It is expected that there will be a third, and final distribution of Co-op dissolution proceeds. The amount will be smaller than in the first two distributions, likely less than $700 per check. The third distribution will occur when the Co-op’s dissolution is nearly complete, which is anticipated to occur sometime in calendar year 2023.

Through a Dissolution Committee, the Co-op has been liquidating assets and wrapping up its obligations. The Co-op sold the building on South Broadway in Lexington to the University of Kentucky, sold its tobacco inventory and other physical assets, closed its office, and no longer has any employees. It has resolved certain ongoing obligations to former employees and liquidated or cashed out securities, annuities, and other financial assets. The Co-op will file income tax returns for its fiscal year ended 9/30/22, and anticipates that it will need to file such returns for the fiscal year ending 9/30/23.

You are not on the list of eligible Class members. To qualify as a Class member and be eligible to receive a share in the distribution of the Co-op’s dissolution proceeds, you needed to submit certain documents before deadlines that have long since passed. In addition, by the end of August 2022, the Court ended its hearings for considering whether to overrule denials of Class membership or eligibility to share in the distributions and had issued its rulings, which have become final and non-appealable.

Contact the Class Counsel team — send an email to ClassCounsel@mcbrayerfirm.com or call 1-866-965-9005 (toll-free) or 1-859-551-3622. If you choose to start the process of cancelling the check and having it re-issued and mailed to you, then a “lost-check affidavit” will be prepared for you to sign, have notarized, and send to the Settlement Administrator.

You may not be able to cash the check if, for example, your name changed or is misspelled on the check, the check has been torn or you lost it, or there is no one who can properly endorse the check. Contact the Class Counsel team — by sending an email to ClassCounsel@mcbrayerfirm.com or calling 1-866-965-9005 (toll-free) or 1-859-551-3622 — and explain the situation. You may need to submit an updated W-9 (see Question 6) or other documents. If you choose to start the process of cancelling the check and having a replacement check issued and mailed to you, then an affidavit will be prepared for you to sign, have notarized, and send to the Settlement Administrator.

A form 1099 for the amount of the check usually was put in the same envelope with the 1st distribution checks sent out to approximately 1800 eligible Class members on December 15, 2021, and with the 2nd distribution checks sent out to approximately 2600 members on November 8, 2022. If you were among the 1000 or so eligible Class members sent your 1st check in 2022, rather than in mid-December 2021, that check typically was not accompanied by a 1099. Similarly, 2nd checks that were issued individually or in smaller groups after November 8, 2022 — for example, because the 2nd check was lost and had to be re-issued — typically will not have the corresponding 1099 in the same envelope. Amounts for 2022 checks that were not accompanied by a 1099 statement should be included on a statement from the Settlement Administrator sent to the payment recipient on or before January 31, 2023.

The Settlement Administrator is required to report the payment to you and other Class members of the amounts in the first and second checks; it must give a statement to you and report to taxing authorities using the 1099 form. Neither the Settlement Administrator nor Class Counsel can provide individual tax advice regarding the distribution(s) of Co-op dissolution proceeds. If you have questions regarding the tax treatment of the distribution(s) you receive, please consult a tax advisor.

You are encouraged to update the W-9 (giving the tax identification number for the Class member) if there has been a name change or change of address, the Class member has passed away, or a trust, LLC, or estate that was the Class member is no longer in operation. Although the 2nd check may have reached you anyway and you were able to cash it despite such changes in circumstances, the same might not be true for the expected 3rd distribution check in 2023. If you are uncertain about whether or how to update the W-9, contact the Class Counsel team — email ClassCounsel@mcbrayerfirm.com or call 1-866-965-9005 (toll-free) or 1-859-551-3622.

The IRS website provides explaining how to complete the form. You may ask Class Counsel to send you a W-9 form, and you may be able to obtain one from a local public library, accountant, or tax professional.

• Sign and date the form in part II.
• To help match up the updated W-9 with the correct Class member, write the Notice I.D. (if known) at the top of the form, along with the old (previous) address or name used.
• Send the completed one-page form to Class Counsel:
  • Email as an attachment to ClassCounsel@mcbrayerfirm.com
  • Mail to: Settlement Class Counsel; McBrayer PLLC, 201 E. Main Street, Suite 900; Lexington, KY 40507
  • Fax and other transmission methods might be available; call the Class Counsel team at 1-866-965-9005 (toll-free) or 1-859-551-3622.

If you are not on the list of eligible Class members to receive dissolution proceeds checks (see FAQ#3 above), then you were not sent this notice and do not have any options about a proportionate share in the Fund’s remainder.

It is also possible that the address we have for you is not up-to-date. If you are an eligible Class member, and have changed your address since last distribution check you received, contact the Class Counsel team by calling 1-866-965-9005 (toll-free) or 1-859-551-3622 or sending an email to ClassCounsel@mcbrayerfirm.com.

Information is available on this website about the settlement approved by the Court, including the $1.5 million fund (“the Fund”) and the options given to Class members and the Burley and Dark Tobacco Producer Association (“the Association”). This information can be found under the Important Documents tab, and includes:

• the 7/28/21 Amended Opinion and Order Approving Partial Settlement, which on pages 15-23 discusses and gives directions about the Fund and the Association
• a report by the Association about its first year
• the Association's Bylaws

More information about the Association is available elsewhere on-line, including from:

• its website, https://tobaccoproducers.co , which includes information about how to contact the Association
• a UK College of Agriculture, Food and Environment article, “Introducing a New Organization Supporting Tobacco Growers”

On June 26, 2023, Roger Quarles, Ian Horn, Campbell Graddy, David Lloyd, and Gary Wilson filed an appeal from Court orders entered on August 24, 2021, April 5, 2023, and June 1, 2023, denying requests by their attorneys to be awarded a fee from funds that would otherwise be distributed to Class members. The appeal seeks to overturn the denial of a fee award and to have the attorneys — the W. H. Graddy & Associates law firm — paid an amount of up to $99,375. The appeal is Kentucky Court of Appeals No. 2023-CA-0767, and is in its preliminary stages. Proceedings will continue in the Fayette Circuit Court on other issues, but the Circuit Court case cannot be completely finished until the appeal is over.

In addition to preventing the case from being finished up, the appeal has already had or may have other effects on Class members. For example, in its recent order about distribution of what remains of the $1.5 million Fund, the Court provided for $30,000 to be set aside for Class Counsel work defending the appeal (that is, arguing against a fee award to the Graddy law firm); this amount reduces the Fund to be distributed to qualified Class members who elected to be paid an individual share. Similarly, if Roger Quarles and the other appellants succeed in having the fee denial overturned on appeal, the amount awarded to the Graddy law firm would reduce the amount distributable to Class members. In addition, the appellants may post a bond to stay (or hold back) the distribution of a significant amount of money otherwise available; this is so that if they succeed on appeal, there would be money available to pay their lawyers. Such a stay would reduce the amount distributed to Class members in 2023. Even if there is a distribution of the held-back funds in a year or two, there are extra costs associated with splitting and delaying a portion of the distribution.

Contact the Class Counsel team by sending an email to ClassCounsel@mcbrayerfirm.com or calling 1-866-965-9005 (toll-free) or 1-859-551-3622.

The Court has appointed Katherine K. Yunker and Jason R. Hollon, from the law firm of McBrayer PLLC, to represent members of the settlement class. These lawyers are called Class Counsel. You will not be charged for these lawyers. You may contact the Class Counsel team by sending an email to ClassCounsel@mcbrayerfirm.com or calling 1-866-965-9005 (toll-free) or 1-859-551-3622. Class Counsel represent the interests of the class as a whole, rather than the particular interests of individual class members. If you want to be individually represented by a lawyer you select, you may hire one at your own expense.

Lawyers for Settlement Class members requested awards of their fees and expenses for work leading up to the dissolution Settlement. The Court held hearings on the requests and the objections received, and in its June 2021 Opinion and Order, made awards that were less than the amounts requested:

• Billings Law Firm, PLLC - $538,890.50 for its fees and $24,010.39 for expenses.
• McBrayer PLLC - $18,561.61 for expenses and, as a fee, 7.5% of the pool of net dissolution proceeds, to be paid to the firm in proportion to proceeds paid out to eligible Settlement Class members.

In a December 2021 Order and an October 2022 Order, the Court also awarded a total of $779,862 to McBrayer PLLC for October 2020 – August 2022 work done by the Class Counsel team and work still to be done before the Co-op’s dissolution is complete and the final distribution is made to eligible class members. In accordance with its 7/28/21 Amended Opinion and Order, the Court has recently awarded $73,056.26 to McBrayer PLLC for work done by the Class Counsel team in developing, implementing, and administering the “postcard process” relating to the $1.5 million Fund.

The lawyers for objectors Roger Quarles, Ian Horn, Campbell Graddy, David Lloyd, and Gary Wilson requested that they be paid an attorney fee of up to $99,375 for their work relating to an objection to the settlement proposal of a $1.5 million grant to a tobacco liaison/advocacy nonprofit. The Court denied those lawyers’ request, and on June 26, 2023, Roger Quarles and the other five objectors appealed the denial of a fee award to their lawyers. See FAQ #10 for more information about that appeal.