Rothmans, Benson & Hedges to Seek Leave for Supreme Court Review of Québec Class Action Tobacco Suits

Plaintiffs' failure of proof requires reversal of the judgment

MONTREAL, March 1, 2019 /CNW/ - Rothmans, Benson & Hedges Inc. (RBH) will seek leave to appeal to the Supreme Court of Canada today's Court of Appeal decision that found in favour of plaintiffs in two class actions. In 2015, the trial court ruled in favour of plaintiffs and found that the class members' damages totaled approximately 15.6 billion CAD including interest.

In today's decision, the Court of Appeal has largely affirmed the total amount of compensatory and punitive damages and the trial court's order for the defendants to deposit a portion of the damages, approximately 1.1 billion CAD, into trust accounts within 60 days. RBH's share of the deposit is approximately 250 million CAD.  RBH previously deposited 226 million CAD as security with the Court of Appeal.  

RBH's parent company, Philip Morris International Inc., is not a party to the cases.

Plaintiffs filed the two class actions against RBH, Imperial Tobacco Canada Limited, and JTI-Macdonald Corp. in 1998—one seeking damages for addiction and one for smoking-related diseases. 

It has long been settled law across Canada that in a class action, plaintiffs must not only prove that the defendants engaged in wrongdoing but also that this wrongdoing caused every member of the class injury. "Yet, during almost three years of trial, plaintiffs chose not to call a single smoker to testify, and otherwise produced no evidence that RBH misled anyone—much less all of the Québec smokers represented by these classes," said Peter Luongo, RBH Managing Director.

"Today's decision by the Court of Appeal changes a fundamental principle of class action law and allows class-wide recovery of damages without proof from even a single class member. We believe this unprecedented change in the law warrants review and reversal by the Supreme Court of Canada," said Luongo.

"The evidence at trial, including the Canadian government's own polling and statements, demonstrated that the Canadian public has been aware of the risks of smoking for well over half a century," added Luongo. "RBH should not be held liable to those who chose to smoke in light of these well-known risks."

Class actions are not designed for personal injury cases like these, where each class member's experience is unique. Individuals begin smoking for different reasons, at different points in time, and have different experiences with smoking. "For precisely these reasons, courts in Canada and around the world have consistently rejected these types of class actions," said Luongo.

For decades, RBH has operated under one of the most comprehensive sets of regulations in the world. Federal and provincial governments have long recognized the serious health risks of smoking and have strictly regulated the manufacture, sale, and marketing of the product. The evidence presented at trial demonstrated that RBH marketed a legal product that complied with these strict laws and regulations.

The trial court previously calculated the total amount of compensatory damages based on the assumption that all of the individuals estimated to be part of the disease class as defined will ultimately file a valid claim, while recognizing that in most large class actions only a small portion of eligible class members make a claim. The ultimate damages disposition will depend on further proceedings at the trial court level and an individual claims process for eligible class members.

The cases are Létourneau v. Imperial Tobacco Limitée, et al. (the addiction class), and Conseil Québecois sur le Tabac et le Santé (CQTS) et Blais v. JTI-Macdonald Corp., et al. (the disease class) before the Court of Appeal of Québec.

Rothmans, Benson & Hedges Inc., an affiliate of Philip Morris International Inc., is one of Canada's leading tobacco companies and employs nearly 800 people across the country with its headquarters in Toronto and a factory in Québec City. Philip Morris International Inc. is not a party to these cases.  To receive more information on this case go to www.tobaccolitigation.ca.

SOURCE Rothmans, Benson & Hedges Inc.

For further information: Media inquiries, RBH media office, T: 416-442-3545, E: [email protected]