SEC Sues Reynolds to Get Documents
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R.J. Reynolds Tobacco Holdings Inc. was sued by the Securities and Exchange Commission for refusing to provide some documents for an investigation of the company’s reporting of expenses.
The agency is seeking an order directing the Winston-Salem, N.C., company to show why it shouldn’t turn over information about legal costs from smoking and health lawsuits, the SEC said.
The SEC is demanding greater financial disclosure after companies including Enron Corp. filed for bankruptcy protection, costing investors billions of dollars.
The agency said its investigation of R.J. Reynolds “would be severely impaired” if the company refused to disclose how much it spends on the more than 4,000 tobacco-related lawsuits against it, according to court papers.
R.J. Reynolds said it was concerned that specific details about legal costs could become public or be given to plaintiffs’ lawyers or the Justice Department.
R.J. Reynolds shares fell 47 cents to $31.72 on the New York Stock Exchange.
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