Two Arkansas scholarship funds -- one at each of the state's law schools -- will split more than $2 million left over in a cigarette settlement fund that has paid about $20 million to almost 20,000 former Marlboro Lights smokers over the past year, Pulaski County Circuit Judge Tim Fox ruled on Tuesday.
The money is the charitable component of a $45 million fund established to end a 14-year-old false-advertising lawsuit against Marlboro Lights manufacturer Philip Morris USA over how it marketed Lights and companion brand Marlboro Ultra Lights.
Fox's disbursement order ends the litigation. The rest of the money went to legal fees and administrative costs.
Lead plaintiffs attorney Tom Thrash of Little Rock, who filed the class-action lawsuit in 2003, said it was important to him that the litigation also raise money that would go toward public service, so the settlement agreement empowered Fox to choose a charitable source, established by court precedent, for whatever funds were left over.
Fox chose the Public Interest Litigation Scholarship Program Fund at the University of Arkansas Law School in Fayetteville and the Dean R. Morley Scholarship Fund at the W.H. Bowen School of Law at the University of Arkansas at Little Rock.
They will each get about $1.1 million, which could generate up to $40,000 in scholarship money, according to university figures.
In his 11-page order disbursing the money, Fox wrote that he considered that the best use of the money, given the spirit of the lawsuit and the restrictions set by case law, was to encourage students to pursue legal careers in public-service fields that they might not have otherwise been able to afford to consider after they had taken on the expense of a legal education.
He also cited recent studies that show Arkansas has one of the lowest number of lawyers per capita nationwide, with 22 of the state's 75 counties found to be "chronically under-served."
Leaders of both schools said Tuesday that the funding will change lives for the better, not just for students who hope to practice law but also for the thousands of Arkansas residents who do not have adequate access to legal counsel.
"In short, this gift is a game-changer for the state and the people of Arkansas -- not just for our students. This is a need-based scholarship, so the funds will go to students who otherwise might have to take out loans or hold a job in addition to their full-time legal studies," Dean Stacy Leads in Fayetteville said.
"The funds will also go to students who are interested in public interest or complex public interest litigation practice in Arkansas -- an underrepresented field within a state with one of the lowest rates of lawyers per capita."
In Little Rock, John DiPippa, interim dean at the Bowen school, said the additional money makes the Morley fund one of the university's largest sources of scholarships. The money comes at a time when programs like the Morley fund, which assists poorer students, are waning.
"Need-based scholarships have dwindled at many law schools, but the Morley Scholarship will allow us to keep our costs affordable to our students, many of whom come from central Arkansas and want to practice here," he said. "Students who graduate with less debt have more job choices. This lets students opt for lower paying law jobs that serve the public, like prosecuting attorneys, public defenders and legal aid."
The Marlboro Lights case is thought to have one of the largest, if not the largest, plaintiffs pools in state history. Arkansas was the only state to get a settlement when the sides reached a compromise last year just before trial.
Plaintiffs -- anyone who had ever bought the Lights brands in Arkansas -- had accused the company and parent Altria Group of misleading customers that Lights were healthier than regular cigarettes. Lights were introduced in November 1971 and sold through June 2010, when federal regulators banned cigarettes from claiming to be light or mild. The Marlboro brands are now sold as Silver and Gold.
In 20 similar lawsuits filed against the cigarette maker in several states over the past 15 years, Philip Morris and Altria consistently denied wrongdoing and prevailed in 18 of the cases. The one case it lost paid out legislatively capped damages of $25 per claimant.
Plaintiffs in the Arkansas litigation were eligible to claim a refund of 10 cents to 25 cents per pack purchased.
After two rounds of payments, 19,425 claimants nationwide divided $19,837,526 tax free, with each getting at least $400, according to the latest figures presented to the court. With the highest payment reaching $8,426, the average claimant received $1,021.
The scholarship money came out of the $2.2 million left after expenses and legal fees were paid. The judge found that the administrative costs would make a third round of payouts economically impractical.
At a hearing on Monday to accept the final accounting for the fund, Fox commended the fund administrators, accountant Angie Hopkins and attorney Allison Allred, as "consummate professionals" who ensured the claims process ran smoothly and efficiently.
The judge also took testimony from the only claimant who filed written objections contesting the allocation process before a Nov. 1 deadline and who showed up for the hearing.
Confessed killer Michael Woods, 59, complained the process was unfair and that he should have been awarded more than the $400 minimum. Fox arranged for Woods to be brought to court under heavy guard after the convict twice wrote to the judge to complain.
Woods, formerly of Success, fatally shot his ex-wife, Tina Woods, in January 2001 after calling police to his rural Clay County home. He immediately surrendered, pleading guilty to capital murder two months later in March 2001.
Metro on 11/29/2017