Judge Stephen P. Lamb rejected arguments made by the foundation in a countersuit that it can't be sued because it wasn't a party to the Master Settlement Agreement between 46 state attorneys general and major tobacco companies that created the foundation and paid $1.5 billion to fund its campaign.
The 1998 agreement bars personal attacks and "vilification" of tobacco companies or their executives in anti-smoking advertising campaigns. Lorillard contends that ads from the foundation violated that agreement.
The dispute stems from several
Legacy President Cheryl Healton in a statement said she regrets the court's decision, which she called "procedural," because it will force the foundation to divert resources.
Will not be 'distracted'
"We will not be distracted no deterred from pursuing our ongoing commitment to save lives," she said.
Ronald Milstein, Lorillard vice president and general counsel, said tobacco company's purpose in the suit is not to stop advertising, but to get the foundation to live up to the terms of the agreement.
"It's not about money. It's about making them adhere to agreement they reached. That is all we need to do," he said. "We are 100% in support of their efforts."
The suit comes as the five major tobacco companies near their last payment to fund the foundation's campaign. Mr. Milstein said Lorillard is continuing the suit because the ads could run for additional years and the foundation will continue.