UST Inc.

Madison, WI: (Sep-03-07) A class action lawsuit was brought against UST Inc., the manufacturer of Copenhagen and Skoal. The suit stemmed from an antitrust lawsuit filed by Conwood Company LP, a UST competitor, alleging that UST engaged in acts designed to monopolize the market. Among other things, according to the antitrust action, UST removed Conwood's display racks and advertising and replaced them with UST products. A Kentucky jury sided with Conwood and awarded $350 million in damages, an amount trebled to $1.06 billion by federal antitrust law. A federal appeals court affirmed the award, and the US Supreme Court refused to hear an appeal. Soon after the decision, lawsuits were brought on behalf of consumers in several states, leading to the class action.

In a settlement reached, UST Inc. agreed to give each class member $816 in coupons that will enable them to buy snuff, a smokeless tobacco, at a huge discount over the next 20 years. The move could cost UST Inc., the manufacturer of Copenhagen and Skoal, up to $65 million. To be eligible for the payout, consumers must be adults and attest that they bought UST snuff between 1990 and 2004. The company will also pay $17 million as legal fees. [JOURNAL SENTINEL: SNUFF ANTITRUST]

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Published on Sep-4-07