Indiana Code 24-3-5.4-13.6. Bonds required for certain newly qualified and certain nonparticipating manufacturers
(1) The nonparticipating manufacturer or an affiliate of a nonparticipating manufacturer has failed to make required payments into a qualified escrow fund in any state during the three (3) calendar years immediately preceding the date of the determination unless:
Terms Used In Indiana Code 24-3-5.4-13.6
- Attorney: includes a counselor or other person authorized to appear and represent a party in an action or special proceeding. See Indiana Code 1-1-4-5
- brand family: means cigarettes that are:
Indiana Code 24-3-5.4-1
- Escrow: Money given to a third party to be held for payment until certain conditions are met.
- importer: means a person that imports, other than for personal consumption, one (1) or more brand families of a nonparticipating manufacturer. See Indiana Code 24-3-5.4-5.5
- Judgment: means all final orders, decrees, and determinations in an action and all orders upon which executions may issue. See Indiana Code 1-1-4-5
- Litigation: A case, controversy, or lawsuit. Participants (plaintiffs and defendants) in lawsuits are called litigants.
- newly qualified nonparticipating manufacturer: means a nonparticipating manufacturer:
Indiana Code 24-3-5.4-6.5
- nonparticipating manufacturer: means a tobacco product manufacturer that is not a participating manufacturer. See Indiana Code 24-3-5.4-7
- qualified escrow fund: has the meaning set forth in IC 24-3-3-7. See Indiana Code 24-3-5.4-9
- United States: includes the District of Columbia and the commonwealths, possessions, states in free association with the United States, and the territories. See Indiana Code 1-1-4-5
- Year: means a calendar year, unless otherwise expressed. See Indiana Code 1-1-4-5
(i) did not knowingly or recklessly fail to make the required payments; and
(ii) makes the required payment not more than one hundred eighty (180) days after receiving notice of the missed or insufficient payment; or
(B) the failure to make the required payment is:
(i) the subject of a good faith dispute that is documented to the satisfaction of the attorney general; and
(ii) cured not more than one hundred eighty (180) days after entry of a final order that resolves the good faith dispute and establishes the amount of the required escrow payment.
(2) A state has removed the nonparticipating manufacturer, an affiliate of the nonparticipating manufacturer, or a brand family of the nonparticipating manufacturer or an affiliate of the nonparticipating manufacturer from the state’s tobacco directory for noncompliance with state law during the three (3) calendar years immediately preceding the date of the determination.
(3) A state has:
(A) litigation pending; or
(B) an unsatisfied judgment;
against the nonparticipating manufacturer or an affiliate of the nonparticipating manufacturer for escrow payments or penalties, costs, or fees related to the nonparticipating manufacturer or affiliate’s noncompliance with the state’s escrow laws.
(b) The attorney general shall require:
(1) a newly qualified nonparticipating manufacturer; or
(2) a nonparticipating manufacturer that:
(A) has filed a certification under section 13 of this chapter; and
(B) poses an elevated risk for noncompliance, as determined by the attorney general under subsection (a);
to post a bond as described in subsection (c).
(c) A bond required under subsection (b) must be:
(1) posted by corporate surety located within the United States;
(2) in an amount equal to the greater of:
(A) fifty thousand dollars ($50,000); or
(B) the amount that the nonparticipating manufacturer is required to place into a qualified escrow fund under IC 24-3-3-12(2) for the calendar year in which the bond is posted;
(3) written in favor of the state of Indiana; and
(4) for a nonparticipating manufacturer, conditioned on the performance of the nonparticipating manufacturer, or an importer that assumes joint and several liability with the nonparticipating manufacturer under section 13.5 of this chapter, of all of obligations and duties of the nonparticipating manufacturer under this article during the calendar year in which the bond is posted and the immediately succeeding calendar year.
(d) If the attorney general determines under subsection (a) that a newly qualified nonparticipating manufacturer poses an elevated risk of noncompliance, the attorney general may require the newly qualified nonparticipating manufacturer to post a bond under subsection (c) for at least the first three (3) years during which the newly qualified nonparticipating manufacturers brand families are listed in a directory under section 14 of this chapter.
As added by P.L.24-2010, SEC.5.