An Ontario court has approved a historic $32.5 billion settlement that will see three major tobacco companies compensate provinces, territories and ex-smokers in Canada.
In a ruling released today, Ontario Superior Court Chief Justice Geoffrey Morawetz called the approval a “momentous achievement in Canadian restructuring history.”
The settlement was first proposed in October after years of mediation between the companies – JTI-Macdonald Corp., Rothmans, Benson & Hedges and Imperial Tobacco Canada Ltd. — and their creditors, which include plaintiffs in two Quebec class-action lawsuits as well as provincial and territorial governments.
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It was unanimously approved by creditors in December and faced its final hurdle – approval from the court – over several days of hearings that began late last month.
The plan calls for the companies to pay more than $24 billion to provinces and territories over about two decades, while plaintiffs in two class-action lawsuits in Quebec will get more than $4 billion to split between them.
Another $2.5 billion will go to compensate Canadian smokers not included in the lawsuits, and more than $1 billion will go to a foundation to fight tobacco-related diseases. The money for the foundation also includes $131 million taken from the amount allocated to the Quebec plaintiffs.
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