Tobacco Titans Reach Landmark Settlement in Canada
A decades-long battle has finally come to an end as three of the world’s largest tobacco companies – Philip Morris, British American Tobacco, and Japan Tobacco – agree to pay a staggering C$32.5 billion to settle a major lawsuit in Canada.
A Long History of Controversy
The roots of this case date back to the 1950s, when it’s alleged that these tobacco giants knew their products were causing cancer and other serious health issues. Despite this knowledge, they failed to warn consumers about the risks. In 2015, a Quebec court ruled in favor of around 100,000 smokers and ex-smokers, awarding them damages totaling C$15 billion. The companies appealed, but the decision was upheld in 2019, forcing their Canadian subsidiaries to seek bankruptcy protection.
A New Chapter
Since then, the subsidiaries have been under court-supervised mediation, negotiating a possible settlement. Today, Philip Morris announced that a proposed plan has been reached, paving the way for a potential resolution. While the exact allocation of the settlement amount between the three companies remains unclear, Philip Morris CEO Jacek Olczak expressed hope that this marks the beginning of the end of the legal process.
A Positive Step Forward
British American Tobacco echoed this sentiment, calling the proposed plan a “positive step” towards finding a resolution. Their Canadian unit, Imperial Tobacco Canada, will fund the settlement using cash on hand and future sales of tobacco products in Canada. Meanwhile, Japan Tobacco has yet to comment on the deal.
What’s Next?
Voting on the plan is set to take place in December, with a hearing to consider approval expected in the first half of next year. If accepted, this landmark settlement will bring closure to a long and contentious chapter in the history of the tobacco industry. As the dust settles, one thing is clear: the stakes have never been higher for big tobacco.
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