Imperial Tobacco Canada gets creditor protection in $15B Quebec lawsuit

MONTREAL — Imperial Tobacco Canada is the latest company to receive a temporary reprieve from compensating 100,000 Quebec smokers after securing creditor protection in an Ontario court.

A judge granted Imperial Tobacco Canada creditor protection Tuesday, and JTI-Macdonald Corp. was granted creditor protection last Friday.

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The two companies, along with Benson & Hedges, lost an appeal of a landmark $15-billion class-action lawsuit in the Quebec Court of Appeal on March 1.

The Ontario Superior Court decision suspends legal proceedings against all three companies until April 5, even though only Imperial Tobacco Canada and JTI-Macdonald sought protection from creditors.

The Quebec Council on Tobacco and Health led two class actions against the companies and won in 2015, when Quebec Superior Court Justice Brian Riordan ordered the companies to make payments of more than $15 billion to smokers who either fell ill or were addicted.

At the time, the ruling was believed to be the biggest class action award in Canadian history.

"Imperial Tobacco Canada continues to disagree with the judgments by the Quebec Court of Appeal and the Quebec Superior Court," the company said in a statement Tuesday.

"Canadian consumers and governments have been aware of the health risks associated with smoking for decades, and the Company has always operated and sold its legal products within a regulatory framework dictated by governments."

The Quebec Council on Tobacco and Health has said that the Ontario court's ruling can be extended beyond April 5 and victims could never see any money.

"Companies are very good at finding strategies to avoid paying damages they were ordered to pay," spokesman Mario Bujold said Monday.

"The Superior Court in Ontario is suspending the rights recognized by six judges in Quebec. It's unacceptable."

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