B.C Can Sue Tobacco Companies

[Axon]

Top court rules B.C. can sue tobacco companies

Thu. Sep. 29 2005 5:32 PM ET

In a decision that could lead to cigarette-makers coughing up billions of dollars to pay for sick smokers' health care, the country's top court has ruled that British Columbia can sue the industry.

"They upheld the constitutionality of the British Columbia legislation," CTV Ottawa bureau chief Robert Fife reported from the Supreme Court.

"This is a landmark ruling that could serve as a prototype for other provinces to sue the big tobacco companies."

The unanimous 9-0 judgment -- delayed, at the request of Rothmans, Benson & Hedges, until after the stock markets closed -- gives the go-ahead for B.C. to seek damages for smoking-related health-care costs dating back 50 years.

At issue was a 1998 British Columbia law, the Tobacco Damages and Health Care Costs Recovery Act. Under the terms of that legislation, the province can not only pursue retroactive damages, but can also recover the costs of future illnesses linked to "tobacco-related wrongs."

The law spells out tough new ground rules that would curtail some traditional defences used in civil suits and puts the burden of proof on the companies on some key legal points. It also makes it easier to prove a cause-and-effect link between smoking and disease.

Before the provincial government could seek file suit against the tobacco companies however, members of the Canadian tobacco industry and the Canadian Tobacco Manufacturers' Council claimed the law exceeded provincial jurisdiction.

But anti-tobacco activists see the B.C. law as a model for the country, and hope that the nod from the country's top court will clear the way for other provinces to follow suit.

In the 1990s, a similar case in Florida led to most American states enacting legislation in the same vein. Those laws pressured U.S. cigarette manufacturers to agree to a $245 billion US settlement. To be spent over a 25-year-period, the money is specifically targeted to the treatment of patients with cancer, emphysema and other smoking-related illnesses.

Canadian companies have said they won't pursue a similar agreement, saying their relatively smaller industry would be bankrupted by a settlement of that size.

The B.C. suit doesn't just name Canadian companies though, it also targets nine foreign firms, including industry heavyweights British American Tobacco and Philip Morris.

Although no one has yet pinned down the cost of analogous claims in Canada, the federal Health Department has estimated the annual cost of treating tobacco-related disease in Canada at $4 billion.

Some estimates pin the potential claims in B.C. alone at more than $10 billion. If other provinces follow suit as expected, the total could climb to hundreds of billions of dollars.

Talking to reporters following the high court ruling, federal Health Minister Ujjal Dosanjh said Ottawa has no plans to follow British Columbia's example.

"That's not an issue that I have given any thought to," Dosanjh insisted, explaining his department's continuing focus on cessation, control and prevention.

When asked whether putting tobacco companies out of business would effectively all three of his goals, the health minister said that's not an option he has.

"I don't think that one views these kinds of issues as cash cows," he said. "It is never the intention of any government to bankrupt any companies."

Watching reaction on Bay Street, RobTV's Linda Sims says B.C. will have to fight a pitched legal battle if it wants any cash from the companies.

"The tobacco companies have never given an inch on any type of culpability or repsonsibility without huge litigation," Sims told CTV from the Toronto Stock Exchange.

"It could be a decade of lawsuits before anything is decided."

Canadian Cancer Society lawyer Rob Cunningham says it is "very important to hold the industry accountable for decades of wrongful behaviour."

"We know that each year in Canada ... there's $4 billion in direct health care costs because of tobacco," he told CTV's Canada AM early Thursday.

"The claims of the B.C. government ... include misleading advertising, denying the health effects, concealing their research and targeting children," Cunningham added.

User Tools

Source: CTV.ca

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I think this is excellent. I'd love to see our government take a detrimental slash out of these companies profit margins to help fix the damage they do to our healthcare system.

-Ax

[Ryan V]

I think this is excellent. I'd love to see our government take a detrimental slash out of these companies profit margins to help fix the damage they do to our healthcare system.

-Ax

586596786[/snapback]

Indeed, on one hand they do contribute the damage done to our healthcare system, but on the other hand the goverments would lose so much money via taxes they collect on cigs.

[R-Flex]

I just heard about this on the news. Sounds like good news!

Not only will this save money on healthcare, but the money that will hopefully be collects in lawsuits will go to aid the system. As for the taxes collected, people will merely spend it elsewhere. Perhaps this can revitalize some of our businesses that don't kill people.

[Axon]

As I said above, I do like this ruling.

But I am left at a paradox. Does the government not collect taxes on these deadly products? In doing so, are they themselves responsible for reaking the benefits of these dirty profit margins?

-Ax

[Starcom826]

Although I hate the tobacco companies to death, honestly, what else can we do? There are CLEAR surgeon general's warnings and everyone knows what smoking does to you, but people still smoke regardless. Really, its sort of unfair to sue the tobacco companies for "not knowing it could do so much harm." The other solution is a win win. Impose a huge levy/tax on all tobacco (not just cigarettes) and the companies that produce them. The prohibition didn't work, but if you tax the crap out of them, it will lower the number of users, and bring in a nice tidy stream of revenue. If it takes a threefold price for smokers to back down, then oh well. Cigarettes unlike some other things we need to get rid of really don't do much in the way of our economy (as opposed to say oil).

[John S. Veteran]

This is pure stupidity. Absolve anyone from the responsibility of their own actions, the smokers. Meanwhile continue to collect some of the highest taxes in the world (I was in Vancouver 10 years ago and they were $2-3 more per pack than in the US).

Either don't profit from it, make it illegal, or shut up and live with the consequences.

[Axon]

This is pure stupidity.  Absolve anyone from the responsibility of their own actions, the smokers.  Meanwhile continue to collect some of the highest taxes in the world (I was in Vancouver 10 years ago and they were $2-3 more per pack than in the US).

Either don't profit from it, make it illegal, or shut up and live with the consequences.

586597830[/snapback]

This issue is a lot more relavent in Canada because of our healthcare system.

I hate the idea of my taxes going up because some dumbass can't get it through his thick skull that he is killing himself, one puff at a time. And because of his blind ignorance, I foot the frigg'in bill. They determined that in BC alone, over 1 billion tax payer's dollars go right into avoidable cigarette damage.

Personally I think thats 1 billion dollars that can be better spent.

I would love to see Cigarette companies find that they are unable to maintain profit margins in Canada, and end up pulling out their death products.

-Ax

[Dashel]

What a crock.

[Fred Derf Veteran]

This is pure stupidity.  Absolve anyone from the responsibility of their own actions, the smokers.  Meanwhile continue to collect some of the highest taxes in the world (I was in Vancouver 10 years ago and they were $2-3 more per pack than in the US).

Either don't profit from it, make it illegal, or shut up and live with the consequences.

586597830[/snapback]

It's not a profit, it is a sin tax. They are taxing it aggressively to cut down on its use and to dissuade young people from picking up the habit. I mean, after all, if you lived in Canada and had to shell out $2-3 more per day (or two) would you want to keep smoking? Would you want to start? Hit them where it hurts, in the pocketbook.

To take away the sin taxes would be to encourage its use. Then the government would be complicient along with the tobacco companies. The way it is done now, the sin taxes aim to prevent harm and reduce use.

Also, everyone now knows that smoking is bad for you. There are big warning on the packages. There was a time, however, when it was not known to be bad for you and the tobacco companies were known to hide those facts. Someone who starts smoking now should know better but not everyone did.

[John S. Veteran]

It's not a profit, it is a sin tax.  They are taxing it aggressively to cut down on its use and to dissuade young people from picking up the habit.  I mean, after all, if you lived in Canada and had to shell out $2-3 more per day (or two) would you want to keep smoking?  Would you want to start?  Hit them where it hurts, in the pocketbook.

To take away the sin taxes would be to encourage its use.  Then the government would be complicient along with the tobacco companies.  The way it is done now, the sin taxes aim to prevent harm and reduce use.

Also, everyone now knows that smoking is bad for you.  There are big warning on the packages.  There was a time, however, when it was not known to be bad for you and the tobacco companies were known to hide those facts.  Someone who starts smoking now should know better but not everyone did.

586599462[/snapback]

Apparently the tax is not working very well as a deterrent. If I wanted to smoke I'd just pay the price. If it's that great a problem simply outlaw it altogether.