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States near tobacco settlement

The nation's state attorneys general are close to a tobacco settlement with Liggett Group Inc. that would include giving the states potentially damaging documents against the tobacco industry, key negotiators said Wednesday.

Mississippi Attorney General Michael Moore said the deal could come as early as today, but it had not been completed as of Wednesday night.

"We're very close, but we still have negotiating to do. If we do this deal it will be explosive," he said.

Moore is in Washington for the spring meeting of the National Association of Attorneys General. Attorneys involved in negotiations with Liggett have been in meetings since Tuesday night separately from the association's formal gathering.

Moore denied television reports that the deal had been finalized.

NBC reported Wednesday night that the parties were close to reaching a settlement in which Liggett would agree to add a warning to cigarette packages that smoking is addictive and that one draft of the deal would acknowledge that smoking causes health problems including lung cancer.

"As of right now, there is no deal," Moore said.

Steve Berman, a Seattle lawyer involved in the talks, also said there was no agreement.

"We've been dating, going to the prom, but there is still no ring," Berman said.

The talks, which involve Liggett's proposal to turn over sensitive tobacco documents, heated up last week ahead of the first anniversary of Liggett's historic break with the industry to become the first cigarette company to settle smoking litigation.

On March 13, 1996, the company, which is owned by Bennett LeBow's Brooke Group agreed to settle a federal class action in New Orleans, and two days later it reached an accord with five states _ including Florida _ that sued the industry to recoup Medicaid health care costs of smokers.

The federal class action has since been thrown out by an appeals court.

Since last year, a total of 22 attorneys general as well as the lieutenant governor of Alabama have filed Medicaid suits against the tobacco industry. Because of this, LeBow has been negotiating a broader agreement that would satisfy a larger number of states.

"We're hoping for an unanimous deal," Moore said.

A key part of the settlement would be LeBow's offer to turn over potentially damaging documents about the entire industry and the prospect that Liggett employees or former employees would testify against other companies.

LeBow would naturally want as many states as possible to agree to drop their suits against Liggett before he would turn over the papers.

Some states, in particular Minnesota, have previously raised doubts about the proposed settlement. Hubert Humphrey, Minnesota's attorney general, did not arrive at the attorneys general meeting until Wednesday night.