GOVERNMENT OF CANADA ANNOUNCES LEGAL ACTION AGAINST TOBACCO COMPANIES

OTTAWA, August 13, 2003 -- The Honourable Martin Cauchon, Minister of Justice and Attorney General of Canada, and the Honourable Elinor Caplan, Minister of National Revenue, today announced that the Government of Canada has filed a civil lawsuit related to tobacco smuggling against certain companies within the R.J. Reynolds and Japan Tobacco groups of companies, including JTI-Macdonald of Toronto.

In the lawsuit, the Government of Canada alleges that a scheme was devised and implemented to gain illicit profits from the smuggling trade in tobacco products, resulting in substantial revenue loss to the Government of Canada.

Through this court action, the Government of Canada is seeking to compel the defendants to surrender profits from their actions, and to pay damages.

The companies named as defendants include: R.J. Reynolds Tobacco Holdings Inc., R.J. Reynolds Tobacco Co., R.J. Reynolds Tobacco International Inc., JTI-Macdonald Corp., Northern Brands International Inc., Japan Tobacco Inc., JT International SA, JTI-Macdonald TM Corp., JT Canada LLC II Inc., JT Canada LLC Inc., JT International Holding B.V., JT International B.V, and JT International (BVI) Canada Inc.

The Government of Canada issued the lawsuit in the Ontario Superior Court of Justice in Toronto and is represented by Ronald G. Slaght, Q.C,. of the law firm Lenczner Slaght Royce Smith Griffin.

As this action is now before the courts, the Government of Canada cannot further discuss the details of the case.

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Media Relations
Department of Justice Canada
Tel.: (613) 957-4207