Big Tobacco fights $1-billion ruling

The country's largest tobacco firms say they don't have the necessary cash to make a $1-billion payment by the end of the month to Quebec smokers who won a landmark class-action suit.

Lawyers argued in court Thursday that a provision in the $15.6-billion judgment obliging the companies to provide an initial compensation of $1.13 billion within 60 days of the ruling should be overturned. The payment is due July 26. All three companies have appealed the decision that saw a Quebec judge rule that Imperial Tobacco, Rothmans, Benson & Hedges and JTI-Macdonald must fork over $15.6 billion to smokers who either fell ill or couldn't quit the habit.

On Thursday, lawyers for all three firms told a Quebec Court of Appeal hearing they simply don't have the funds to cover the $1.13-billion payment, which they argued could cause irreparable harm to their ability to appeal and even put them on the brink of bankruptcy.

They argued Superior Court Justice Brian Riordan, the trial judge, erred in granting the provisionary sum and that the amount would not be recoverable if they eventually won on appeal. But lawyers for the plaintiffs said the tobacco companies are bluffing and are very capable of finding the necessary money from their parent companies based outside Canada or from elsewhere. One lawyer noted the tobacco firms haven't put aside any money for the Canadian legal case.