On March 1, 2019, the Court of Appeal for Québec issued a judgment awarding over $13.5 billion against Imperial Tobacco Canada Limited (“ITCAN”), JTI-Macdonald Corp. (“JTI”), and Rothmans, Benson & Hedges Inc. (“RBH”) in the largest class proceeding in Canadian history.
The Letourneau and Blais actions, the two underlying proceedings, were filed separately in 1998 and heard together beginning in 2012. The trial lasted over 251 days, with 76 witnesses and nearly 22,000 documents entered into evidence.
The trial judgment was released on May 27, 2015, and was appealed by all three tobacco companies. The appeal was heard by a five-member panel of the Court of Appeal for Québec in November 2016. On March 1, 2019, the Court released a 400-page decision largely upholding the trial judgment and finding the defendant tobacco companies liable for failing to adequately warn consumers of the risks of smoking. The Court of Appeal affirmed the award of moral damages against all defendants in the Blais action, calculating them at a maximum of $13.5 billion in the aggregate.
In addition, the Court of Appeal affirmed the trial judge’s award of punitive damages against each defendant in the two underlying proceedings, totaling approximately $140 million in the aggregate.
Following the release of the appeal judgment, JTI, ITCAN and RBH obtained creditor protection under the Companies’ Creditors Arrangement Act from the Ontario Superior Court of Justice (Commercial List) on March 8, 12, and 22, 2019, respectively. The “comeback hearing” for all three proceedings was held on April 4 and 5, when the Court heard motions from numerous stakeholders, confirmed the initial orders granted to each of the tobacco companies with some amendments, and extended the stay of proceedings in favour of all tobacco companies until June 28.
Deborah Glendinning, Craig Lockwood, Mahmud Jamal, and Alexandre Fallon of Osler, Hoskin & Harcourt LLP acted for Imperial Tobacco Canada Ltd.
Guy Pratte, AdE, François Grondin, Patrick Plante and Kevin LaRoche of Borden Ladner Gervais LLP and Catherine Elizabeth McKenzie of IMK LLP represented JTI-Macdonald Corp.
Simon V. Potter, AdE, Michael Feder, QC, and Pierre-Jérôme Bouchard of McCarthy Tétrault LLP acted for Rothmans, Benson & Hedges Inc.
André Lespérance, Philippe Hubert Trudel, Bruce Johnston and Gabrielle Gagné of Trudel Johnston & Lespérance, Marc Beauchemin of De Grandpré Chait, and Gordon Kugler and Pierre Boivin of Kugler Kandestin represented Conseil québécois sur le tabac et la santé, Jean-Yves Blais et Cécilia Létourneau.