Lorillard Enters Into Tentative Deal To Resolve Pending Engle Progeny Lawsuits

(RTTNews) - Lorillard Inc. (LO) announced that its Lorillard Tobacco Company subsidiary, along with other cigarette manufacturers, have entered into a tentative agreement to resolve pending Engle progeny lawsuits in U.S. federal courts.

As per the terms of the tentative agreement, Lorillard will not be subject to any further legal proceedings pertaining to these Engle progeny cases currently pending against the Company in the federal district courts.

Federal Engle progeny cases currently in trial or previously concluded, along with Engle progeny cases pending in Florida state courts, are not part of the tentative agreement. Lorillard will pay $15 million to resolve the federal cases and expects to record a charge in the first quarter of 2015 in connection with the agreement.

Engle progeny cases arose from a 1994 class action case on behalf of Florida residents, and survivors of Florida residents, who were injured or died from medical conditions allegedly caused by addiction to smoking. The class was later decertified by the Florida Supreme Court; however, the court permitted members of the Engle class to file individual claims, including claims for punitive damages.

Lorillard, Inc. and Lorillard Tobacco Company have been named as defendants in cases in both state and federal courts in Florida that were filed by members of the Engle class. These resulting Engle cases are commonly referred to as "Engle progeny" cases.

The tentative agreement is subject to final approval and will not become final unless all plaintiffs agree to participate or the parties reach an alternative agreement. Until such final approval or other final resolution is reached, all trials against Lorillard Tobacco and the other manufacturers in federal courts are stayed pending final approval of the agreement.