Tobacco firms say cannot pay Quebec court award

Canada’s biggest tobacco companies say they don’t have enough cash to make a $1.13 billion payment by the end of the month to Quebec smokers who won a landmark class-action suit, according to a story by Sidhartha Banerjee for The Canadian Press.

Lawyers argued in court on Thursday that a provision in the $15.6 billion judgment obliging the three companies to provide an initial payment of $1.13 billion within 60 days of the ruling should be overturned.

The payment is due on July 26.

All three companies have appealed against the decision that saw a Quebec judge rule that Imperial Tobacco, Rothmans, Benson & Hedges and JTI-Macdonald must pay $15.6-billion to smokers who either fell ill or couldn’t quit the habit.

On Thursday, lawyers for all three firms told a Quebec Court of Appeal hearing they didn’t have the funds to cover the $1.13 billion payment, which they argued could in any case cause irreparable harm to their ability to appeal and even put them on the brink of bankruptcy.

They argued that Superior Court Justice Brian Riordan, the trial judge, erred in granting the provisional sum and in ruling that the amount would not be recoverable if the tobacco companies won on appeal.

But lawyers for the plaintiffs said the tobacco companies were bluffing and that they were capable of finding the necessary money from their parent companies based outside Canada or from elsewhere.