THE CANADIAN federal government is suing the country's major tobacco firms for CDN$1.5 billion, alleging they illegally evaded tax by profiting from the sale of contraband cigarettes in the early nineties, while failing to disclose these earnings. A dozen companies have been accused, all of them part the R.J. Reynolds and Japan Tobacco groups, including JTI-Macdonald Corp. of Toronto. A related CDN $1 billion lawsuit was rejected by the US Supreme Court last year, which said American judges should not decide Canadian tax cases.

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