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May 16, 2006

Minnesota Supreme Court Holds Health Impact Fee Not in Violation of 1998 Tobacco Settlement Agreement

In State v. Philip Morris USA, Inc.State v. Philip Morris USA, Inc., the Minnesota Supreme Court held in an opinion handed down on May 16, 20067, that the imposition of a Health Impact Fee under Minn. Stat. § 256.9658 (Supp. 2005) does not violate the 1998 settlement agreement between the State and the tobacco companies.  The supreme court concluded "that to construe the settlement agreement as respondents urge, that is, to waive the legislature’s authority to enact revenue measures to recover tobacco-related health care costs, would be a surrender of the legislature’s sovereign power.  As a result, the unmistakability doctrine applies and requires that we not so construe the settlement agreement unless it surrenders sovereign power in unmistakable terms.  We do not find the requisite unequivocal language in the settlement agreement, and therefore conclude that the Health Impact Fee legislation does not violate the terms of the agreement."

May 16, 2006 | Permalink

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