Three major tobacco companies in Canada are seeking a stay on legal proceedings involving potential payouts of more than US$15 billion to approximately 100,000 individuals. Photo credit: cottonbro studio, Pexels.
JTI-Macdonald Corp., Rothmans, Benson & Hedges, and Imperial Tobacco Canada Ltd. seek to maintain the stay of legal proceedings until late March 2025 while they work toward a settlement with creditors in a lengthy case concerning billions in potential payouts to around 100,000 smokers and their families.
The court was scheduled to hear the request on October 1, but the hearing has now been postponed until October 31, with the stay of proceedings extended until that date. It was originally set to expire on September 30.
This delay, coupled with limited public information about the case, has frustrated health advocacy groups who argue that provinces may miss a crucial opportunity to implement regulations and smoking-reduction measures for the tobacco industry.
The court initially granted the order to stay legal proceedings against the companies in early 2019 after they lost an appeal in a significant legal case in Quebec. This stay aims to keep the current situation stable while the companies negotiate a comprehensive settlement with class action members and various creditors, which include provincial governments seeking to recover costs related to tobacco-related health care.
The first suspension lasted only a few months but has since been renewed multiple times, totaling over a dozen renewals. The details of the ongoing negotiations remain confidential.
The companies sought creditor protection in Ontario following the Quebec court's order for them to pay more than US$15 billion to approximately 100,000 individuals involved in two class-action lawsuits. These lawsuits addressed the claims of smokers who began their habits between 1950 and 1998 and experienced health issues or addiction, as well as claims from the heirs of these individuals.
Recent court documents indicate that hundreds of individuals linked to the class-action suits have passed away since the creditor protection proceedings started.