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1. What lawsuit is this settlement about?

Answer:

The proposed settlement is for a class action lawsuit brought by former members of the U.S. Tobacco Cooperative (“U.S. Tobacco”) against U.S. Tobacco, claiming that U.S. Tobacco accumulated funds over the years that should be distributed  to members and that it acted unfairly and improperly with respect to the members’ equity interests.

2. What is a class action?

Answer:

A class action is a lawsuit brought by one or more persons (who are called the “class representatives” or “named plaintiffs”) on behalf of a group of similarly-situated people (who are called the “class members”). The court resolves all claims for all class members in one lawsuit, except for any class members who choose to exclude themselves from the class action by opting out. (See Question 37 below for information on how to opt out.)

3. Who is the defendant?

Answer:

The defendant is U.S. Tobacco Cooperative Inc. (formerly known as Flue-Cured Tobacco Cooperative Stabilization Corporation).

4. Who are the named plaintiffs?

Answer:

There are 11 named plaintiffs: Teresa Speaks, Toby Speaks, Stanley Smith, Eddie Brown, Robert Poindexter, Mike Mitchell, Roy Cook, Alex Shugart, H. Randle Wood, Robin Rogers, and Daniel Lee Nelson.



5. Who is included in the class?

Answer:

The class includes all individuals, proprietorships, partnerships, corporations, and other entities that are or were shareholders and/or members of U.S. Tobacco at any time since the date of U.S. Tobacco’s incorporation on June 1, 1946  until the date the settlement goes into effect, without any exclusion, including any heirs, representatives, executors, powers-of-attorney, successors, assigns, or others purporting to act for or on their behalf.

6. What if I am not sure whether I am included in the settlement class?

Answer:

If you are not sure whether you are a class member, you can ask for help by contacting the claims administrator at 1-866-458-3207. You can also contact class counsel, Shipman & Wright LLP or Daughtry, Woodard, Lawrence &  Starling, LLP. (See Question 43 below for the contact information for class counsel.)

7. In which court is the lawsuit pending? Who is the judge?

Answer:

The lawsuit is pending in Raleigh, North Carolina, in the United States District Court for the Eastern District of North Carolina. This is a federal court. The Honorable Chief United States District Judge James C. Dever III is presiding over the matter.

8. Has the judge or a jury decided on the merits of the case?

Answer:

No. The Court has not decided in favor of the plaintiffs or the defendant. Instead, the plaintiffs and defendant have agreed to a settlement. The settlement does not mean that U.S. Tobacco did anything wrong or that U.S. Tobacco admits to any wrongdoing as alleged in the lawsuit.

9. Where can I find public records related to the lawsuit?

Answer:

A copy of the complaint, settlement agreement, and the order granting preliminary approval of the settlement are available HERE. In addition, electronic copies of all public filings for the lawsuit can be viewed online through the PACER service (“Public Access To Court Electronic Records”) by searching for the case number in the Eastern District of North Carolina.  The case number for this lawsuit is 5:12-CV-729-D. Finally, you can obtain copies of relevant filings by contacting class counsel. (See Question 43 below for the contact information for class counsel.)

10. Why is there a settlement?

Answer:

The Court has not decided in favor of the plaintiffs or U.S. Tobacco. Instead, the parties have agreed to a settlement. By agreeing to the settlement, the parties avoid the costs and uncertainty of litigation, and class members receive  the benefits described in the proposed settlement agreement. The named plaintiffs and class counsel think the proposed settlement is best for everyone who is affected.

11. What does the proposed settlement provide?

Answer:

Pursuant to the settlement agreement, U.S. Tobacco has agreed to pay $24 million into a settlement fund over a five-year period, for distribution to class members.

U.S. Tobacco will pay into the fund according to the following schedule:

  • $10 million when the settlement goes into effect;
  • $5 million two years after the settlement goes into effect;
  • $5 million four years after the settlement goes into effect; and
  • $4 million five years after the settlement goes into effect

12. Will the entire $24 million fund be distributed to class members?

Answer:

No. Class counsel will ask the Court for up to $2 million from the fund to be used to pay for attorneys’ fees, costs, and expenses, as well as incentive payments to the named plaintiffs.

13. How will the settlement fund be divided among class members? How much will I get paid?

Answer:

We do not know at this point how much any individual class member may receive. The settlement fund will be divided into two groups (Group 1 and Group 2), each with different distribution rules.

Group 1 is expected to comprise 75% of the settlement fund and will be distributed to class members on a pro rata basis, determined by the total pounds of flue-cured tobacco each member marketed and sold relative to the total pounds of  flue-cured tobacco from all members who submit a Group 1 claim. Distributions for Group 1 claims will be capped at $15,000 per claimant.

Group 2 is expected to comprise 25% of the settlement fund and will be distributed to class members on a pro rata basis, determined by the total number of crop years that each member marketed and sold flue-cured tobacco relative to the total number of crop years of all members who submit a Group 2 claim.

14. What happens if there are leftover “Group 1” funds because of the $15,000 cap?

Answer:

Any funds leftover from “Group 1” will be added to “Group 2” and distributed accordingly.

15. How do I request a distribution from the settlement?

Answer:

To receive a distribution, you must submit a claim form, click HERE. Please provided supporting documentation, to the claims administrator by May 26, 2018.

16. How do I obtain a claim form?

Answer:

To obtain a claim form, click HERE to download a claim form and file your claim online.

17. What kind of supporting documentation do I need to submit with my claim form?

Answer:

You should submit any documents that show (1) the total pounds of flue-cured tobacco you or your ancestor or predecessor grew since 1946; and/or (2) the number of years in which you or your ancestor or predecessor grew flue-cured tobacco  since 1946 (e.g., tobacco sale receipts, tax returns showing income from tobacco production).

You should provide as much documentation as you have to show you are eligible for a payment. The claims administrator will authorize distributions based on a range of documents and there is no specific document that the claims  administrator is looking for.

18. What kind of documentation do I need to submit to show that I am a legal heir, representative, successor, etc. of a former member?

Answer:

You should submit documents proving that you inherited the former member’s interests and rights related to his or her membership in U.S. Tobacco, such as a copy of the will showing that you are the beneficiary under a will, or a legal heir based on your relationship with the member under state law.

19. Who will be responsible for determining the validity of the claims and the amount paid?

Answer:

The claims administrator will be responsible for reviewing the claim forms to determine which claims are valid and the amount of money each claimant is paid.

20. Will I have the opportunity to amend my claim form or submit additional documentation if the claims administrator determines that my claim is not valid?

Answer:

Yes. If your claim is rejected, the claims administrator will notify you in writing and provide the reason that your claim was rejected. At that point, you will be permitted to submit additional information by a specified deadline. In addition, if you disagree with the claims administrator’s determination, you can submit a statement contesting the determination and requesting re-review. If a claims dispute cannot be resolved, class counsel may submit the request  for review to the court.

21. My ancestor grew flue-cured tobacco and was a member of U.S. Tobacco but I do not have any records regarding the amount of tobacco production or years of membership. Am I eligible for a distribution?

Answer:

Potentially. U.S. Tobacco has membership records for all members dating back to 1946. As long as you can submit documentation to show that you are the legal heir of the former member, and the member’s name is listed in U.S. Tobacco’s  records as a former member, you will be eligible for a Group 2 distribution. In addition, U.S. Tobacco maintains some records for certain years regarding the level of tobacco production for members. If your ancestor produced tobacco during years in which U.S. Tobacco maintains records as to levels of tobacco production, you may be eligible for a Group 1 distribution.

23. What do I do if I made a mistake in filling out my claim form?

Answer:

Claim correction requests must be mailed to claims administrator at: 

Settlement Claims Administrator - 5773

PO Box 2612

Faribault, MN 55021-9612

Please provide the following information to correct your claim:

  • First and Last Name
  • Phone
  • Email
  • Best contact time
  • What information is incorrect in your claim?
  • What is the correct information you need for us to update?

24. When will I get a payment?

Answer:

The settlement funds will be distributed after the settlement becomes effective and all claims have been processed and resolved. The Court will hold a hearing on January 19, 2018 to decide whether to approve this settlement. Even if the  settlement is approved by the court, the settlement will not become effective until after several conditions are met, including the resolution of any appeals. (See Question 34 below for the conditions on the settlement going into  effect.) You can continue to check on the progress of the settlement by visiting this website for the latest information. Also, U.S. Tobacco will make four payments over a five-year period to pay the $24 million into the settlement fund.  Therefore, money will be distributed to those who filed claims each time U.S. Tobacco makes a payment into the settlement fund.

25. Will I owe taxes on my settlement distribution?

Answer:

Yes. You will be responsible for paying taxes related to any payment you receive from the settlement fund. You  should consult a tax professional to assess the specific tax implications of any payment you may receive.

26. Do class members give up any rights because of the settlement?

Answer:

Yes. By participating in the settlement, class members agree that their claims against U.S. Tobacco related to the facts and issues in the lawsuit are dismissed and released. In other words, they will not be able to sue U.S. Tobacco Cooperative for any conduct arising out of or related to the facts and claims alleged in this lawsuit.

27. What are my options if I do not like the proposed settlement?

Answer:

If you do not like the proposed terms of the settlement, you can either opt out of the settlement or object to the settlement. If you opt out, you will not be legally bound by any aspect of the settlement and are free to participate in any other lawsuit against U.S. Tobacco about the claims in this case. If you object to the settlement, the court will consider your objection in deciding whether to approve the settlement, but you will still be bound by the settlement if it is approved.

28. If I do not submit a claim form, will I still be bound by the settlement?

Answer:

Yes, unless you opt out. Even if you do not submit a claim form to request a payment, you will be bound by the settlement as a class member, unless you opt out from the settlement. (See Question 37 below for information on how to opt out.)

29. What happens if I do nothing?

Answer:

If you are a class member and do nothing, you will not receive a payment from the settlement. You will still be bound by the settlement and will not be able to start or continue any other lawsuits against U.S. Tobacco for the claims released in the settlement.

30. What is the final approval hearing?

Answer:

The Court has preliminarily approved the settlement and will hold a hearing to decide whether to give final approval to the settlement. At the final approval hearing, the court will decide (1) whether the settlement is fair, reasonable,  and adequate, and in the best interests of the class, considering any objections received; (2) whether the class has been fairly and adequately represented by the plaintiffs who brought the case and by class counsel; (3) the amount to grant class counsel in response to its request for an award of attorneys’ fees and reimbursement of expenses; (4) the amount to grant to class representatives as their incentive awards; and (5) any other issues relating to the settlement and the lawsuit that the court thinks are necessary.

31. When will the final approval hearing take place?

Answer:

Judge Dever has scheduled the final approval hearing at 10:00 a.m. on January 19, 2018. Because it is possible that  his date may change, it is best to consult this settlement website, the court, or class counsel to confirm the date of the hearing.

32. How can I object to the settlement?

Answer:

You can object to the settlement by submitting a written letter to the court that states the reasons you object to the settlement. Additional details on the information to include in the written request are available in the long form, click HERE.

33. If I submit an objection to the settlement, do I have to appear at the approval hearing? Can I appear?

Answer:

You do not have to appear. If you submit a written objection, the court will consider your views in determining whether to approve the settlement. You (or your attorney) are welcome to appear at the fairness hearing if you would like, but it is not necessary. Additional details on what steps to take if you would like to appear are available in the Long Form, click HERE.

34. When will the settlement become final and go into effect?

Answer:

The settlement will become final after Judge Dever enters an order approving the settlement, after any appeals are resolved or the opportunity to appeal expires, and after the class allegations contained in the Lewis and Fisher parallel class action in North Carolina Superior Court are either dismissed or enjoined (i.e., the judge enters an order prohibiting further prosecution of the class action allegations in the case). (See Question 35 below for additional information about the parallel state court class action.)

35. Is this a separate lawsuit from the Fisher/Lewis action pending in North Carolina superior court?

Answer:

Yes. This is a different lawsuit brought by a separate set of class representatives. The lawsuits allege similar facts and legal claims.

36. What is the relationship between the two lawsuits?

Answer:

The lawsuits are brought by two different sets of plaintiffs. However, because the factual allegations and claims overlap, if the settlement is approved, the class allegations in the Fisher/Lewis lawsuit may be stopped or discontinued. If this Settlement is approved, you may participate in this Settlement by the submission of a claim(s) even if you are a class member in the Fisher/Lewis lawsuit. This Settlement will not become effective, and claims will not be paid pursuant to the Settlement, unless and until the class claims in the Fisher/Lewis lawsuit are discontinued or dismissed.

37. How do I opt out of the settlement?

Answer:

You must submit a written request to opt out to the court by December 20, 2017. Additional details on the information to include in the written request and where to send the request are available in the Long Form, click HERE.

38. If I opt out of the settlement, can I still receive a distribution from the settlement fund?

Answer:

No. If you opt out, you will not be eligible to receive any distribution from the settlement fund.

39. If I opt out of the settlement, can I still appear at the approval hearing and object?

Answer:

No. If you opt out of the settlement, you will not be bound by any of the terms of the settlement. Therefore, you will not have a right to object or be heard at the approval hearing.

40. Can I wait and opt out after the final approval hearing?

Answer:

No. If you would like to opt out, you must do so by the deadline of December 20, 2017.

41. What is the difference between opting out and objecting?

Answer:

Objecting is simply telling the court that you don’t like something about the settlement. You can object only if you stay in the class. Opting out is telling the court that you don’t want to be part of the class. If you exclude yourself, you have no basis to object because the settlement no longer affects you.

42. Do I have a lawyer in the case?

Answer:

The court appointed Shipman & Wright, LLP and Daughtry, Woodard, Lawrence & Starling, LLP as class counsel to represent you and the rest of the class.

43. How do I contact class counsel?

Answer:

Class counsel can be contacted at the below phone numbers and addresses:

  • Gary K. Shipman and William G. Wright

Shipman & Wright, LLP

575 Military Cutoff Road,Suite 106

Wilmington, NC 28405

1-910-762-1990

  • Leo Daughtry and Kelly Daughtry

Daughtry, Woodard, Lawrence & Starling, LLP

403 E. Market Street

Smithfield, NC 27577

1-919-300-6982

44. If I contact class counsel for legal advice, do I personally have to pay them for legal fees? How will class counsel be paid?

Answer:

No. You will not be charged for any fees or costs of class counsel. At the approval hearing, class counsel will ask the Court for up to $2 million of the settlement fund to pay for attorneys’ fees, costs, and expenses and incentive payments to the named plaintiffs. The court will decide the amount to award.

45. Can I hire my own attorneys?

Answer:

Yes. You can hire your own attorneys to represent you. However, your individual lawyers will not be compensated based on the settlement agreement and you will personally be responsible for paying their fees.

46. Who should I contact if I have other questions?

Answer:

You can contact the claims administrator or class counsel if you have any other questions about the proposed settlement. Please do not contact the Clerk of the Court or the Judge with questions about the settlement.

47. Can I submit both a Group 1 and a Group 2 Claim?

Answer:

Yes, you can file both a Group 1 and a Group 2 claim, whether at the same time or separately. you may be eligible to receive a payment from both Group 1 and Group 2 if the claims administrator determines that your claim for each Group is valid.

48. Can you provide me with information or documents about my membership or pounds of tobacco grown to help fill out the claim form?

Answer:

We cannot provide individual grower information or documentation.  You should complete the information requested in the Claim Form to the best of your ability and upload electronic copies of any documentation that you have to support your claim.  You should provide as much documentation as you can to show you are eligible for a payment.  However, even if you do not have documentation to upload, you may still submit your claim, and it is possible that you may still be able to participate in the Settlement based on U.S. Tobacco’s documents and records.  The claims administrator will assess those records to determine if there is data to support your claim.  We will follow up with you later if there are questions about your claim.

Please do not contact the Court.  You may refer to the Commonly Asked Questions page or Long Form notice on this site, or call 1-866-458-3207 if you have additional questions.

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