Tobacco Giants Settle Historic $23.6 Billion Lawsuit in Canada

In a landmark legal settlement, three major tobacco companies have agreed to pay C$32.5 billion ($23.6 billion) to resolve a long-standing lawsuit in Canada, according to a statement from Philip Morris International. The proposed settlement, which has yet to receive final approval, marks the largest of its kind outside the United States, and follows years of litigation and mediation.

The companies involved—Philip Morris, British American Tobacco, and Japan Tobacco—have been embroiled in legal battles for nearly a decade over claims that they failed to adequately warn consumers about the health risks of smoking. In 2015, a Quebec court awarded damages to approximately 100,000 smokers and ex-smokers, who accused the companies of knowingly selling harmful products linked to cancer and other illnesses since the 1950s. The court found the companies liable for C$15 billion in damages.

The 2015 decision was upheld by a Quebec appeals court in 2019, solidifying the legal victory for the plaintiffs. In response, the Canadian subsidiaries of the three tobacco companies sought bankruptcy protection, and have since been negotiating a settlement under a court-supervised mediation process.

Per Reuters, the proposed C$32.5 billion settlement represents the culmination of years of legal maneuvering and mediation. If finalized, it would be a significant milestone in holding tobacco companies accountable for the health impacts of their products. However, as Philip Morris noted, the exact allocation of the settlement between the companies remains unresolved.

“Although important issues with the plan remain to be resolved, we are hopeful that this legal process will soon conclude, allowing Rothmans, Benson & Hedges and its stakeholders to focus on the future,” Philip Morris CEO Jacek Olczak said on Friday.

According to Jacob Shelley, co-director of the Health Ethics, Law, and Policy Lab at Western University in Canada, this case could serve as a model for future litigation against tobacco companies. “The scale of this settlement is unprecedented outside the United States,” Shelley noted, highlighting its potential impact on global tobacco regulation and accountability.

Source: Reuters