MONTREAL (Reuters) - A Canadian appeal court ruled on Thursday that three major tobacco companies will not have to make a preliminary deposit of C$1.13 billion ($867.56 million) as they appeal a case that awarded more than C$15 billion in damages to Quebec smokers.
Imperial Tobacco Canada, a subsidiary of British American Tobacco Plc, JTI-Macdonald Corp, part of Japan Tobacco Inc, and Rothmans, Benson & Hedges Inc - a subsidiary of Philip Morris International - had originally been ordered by a lower court judge to deposit the amount in trust with their attorneys.
The companies were ordered to make the payment as part of a historic June 1 court decision that awarded the damages in two related Quebec smoking class action cases.
But the Quebec Court of Appeal overturned the lower court judge’s order to make a provisional payment, saying that even the exceptional circumstances of the case did not warrant it.
“We are certainly not without empathy for potential class members who may die of a tobacco related illness prior to receiving any compensation,” the ruling said.
“Unfortunately, the law relating to class actions makes it such that the order of provisional execution is of questionable benefit to potential class members.”
Launched in 1998, the action was considered to be the largest civil case in Canadian history, marking the first time tobacco companies have gone to trial in a civil suit in the country.
The damages would compensate about 100,000 Quebec smokers and ex-smokers who alleged that the companies knew since the 1950s that they were selling a harmful product that was causing cancer and other illnesses, but that the industry allegedly failed to adequately warn consumers.
Reporting by Jeffrey Hodgson; Editing by Bernard Orr