Information

June 2007

Key Characteristics of the pre-1986/post-1990 Hepatitis C Final Settlement Agreement

The federal government and plaintiffs' counsel have concluded the final settlement agreement for all those infected with hepatitis C from the Canadian blood system before January 1, 1986, and after July 1, 1990. The federal government will set aside $1.023 billion (composed of $962 million for compensation, $20 million in administrative costs, $37.29 million plus applicable taxes in legal fees, and $500,000 plus applicable taxes in disbursements) for the pre-1986/post-1990 Final Settlement Agreement.

The agreement is based, to the extent possible, on parity with federal compensation for those infected from 1986-1990. The federal government has not admitted any liability in reaching this settlement. This is a negotiated settlement that is supported by both the federal government and plaintiffs' counsel.

As with the 1986-1990 settlement, compensation to eligible class members will be provided for both general and economic damages, including payments for loss of income and services, uninsured medication and treatment costs, care costs and out-of-pocket expenses, compensation for funeral costs, payments to estates and surviving family members. The agreement is designed so that those who are most sick and have suffered the most from their hepatitis C infection will receive the highest amounts of compensation, as was the case with the 1986-1990 agreement. Hepatitis C has varying effects on the human body, and the compensation plan is structured to reflect this fact.

Eligibility criteria will be the same as in the 1986-1990 agreement, which involved the submission of appropriate medical records and evidence to document the existence of a hepatitis C infection, current health status and the source of infection. In addition, as with the 1986-1990 agreement, there are provisions in the final settlement agreement that permit alternative application measures in the absence of documented proof, such as the provision of affidavits from independent parties, in order to confirm that the infection was due to the blood supply.

Class members will be paid on a present-value basis that will provide a lump-sum payment based on an individual's current health status, age, and the probability of moving to a more advanced state of illness. Claimants will be eligible to apply for reimbursement of past loss of income and services. This is different from the 1986-1990 settlement, which only paid increased benefits once the disease actually progressed, requiring ongoing administration and re-application.

The final settlement agreement includes a deduction for the federal share of compensation paid to class members out of the insolvency of the Red Cross (approximately $7,490 per person - regardless of health status). This deduction was necessary given that this compensation was not made available to the 1986-1990 class.

The amount will only be deducted from those who received payments from the Red Cross. No deduction will be applied for compensation paid by a provincial/territorial government.

The last step before class members begin to receive compensation payments is the creation of the administrative structure to receive and to evaluate applications. The Fund Administrator and plaintiffs' counsel will be undertaking this work, therefore the timing of this step is outside of the federal government's control. The government is taking all possible measures to ensure that compensation reaches eligible class members as quickly as possible.

For further information, class members should contact their class counsel:

1986-1990 Class

In 1998, federal, provincial and territorial governments agreed to offer financial assistance to Canadians infected with hepatitis C through the blood system between January 1, 1986, and July 1, 1990. This specific time period was chosen as the Untied States had made a decision to implement testing for hepatitis C in the blood system in 1986, whereas Canada waited until 1990. The estimated value of the settlement was approximately $1.118 billion. The settlement included persons with hemophilia and thalassemia who are hepatitis C positive and who received blood products between 1986 and 1990, regardless of when they became infected with hepatitis C.

Individuals infected before January 1, 1986 and after July 1, 1990 (the pre-1986/post-1990 class) were not included in this settlement. At that time, the Government of Canada committed $525 million for a package to support treatment for people infected before January 1, 1986, and after July 1, 1990, to improve blood regulation as well as surveillance, prevention, support and research. Now that the Courts have approved the pre-1986/post-1990 Hepatitis C Settlement Agreement, all those infected will receive compensation, regardless of their date of infection.