LAVAL, Quebec – Should retailers who sell cigarettes be worried that customers may sue convenience-store chains for health problems they or their loved ones may experience? That’s the concern the parent company of Circle K expressed in a recent securities filing, reported Canadian Underwriter.
Alimentation Couche-Tard Inc., Laval, Quebec, the parent of the second largest c-store chain in the United States with more than 8,000 locations, warned in the Canadian Securities Administration (CSA) filing that the company “could be sued for health problems caused by the use of tobacco products” and that such a lawsuit could affect future earnings.
Couche-Tard did not say it is actually being sued, the report said, citing that it is standard practice for publicly traded companies to discuss business risks when releasing year-end financial results.
Some brands of cigarettes are made exclusively for Couche-Tard, the firm said in a July 9 investor call discussing its financial results for the year ending April 29.
About 38% of Couche-Tard’s merchandise sales are from tobacco products, the filing said.
“Various health-related legal actions, proceedings and claims arising out of the sale, distribution, manufacture, development, advertising and marketing of cigarettes have been brought against vendors of tobacco products,” Couche-Tard officials said.
Liability claims can extend into other areas of the convenience store, including coffee and hot beverages.
Couche-Tard’s retail network includes more than 10,000 c-stores in North America, most under the Circle K banner. It is No. 2 on CSP’s 2018 Top 202 ranking of c-store chains by number of company-owned retail outlets.
Watch for the August issue of CSP magazine for more on what liability and insurance issues c-store retailers face when selling goods and services to the public.
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