State ex rel. Stenehjem v. Philip Morris Inc.
|
| 20060207 |
State of North Dakota,
ex rel. Wayne Stenehjem,
Attorney General, Plaintiff and Appellee
v.
Philip Morris, Incorporated,
Brown & Williamson Tobacco
Corporation, Lorillard Tobacco
Company, R. J. Reynolds Tobacco
Company, Liggett Group Inc.,
United States Tobacco
Manufacturing Company Inc.,
and United States Tobacco Sales
and Marketing Company Inc., Defendants
--------------
Philip Morris, Incorporated,
Lorillard Tobacco Company,
and R. J. Reynolds Tobacco Company, Defendants and Appellants
|
| Appeal from: |
District Court,
East Central Judicial District,
Cass County
Judge Steven L. Marquart |
|
Nature of Action: |
Contracts
|
| Counsel: |
|
| Term: |
03/2007 Argument: 03/01/2007 09:30am
|
| ND cite: |
2007 ND 90
|
| NW cite: |
732 N.W.2d 720
Listen to recording of oral argument
using RealPlayer Basic,© a free download.
|
|
|
| Issues: |
Appellant's Statement of the Issues:
Issue of Original Participating Manufacturers
Whether the District Court erred in refusing to compel arbitration pursuant to the Tobacco Litigation Master Settlement Agreement ("MSA") of the parties' dispute concerning the MSA Independent Auditor's refusal to apply an "NPM Adjustment" to the
Participating Manufacturers' April 2006 annual nationwide payment, including the State's defense that it qualifies for a "diligent enforcement" exemption to that Adjustment, where the MSA's Arbitration Clause broadly requires arbitration of "any
dispute . . . arising out of or relating to calculations performed by, or any determinations made by, the Independent Auditor," and specifically lists "any dispute concerning the operation or application of" the NPM Adjustment and the diligent
enforcement defense to that Adjustment as examples of disputes that must be arbitrated?
Issue of Subsequent Participating Manufacturers
The issue presented for review is whether the parties' dispute over the 2003 NPM Adjustment, including the issue of diligent enforcement, is arbitrable under the MSA provision requiring arbitration of "any dispute . . . arising out of or relating to"
the Independent Auditor's calculations and determinations, including "without limitation" any disputes "concerning the operation or application" of the MSA's adjustments and allocations.
RYB
I. The State Mischaracterizes the MSA'S plain language.
A. The arbitration clause is not limited to "appeals" from specific determinations the auditor has "actually made."
B. Arbitration would be required even under the State's "Interpretation" because the auditor, in fact, made a diligent enforcement determination.
C. The Auditor had express authority to make the diligent enforcement determination.
D.The MSA expressly excludes this dispute from MSA Court jurisdiction.
II. The State misconstrues the MSA'S nationwide payment provisions.
III. The State does not purport to rebut the well-settled presumption favoring arbitration.
Appellee's Statement of the Issues:
The Master Settlement Agreement ("MSA") and the Consent Decree And Final Judgment With Respect To Master Settlement Agreement ("Consent Decree) give the North Dakota MSA Court general jurisdiction to decide MSA disputes. An arbitration clause in the
MSA limits arbitration to disputes that arise out of or are related to a calculation performed by or a determination made by the accounting firm PricewaterhouseCoopers. PricewaterhouseCoopers did not determine -- and told the parties that it could
not and would not determine -- whether any state diligently enforced its Qualifying Statute. On May 1, 2006, North Dakota moved to have the North Dakota MSA Court decide whether North Dakota diligently enforced its Qualifying Statute, N.D.C.C ch.
51-25 (N.D. Br. Add. at 1-3). Should the dispute over whether North Dakota diligently enforced N.D.C.C. ch. 51-25 be decided by the North Dakota MSA Court or by PricewaterhouseCoopers and a national arbitration panel?
|
|
 Add Docket 20060207 RSS
|
| 1 | | 07/27/2006 | |
NOTICE OF APPEAL: 07/25/2006 |
| 2 | | 07/27/2006 | |
ORDER FOR TRANSCRIPT: 07/25/2006 |
| 3 | | 07/31/2006 | |
(Consolidated w/20060213. Make all docket entries, except DIS & MAN codes, in this case.) |
| 4 | | 09/14/2006 | |
TRANSCRIPTS DATED May 30, 2006 & June 28, 2006 |
| 5 | | 09/14/2006 | |
DISK - tra (5/30/06 & 6/28/06) (e-mailed) |
| 6 | | 09/20/2006 | |
RECORD ON APPEAL (3 volumes and separates); Not received: 17 & 61 (tapes). Note: there are no |
| 7 | | 09/20/2006 | |
attachments to entry 6 and entry 23 as indicated in the register of actions |
| 8 | | 10/13/2006 | |
Affidavit of Stephen R. Patton |
| 9 | | 10/13/2006 | |
Affidavit of Gayle E. Rosenstein |
| 10 | | 10/19/2006 | |
MOT. EXT/TIME APPELLANT BRIEF, Affidavits of Lawrence Bender, Lawrence King,& Gary Wolberg |
| 11 | | 10/19/2006 | |
ACTION BY CLERK. Granted: 11/23/2006 |
| 12 | | 10/25/2006 | |
Affidavit of Thomas J. Frederick Pursuant to ND Admission to Practice Rule 3 (authorized) |
| 13 | | 11/22/2006 | |
APPELLANT BRIEF (Original Participating Manufacturers - 20060207) |
| 14 | | 11/22/2006 | |
APPELLANT APPENDIX (Original Participating Manufacturers & Subsequent Participating Manufacturers) |
| 15 | | 11/22/2006 | |
Addendum to ATB of Original Participating Manufacturers |
| 16 | | 11/22/2006 | |
DISK - ATB Original Participating Manufacturers (CD-R) |
| 17 | | 11/22/2006 | |
Certificate of Service by Mail |
| 18 | | 11/22/2006 | |
APPELLANT BRIEF (Subsequent Participating Manufacturers - 20060213) |
| 19 | | 12/06/2006 | |
MOT. EXT/TIME APPELLEE BRIEF & Aff/Support |
| 20 | | 12/06/2006 | |
ACTION BY CLERK. Granted: 01/25/2007 |
| 21 | | 01/18/2007 | |
MOTION for Leave to File Brief in Excess of Page Limits, Affidavit of Todd Sattler, Affidavit |
| 22 | | 01/19/2007 | |
ACTION BY CHIEF JUSTICE (additional 2,625 words). Granted |
| 23 | | 01/25/2007 | |
APPELLEE BRIEF |
| 24 | | 01/25/2007 | |
Addendum to Appellee's Brief |
| 25 | | 01/25/2007 | |
DISK - AEB |
| 26 | | 01/25/2007 | |
APPELLEE APPENDIX w/ separate Master Settlement Agreement |
| 27 | | 01/29/2007 | |
Table of Contents for Appellee's Appendix |
| 28 | | 02/02/2007 | |
MOTION of Original Participating Manufacturers to File a Reply Brief in Excess of 2500 wds. & |
| 29 | | 02/02/2007 | |
Affidavit in Support |
| 30 | | 02/02/2007 | |
ACTION BY CHIEF JUSTICE (Mot/Excess/of Words for RYB - 1250 additional words). Granted |
| 31 | | 02/08/2007 | |
REPLY BRIEF of Subsequent Participating Manufacturers in 20060213 |
| 32 | | 02/08/2007 | |
Addendum to RYB of Subsequent Participating Manufacturers |
| 33 | | 02/09/2007 | |
DISK - ryb (Subsequent Participating Manufacturers) (e-mailed) |
| 34 | | 02/08/2007 | |
REPLY BRIEF of Original Participating Manufacturers |
| 35 | | 02/08/2007 | |
Addendum to RYB of Original Participating Manufacturers |
| 36 | | 02/08/2007 | |
DISK of ryb (Original Participating Manufacturers) |
| 37 | | 02/13/2007 | |
Corrected p.20 for Brief of Appellants Subsequent Participating Manufacturers (20060213) |
| 38 | | 02/13/2007 | |
DISK of ATB (Subsequent Participating Manufacturers -- 20060213) |
| 39 | | 02/26/2007 | |
Request for Radio/TV Coverage KXMB - TV (approved) |
| 40 | | 02/26/2007 | |
Letter from Gary Wolberg dated 2-23-07 RE: Corrections to RYB in 20060213 |
| 41 | | 03/01/2007 | |
APPEARANCES: For Original Participating Manufacturers: Stephen R. Patton, Lawrence Bender, |
| 42 | | 03/01/2007 | |
Patrick J. Ward, Lawrence King, Thomas J. Frederick; For Subsequent Participating Manufacturers: |
| 43 | | 03/01/2007 | |
Robert J. Brookhiser, Gary R. Wolberg. For Appellee: Asst. Attorney General Todd A. Sattler, |
| 44 | | 03/01/2007 | |
Attorney General Wayne K. Stenehjem, Solicitor General Douglas A. Bahr |
| 45 | | 03/01/2007 | |
ARGUED: Patton; Brookhiser; Sattler |
| 46 | | 03/01/2007 | |
ORAL ARGUMENT WEBCAST |
| 47 | | 04/05/2007 | |
Ltr from Lawrence Bender w/copies of IL Appellant Court Decision |
| 48 | | 04/19/2007 | |
Letter dated 4-19-07 from Lawrence Bender w/8 cc of Deleware Supreme Court decision |
| 49 | | 04/24/2007 | |
Letter dated 4-24-07 from Lawrence Bender w/8 cc of Massachusetts Supreme Court decision |
| 50 | | 05/29/2007 | |
Letter dated 5-29-07 from Lawrence Bender w/8 cc of Arizona Court of Appeals decision |
| 51 | | 06/07/2007 | |
DISPOSITION: REVERSED AND REMANDED |
| 52 | | 06/07/2007 | |
UNANIMOUS OPINION: Sandstrom, Dale V. |
| 53 | | 06/07/2007 | |
Costs on appeal taxed in favor of Appellants |
| 54 | | 06/08/2007 | |
Order/Judgment Mailed to Parties |
| 55 | | 06/29/2007 | |
MANDATE |
| 56 | | 07/05/2007 | |
RECEIPT SIGNED BY DISTRICT COURT CLERK'S OFFICE |