British American Tobacco is being sued by Nigeria’s two largest states, which are hoping to recover the costs incurred in treating smoking-related diseases in cases inspired by American state lawsuits of the 1990s, which led to a multi-billion-dollar settlement by the tobacco industry.

Kano and Lagos, joined by another state, Gombe, and a nonprofit organisation, have also accused BAT of targeting young and underage smokers by sponsoring events such as pop concerts and of promoting the sale of individual cigarettes, which they claim reduces the effectiveness of mandatory health warnings.

The states are suing BAT Nigeria and its parent company in Britain, which have strongly denied the allegations.

The plaintiffs are seeking damages of $38.6 billion (£19.4 billion).

“In response to loss of market dominance and income in developed countries, tobacco companies are channelling their massive resources and promotional machinery to lure impressionable youths in the developing countries of Africa to long-term tobacco use,” Akinbode Oluwafemi, the programme manager for Environmental Rights Action, the nonprofit organisation working with the states, said.

Lawyers for the state governments are being advised by Michael Moore, the former attorney-general of Mississippi, which in 1994 was the first US state to sue big tobacco companies for public health costs. Other states followed suit, leading to a settlement with the tobacco industry in 1998 that required the companies to disclose millions of pages of internal documents, some of which are now central to the Nigerian case. Lawyers say that they have uncovered details of the tobacco companies’ marketing strategy in Nigeria.

Yemi Osinbajo, the Lagos attorney-general, who will be representing the state government in court, told The Times: “We came across information which established that there has been a deliberate design on the part of the tobacco companies to conscript young underage persons into smoking.”

The plaintiffs allege that the mandatory health warnings on cigarette packs in English are ineffective in a country with numerous languages. They add that the sale of individual cigarettes makes them more accessible to young people.

However, the lack of explicit laws restricting the sale of cigarettes to underage smokers poses a challenge to antismoking activists.

A BAT spokeswoman denied that the company targets underage smokers and promotes the sale of individual cigarettes. “We strenuously deny those allegations,” she said. BAT, the world’s second-biggest cigarette maker, claims a 75 per cent market share in Nigeria.

Philip Morris International is also named in the lawsuit. Lawyers for the state governments say that brands such as Marlboro are advertised and sold in the country. A spokesman for the company said: “Philip Morris International and its affiliates do not currently sell cigarettes in Nigeria.”

Smoking by numbers

20% Increase in smoking rate in Lagos over past two decades

9,527 Cases of tobacco-related diseases in government-run hospitals in Lagos

900 People employed by BAT Nigeria

18% The prevalence of smoking among youths in Nigeria in 2001

12 Brands sold by BAT in Nigeria, including Benson & Hedges and Rothmans

Sources: Lagos state; Global Youth Tobacco Survey Collaborative Group; BAT Nigeria

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