Three of the world’s biggest tobacco companies were stung by a Canadian court that ordered them to pay a record CAD$15.6 billion (£8.20 billion, $US12.48 billion) to smokers who claimed they didn’t know about the health risks.
British American Tobacco, Philip Morris International and Japan Tobacco International were hit with the ruling yesterday on 2 Canadian class action cases dating back to 1998. The cases have only recently come to court.
The 2 cases represent almost 1 million Canadian smokers who couldn’t quit or suffered lung or throat cancer or emphysema.
The three companies all plan to appeal the record Canadian damages award but even if they do the court has ordered them to pay the defendants CAD$1.13 billion (£590 million, $US900 million) between them while the appeal is ongoing. The tobacco giants are appealing this too.
Between them the companies own some of the world’s biggest cigarette brands like Dunhill, Lucky Strike, Marlboro, Benson & Hedges, Camel and Winston.
Big tobacco has a history of being hit with big fines for the effects of smoking. In 1998 the tobacco industry paid a combined $US246 billion (£162 billion) to settle with 46 states, five U.S. territories and the District of Columbia in 1998 over a case on the cost of healthcare related to smoking.
Last year a Florida jury ordered cigarette giant R.J. Reynolds to pay the widow of a chain smoker $US23.6 billion (£15.5 billion).
But while cigarette giants are losing the battle on smoking in many advanced western nations, companies are now focusing on growth areas like e-cigarettes and growth markets like central and eastern Europe, south east Asia and the Middle East.
British American Tobacco yesterday paid €550 million (£395 million, $US601 million) for the number one cigarette company in Croatia, TDR.