DOVER, Del. — Cigarette maker ITG Brands presumed liability for tobacco settlement payments to the state of Florida when it gotten 4 brandnames from Reynolds American in 2015, a Delaware judge has ruled.
Vice Chancellor Lori Will ruled Friday that, as a result, ITG should compensate Reynolds American for losses due, approving summary judgment in favor of Reynolds.
Reynolds offered the Kool, Winston, Salem and Maverick brandnames to ITG in 2014 to gain federal regulators’ approval of its acquisition of Lorillard Inc.
Before the sale closed, Reynolds American affiliate R.J. Reynolds Tobacco Co. was making payments under a preexisting settlement arrangement with Florida for repayment of smoking-related health care expenses. After closing, Reynolds stopped making payments for the 4 brandnames it no longer owned.
The property purchase contract needed ITG to usage sensible finest efforts to signupwith the Florida settlement and make yearly payments to Florida for sales of the brandnames it obtained from Reynolds. ITG has yet to j