Tobacco giants to pay £495m to ailing smokers

Three cigarette manufacturers who lost a record-setting £1.1bn verdict to sick Florida smokers have agreed to pay them £495m, no matter how their appeals turn out.

‘‘That amount of money is guaranteed to the class win, lose or draw,’’ said Lorillard lawyer Ronald Milstein. ‘‘We’ve decided this is the surest path to making the appeals process unencumbered and unhindered.’’

The guarantee represents the industry’s first major financial commitment directly to smokers in nearly four decades of hotly contested tobacco litigation. The industry agreed in the late 1990s to pay £173bn over 25 years to settle state lawsuits.

‘‘Obviously this is a milestone,’’ said longtime industry critic Richard Daynard.

‘‘At least for a moment, the industry spin stopped long enough for them to shell out 700 million dollars.’’

Philip Morris, Lorillard and Liggett chose for the agreement to keep the sick smokers from challenging the constitutionality of a new state law placing a £350m cap on appeal bonds in the case.

Without the law, the companies would have been required to buy bonds worth more than the £1.1bn verdict to be able to get higher court review an impossibly high requirement, in the industry’s view.