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SC Tobacco Growers and Quota Owners Helped by North Carolina Supreme Court Ruling South Carolina tobacco growers and quota holders received a boost today from the North Carolina Supreme Court. The North Carolina high court ruled that tobacco growers and quota holders in 14 tobacco producing states, including South Carolina, are due a total of $424 million in payments that had previously been withheld by tobacco companies. “This is a tremendous victory for South Carolina tobacco growers and quota holders,” said South Carolina Farm Bureau Federation President David Winkles. SCFB was one of the parties joining the suit as a "friend of the court" -- someone who is not a party to the litigation, but who believes that the court's decision may affect its interest. Winkles met with tobacco area farmers Thursday evening in Florence to discuss, among other things, the tobacco buyout and Farm Bureau’s lump sum payment program for tobacco growers. Winkles said, “Growers told me it has been tough for them to make planting decisions this year because the delayed 2004 Phase II program payments put them in a financial bind.” Winkles added “My only disappointment with the North Carolina ruling is that I could not announce it at last night’s meeting.” Tobacco companies initially withheld the so-called “Phase II” payments last October 22 after President Bush signed legislation enacting a $10 billion buyout of tobacco quotas. Once the buyout became law, tobacco companies demanded refunds of $318 million in payments they had made to that point in 2004 and refused to pay $106 million more that farmers were expecting for 2004. The NC Supreme Court ruled that the tobacco companies could not withhold "Phase II" payments to compensate farmers for losses stemming from a 1998 settlement with the states because the companies had not yet made any payments for the tobacco buyout. Judge Ben Tennille of the NC Business Court had previously agreed with the tobacco companies in a ruling last December; however, the NC Supreme Court reversed Tennille’s ruling and returned the case to his court to resolve. The case was decided in North Carolina's Supreme Court because the Phase II trust was originally settled and filed in a North Carolina court. But the decision also affects 80,000 tobacco growers and more than 300,000 quota holders in Virginia, South Carolina, Tennessee, Alabama, Florida, Georgia, Indiana, Kentucky, Maryland, Missouri, Ohio, Pennsylvania and West Virginia.
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