Big tobacco companies have reached a tentative multibillion-dollar settlement with Canada following a long-running legal battle. The proposed deal, valued at nearly $24 billion, involves three major tobacco companies: Philip Morris International, JTI-Macdonald Corp., and Imperial Tobacco Canada Ltd.
Philip Morris International confirmed on Friday that a court-appointed mediator has submitted the proposed settlement with its Canadian affiliate, Rothmans, Benson & Hedges, regarding various tobacco product-related claims and litigation in Canada. Similar agreements have also been filed for JTI-Macdonald Corp. and Imperial Tobacco Canada Ltd.
CEO of Philip Morris International, Jacek Olczak, expressed the company’s satisfaction with the progress, stating, “After years of mediation, we welcome this important step towards the resolution of long-pending tobacco product-related litigation in Canada.”
The three tobacco companies had previously sought creditor protection in Ontario in 2019 after losing an appeal in a significant court case in Quebec. According to reports by the Canadian Press, the proposed $32.5 billion Canadian dollar ($23.53 billion) settlement includes allocations such as CN$24.8 billion for Canadian provinces and territories, CN$4.25 billion for the class action members, CN$2.5 billion for Canadian victims outside Quebec, and over CN$1 billion for a foundation dedicated to combating tobacco-related diseases. This figure includes CN$131 million redirected from the amount designated for the Quebec plaintiffs.
The settlement marks a crucial development in the tobacco industry’s legal challenges in Canada, emphasising the significant financial agreements put forth to address longstanding disputes.