TOBACCO-SUIT LEGAL FIRM TOOK A HEFTY PAY CUT

MINNEAPOLIS - Attorneys who represented Minnesota and an insurance company
in their lawsuit against the tobacco industry are being paid $466 million -
a much smaller fee than the lawyers had hoped to receive.

That agreement is a key aspect of the $6.6 billion settlement of
Minnesota's tobacco lawsuit, and it should prevent the acrimony that has
plagued tobacco deals in other states.

The hometown firm of Robins, Miller, Kaplan and Ciresi will get 7.1 percent
of the $6.6 billion that cigarette makers are paying to the state and Blue
Cross and Blue Shield of Minnesota.

Under the terms of the firm's 1994 contract, the lawyers were promised 25
percent of any winnings, which would have worked out to $1.65 billion under
Friday's settlement.

But that arrangement was sharply criticized by Gov. Arne Carlson and some
state lawmakers.

Although his firm took what amounts to a pay cut of more than $1 billion,
Michael Ciresi, lead attorney in the Minnesota case, said the final fee is
fair and appropriate.

Ciresi pointed to the financial risks and the immense effort his firm put
in to force the tobacco industry to disclose its secret documents and then
to try the case, which was the first state lawsuit against tobacco
companies to go to trial.

"I understand it's a lot of money. All I can say is, we earned it," he said.

Minnesota Attorney General Hubert Humphrey III also defended the fee agreement.

"For the critics, I remind you that this hometown firm took immense risk
and advanced tens of millions of dollars on behalf of taxpayers, to take on
an industry no one - no one - had ever defeated," Humphrey said.

Big fees have been a hot issue in Texas and Florida, which both settled
their tobacco lawsuits earlier.

Texas' $15.3 billion settlement threatened to come apart in a dispute over
$2.3 billion in fees for attorneys who contracted to work on that case for
a 15 percent slice. Gov. George W. Bush demanded a full accounting after
their expense accounts grew to almost $40 million.

In Florida, which settled for $11 billion, a judge rejected a 25 percent
contingency fee of $2.8 billion as "patently ridiculous" and sent the
matter to arbitration. The decision is being appealed.

In Minnesota, the lawyers' fee won't cost the taxpayers or Blue Cross
anything - the $466 million will be paid by the tobacco companies instead
of being taken out of the settlement.