(Toronto) Three tobacco giants are once again seeking to extend an order staying legal proceedings against them, as they negotiate a settlement with creditors in a long-running case involving an order to pay billions of dollars to some 100,000 smokers and their loved ones.
Documents filed with an Ontario court show the companies – JTI-Macdonald Corp., Rothmans, Benson & Hedges and Imperial Tobacco Canada Ltd. – request that the suspension of procedures remain in force until the end of March 2025.
The application was scheduled to be heard on Tuesday, but court documents show the hearing was postponed until October 31, with the stay extended until that date. It was previously due to expire on Monday.
The order to stay legal proceedings against the companies was first granted in early 2019 after the three companies lost an appeal in a landmark legal battle in Quebec.
The delays, along with a lack of public information surrounding the case, have sparked anger from health groups, who say provinces could miss a historic chance to impose regulations and tobacco reduction measures to the industry.
In a sworn statement, the chief executive of Rothmans, Benson & Hedges (RBH) said the firm believes progress was made on a number of issues during mediation.
“However, there remain some important issues that RBH considers vital to any global consensual settlement of tobacco-related claims,” Milena Trentadue explained in the affidavit, which is included in the company’s extension request.
The company continues to participate in mediation to resolve these issues, she added.
“At this point, it is difficult to provide an accurate estimate of the remaining time required to complete these procedures. Considering the number of parts and the steps to follow and the work to be accomplished, RBH anticipates that it will take at least six months [et peut-être plus de temps] », argued Mme Trentadue.
The remaining steps include completing settlement negotiations as well as a claims process, holding at least one creditors’ meeting, obtaining a sanction order and implementing the plan, he said. -she declared.
A historic legal battle
The order to stay legal proceedings against the companies was first granted in early 2019 after the three companies lost an appeal in a landmark legal battle in Quebec.
The stay is intended to maintain the status quo while the companies work out a comprehensive settlement with class action members and several other creditors, including provincial governments seeking to recoup tobacco-related health care costs.
The initial suspension of proceedings lasted a few months, but has since been renewed a dozen times. Negotiations are confidential.
Some groups argue that the creditor protection process is inherently problematic in this case because it focuses on the viability of the industry rather than public health and other issues.
In a joint statement released last week, Action on Smoking & Health, Physicians for a Smoke-Free Canada and the Quebec Coalition for Tobacco Control said parts of the companies’ recent court filings suggest the provinces ” have accepted an industry-friendly process.”
“This insolvency process not only allowed the tobacco industry to continue ‘business as usual’ for five and a half years, but it also appears to have given tobacco companies a veto over any final deal.” , said Cynthia Callard, executive director of Physicians for a Smoke-Free Canada.
“Several passages in the companies’ motions, including references to a ‘consensual’ settlement, suggest that it is the tobacco industry that holds the short end of the stick, not creditors, including provincial governments and lawyers specializing in class actions. »
The companies sought protection from their creditors in Ontario after Quebec’s highest court ordered them to pay more than $15 billion to about 100,000 Quebecers in two class actions.
The prosecutions involved smokers who started smoking between 1950 and 1998 and became ill or addicted. The heirs of these smokers were also parties to the lawsuits.
Court documents from last September suggest that hundreds of class action members have died since the creditor protection proceedings began.