Ontario court extends suspension of case against 3 tobacco companies

An Ontario court has again extended an order suspending legal proceedings against three major tobacco companies as they pursue mediation with their creditors.

In a virtual hearing this morning, Ontario Superior Court Justice Thomas McEwen agreed to extend the stay against JTI-Macdonald Corp., Rothmans, Benson & Hedges and Imperial Tobacco Canada Ltd. until March 31, 2021.

McEwen said he accepted the position of the companies that they were engaging in good faith negotiations with their creditors, and noted none of the other parties opposed the extension.

The stay has already been extended several times, most recently in February, and was due to expire Wednesday.

The order to put legal proceedings against the three tobacco giants on hold was first granted more than a year ago after the companies lost an appeal in a landmark class-action lawsuit in Quebec.

The stay aims to maintain the status quo while the companies negotiate a global settlement with the class-action members and several other creditors — including a number of provincial governments seeking to recover health-care costs related to smoking.

Lawyers representing the Quebec plaintiffs said earlier this year they believed a settlement could be reached by Wednesday's deadline, stressing the urgent need for a resolution given that class-action members continue to die from smoking-related health issues.

Rob Cunningham, who represents the Canadian Cancer Society, said outside of the hearing that provincial governments must make public health measures the priority in the negotiations.

"What is most important about any potential settlement is its final content. It is essential that any potential settlement contain substantial long-term funding for tobacco control initiatives, as well as effective policy measures to reduce tobacco use," he said in an email.

"The tobacco industry should not be able to carry on business as usual."