Class Actions, Punitive Damages, and Decreasing Consumption of Tobacco Products

• Author: Sarah Kettani
• Pages: 197-234

197

CLASS ACTIONS, PUNITIVE

DAMAGES, A ND DECR EASING

CONSUMPTION OF TOBACCO

PRODUCTS

Sarah Kettani

Abstract: In 2015, the Superior Court of Quebec awarded over

$15 billion in damages, including $1.6 billion in punitive

damages, in a cla ss action against th ree major tobacco com-

panies. This judgment i s signif‌icant as it repre sents the f‌irst

successful cla ss action against a tobacco company in Canada.

In light of the Superior Court judgment, t his essay ex plores

whether awards of punitive da mages against tobacco compan-

ies in class act ion proceedings can play a role in decre asing

demand for tobacco products. It will be a rgued that puni-

tive damages awar ds, especial ly in the context of large clas s

actions, can be a powerf ul complementary tool to advance

regulatory effort s to decrease tobacco consumption. Tobacco is

a unique product, in that it is an i nherently dangerous prod-

uct with no safe consumption level that is lawfully s old, thus

requiring a un ique regulatory respon se. At the domestic and

international level, t he response has b een an indirect ban.

Regulators have use d the concepts of de-normaliz ation and

consumer empowerment to reduce the demand for tobacco

products, with the hopes of re aching a zero-consumption

level. Similarly, awards of punitive da mages can contribute

to the de-normaliz ation of the tobacco industry by shedd ing

light on the misconduct of tobacco companies. P unitive dam-

ages awarded in clas s action proceedings can a lso increase

access to justice, provide f‌in ancial incentives, and restore power

inequalities b etween merchants and consumers, resulting

198 The Cana dian Cl ass Action Re view

in consumer empowerment. In doing s o, awards of punitive

damages contr ibute to curtailing demand for tobacco products

and go hand in hand w ith the current regu latory approach.

199

CLASS ACTIONS, PUNITIVE DAMAGES,

AND DECREASING CONSUMPTION OF

TOBACCO PRODUCTS

Sarah Kettani*

A. INTRODUCTION

In June 2015, Riordan J of the Superior Court of Quebec awarded over

$15 billion in damages against t hree major tobacco companies, JTI-

Macdonald, Imperi al Tobacco Canada, and Roth mans, Bensons & Hedges,

in a landmark 276-page judgment.1 The case involved two dif ferent class

actions heard together, that span ned the course of sixteen ye ars and

totalle d 253 days of hearing.2 The Blais class act ion was made on behalf

of 100,000 people with lung cancer, throat cancer, or emphysema.3 The

Létourneau class action wa s taken on behalf of nea rly 1 million people

addicted to nicotine.4 The court found that in both ca ses, the tobacco

companies committed fault s under four headings: “the general rule of

civil liabil ities,” “the safety defect in cigarettes,” “an unlawful i nterfer-

ence with a right under t he Quebec Charter (‘Charter’),” and “a pro-

hibited practice under the Consu mer Protection Act (‘CPA’).”5 As a result,

the court awarded $6.9 billion in compens atory moral damages for the

Blais cla ss, amounting to more than $15 billion when tak ing interests

* Sarah Ketta ni obtained a bachelor of civi l law and bachelor of common law

from McGill Univers ity in 2015 and a master of laws in commerc ial and cor-

porate law from the Un iversity of Auckland in 2016. She will be ad mitted as a

barri ster and solicitor in New Zealan d in September 2017.

1 Létourneau c JT I-MacDonald Corp, 2015 QCCS 2382 [Blais-Létourneau].

2 Myriam Br ixi, “Historic Quebe c Lawsuit Against Tobacco Companie s: the Supe-

rior Court Awards More t han $15 Billion in Damages” Lavery Lawyers (10 June

2015), online: www.lavery.ca/en /publication s/our-publications /1868-histor ic-

quebec-lawsuit-against-tobacco-companies-the- superior-court-awards-more-

than-15-billion-in-d amages.html [B rix i].

3 Blais-Létourneau, above note 1 at 11 (Summary of the judg ment).

4 Ibid at 10 and 12 (Summary of the judg ment).

5 Ibid at para 643.