Administration to Start Settlement Talks with Tobacco Companies

WASHINGTON – The Justice Department is poised to begin talks with tobacco companies to settle the U.S. government's lawsuit against the companies.

Justice Department officials told Fox News that Attorney General John Ashcroft had decided to enter settlement negotiations with tobacco companies as the lawsuit continues to wind its way through the courts.

In filing the suit in September 1999, the Justice Department, then under the leadership of Attorney General Janet Reno, said federal health care plans spend more than $20 billion a year treating smoking-related illnesses.

Ashcroft was critical of the lawsuit brought by the Clinton administration when he was a Republican senator in Missouri.

The lawsuit will continue, officials said, as the settlement negotiations are underway. Officials said Ashcroft's decision was based on the recommendation from career Justice Department employee Stuart Schiffer, the acting Assistant Attorney General in charge of the Civil Division.

The Justice Department negotiating team will consist of three career attorneys from the Civil Division. Those attorneys spent the day meeting with Justice Department trial lawyers who have been litigating the tobacco lawsuit.

Officials said Ashcroft spent the morning briefing lawmakers about the settlement negotiating team. Ashcroft talked to Sen. Judd Gregg, R-N.H., and was reaching out to other prominent members of the House and Senate Appropriations subcommittees.

No meeting has been scheduled so far, but officials told Fox News they expect Justice Department attorneys to meet soon with tobacco attorneys.

Other sources who discussed the case only on grounds of anonymity said the administration was concerned about the strength of the government's case and wanted to forge a settlement now rather than risk losing later.

-- Fox News' Bryan Sierra in Washington contributed to this report.