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 News from Around the Americas | September 2005 
Canada's Top Court Ruling Paves Way for Provinces to Sue Tobacco Firms
 AFP
| | The Supreme Court of Canada ruled that provinces may sue tobacco companies to recover related health costs, a decision that may eventually cost Canadian and foreign firms billions of dollars. |
Ottawa - A Supreme Court ruling cleared the way for Canadian provinces to sue tobacco companies to recover tobacco-related health costs, a decision that may eventually cost Canadian and foreign firms billions of dollars.
The top court dismissed a claim by tobacco companies that a law adopted by the western province of British Columbia in 2000 to facilitate such litigation was unconstitutional.
"This is an enormous victory against the tobacco industry that will be beneficial to Canada," said Rob Cunningham, a lawyer for the Canadian Cancer Society.
"Finally, the tobacco industry will be forced to account for its actions before a court of law, for its wrongdoing over many decades."
Canadian Health Minister Ujjal Dosanjh, who introduced the British Columbia law when he was the province's attorney general, said he was "pleased" the case was finally moving forward.
"This is a product that if consumed in accordance with the instructions will kill," he said.
The British Columbia government, inspired to act by multi-billion dollar settlements with tobacco companies in the United States, must still prove in court that smoking causes disease, that the tobacco companies failed to adequately warn smokers of the risks and misrepresented their product.
"The defenders were manufacturers of a dangerous product that caused people to become sick and die. It was addictive. They didn't warn consumers of the risks until the mid-70s and after that the warning was inadequate," said Dan Webster, lawyer for the province of British Columbia.
"For decades, they denied that there were any health consequences to smoking and used technical arguments to argue that tobacco wasn't addictive when in fact, it was," he said. "My instructions are to proceed with the lawsuit, which we will be doing immediately."
Eight provinces are now considering similar laws and planning lawsuits that are likely to take several years to prosecute.
Imperial Tobacco Canada, Rothmans Benson and Hedges, JTI-Macdonald, British American Tobacco and Philip Morris are among the dozen companies that could be impacted by the lawsuits.
Imperial Tobacco Canada spokesperson Christina Dona said the tobacco companies "intend to defend themselves very vigorously in the courts" and even expect to prevail.
Dona accused the provinces of complicity in Canadian consumers' tobacco use, collecting over 130 billion dollars (111 billion USD) in taxes in recent decades, including 9 billion dollars (7.7 billion USD) last year.
Taxation of tobacco products in Canada is at 70 to 80 percent.
"Governments in Canada collect 13 times more revenue from the sale of tobacco products than the tobacco industry gains in profit. Where do they think the money is coming from? There is not some hidden vault for them to loot that has cash in it. There is not a lot of leeway," Dona said.
"We see this as a cash grab. The health risks associated with tobacco smoking have been known for decades. Taxes have been collected from tobacco for decades. The tobacco industry has been regulated for decades, so when we go to trial, governments will also have to defend their own behavior for decades."
In the United States, tobacco companies agreed in 1997 and 1998 to pay state governments 245 billion dollars over 25 years. |
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