Tobacco giants vow to fight Canadian judgment handing C$15bn to smokers

http://www.theguardian.com/business/2015/jun/02/tobacco-giants-vow-fight-canadian-class-action-suit

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Three tobacco companies are appealing against a “historic” decision by a Canadian court to award smokers C$15.6bn (£8.2bn) in damages.

Quebec superior court justice Brian Riordan said the companies had put profits before the health of their customers, as he issued his long-awaited decision in what is thought to be Canada’s largest class-action lawsuit.

Bruce Johnston, a lawyer with one of the firms that took on the tobacco companies, called the ruling “historic – not just for the compensation for victims but also for public health and accountability”.

Related: If cigarettes kill, why do tobacco giants still wield so much power?

More than a million smokers and former smokers in Quebec were seeking damages, on the grounds that the companies knew they were selling a harmful product but concealed the risks. The case covered two groups of plaintiffs: those who became seriously ill from smoking and those who said they could not quit.

Riordan found for the plaintiffs in a scathing judgment against three tobacco companies – Imperial Tobacco Canada, a subsidiary of British American Tobacco; Rothmans, Benson & Hedges, a subsidiary of Philip Morris; and JTI Macdonald Ltd, part of Japan Tobacco.

“The companies earned billions of dollars at the expense of the lungs, the throats and the general well-being of their customers,” he wrote in a 276-page judgment. “If the companies are allowed to walk away unscathed now, what would be the message to other industries that today or tomorrow find themselves in a similar moral conflict?”

One of the lawsuits was brought by Jean-Yves Blais, who died of lung cancer in 2012 aged 68. At a press conference in Montreal, his widow urged people to quit smoking. “Your health is completely lost,” said Lise Blaise, carrying photos of her late husband. “I waited every year [for a judgment] — for 17 years. But I had the opinion we were going to win and we did.”

Although the cases were launched in 1998, the trial did not begin until March 2012. Proceedings concluded in December 2012 after the court heard from 76 witnesses and reviewed more than 43,000 documents.

One lawyer for the plaintiffs, Andre Lesperance, described the ruling as a great victory for the plaintiffs and society. “These three companies lied to their customers for 50 years and hurt their right to life,” he said.

The three firms must now split the damages according to the responsibility assigned by the court: Imperial Tobacco Canada has been ordered to pay two-thirds of the total, C$10.5bn, while RBH has been allocated a 20% share (C$3.1bn) and JTI Macdonald Corp must pay 13% (C$2bn).

All three tobacco firms said they planned to contest the decision.

Imperial Tobacco Canada said the judgment “ignores the reality that both adult consumers and governments have known about the risks associated with smoking for decades”. Its parent company, British American Tobacco, one of the UK’s biggest enterprises, was the biggest faller on the London stock exchange on Tuesday, losing 1.5% of its value. In a statement to investors, BAT said no payments would be made until a request to stay the execution order has been heard.

“There are strong legal grounds with which to challenge both the overall judgment and to seek a stay of the provisional execution order, which Imperial Tobacco Canada will do within 30 days of the original 27 May ruling,” it said.

An RBH spokeswoman said the cases were far from over. “We will vigorously appeal this lower court’s judgment, and believe that we have very strong legal grounds to overturn the judgment in its entirety.”

JTI-Macdonald said that Canadians have been well aware of the health risks since the 1950s and health warnings have been on packages for more than 40 years. “JTI-Macdonald Corp fundamentally disagrees with today’s judgment and intends to file an appeal,” it said. “The company strongly believes that the evidence presented at trial does not justify the court’s conclusions.”

The plaintiffs said the companies were required to pay $C1bn within 60 days regardless of any appeal.