Video lottery terminals bring in more than a quarter of Loto-Québec's $3.8-billion in annual revenues. (CBC)A multi-million dollar settlement has been ironed out between Loto-Québec and thousands of problem gamblers over the cost of treating their addiction.

The agreement settles a class action lawsuit brought against Loto-Québec by nearly 120,000 gamblers in 2001.

The provincial government has now agreed to reimburse the costs of addiction treatment between 1994 and 2002. The money is to help gambling addicts who were not previously covered by Quebec health insurance. The province began covering the cost of therapy for problem gamblers in 2002.

The lawsuit went to court in 2008 and was supposed to wrap up in the next couple of months.

The plaintiffs sought about $1 billion in damages. The settlement will cost the provincial government around $50 million.

Former journalist Nelson Labrie, the first witness called to testify, told the judge he thought video lottery terminals, or VLTs, were ridiculous — until he couldn’t stop playing them.

Labrie described how his addiction had cost him his home and more than $250,000.

Montreal-based gambling counsellor Sol Boxenbaum says settling with Loto-Québec was a mistake. (CBC)

“We succeeded to prove that VLTs are dangerous,” said lawyer Roger Garneau of the firm Garneau Verdon Michaud Samson, which represented Labrie and the other plaintiffs.

But experts were not able to prove that playing on video lottery terminals caused people to become addicted to gambling, Garneau said.

Agreeing to the settlement was a mistake, said gambling counsellor Sol Boxenbaum, a consultant on the case. The lawsuit could have created a precedent that would have forced Loto-Québec to warn people about the dangers of VLTs.

“How did we give up on a point like that?” Boxenbaum asked. “[There] should have been no question about a settlement unless we get that warning put onto the machines.”

Loto-Québec declined to comment on the settlement before a court hearing March 8 in Quebec City. Plantiffs who disagree with the deal will present their opposition to a judge, who will rule on the agreement.

Video Lottery Terminals bring in more than one quarter of the gaming corporation’s $3.8-billion in annual revenues.