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Ontario Tobacco Growers class action: Frequently Asked Questions 

GENERAL INFORMATION ABOUT THESE CLASS ACTIONS

PARTICIPATION IN THESE CLASS ACTIONS

PROGRESS OF THESE CLASS ACTIONS

CLASS ACTIONS

GENERAL INFORMATION ABOUT THESE CLASS ACTIONS

Q: What are these class actions about?

A: These class actions seek to recover the difference between the export price paid by the domestic manufacturers (Rothman’s Benson & Hedges Inc., Imperial Tobacco Canada Limited and JTI-MacDonald Corp.) for Ontario tobacco at the Board’s auctions and the higher price they ought to have paid because the tobacco was actually intended for domestic use. The pricing and payment obligations were contained in the agreements negotiated annually by the Board on behalf of Ontario flue-cured tobacco growers and producers

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• Ontario Tobacco Growers class action 

THE CLASS ACTIONS

2. RBH, ITCL and JTI have settled civil claims by the federal and provincial governments in respect of those companies' roles in cross-border smuggling of tobacco. While the governments will be compensated for the losses they have sustained due to tobacco smuggling, the tobacco growers and producers, who claim they were underpaid for their crops, have not been compensated for their losses stemming from that same activity. The class actions are intended to achieve that purpose.

3. On November 5, 2009, a class action was commenced on behalf of Ontario flue-cured tobacco growers and producers against RBH.

4. On December 2, 2009, a class action was commenced on behalf of Ontario flue-cured tobacco growers and producers against ITCL.

5. On April 23, 2010, a class action was commenced on behalf of Ontario flue-cured tobacco growers and producers against JTI.

6. The class actions seek to recover the difference between the export price paid by the domestic manufacturers (RBH, ITCL and JTI) for Ontario tobacco at the Board's auctions and the higher price they ought to have paid because the tobacco was actually intended for domestic use. The pricing and payment obligations were contained in the agreements negotiated annually by the Board on behalf of Ontario flue-cured tobacco growers and producers.

NEXT STEPS

7. The class actions are in the preliminary stages. The court will eventually set a timetable for the conduct of the actions, but that has not occurred yet.

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• Tobacco growers’ lawsuit expands 

A growing class-action lawsuit by the Ontario tobacco board and growers against major manufacturers is taking another step forward with the filing of a statement of claim against a third company, JTI MacDonald Corp.

Werner Keller, a lawyer with Windsor-based Sutts, Strosberg LLP acting on behalf of the plaintiffs, was successful in late April in getting a judge's order allowing a suit to be filed against JTI.

The company is under court protection through the federal Companies Creditors Arrangements Act, which protects it from lawsuits, unless a judge agrees to a motion allowing an action to proceed. Shortly afterward, the plaintiffs filed a $ 50-million suit against the company in Ontario Superior Court in London.

The Ontario Flue-Cured Tobacco Growers' Marketing Board and individual growers Andy Jacko, Brian Baswick, Ron Kichler and Arpad Dobrentey filed similar actions against Imperial Tobacco and Rothmans Benson and Hedges in late 2009, but had to wait to file against the third large manufacturer until the legal protection obstacle had been cleared. . . .

The plaintiffs argue the class actions seek to recover the difference between the export price paid by the domestic manufacturers for Ontario tobacco at the board's auctions and the higher price they ought to have paid because the tobacco was actually intended for domestic use.

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• Underage tobacco smoking an issue in Jamaica  

Underage tobacco smoking continues to be an issue in Jamaica, according to a senior guidance counsellor at the Ministry of Education.

Senior counsellor Eugenie Brown spoke at a Carreras Limited media briefing yesterday, supporting the launch of the second part of the tobacco company's youth smoking-prevention campaign.

"I'm sure you're well aware that currently in our education system, even at the primary level, we have youngsters who are engaged in smoking," Brown said.

She pointed out that the education ministry's guidance counselling unit works on educating students on substance-abuse and this includes smoking.

Carreras Limited is a cigarette marketing and distribution com-pany in Jamaica. In recognition of yesterday's World No Tobacco Day, and following up on its youth campaign launch in 2008, it launched the youth smoking-prevention campaign.

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• Manufacturers served with statement  

Werner Keller of the Windsor law firm Sutts Strosberg LLP said a statement of claim was served to Imperial Tobacco Canada and Rothmans Benson & Hedges in the last few days. The documents were filed with the court in October.

The lawsuit centres around a guilty plea by Imperial Tobacco Canada Ltd. and Rothmans Benson & Hedges to a single count of violating the federal Excise Act by "aiding persons to sell or be in possession of tobacco products manufactured in Canada that were not packaged and were not stamped in conformity with the Excise Act and its amendments and the Ministerial regulations". The cash settlement out of the guilty pleas was the basis for the federal Tobacco Transition Program.

Werner said JTI Macdonald has to be treated differently because the company is under court protection under the Credits Arrangement Act. While the act is normally used to provide financial protection for companies filing for bankruptcy, in this case JTI filed for protection due to numerous claims against the company by governments. The charges, which the other two companies pled guilty to are still outstanding against JTI.

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• LIBIN: A Tory cakewalk goes up in smoke 

There can scarcely be an easier pitch to voters than promising to pass laws that could discourage kids from smoking. That's probably what the Conservatives thought when they promised during last fall's election to ban the sale of candy-and fruit-flavoured tobacco products. At a news conference, Stephen Harper wagged before the cameras rainbow-coloured packages of cigarillos, infused with flavours like banana split, bubble gum and cherry. "These products are packaged as a candy, and this is totally unacceptable," the Prime Minister said. "This can't continue." A nation of alarmed parents nodded its head in agreement.

But somewhere along the way, the Conservatives' attempt to make good on their populist promise set off controversies over NAFTA, unemployment and crime so serious that several Tory MPs who initially voted for the law have now withdrawn their unconditional support. Under scrutiny now by a Senate committee, Bill C-32 appears to have turned from a presumed legislative cakewalk -- it sailed through all three readings in the House -- into a political morass. Ironically, some critics think it is the bureaucrats of Health Canada who are to blame for the delay, and possibly the imperilment of the law.

"In addition to violating a fundamental principle, this legislation could have important negative repercussions," wrote Quebec MP Maxime Bernier on his blog yesterday, explaining why he now opposes the bill in its current form. "Among which [are] an increase in contraband sales, a violation of our international commercial obligations, and the closing of the Rothmans plant in Quebec City which employs 330 workers." . . .

"There is no justification to single out American blend cigarettes in the Canadian legislation, as the ban of this product would not achieve a meaningful public health benefit or discourage youth smoking," North Carolina Congressman G. K. Butterfield wrote in a letter to Canada's ambassador, Michael Wilson, this week.

Bill C-32 has also become a political embarrassment for the Conservatives in Quebec, and in its primary base there, the Quebec City region. American parent firm Philip Morris had planned to equip its Rothmans Benson and Hedges plant in the city to produce American blend cigarettes for the export market. Company executives warn the new law could lead to the plant's closure.

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• Amend tobacco bill or Quebeckers will lose jobs, U.S. firm warns 

Canadian tobacco heavyweight Rothmans, Benson & Hedges is threatening to close a Quebec factory employing more than 300 people if Ottawa doesn't narrow the scope of a bill aimed at stopping the manufacture of candy- and fruit-flavoured cigars and cigarettes.

The Harper government promised the legislation during last year's election campaign as a means of cracking down on tobacco products that appeal to children. But concerns over its Quebec impact are making Conservative MPs in that province eager to accommodate Rothmans.

Rothmans, today 100-per-cent owned by international tobacco giant Philip Morris International, says the legislation, Bill C-32, is too broad and would also ban flavourings traditionally employed to make "American-blend" cigarettes in Canada for local and export markets.

Far less popular with Canadians than Virginia tobacco cigarettes, an American blend of several tobaccos can include sweeteners or flavourings to dispel bitter or harsh tastes. These cigarettes, however, don't taste like candy or fruit.

"The current wording of Bill C-32 puts the future of RBH's factory in Quebec City in jeopardy," Rothmans spokesman Bert Van Gossum said. "RBH employs 750 people in Canada, including more than 300 in its Quebec factory alone."

Mr. Van Gossum said his company backs efforts to ban fruit- and candy-flavoured cigars and cigarettes, but says if the legislation isn't fixed it will undermine Rothmans's current business plan in Canada.

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Tobacco Board Looking Into A Class Action Lawsuit  

The Ontario Flue Cured Tobacco Grower's Marketing Board is looking into a class action lawsuit against the tobacco companies who pled guilty to smuggling. Imperial Tobacco Canada as well as Rothmans Benson and Hedges pled guilty in July, and as a result, their cash settlement is what is funding the Tobacco Transition Program.

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Norfolk County : Tobacco Board Looking Into A Class Action Lawsuit  

The Ontario Flue Cured Tobacco Grower's Marketing Board is looking into a class action lawsuit against the tobacco companies who pled guilty to smuggling. Imperial Tobacco Canada as well as Rothmans Benson and Hedges pled guilty in July, and as a result, their cash settlement is what is funding the Tobacco Transition Program. The tobacco board with the help of their lawyer Werner Keller of Sutts, Strosberg are looking into any legal proceedings that could take place because of the guilty plea.

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Rothmans Inc. announces commencement of compulsory acquisition by Philip Morris International Inc. (PMI) 

Rothmans Inc. announced today that, since the offer by PMI was accepted by shareholders holding more than 90% of Rothmans Inc. common shares, PMI has exercised its rights under the compulsory acquisition provisions of the Canada Business Corporations Act to acquire all of the outstanding common shares of Rothmans Inc. not already owned by PMI at the price C$30.00 cash per share. Further details are provided in PMI's Notice of Compulsory Acquisition which is available on SEDAR at www.sedar.com under the SEDAR profile of Rothmans Inc. For further information: Barry Joslin, (416) 442-3634

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• Philip Morris Int'l completes Rothmans buyout  

Philip Morris International, maker of Marlboros overseas, said Tuesday it has bought about 94 percent of the stock of Canadian cigarette maker Rothmans Inc.

The company said it bought all the shares that were tendered and will pay for any remaining shares on Thursday. It said shareholders of about 63.9 million shares had responded to its tender offer.

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Philip Morris International: 68% of Rothmans Shares Tendered 

Philip Morris International Inc.'s (PM) planned C$2 billion acquisition of Rothmans Inc. (ROC.T) moved closer to completion as more than two-thirds of shares outstanding have been tendered in favor of the deal.

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Philip Morris International Inc. (PMI) Receives Investment Canada Approval for Rothmans Offer 

Philip Morris International Inc. (NYSE/Euronext Paris: PM) today received Ministry of Industry approval pursuant to the Investment Canada Act in connection with the company's proposed acquisition of Rothmans Inc. (TSX: ROC).

The issuance of this approval satisfies the last remaining regulatory condition to the company's acquisition offer dated August 7, 2008. In connection with the determination of net benefit, the company provided certain undertakings, including pledges to continue to operate Rothmans, Benson & Hedges Inc.'s current manufacturing facilities in Canada, invest in their modernization and provide minimum employment assurances.

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Philip Morris International Inc. (PMI) extends Rothmans offer pending Investment Canada review 

Philip Morris International Inc. (NYSE / Euronext Paris: PM) announced today that it has extended the expiry of its CAD $30.00 per share cash offer to purchase all of the outstanding common shares of Rothmans Inc. (Rothmans).

The extension is procedural, being related to the last remaining regulatory approval required for the transaction, namely a determination of net benefit by the Minister of Industry pursuant to the Investment Canada Act.

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Rothmans Inc. announces redemption of RBH bonds 

Rothmans Inc. announced today that its 60%-owned subsidiary, Rothmans, Benson & Hedges Inc. ("RBH") is repaying its currently outstanding 5.552% Senior Unsecured Bonds due December 21, 2011 in the principal amount of C$150 million (the "Bonds").

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