British American Tobacco Settles Asbestos And Dividends Legal Action

Source from:  Daily Telegraph 12/22/2014

British American Tobacco has paid $575m (£367m) to settle a legal case relating to asbestos claims and disputed dividends in the 1980s.

The FTSE 100 tobacco producer said its Canadian subsidiary, Imperial Tobacco Canada, had settled the litigation brought by Flintkote, a US firm that formerly produced products containing asbestos.

Flintkote was part of a firm that was later absorbed into what eventually became Imperial Tobacco Canada. The US company started a lawsuit in 2006 to recover dividends from 1986 and 1987 that were paid out during some of this corporate consolidation.

Flintkote also wanted Imperial Tobacco Canada to take on some of its asbestos liabilities.

Used in roofing and insulation in the last century, asbestos fibres have been found to cause several diseases including mesothelioma, a form of cancer. More than 2,500 people a year die from mesothelioma in the UK, according to government statistics, and claims from those affected have been passing through the courts since the 1970s.

"The settlement agreement now provides closure on a legacy file, allowing Imperial Tobacco to focus on its current business by finally and completely resolving the existing Flintkote litigation and obtaining protections from potential future litigation related to Flintkote," said BAT in a statement. Enditem