2006-621, STATE OF NH v. PHILIP MORRIS USA, INC. & a

Morris USA, Inc., R.J. Reynolds, Inc. and Lorillard Tobacco Company. York, New York (Alexander Shaknes & a. on the brief), for defendants Philip of New York, New York (Penny Reid on the brief), and DLA Piper US LLP, of New Douglas G. Smith on the brief, and Mr. Patton orally), Weil Gotshal & Manges, on the brief), Kirkland & Ellis LLP, of Chicago, Illinois (Stephen R. Patton and on the brief), Winston & Strawn, LLP, of Chicago, Illinois (Thomas J. Frederick brief), Kirkland & Ellis LLP, of New York, New York (Marjorie P. Lindblom & a. on the brief), Ford, Weaver & McDonald, of Portsmouth (Marc McDonald on the Ransmeier & Spellman, of Concord (R. Matthew Cairns and Lisa M. Lee

attorney general, & a. on the brief, and Mr. Head orally), for the State. to press. Errors may be reported by E-mail at the following address: Kelly A. Ayotte, attorney general (Richard W. Head, senior assistant

editorial errors in order that corrections may be made before the opinion goes No. 2006-621 Hampshire, One Charles Doe Drive, Concord, New Hampshire 03301, of any Merrimack Readers are requested to notify the Reporter, Supreme Court of New ___________________________

page is: http://www.courts.state.nh.us/supreme. a.m. on the morning of their release. The direct address of the court's home reporter@courts.state.nh.us. Opinions are available on the Internet by 9:00

well as formal revision before publication in the New Hampshire Reports. NOTICE: This opinion is subject to motions for rehearing under Rule p. 2 22 as 2

related public health measures.” Under the MSA, the PMs do not make advancement of public health” and “the implementation of important tobacco-

Participating Manufacturers (NPMs). tobacco companies that did not enter into the settlement are known as Non- OPMs and the SPMs are known as Participating Manufacturers (PMs). Those

intended to help the Settling States achieve “significant funding for the The annual payments that the MSA requires the PMs to make are

Inc., R.J. Reynolds, Inc., and Lorillard Tobacco Co. manufacturers have merged, the OPMs now are defendants Philip Morris USA, Original Participating Manufacturers (OPMs). Because two of the payment obligations and other restrictions as the OPMs. Collectively, the Manufacturers (SPMs), have joined the MSA and are subject to the same various other tobacco manufacturers, known as Subsequent Participating marketing and advertising restrictions. Since the execution of the MSA, payments from the OPMs, as well as several other concessions, including to release past and future claims against the OPMs in exchange for annual and other tobacco products. Under the MSA, the Settling States agreed to dismiss their lawsuits and that they were engaging in wrongful advertising and marketing of cigarettes jurisdictions, filed suit against a number of tobacco manufacturers, alleging

Agreement (MSA) with four domestic tobacco manufacturers, known as the Territories (the Settling States) entered into the Tobacco Master Settlement of Columbia, the Commonwealth of Puerto Rico and four United States p. 2 2006). In November 1998, the Attorneys General of forty-six states, the District 505, 507 (Mass. 2007); State v. Philip Morris, Inc., 905 A.2d 42, 43 (Conn.

Several years ago, New Hampshire, along with other states and

A. The Master Settlement Agreement

I. Background

dismissing its petition for declaratory judgment. We affirm. (Fitzgerald, J.) granting the defendants’ motion to compel arbitration and DUGGAN, J. The State appeals an order of the Superior Court

Manufacturers). Commonwealth Brands, Inc. & a. (the Subsequent Participating McCallum on the brief, and Mr. Brookhiser orally), for defendants Howrey LLP, of Washington, D.C. (Robert J. Brookhiser and Elizabeth B. McNeill, Taylor & Gallo, P.A., of Dover (Robert J. Gallo on the brief), and p. 3 Adjustment applies. the MSA was a significant factor contributing to that loss, then the NPM

of such statute during such entire calendar year . . . .

experience the requisite market share loss and the Firm also concludes that was a “significant factor” in the PMs’ loss of market share. If the PMs

payment in question is due, and diligently enforced the provisions calendar year immediately preceding the year in which the Qualifying Statute . . . in full force and effect during the entire imposed a competitive disadvantage on the PMs and whether that disadvantage Adjustment . . . if such Settling State continuously had a consulting firm – referred to in the MSA as the “Firm” – whether the MSA A Settling State’s Allocated Payment shall not be subject to an NPM to the NPMs. Next, it must be determined by a nationally recognized economic experienced a collective loss of a certain percentage of domestic market share reduction of payments. The MSA provides that: applicable, the MSA contains a mechanism for a Settling State to avoid a Adjustment” (NPM Adjustment), which is here at issue. Even if these two factors are proven and the NPM Adjustment is

it is proven that they lost market share to the NPMs. reducing the annual payment obligations of the PMs if – as a collective group – NPMs. Thus, the NPM Adjustment attempts to level the marketplace by competitive disadvantage and potentially cause PMs to lose market share to the marketing restrictions and payment obligations could put the PMs at a and payment obligations. The drafters of the MSA acknowledged that accounting firm PricewaterhouseCoopers LLP.

payment obligations of the PMs, it first must be determined whether the PMs In order for the NPM Adjustment to apply and reduce the annual adjustments. One adjustment is the “Non-Participating Manufacturer IX(c)(1) of the MSA. This amount is then subject to several reductions and market share of the base amount for the year at issue as specified in section starting point is for each of the OPMs to pay into the escrow account its relative

joined the MSA, and are thus not subject to the MSA’s marketing restrictions “Independent Auditor.” Currently, the Independent Auditor is the public As noted above, the NPMs are tobacco manufacturers that have not States. The PMs’ payment obligations are calculated annually by an 15th of each year, and the funds are subsequently allocated among the Settling

Independent Auditor calculates the PMs’ annual payment obligation. The The MSA contains a comprehensive formula governing how the

required to make a single, nationwide payment into an escrow account on April payments directly to the individual Settling States. Instead, each PM is p. 4 4

“[u]ntil such time as the parties resolve this issue or the issue is resolved by a

Adjustment to the PMs’ annual payments for 2003. applying an NPM Adjustment had been met, it refused to apply the NPM since, in spite of the fact that it acknowledged that all of the conditions for attempt to resolve the dispute. Rather, it reiterated its prior statement that the Settling States concerning application of the NPM Adjustment, it did not the Independent Auditor again acknowledged the dispute between the PMs and NPM Adjustment in its final calculations issued March 29, 2006. Even though payment calculation. Nonetheless, the Independent Auditor did not apply the PMs requested that an NPM Adjustment for 2003 be applied to their final 2006 After receiving the Independent Auditor’s preliminary calculations, the to the calculation. fact, the Independent Auditor will not modify its current approach Inc., 86 p. 4 4 N.E.2d at 510 n.7. as the parties resolve this issue or the issue is resolved by a trier of

that the Settling States were diligently enforcing their Qualifying Statutes, whether an NPM Adjustment applies, apparently its approach was to presume calculations or elsewhere – explicate its current approach to determining Although the Independent Auditor did not – in its preliminary

has “diligently enforced” its Qualifying Statute. . . . Until such time the legal determination as to whether any particular Settling State More importantly, the Independent Auditor is not qualified to make under the MSA of making a determination regarding this issue. The Independent Auditor is not charged with the responsibility

adjustment should apply, the Auditor stated that: PMs’ payment obligations. Recognizing that the parties disputed whether the calculations, the Independent Auditor did not apply the NPM Adjustment to the calculations of the amounts due from the PMs on March 7, 2006. In its accordance with the MSA, the Independent Auditor issued detailed preliminary apply an NPM Adjustment to the PMs’ April 17, 2006 annual payments. In The present dispute concerns the Independent Auditor’s decision not to

B. The Present Dispute

also RSA 5 p. 4 41-C:2, VI, :2, X (defining “qualified escrow fund” and “units sold”). Hampshire by the NPM during the previous year. See RSA 541-C:3, I(b); see amount of money based upon the number of individual cigarettes sold in New New Hampshire to place into a qualified escrow fund by April 15th a certain chapter 541-C (2007). RSA chapter 541-C requires NPMs doing business in MSA § IX(d)(2)(B). New Hampshire has a Qualifying Statute, codified as RSA of a series of agreements executed by the parties in June 2003. The State also

p. 5 which was denied. dismissed the State’s petition. The State filed a motion for reconsideration, submitted to arbitration in accordance with the terms of the MSA, and (4) the PMs waived their right to contest diligent enforcement in 2003 by virtue

State’s petition. nationwide basis.” Consequently, the court found that the matter ought to be from their own judiciaries the review of their executive officers’ diligence; and Consequently, the PMs filed a motion to compel arbitration and to dismiss the the issues raised in its petition; (3) the Settling States did not contract away arbitration provisions of the MSA; (2) section IX(j) of the MSA does not apply to

as the application of nationwide adjustments and reductions, determined on a submitted to arbitration in accordance with section XI(c) of the MSA. consistent with the parties’ intent “to have issues of nationwide concern, such subject of an action in superior court, and that the matter ought to be Particularly, the court noted that submitting the matter to arbitration would be diligently enforced its Qualifying Statute in 2003 is not subject to the would more closely conform to the parties’ expectations and intentions.” On appeal, the State argues that: (1) the dispute over whether it

II. Discussion

17, 2006, albeit under protest, While most of the PMs paid the full amounts calculated on the due date of April Hampshire’s diligent enforcement of its Qualifying Statute was not properly the from the disputed payments account. The PMs countered that the issue of New found that the matter ought to be submitted to arbitration “because to do so sought an order requiring the OPMs to release all money due New Hampshire concerning the application of the NPM Adjustment. In addition, the court in effect and that it diligently enforced that statute during 2003. The State also concluded that the MSA’s arbitration clause, section XI(c), covers disputes determine whether the dispute between the parties was arbitrable. It The superior court examined the provisions of the MSA in order to

calculations, several PMs served notice that they disputed the final calculation.

order in superior court, seeking a declaration that it had a Qualifying Statute On April 18, 2006, the State filed a petition for an expedited declaratory

provided in the MSA. Id. attributable to the NPM Adjustment into the “Disputed Payments Account,” as 546, 551 (Ill. App. Ct. 2007), R.J. Reynolds and Lorillard paid the sums

Shortly following the release of the Independent Auditor’s final

the application of the NPM Settlement Adjustment.” trier of fact, the Independent Auditor will not modify its current approach to be governed by the United States Federal Arbitration Act. p. 6 so selected shall select the third arbitrator. The arbitration shall 6 they be submitted to arbitration.

controversy or claim arising out of or relating to calculations performed by or The language used in section XI(c) is broad, encompassing “[a]ny dispute,

sides to the dispute shall select one arbitrator. The two arbitrators considered these and similar issues and concluded that the MSA requires that whom shall be a former Article III federal judge. Each of the two SPMs also point to the fact that a significant number of other states have arbitration before a panel of three neutral arbitrators, each of NPM Adjustment claims for 1999-2002 is an arbitrable issue. The OPMs and subsection IX(j) or subsection XI(i)) shall be submitted to binding contest diligent enforcement during 2003 through agreements settling their the parties’ intent to arbitrate disputes such as the one at issue in this case. We conclude that the plain language of the arbitration provision evinces

MSA § XI(c).

reductions, offsets, carry–forwards and allocations described in purpose and policy.” arbitration; and (4) the State’s assertion that the OPMs “waived” their right to concerning the operation or application of any of the adjustments, speak the intention of the parties at the time it was made bearing in mind its arbitration; (3) the well-settled presumption in favor of arbitration compels Independent Auditor (including, without limitation, any dispute correctly concluded that the MSA’s nationwide payment structure compels calculations performed by, or any determinations made by, the language of the MSA requires arbitration of this dispute; (2) the superior court Any dispute, controversy or claim arising out of or relating to

The arbitration provision of the MSA states as follows:

the dispute. Id. at 355-56. assurance that the contract is not susceptible of an interpretation that covers that a particular grievance is not arbitrable if it is determined with positive arbitrability if the contract contains an arbitration clause, we may conclude

N.H. 352, 355 (2001). “Such a clause is to be interpreted so as to make it question of law for this court.” John A. Cookson Co. v. N.H. Ball Bearings, 147 that: (1) the superior court correctly ruled that the plain and unambiguous “The scope of an arbitration provision contained in a contract presents a

In response to the State’s arguments, the OPMs and the SPMs assert

with the duties and powers that are traditionally within its province. argues that it never surrendered its sovereignty to provide an accounting firm p. 7 7

jurisdiction to hear disputes over the applicability of the NPM Adjustment.”

enforcement determination and has not made one, there is nothing to arbitrate. since the Independent Auditor does not have the authority to make a diligent calculation or determination made by the Independent Auditor. It asserts that decisions of every other state court that has decided the issue to date.”); Qualifying Statute is not a dispute that “arises out of or relates to” a requires arbitration of the parties’ dispute. Our conclusion comports with the The State argues that the dispute over whether it diligently enforced its

Williamson Tobacco Corp., No. HJ-2241, at 6 (Richmond Cir. Ct. Aug. 9, 2006). No. S 0463-06-CnC, at 5 (Vt. Super. Ct. July 14, 2006); Virginia v. Brown & 00929, at 3 (Nev. Dist. Ct. Aug. 4, 2006); Vermont v. Philip Morris USA, Inc., (Iowa Dist. Ct. Aug. 16, 2006); determined, “it is abundantly clear that [the superior court] does not have Nevada v. Philip Morris USA, Inc., No. CV06- Dist. Ct. June 30, 2006); Iowa v. Philip Morris USA, Inc., No. CL p. 7 71048, at 5 Ct. Aug. 3, 2006); Idaho v. Philip Morris, Inc., No. OC 97 03239D, at 12 (Idaho Ct. July 19, 2006); Hawaii v. Philip Morris USA, No. 06-1-0695, at 7 (Haw. Cir. We agree with those courts. also Colorado v. R.J. Reynolds Tobacco Co., No. 97CV3432, at 6 (Denver Dist. apply the NPM Adjustment to the PMs’ 2003 annual payment are arbitrable. see language, disputes pertaining to the Independent Auditors’ decision not to (“[W]e believe the plain and unambiguous language of the settlement agreement Morris, ___ N.W.2d ___, ___, 2007 WL 1650423, at *5-*6 (N.D. June 7, 2007) 2007) (“The plain language of the MSA compels arbitration.”); State v. Philip State v. Philip Morris, Inc., ___ N.E.2d ___, ___, 2007 WL 1624765 (N.Y. June 7, Provision shows that the parties intended to arbitrate the present dispute.”); provision], [and] XI(c) [the arbitration clause] . . . .” Thus, as the superior court Co., 865 N.E.2d at 552 (“We conclude that the clear language of the Arbitration disputes “except as provided in subsections IX(d) [the NPM Adjustment unambiguously encompasses the present dispute.”); People v. Lorillard Tobacco MSA, and provides that it has jurisdiction to enforce the MSA and resolve at 512 (“The language of the [MSA] arbitration clause thus plainly and

be applied by the Independent Auditor. have almost unanimously concluded that by operation of the MSA’s plain While not binding upon us, we note that courts in other jurisdictions

exclusive jurisdiction of the Merrimack County Superior Court relative to the In addition, section VII of the MSA, entitled “Enforcement,” defines the

(including the NPM Adjustment), allocations, offsets and reductions that are to adjustments described in section IX(j), which lists the various adjustments omitted)). The provision also explicitly includes disputes related to the “arising out of” is a “very broad, general and comprehensive term” (quotation School Dist. v. Nat’l School Bus Serv., 140 N.H. 9, 13 (1995) (the phrase any determinations made by, the Independent Auditor.” See, e.g., Merrimack p. 8 8

presuming diligent enforcement. The Independent Auditor was, therefore, acting within its authority by of all payments owed, including adjustments, reductions and offsets thereto). MSA § XI(a)(1) (Independent Auditor shall calculate and determine the amount annual payments, but it requires the Auditor to make this determination. See initial determination of whether to apply the NPM Adjustment to the PMs’ contrary, the MSA not only authorizes the Independent Auditor to make the Auditor lacks authority to make a diligent enforcement determination. To the language in the arbitration clause stating that Finally, we disagree with the State’s contention that the Independent determinations to submit to arbitration. The State overlooks the broad actually determined.” enforcement of the Qualifying Statutes, there were no calculations or Id. at 513. issues not actually determined, just as well as those over issues which are Adjustment. This language is broad enough to encompass “disputes over adjustments . . . described in subsection IX(j),” which discusses the NPM “any dispute concerning the operation or application of any of the Morris, Inc., p. 8 864 N.E.2d at 513. The arbitration clause specifically includes limiting arbitration to those questions actually determined.” Com. v. Philip is subject to arbitration. Moreover, “there is nothing in the arbitration clause claim arising out of or relating to the Auditor’s calculations or determinations presumption makes no difference. any dispute, controversy or determination explicitly, or impliedly, or by employing a

Auditor did not make a specific determination as to whether there was diligent Further, we are unconvinced by the State’s contention that because the

Statutes). presumption that the Settling States were diligently enforcing their Qualifying Auditor’s decision not to apply NPM Adjustment was based upon its Id; see also People v. Lorillard Tobacco Co., p. 8 865 N.E.2d at 553 (Independent

enforcement determination. Whether the auditor made this therefore logically necessary that the auditor did make a diligent finding that there was diligent enforcement by the States. It is have denied the NPM adjustment for that year was by affirmatively manufacturers in 2003, the only means by which the auditor could significant factor in the loss of market share by the participating [B]ecause [the Firm] had determined that the [MSA] was a

Court of Massachusetts: enforcement of Qualifying Statutes. As explained by the Supreme Judicial Independent Auditor did, in fact, make a determination regarding diligent We concur with other appellate courts that have held that the and ensures fairness for all parties to the MSA.

p. 9 parties can fully and effectively participate, obviates this problem

articulated set of rules that apply universally in a process where all panel of competent arbitrators, who are guided by one clearly involving the decisions of the Independent Auditor to a neutral

N.E.2d ___, 2007 WL 1624765 (N.Y. June 7, 2007). Accordingly, we reiterate State v. Philip Morris, Inc., 813 N.Y.S.2d 71, 76 (App. Div. 2006), aff'd, ___

new litigation. essential health programs, and causing wave after costly wave of settling states of moneys needed for smoking cessation and other sets of payment rules might emerge, sowing confusion, depriving reduced is reallocated Qualifying Statute, the amount by which its allocated share would have been Settlement Agreement. The mechanism of submitting disputes Such a result [would defeat] the whole purpose of having a Master

As the Appellate Division of the New York Supreme Court aptly stated: State v. Philip Morris, Inc., 905 A.2d at 50 (quotations and alterations omitted).

left up to the courts of each of the settling states, fifty-two different interpretation of the rules on calculating annual payments were determined not to apply to a given state because it diligently enforced its is to calculate the annual payments. Indeed . . . if the state-by-state level. Under MSA section IX(d)(2)(C), if the NPM adjustment is uniform, nationwide set of rules by which the independent auditor made to the total amount owed by the PMs, as opposed to an adjustment on a calculations or determinations reflects the necessity of creating a then allocated to the Settling States. The NPM Adjustment is an adjustment controversy or claim arising out of the independent auditor’s [T]he [MSA’s] broad referral to an arbitration panel of any dispute,

states. to one state’s allocated share affects the payments made to the other settling Adjustment does apply. In other words, the application of the NPM Adjustment

pay in a given year is calculated on a nationwide level, and the sums paid are As the superior court noted, the total amount the PMs are required to

that the MSA’s nationwide payment structure compels arbitration. We agree. and SPMs counter that the superior court’s ruling was correct, and point out conform to the parties’ expectations and intentions” under the MSA. The OPMs concluding that submitting this dispute to arbitration “would more closely The State also apparently argues that the superior court erred in p. 10 NPM Adjustment.

and allocations listed in section IX(j). Second, as the superior court observed: determination by the Independent Auditor whether to apply the Thus, a dispute over diligent enforcement arises out of a the diligent enforcement of a Qualifying Statute has any relevance. 10 the MSA other than those regarding the NPM Adjustment, where

Adjustment is described in the same manner as all of the other adjustments

do not point to, and the Court is not aware of, any provisions in June 2003, in which the PMs absolutely and unconditionally released and Adjustment, the Court finds the argument unavailing. The parties the Auditor, it nonetheless argues: Next, the State argues that the parties executed a series of agreements in attempted to rephrase this issue as unrelated to the NPM NPM Adjustment), allocations, offsets and reductions that are to be applied by enforced its Qualifying Statute during 2003. While the State has We agree with the superior court and consequently reject the State’s argument.

section IX(j). A close reading of section IX(j), however, reveals that the NPM “enumerated,” which is the word used to describe the NPM Adjustment in “described,” which is the word used in the arbitration clause, and

acknowledges that section IX(j) lists the various adjustments (including the Adjustment. Instead, the only issue is whether it diligently petition to dispute the application of the p. 10 NPM Adjustment. Although the State The State contends that this dispute is not in regard to the NPM Statute, but that the superior court mistakenly concluded that it brought its court to obtain a determination that it had diligently enforced its Qualifying

the arbitration clause by drawing a meaningless distinction between the words We are not persuaded by this argument. First, the State misconstrues

related in any way to the NPM Adjustment is arbitrable. and after others – is not a reason to conclude that [ ] every issue it would need to be applied before certain adjustments are applied NPM Adjustment is mentioned in this list – as one would expect, as issues raised in its petition. It contends that it filed its petition in superior allocations enumerated in subsection IX(j). Simply because the forwards and allocations described in subsection IX(j). . . not the application of any of the adjustments, reductions, offsets, carry- The arbitration clause specified in § XI(c) refers to the “operation or

Next, the State argues that section IX(j) of the MSA does not apply to the

arbitration of this dispute. our conclusion that the plain and unambiguous language of the MSA requires p. 11 11

arbitrated.” circumstances where the parties expressly exclude the settlement from being is an arbitrable subject when the underlying dispute is arbitrable, except in

2003 annual payment, and therefore must be presented as part of the is arbitrable.” We agree. determination concerning applicability of the NPM Adjustment to the PMs’ is that the dispute in which those agreements are being asserted as a defense issue. Several circuit courts of appeals have held that “a settlement agreement enforcement in 2003 falls within the purview of the Independent Auditor’s of these agreements. agreements do not contain an arbitration clause, because “[w]hat is dispositive we turn to decisions from other jurisdictions that provide guidance on this whether the June 2003 agreements prohibit the PMs from contesting diligent not the arbitration panel – has the authority to determine the scope and effect We find these cases persuasive, and conclude that the dispute over not contain an arbitration clause, and thus argues that the superior court – CBA’s arbitration clause”). arbitrated if the dispute relates to a subject that is within the scope of the 1075, 1080 (9th Cir. 2002) (“disputes arising under a side agreement must be 1987); see also Inlandboatmens Union of the Pacific v. Dutra Group, 279 F.3d

Niro v. Fearn International, Inc., 827 F.2d 173, 175 (7th Cir.

arbitration clause. They argue that it is irrelevant that the June 2003 any determinations made by, the Independent Auditor. Bearing this in mind, diligent enforcement exemption fall within the plain language of the MSA’s controversy or claim arising out of or relating to calculations performed by, or enforcement in 2003. The State points out that the June 2003 agreements do language of the MSA arbitration clause is broad, encompassing any dispute, Nonetheless, we begin our analysis by reiterating our conclusion that the arbitration clause in a settlement agreement involving the same parties. concerning a subsequent agreement must be arbitrated pursuant to an We have not yet had the occasion to examine whether a dispute

agreements is arbitrable, because disputes concerning the applicability of the State contends that the PMs have waived their right to contest diligent contest diligent enforcement through execution of the June 2003 settlement effect such claims may have on future payments under the MSA. Thus, the Further, they assert that the issue of whether the PMs “waived” their right to cigarettes shipped or sold during 1999, 2000, 2001 and 2002, including any them from asserting claims pertaining to the NPM Adjustment for 2003. based upon cigarettes sold in that year, and the agreement does not prohibit present dispute, arguing that the PMs’ NPM Adjustment for a particular year is The PMs question whether the June 2003 agreements apply to the

the MSA (the provision discussing the NPM Adjustment) with respect to discharged each Settling State from any and all claims under section IX(d) of power. Indeed, the [MSA] places no limitations on the p. 12 constitute a cession or delegation of the sovereign enforcement

Commonwealth has met a condition in a contract does not established by the contract. Determining whether the its having met (or not) contractual conditions within the terms

any other party to a contract, cannot be subject to an analysis of

met. There is no reason why the Commonwealth, as opposed to analysis to determine whether a condition in the contract has been with no effect on anyone except for the [MSA] parties. It is an

Any determination by the auditor or the arbitrator concerning enforcement decisions under [Massachusetts’ Qualifying Statute]. sovereign power nor the task of reviewing discretionary

diligent enforcement question to an arbitrator cedes neither separation of powers. The Commonwealth’s argument misses the mark. Submitting the

(1908)). However, as it further observed: Id. at 514 (citing Home Tel. & Tel. Co. v. Los Angeles, 211 U.S. 265, 273 presumed not to have delegated or by contract alienated its sovereign powers.” “draws on the long-standing principle that the government is generally the Supreme Judicial Court’s analysis. As the court noted, the argument Supreme Judicial Court of Massachusetts soundly rejected. We concur with made on appeal in Com. v. Philip Morris Inc., 864 N.E.2d at 513-15, which the This is the identical argument that the Commonwealth of Massachusetts

itself proceed deferentially in order to preserve the constitutional under RSA 541-C where judicial review of such decisions must firm the task of reviewing regulatory and enforcement activities cannot be inferred that the State agreed to cede to an accounting from being arbitrated. In the absence of unmistakably clear language in the MSA, it agreements indicative of the parties’ intent to expressly exclude the agreements review of their executive officers’ diligence.” It argues: infer that the settling states contracted away from their own judiciaries the As mentioned above, the State asserts that this court “should not lightly

the Collective Bargaining Agreement). subject was one “ordinarily a matter for consideration by an arbitrator” under Collective Bargaining Agreement arbitration clause because the underlying over a side agreement that was silent as to arbitrability was governed by the United Steelworkers of America, 381 F.2d 196, 204-05 (3d Cir. 1967) (dispute

arbitration clauses is significant because there is no language in the arbitration process. The fact that the June 2003 agreements do not contain p. 13 13

BRODERICK, C.J.