing past public health costs related to smoking, but further sought broad injunctive and other equitable relief requiring the Defendant parties to "take all reasonable and necessary steps to prevent the distribution and sale of tobacco products to minors under the age of 18" and to cease any conduct targeting minors and/or inducing minors to smoke.

The proposed MSA, however, fails to provide for reasonable and adequate restrictions upon the Defendant manufacturers with respect to the reduction and/or elimination of underage smoking or any genuine measures which would serve to prevent the commercial targeting of minors as potential customers. While the MSA sets forth a number of provisions which purport to address these significant concerns of State interest, these asserted restrictions are in large part either too vague or not reasonably adequate to properly address the important issues raised by the State’s action. As set forth above, this Court is obligated to examine the proposed MSA for its fairness, reasonableness and adequacy and to determine whether the resolution detrimentally affects the rights and legitimate interests of third parties and the generalpublic. Wilder v. Bernstein, 645 FSupp 1292, aff’d, 848 F2d 1338 (2d Cir.1988). In the instant case, amici, as leading authorities on public health issues, have identified a number of serious and credible concerns about the proposed MSA despite a remarkably short time frame in which to work. Dr. C. Everett Koop, in a joint statement with David Kessler, Commissioner of the Food and Drug Administration from 1990 to 1997, sharply criticized the MSA as providing:

[c]ents on the dollar compared with states that have settled their cases individually; no provision for federal regulation of an addictive drug; stunningly weak restrictions on advertising; increased roadblocks to the federal government to increase cigarette taxes; improper immunity for an industry that has still not admitted its misdeeds. (Desperate for a Deal, 11/20/98 Washington Post p.A29).

In its editorial entitled, A Weak Tobacco Deal, The New York Times (11/17/98) correctly pointed out that the MSA is a "mostly financial settlement" which does "far too little to combat teen-age smoking, the primary goal that any legal settlement should advance." In fact, the proposed MSA as it is currently written, appears to contain loopholes and vague terms in the areas affecting public health interests. Furthermore, the two initiatives which every major health organization consider critical for reduction of smoking related public health problems -- meaningful advertising restrictions and "look-back provisions" which introduce a profit motive for tobacco companies to achieve reductions in teen smoking -- are missing entirely.

1.Portions of the Proposed MSA are Inappropriately Vague With Respect to Manufacturer Obligations.

Considering the specificity with which most terms are defined in Section II of the MSA, it is disconcerting that the language in provisions which purport to restrict effortsto market tobacco to minors is hopelessly vague, which, at best, make these provisions difficult to enforce, and at worst, leading inexorably to legal battles at the outset of each new tobacco marketing campaign. For example, while such open-ended terms as "Outdoor Advertising" are defined with actuarial precision (MSA Section II (ii)), terms which prohibit the marketing cigarettes to youth are simply defined as those actions for which the "primary purpose is to initiate, maintain or increase the incidence of Youth smoking within any Settling State." (MSA Section III(a) emphasis added). Such a provision would presumably allow the industry to continue marketing to kids if they couch such efforts among several other purposes of the advertising. Another vague restriction would prohibit any defendant from sponsoring "events in which the intended audience is comprised of a significant youth audience". (MSA Section III(c)(1)). The precise percentage of an audience need be identified as "youth" for the restriction to apply is entirely unclear. Compounding this vagary is the possibility that Defendants may be excused from the restriction if they "intend" the event to be for an adult audience even if a significant proportion of the audience is comprised of youth. This Court can well imagine the difficulty and cost of monitoring such marketing efforts, let alone proving the intent of an advertising campaign. Indeed, according to an articlepublished by the Salt Lake Tribune on December 8, 1998, United States District Judge Dee Benson has delayed approval of the comparable settlement proposal in the State of Utah based on his concern that the generality of the obligations imposed upon the tobacco industry will engender significant litigation over its meaning and enforcement. In addition to being vague in critical areas, the MSA contains loopholes which could render the youth marketing restrictions meaningless. One immediate example of a youth advertising loophole would be tobacco sponsorship of a NASCAR tour. In such a case, although youth comprise a significant proportion of the audience, the promotion of cigarettes may be permitted at NASCAR racing under the"Brand Name Sponsorship" exemptions set forth in Sections II and III of the MSA. Another example involves the MSA’s definition of "underage", which is stated as "younger than the minimum age at which it is legal to purchase or possess...cigarettes." Since New York does not have any statute criminalizing the "purchase" or "possession" of cigarettes by minors, but rather only the sale of cigarettes to minors, it may be argued that all restrictions as to "underage" smoking in the proposed MSA do not apply to New York’s children.

Certain prohibitions against outdoor and transit advertising are largely empty concessions when one considers that many New York localities, including New York City, Yonkers, New Rochelle, Albany, Rochester and Buffalo have enacted legislation restricting outdoor tobacco advertising and most transit authorities have adopted policiesagainst accepting tobacco product advertising. However, even empty concessions are not devoid of loopholes: The definition section states "Outdoor advertising" does not mean posters (of up to 14 square feet) on the inside or outside of retail stores. (MSA Sections II(ii) and III (d)).

Additional examples of loopholes and vague terms which permeate the proposed MSA are set forth in a report by the Tobacco Control Resource Center entitled, "The AG Settlement: Short on Time and Money, Long on Loopholes. A copy is annexed as Appendix "E".

2.Realization of Settlement Proceeds is Uncertain.

The presence of loopholes is not limited to those provisions which restrict the marketing of cigarettes. Significantly, the State’s compensation appears vulnerable to substantial downward adjustments in the event of a number of contingencies. The most compelling concern is that the federal government may have a legitimate claim to up to half of the funds received by the states under the settlement. Immediately after the settlement was announced, a spokesman for President Clinton asserted:

"The federal government is under some obligation to claim some of this money" as reimbursement for its share of smoking-related Medicaid costs. "We look forward to working with the states to figure out the best way to do that or...to make sure the money is used for children and the reduction of teen smoking," the spokesman, Joe Lockhart, told reporters. (States Fuming Over Feds’ Smoke $ignals; U.S. Eyeing Tobacco Cash, The New York Post, November 17, 1998.)

Although the Attorney General’s Office downplayed the merits of this assertion ("Wedon’t believe the feds have a claim to the money and...we think we’ll prevail." Id.), the compelling nature of the federal government’s argument was accurately captured by The New York Times in a December 1, 1998 editorial:

Congress and President Clinton have a significant role to play in this fight. They have leverage through a strong legal argument that the Federal Government has a right to part of the settlement since it provides about 50 percent of the Medicaid funds that state attorneys general were trying to recover. Indeed, a Federal waiver by Congress may be required for the states to keep all the money. (Spending the Tobacco Billions, The New York Times, December 1, 1998 at A30)

In sum, amici contend that the Special Master should explore the merits of such a potentially devasting contingency. Furthermore, the payments to states under the MSA are "back-loaded." In the year 2000, the Defendants would pay half of what they would in 2018, even taking inflation into account. Smaller payments in the early years would minimize the financial impact on the tobacco companies and avoid immediate price increases that are necessary to reduce consumption and make tobacco products less affordable for youth.

Finally, the financial obligations are apparently imposed only on individual tobacco subsidiaries as opposed to their parent corporations which have enjoyed many years of profit from their tobacco holdings. The MSA also provides that none of theDefendants’ multi-national holdings may be reached. If a company were to suffer major legal defeats in other pending or future lawsuits and be required to pay lump sum damages in the range of billions of dollars, a Defendant could declare bankruptcy under Chapter 11.

If it did, then those larger payments placed in the later years of the agreement might never materialize. Furthermore, because only the tobacco manufacturing divisions and not the parent corporations are liable under the MSA, such a result would mean that the states have given up all future claims for far less than they had bargained for.

3.The MSA Fails to Adequately Address the Compelling Public Interest in Supporting Prevention Efforts and Curtailing Promotion of Tobacco.

The following shortcomings and other issues detailed below raise significant concerns with respect to the fairness, adequacy and reasonableness of the proposed MSA. These issues may only be appropriately resolved through active debate and comment among the parties to the litigation, advocates of public health, and members of the general public.

The MSA fails to fulfill the important public interests which prompted the litigation imposing adequate and reasonable terms aimed at reducing the use of tobacco-related products in the State, including the creation of funding of an independent statewide tobacco control program.

(a) Expand Outdoor Advertising Restriction. The settlement provides a 14 square foot hole through which Defendants can drive a significant amount of outdoor advertising. Amici recommend that the ban be expanded to include all outdoor brandname advertising of tobacco products, and not just those billboards larger than 14 square feet.

(b) Money Not Directed Toward Solving the Problem. The settlement does nothing to assure that Defendants’ payments will be used in New York State to correct the damage caused by their actions. No money is set aside either to prevent teen smoking or to assist New York smokers who want to quit. (See Point II, infra)

(c) Set Youth Smoking "Look-back" Penalties. One of the most glaring omissions in the proposed deal is the absence of any potentially effective mechanism to require the industry to actually reduce youth smoking. A critical component of an adequate settlement would include a "look-back" provision which would require tobacco companies to pay stiff penalties if specified targets for reducing youth smoking are not reached by certain dates. Under such a provision, if the goals set for reductions in teen smoking are not met, company payments to the state would increase by an amount equal to the increased revenue they derive from the sale of product above and beyond what they would have achieved had the goals been met. Lookback provisions would provide Defendants with a strong economic incentive to reduce youth sales and are an essential component of any state settlement which is serious about reducing sales of tobacco products to minors. (See Koop Affidavit, Appendix "H", Paragraph "9").

(d) Fund Smoking Cessation. Amici urge the Court to follow the model provided by the Minnesota Settlement to ensure that a portion of the settlement proceeds go to an independent, non-profit entity to reimburse smokers for clinical and pharmacologic assistance in stopping smoking. (See Point II, infra)

C.This Court Should Postpone Approval of the MSA Pending an Impartial Review By a Special Master, Including an Opportunity For a Fair Hearing on its Merits.

The opportunity for any meaningful review of the proposed settlement – a period of less than three weeks – has been shockingly brief in light of the monumental impact of the proposed settlement as outlined herein. Indeed, as Dr. C. Everett Koop noted, the tobacco companies struck this deal behind closed doors, specifically excluding public health experts from the complicated negotiations. (Koop Affidavit, Appendix "H", Paragraph "4"). Dr. Koop opines that the tobacco companies’ rush to push the proposed MSA through the Courts without adequate time for review is "unconscionable" (Id. Paragraph "5"). The proposed MSA clearly raises a number of substantial concerns which implicate interests of importance both to the State of New York and other third parties. No approval of the proposed MSA should be granted by the Court unless and until these and other issues are thoroughly considered and understood.

Based on the concerns identified herein, amici strongly urge this Court to provide additional time to allow for a more thorough analysis of the proposed settlement’s short and long-term ramifications on public health issues and to determine whether the proposed MSA is, in fact, truly in the best interests of all potentially affected parties. The Court is empowered under CPLR Section 907 to issue Orders governing the conduct and procedure of class suits. Pursuant to this discretion, amici respectfully request that any decision by the Court approving or disapproving of the proposed MSA be held in abeyance for a period of not less than 90 to 120 days and that a Special Master be appointed in the interim to hold a public hearing and receive public comment as to thevarious issues raised by the proposed settlement. Amici are joined in this request by such public health experts as Drs. Koop and Freeman and Chairman Pertschuk. (Koop Affidavit, Appendix "H", Paragraph "12", Pertschuk Affidavit, Appendix "I", Paragraph "12", Freeman Affidavit, Appendix "J", Paragraph "12").

The appointment of a Special Master will both assist the Court in its consideration of the proposed settlement and serve as a moderator of public debate and comment. Many of the issues raised by the proposed settlement – including the underlying causes of youth smoking and effective means of prevention – are concededly complex issues which require the assistance of public health experts to properly appreciate. Those persons and entities with appropriate training and experience dealing with tobacco-related health issues should be permitted to be heard on the proposed MSA, rather than simply the attorneys who drafted the proposed Agreement on behalf of the State and the tobacco companies who do not have any comparable background dealing with specific public health issues. A public, disinterested forum on the merits of the proposed settlement would also serve to dispel public cynicism regarding any perceived conflict of interest associated with the payment of substantial attorneys’ fees to the public and private firms which participated in the negotiation of the deal.

There can be no substantial prejudice to the parties if the approval or disapproval of the proposed MSA, a complex document negotiated over the course of several months, is briefly delayed in order to properly consider its implications. However, substantialand potentially irrevocable prejudice to the citizens of the State of New York and other third parties may very well result if the proposed MSA, offering broad immunities and implementing unquestionably sweeping changes in New York public health policy which will bind generations to come, is approved without the benefit of a full and complete understanding of its implications.

Amici therefore respectfully request that any determination by the Court approving or disapproving of the proposed MSA be delayed for a period of at least 90 to 120 days and that a Special Master be appointed in the interim to hold a public hearing and receive public comment as to the implication of the proposed settlement.

POINT II

The Court is under no obligation to accept the terms of the proposed Master Settlement Agreement simply on the recommendation of the settling parties. To the contrary, the Court is under an affirmative duty to exercise its independent judgment and discretion in reviewing a proposed class settlement to ensure that its terms are fair, adequate and reasonable both to class members, third parties and the general public. Weinberger v. Kendrick, 698 F2d 61 (2d Cir. 1982). To the extent a proposed class settlement fails to meet these criteria, the proposal must be rejected. The Court also, however, possesses the inherent judicial authority to guide the parties in developing a proposed settlement which will satisfy the Court as to its fairness and adequacy. In Re Joint E. & S. Dist. Asbestos Litigation, 982 F2d 721, 733 (2d Cir.1992) [Court may suggest but not impose settlement terms].

Given the substantial costs of smoking and other tobacco-related illnesses to the State of New York, both in human and economic terms, and further given the stated goals of the State litigation in achieving meaningful tobacco control concessions, it is the position of amici that the proposed MSA, as currently drafted, is not appropriately fair, reasonable or adequate in the absence of a comprehensive program, financed through a dedicated funding stream, to reduce tobacco use in the State of New York. Amici therefore request that the Court condition any approval of the proposed MSA upon theinclusion of a significant and meaningful tobacco control program to be funded from a portion of the settlement proceeds. Each year in the State of New York, tobacco-related diseases kill more than 31,000 people, accounting for nearly one fifth of all deaths. Direct medical costs related to smoking approach four billion dollars annually. While the tobacco companies spend one million dollars a day to promote use of their products in New York, the MSA -- despite providing funding at a level of nearly one billion dollars per year -- does not provide for any meaningful counterbalance to the enormous resources of the tobacco industry. Therefore, the State’s important interest in reducing the prevalence of smoking among its population will only be served through the adoption of a comprehensive, statewide tobacco control program that will act to effectively reduce and prevent tobacco use, especially among children. These efforts should include prevention, education, and treatment components; areas which are not adequately addressed in the MSA.

The State’s proposed settlement with the tobacco industry, if approved, will generate revenue to the State in an amount averaging nearly one billion dollars per year. This provides an unprecedented opportunity to support an ongoing comprehensive program to eradicate tobacco addiction and the consequent suffering and disease. Such a program, assured permanence, adequate funding and independent administration, could promote a long-term, science-based strategy to significantly reduce tobacco use based on a model of successful programs adopted in other states. Amici respectfully urge this Court to follow the model established by the settlement of Minnesota’s lawsuit and exercise its discretion to make the approval of any settlement in this action contingentupon the establishment of an independent 501(c)(3) nonprofit foundation to administer a comprehensive program, financed through a dedicated funding stream, to reduce tobacco use in New York. (Koop Affidavit, Appendix "H", Paragraph "13"; Pertschuk Affidavit, Appendix "I", Paragraph "13"; Freeman Affidavit, Appendix "J", Paragraph "13").

To assist the Court in accomplishing this critical task, amici have submitted a plan modeled on the successful Minnesota program and based on the sound methodology developed by the Centers for Disease Control (CDC). This proposed plan, entitled A Vision for the Future, was developed by the Coalition for a Healthy New York, in conjunction with the professional staff at CDC. This plan, which calls for an allocation of $250 million dollars per year from New York’s proposed tobacco settlement, recently received the approval and endorsement of the Commission for a Healthy New York, an advisory panel to the New York State Department of Health chaired by Dr. Harold Freeman. (Freeman Affidavit, Appendix "J", Paragraph "10"). A complete copy of the plan is annexed hereto as Appendix "C". The Centers for Disease Control methodology, which provides the scientific underpinnings of the program and breaks down its estimated costs, is also annexed as Appendix "D". Finally, amici submit copies of the Order of the Minnesota District Court approving the Plan of Administration of that State’s settlement for this Court’s consideration. A critical element of the proposed plan is a commitment to science-based programming and administration free of undue political influence. The program would be administered by an independent nonprofit organization governed by a board of directors drawn from academic and professional communities, with expertise in public health and tobacco control. This foundation would functionstatewide through a variety of means, including grants to other agencies.

The guidance provided by CDC is based on a best-practices model entitled, State Comprehensive Tobacco Prevention and Control Guidelines, which was developed following extensive analysis of existing state-funded tobacco control programs in California, Massachusetts, Arizona, and Florida. Amici believe this model represents the state of the art in state-based tobacco control and provides a rational basis for designing a similar program for New York. The "Foundation" and "National Public Education Fund" set forth in the proposed MSA (Section VI) is an inadequate alternative to the independent, state-based tobacco control model proposed above. While the proposed MSA envisions an annual payment of funds by the settling Defendants to the Foundation for the laudable purposes of "reducing Youth Tobacco Product usage and Youth substance abuse" and "the study of and educational programs to prevent diseases associated with the use of tobacco products", the envisioned Foundation is simply no substitute for a local, independently administered State prevention and education program.

Although the stated goals of the Foundation are commendable, there is doubt as to whether a nationally organized and administered program can adequately address the significant public health issues at a State and local level. First, the level of funding foreseen for the National Education Fund ($1.45 billion over a five-year period) is, according to Drs. Koop and Freeman, "grossly inadequate" to alone address the tobacco problem in the United States. (Koop Affidavit, Appendix "H", Paragraph "10"; Pertschuk Affidavit, Appendix "I", Paragraph "10"; Freeman Affidavit, Appendix "J",Paragraph "10").

The Centers for Disease Control Comprehensive Tobacco Prevention and Control Guidelines foresees spending by the 50 states at between $1.578 billion and $4.126 billion per year. Furthermore, the permissible activities and efforts of the proposed national Foundation are strictly limited by the express restrictions set forth in the proposed MSA, including limitations as to lobbying, political activities, and any "personal attack on, or vilification of" tobacco companies and related entities. The continuing involvement of the Defendant tobacco companies in the functions of the proposed national Foundation, through their annual funding of the Foundation and enforcement of specific restrictions under the Agreement, creates an uneasy alliance which calls into question whether the proposed Foundation can truly function as an independent entity serving the public interest.

A State-based, independently administered tobacco control program is a needed supplement to the proposed national Foundation. The funding of the program by the State through its receipt of the anticipated settlement proceeds, rather than directly from the tobacco companies themselves, will assure the continued independence of the program. A local program would not only be more responsive to the specific public health concerns of the State of New York, but would also be able to function free of the restrictions outlined in the MSA. Such a program could pursue not only the State’s interests in reducing "underage"

smoking, but also the use of tobacco products among segments of the population not expressly covered under the mantle of the proposed Foundation, such as among adultsmokers. Because tobacco-caused disease occurs almost entirely among people over 40, the state will benefit much earlier from a program that reduces tobacco use among adults.

In order to be truly fair, adequate and reasonable to both the settling parties and the citizens of the State of New York, the proposed MSA must provide for the creation and funding of an independent State-based comprehensive tobacco control program free of undue limitations and any influence by the tobacco Defendants. Amici, therefore, respectfully request that the Court exercise its discretion to condition any approval of the proposed MSA upon the inclusion of a meaningful State tobacco control program funded through the proposed settlement proceeds.

CONCLUSION

Wherefore, amici respectfully request that the Court withhold any approval of the proposed MSA pending a public review period of at least 90 to 120 days in order to permit a comprehensive review of the proposed settlement terms and their likely impact on vital public interests, request that the Court appoint a Special Master to conduct an impartial review and hearing, and request that the Court condition approval of the proposed MSA on the inclusion of a significant tobacco control program.

Dated: December 9, 1998

Respectfully submitted,

RUBERTI, GIRVIN & FERLAZZO, P.C.
Attorneys for American Cancer Society Eastern Division

By:______________________________

Patrick J. McKenna, Esq.
Office and P.O. Address
120 State Street
Albany, New York 12207
(518) 462-300

TO:[Attached Distribution List]

Lucia M. Valente, Esq.
Chief Special Counsel
Office of the Attorney General of the State of New York
120 Broadway
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Philip M. Damashek, Esq.
Schneider, Kleinick, Weitz, Damashek & Shoot
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Joseph W. Belluck, Esq.
Sullivan & Liapakis, P.C.
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Ness, Motley, Loadholt, Richardson & Poole, P.A.
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Pamela A. Liapakis, Esq.
Sullivan & Liapakis
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