While Omaha’s youth access ordinance was able to survive the lawsuit brought by the vending companies, the lawsuit brought by Baker’s Supermarkets was more successful. One significant reason for this success was that Baker’s had learned from the example set by the vending companies and the other retailers opposed to Omaha’s ordinance that a battle in public over youth access would not be to the advantage of retailers who sought to weaken the law and its enforcement. As a result, Baker’s did not take their appeal to the media or to public officials. Instead the company quietly took their case to court. No evidence could be found that the proceedings of the lawsuit or its eventual result were ever written about in the media. On August 14, 1996, the lawsuit filed by Baker’s parent company challenging the ordinance was heard by Douglas County District Judge Stephen A. Davis. The members of the Prevention Coalition for Children were unaware that this lawsuit was proceeding.On September 19, Judge Davis ruled that the portions pertaining to hearing procedures and punishments of the Omaha ordinance were in conflict with state laws and thus, were void. Specifically, Judge Davis ruled that it was not permissible for the City of Omaha to suspend a license granted by the State of Nebraska because state law did not provide for suspensions. Davis’ ruling eliminated the ability of the Omaha Police Department and its STOPP Unit to aggressively enforce the city’s youth access ordinance by removing the penalties against retailers that were provided in Ordinance #32972.While the remaining portions of the ordinance are still written into law, the ordinance as a whole can no longer be enforced strongly by the Omaha Police Department as they were before the lawsuit by Baker’s Supermarkets because penalties provided by the ordinance were removed. The initial strategy taken by the tobacco industry was discussed by Matt Paluszek, Government Affairs Regional Director for Philip Morris, in a memo to other senior Philip Morris executives.He stated, “Our short-term strategy is to make it known that there is broad-based opposition to this initiative, so as to undermine efforts to raise money for the campaign and to get the 42,000 valid signatures needed.”Paluszek also wrote that all press inquires would be handled by Bill Peters, the Tobacco Institute’s lobbyist for Nebraska,cannabis drying rack and he named possible allies in their fight against the initiative, namely, “NE Retailer Federation, Farm Bureau, NE Consumer Packaging Council, Higher Education representatives .”
Another list which appears to include possible allies was found in tobacco industry documents that was handwritten on a copy of the Clean Environment Committee’s donation information sheet, but it is not known who wrote this list. This list included the “NE Tax Research Council, Chamber [of Commerce], Farm Bureau, Solid Waste – Retail Merchants, Smokers, Retail Grocers, University [of Nebraska], Cancer Research, Every Group That Is Currently Recieving Funding.”While the Clean Environment Committee was just getting their petition off the ground, the tobacco industry had their hands full with several other initiatives. Similar tax initiatives were further along in Massachusetts, Colorado and Oregon, and new ones were beginning in Arkansas and Oklahoma as well.The tobacco industry was already focused on these other initiatives and they did not take the threat posed by the Francis Moul and his group very seriously. As a result, the initial response by the tobacco industry was to simply monitor the progress of the Nebraska Clean Environment Committee. As Robert McAdam, Tobacco Institute Vice President of State Affairs for Initiatives, Referendums, and Special Projects, and Daniel Wahby, Director of Special Projects for the Tobacco Institute, stated in a memo to the Tobacco Institute Coordinating Committee, “It has been consistently believed that the proponents of this issue were not politically sophisticated enough to qualify this issue for the ballot. Now that they have filed this issue for circulation, we will be monitoring their activity closely to determine their progress.”Both McAdam and Wahby would lead the tobacco industry’s opposition to the Nebraska Clean Environment Act. Through the middle of May, the tobacco industry mainly focused on monitoring the progress of signature-gathering. A memo from McAdam to the Tobacco Institute Coordinating Committee on May 19, 1992 stated, “There is still little evidence that the proponents of this initiative have organized sufficiently to qualify this issue for the ballot. While they did have some petition gatherers located at polling places during this state’s primary election, they did not have the coverage necessary to obtain sufficient signatures.”At the same time, however, the tobacco industry started to spend money to fight the petition. On May 20, McAdam wrote to the Tobacco Institute Management Committee saying, “In an attempt to pay for some preparatory legal work and for a possible survey should the petition gatherers appear to be reaching their goal, I believe we need to allocate $40,000 for this campaign at this time.”By the middle of June, McAdam was beginning to take the initiative campaign in Nebraska more seriously.
His memo to the Tobacco Institute Coordinating Committee on June 15 stated, “While the proponents of the tax increase initiative in this state continue to appear somewhat disorganized, they have recently hired a professional consulting firm to help them gather signatures throughout the state. They have indicated to reporters that they plan to pay signature gatherers on an hourly basis. While it is still too early to determine if they will be successful, we have organized our legal approach to challenging certain aspects of the initiative, as well as the individual signatures that the proponents may submit.”By June 17, the first assessment for funds to combat the Nebraska initiative was prepared and sent to senior executives within Philip Morris, R.J. Reynolds, Lorillard and American Tobacco with the total amount being the $40,000 requested by McAdam, divided between the companies on the basis of market share.This money was to be sent to the Nebraska Executive Committee c/o Bill Peters,vertical grow system who was the Tobacco Institute’s lobbyist for Nebraska.These “Executive Committees” and other front groups with neutral to positive-sounding names, were led by the Tobacco Institute lobbyist in states where an initiative was underway.For example, money from the tobacco industry to defeat the initiative in Arizona was sent to the Arizona Executive Committee and in New Jersey, the checks were mailed to John O’Conner in the Tobacco Institute’s office in Albany, New York, but the checks were to be made payable to Citizens for Representative Democracy in West Trenton, New Jersey.In July, the Nebraska Clean Environment Committee submitted an estimated 48,000 signatures to the Secretary of State for certification.The total number of signatures that was needed to be placed on the ballot was.By then, the tobacco industry was actively attempting to recruit new allies to help in its fight against this environmental initiative. In addition to the “traditional” tobacco industry allies, which included business and tax groups,the Tobacco Institute was attempting to enlist the aid of WIFE, which stands for Women Involved in Farm Economics. WIFE is a national organization whose president in 1992 was Elaine Stuhr, who was elected a Nebraska state senator from Bradshaw in 1994 and remained in the Legislature as of 2003 . In a letter to Stuhr, Daniel Wahby, the Director of Special Projects for the Tobacco Institute, wrote, “First of all, I would like to take this opportunity to thank you and your organization for your interest in assisting our efforts in defeating the proposed 25 cents per pack excise tax on tobacco products.”Wahby tells Stuhr that he has asked Bill Peters to get in touch with her to give her more information. He states, “I apologize for not having specific information in writing as it relates to the farm community in Nebraska but I trust your conversation with Mr. Peters will give you some information to go on.”Bill Peters, the Tobacco Institute’s lobbyist, told reporters that the true number of signatures that needed to be obtained was more than 61,000 and not the 41,058 that the secretary of state said was necessary.The conflict came over whether language in the Nebraska Constitution required the number of signatures to exceed a percentage of the citizens that were registered to vote in the last election for governor or a percentage of citizens that actually voted in the last election for governor. While Nebraska was filing suit, a team of attorneys general were negotiating with the tobacco industry to create a new settlement to replace the Global Settlement Agreement.
Having learned from the failure of the Global Settlement, the attorneys general decided to limit their settlement negotiations with the tobacco industry to issues that they had the full authority to settle directly, rather than including legislative proposals. The deal that they brokered became the Master Settlement Agreement.In exchange for payments to the states determined by a complex formula related to cigarette consumption and inflation that extended indefinitely , public access to tobacco industry documents, limitations on advertising and promotions and disbanding the Council for Tobacco Research, the Council for Indoor Air Research and the Tobacco Institute, the states agreed to drop their lawsuits.In addition, the tobacco industry, having learned that a lengthy debate on the merits did not serve its interests, insisted that the individual states had to decide whether they would participate within seven days following announcement of the Settlement.This last component of the Master Settlement Agreement raised some concern with tobacco control advocates in Nebraska. Before the deal had been finalized between the attorneys general and the tobacco industry, the members of SmokeLess Nebraska and Mark Welsch of GASP were publicly worrying that seven days would not permit the State of Nebraska, particularly Attorney General Stenberg, to closely examine the details of the settlement before deciding whether or not to sign the agreement.Dave Holmquist of the American Cancer Society stated, “We just think seven days is an awfully short time to make a decision on something that will affect the American people for a long time to come.”When the Master Settlement Agreement was formally announced on Saturday November 14, 1998, it seemed highly likely that Nebraska would participate. By Monday Attorney General Stenberg and Governor Nelson came out in favor the settlement.Stenberg, who had final say on whether to sign the Master Settlement Agreement, said that he wanted to consult State Senator Roger Wehrbein , Chairperson of the Appropriations Committee, and State Senator Don Wesely , Chairperson of the Health and Human Services Committee, before making his final decision.Stenberg explained his rationale for favoring the settlement, saying, “It is unlikely that Nebraska would obtain a judgement of more than $1 billion [the estimated value of the MSA to the state over the first 25 years] if we refuse this settlement and continue our own lawsuit.”Early Tuesday November 17, 1998, Attorney General Stenberg announced that he had decided to accept the Master Settlement Agreement.Once again, Stenberg reiterated his position that he felt Nebraska would not receive as much in its own lawsuit as it would receive by participating in the Master Settlement Agreement. Governor Nelson stated that he felt that the settlement was not perfect but that it was acceptable; he said “I’ve never been one to let my desire for the perfect get in the way of the good.”By signing the Master Settlement Agreement, Nebraska’s share of the settlement over the first 25 years was estimated to be $1.17 billion.Annual MSA payments for Nebraska are between $38.1 and $49.9 million.In 1998, Nebraska established trust funds for the tobacco settlement money that the state was expecting to receive from the Global Settlement Agreement and which it eventually received under the Master Settlement Agreement. While the Legislature, responding to pressure from Governor Nelson, decided early on that the settlement money would be used for improvements to the state’s health infrastructure, the Legislature was less committed using the money received as a result of the state’s Medicaid expenditures due to smoking to actually reduce the harm done by smoking through tobacco prevention and control efforts. During the 1998 legislative session, when Nebraska was anticipating receiving money from the Global Settlement Agreement, Governor Nelson and state legislators, such as Don Wesely of Lincoln, the Chairperson of the Health and Human Services Committee, and Jim Jensen of Omaha stated their desire to ensure that the settlement money be applied to improving the healthcare system of the state.