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Tobacco litigation languishes as industry wins battle over privilege

Portions of Ontario’s claim struck as parliamentary statements protected
|Written By Shannon Kari

The court has struck portions of the Ontario government’s statement of claim in its ongoing $50-billion lawsuit against the tobacco industry because it may not use statements made to House of Commons committees in either a civil action or criminal prosecutions.

The tobacco industry is facing a $50-billion claim by the Ontario government as well as litigation in other provinces. Photo: gosphotodesign/Shutterstock

The province had been seeking to use presentations by the tobacco industry to Commons committees in the 1960s, 1980s, and 1990s as evidence of misrepresentations about the health risks of smoking.

The allegations arose in seven subparagraphs of the lengthy amended statement of claim filed this spring by the province five years after it began the litigation.

Superior Court Justice Barbara Conway agreed with arguments put forward by Imperial Tobacco Canada Ltd. to strike the subparagraphs due to protections under the freedom of speech category within Parliamentary privilege.

“The privilege extends not only to statements made by members of Parliament but to those who participate in proceedings in Parliament or parliamentary committees,” wrote Conway in her ruling issued June 12.

“The case law has also established that if the words spoken in a parliamentary proceeding are misleading, they are nonetheless immune from review in the civil courts,” she added.

While the decision affects a small portion of the amended statement of claim, “there is an important principle” at stake, says Craig Lockwood, counsel for Imperial Tobacco. “This isn’t about who the defendant is; it is a broader principle. It is the recognition of freedom of speech in Parliament,” says Lockwood, a partner at Osler Hoskin & Harcourt LLP in Toronto.

“The effect of allowing in these statements would have allowed the province to open up discoveries in an area protected by privilege,” he adds.

The privilege issue is one of many procedural battles since Ontario filed the lawsuit in 2009 pursuant to the Tobacco Damages and Health Care Costs Recovery Act. Ontario is one of nine provinces that have filed similar lawsuits with more than $110 billion in claims against the tobacco industry (and Nova Scotia has issued a notice of intent). There are 14 defendants in the Ontario action, including Canadian subsidiaries and their parent companies. The Ontario Court of Appeal ruled against the industry in May 2013 in deciding whether there was jurisdiction to include the foreign companies in the lawsuit. The Supreme Court later denied leave to appeal.

In her ruling on the privilege issue, Conway rejected an argument by the province not to strike the sections because an evidentiary context is necessary before making a decision. “The problem with this argument is that nothing turns on the evidentiary context. The references to the presentations in the subparagraph fall squarely within the established scope of the freedom of speech privilege,” wrote Conway.

“The privilege belongs to Parliament and therefore it is up to Parliament — not the person who made the statement — to decide whether privilege is to be waived,” she added.

A spokesman for the Ontario Ministry of the Attorney General declined to comment on whether the province would appeal the privilege ruling or ask Parliament to waive it.

On another issue before the court, Conway ruled in favour of the province and refused to order any costs related to proposed motions to strike the statement of claim as a whole.

The tobacco defendants were seeking $300,000 in costs for work on motions to strike they withdrew after Ontario filed an amended statement of claim on April 1 of this year. The industry alleged the previous claim was “so wholly deficient it disclosed no cause of action” and it didn’t distinguish among the defendants.

While it has abandoned the motions to strike for now, the tobacco industry has reserved its right to make the arguments at a later date, the judge observed. “I am therefore not persuaded that any of the costs they incurred were wasted,” she wrote in a decision issued June 18.

None of the actions filed by the provinces has gone to trial. Rob Cunningham, a lawyer and senior policy analyst with the Canadian Cancer Society, suggested the slow pace is what the defendants want. “The tobacco industry strategy is one of delay. The provinces need to respond aggressively,” says Cunningham.

He adds that the tobacco industry made many of the same claims about the health risks of smoking in public statements and to the media over the years that aren’t subject to privilege.

As well, the importance of the litigation is more than cost recovery. “It is not only about compensation but for health justice as well,” says Cunningham.

An open letter issued June 17 and signed by more than 130 prominent Canadians and health-care professionals states the cost-recovery lawsuits also have the potential to deter future misconduct and provide more public education through the disclosure of documents.

“We need to get these cases to trial,” says Cunningham.

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