Ontario Tobacco Growers

WHAT IS A CLASS ACTION?

[UPDATED ON OCTOBER 6, 2025]

OVERVIEW OF THE CLASS ACTIONS

  1. In 2009 and 2010, class actions were commenced by The Ontario Flue-Cured Tobacco Growers Marketing Board ('Board') and individual tobacco growers against Rothman's Benson & Hedges Inc., Imperial Tobacco Canada Limited and JTI-MacDonald Corp. (collectively, 'Tobacco Manufacturers') for breach of contract on behalf of tobacco growers and producers (collectively, 'Producers') who sold tobacco through the Board in the period January 1, 1986 to December 31, 1996.
  2. In 2008 to 2010, the Tobacco Manufacturers first publicly disclosed their involvement in the smuggling of duty-free cigarettes and other tobacco products back into Canada in response to charges brought against them under the federal Excise Act. The Tobacco Manufacturers subsequently settled civil claims with the federal and provincial governments concerning their involvement in the cross-border tobacco smuggling. The Board and Producers now seek compensation for the Tobacco Manufacturers underpayment of purchased tobacco stemming from this smuggling activity.
  3. The class actions sought to recover the difference between the discounted export price paid by the Tobacco Manufacturers for Ontario tobacco at the Board's auctions and the higher price they ought to have paid for tobacco that was actually intended for domestic use. The pricing and payment obligations were contained in contracts negotiated annually by the Board on behalf of the Producers.

DISMISSAL OF TOBACCO MANUFACTURERS’ DEFENCE MOTIONS

  1. From 2010 to 2015, the Court heard various motions and appeals of the Defendants in respect of the Tobacco Manufacturers’ defences, all of which were dismissed.

TOBACCO MANUFACTURERS GRANTED CCAA PROTECTION

  1. On March 1, 2019, the Quebec Court of Appeal upheld trial judgments made in 2015 against the Tobacco Manufacturers in favour of Quebec residents with tobacco-related diseases. The damages awarded against the Tobacco Manufacturers, as affirmed by the Quebec Court of Appeal, totaled approximately $13.6 billion including interest.
  2. Shortly after the Quebec Court of Appeal decision, each of the Tobacco Manufacturers made separate applications for court protection from their creditors under the Companies Creditors Arrangement Act ('CCAA').
  3. CCAA proceedings are Court-supervised proceedings designed to bring creditors and potential creditors together to resolve their claims while the businesses of the debtor companies continue to operate under CCAA protection with minimal disruption. The CCAA is federal legislation designed to avoid harm associated with the bankruptcy and liquidation of insolvent companies by permitting them to devise a plan of compromise or arrangement with their creditors to restructure and become viable businesses again in the future ('Plan').
  4. On March 8, 2019, the Court made CCAA Initial Orders that imposed a comprehensive stay of pending litigation against the Tobacco Manufacturers. As a result, the Board's class actions against the Tobacco Manufacturers brought on behalf of the Producers were stayed, and these Orders were subsequently amended and extended with the stay of these class actions remaining in effect.
  5. The Board retained Strosberg Wingfield Sasso LLP to represent its interests and those of the Producers in the CCAA Proceedings.
  6. Pursuant to an Order dated April 5, 2019, the Honourable Warren K. Winkler, K.C. was appointed by the Court to mediate a global settlement of creditors’ claims against the Tobacco Manufacturers.

SETTLEMENT OF THE PRODUCERS’ CLAIMS IN THE CCAA

  1. On October 31, 2024, the Court issued an Order approving the filing of plans of compromise and arrangement (‘CCAA Plans’) and a process for creditors to vote on the CCAA Plans. The creditors voted unanimously in favour of the CCAA Plans.
  2. On March 6, 2025, the Court released its decision to sanction the CCAA Plans. Under the CCAA Plans, the Producers’ settlement amount is $15 million, inclusive of legal fees payable to counsel for the Producers as approved by the Court.
  3. On August 29, 2025, payment of the Producers’ settlement was received, the net proceeds of which were delivered to the Board for distribution to the Producers.
  4. Any inquiries in respect of the payment of settlement funds received by the Board for the Producers should be directed to the Board at [email protected].