Quebec court refuses to authorize class action prompted by voluntary withdrawal of a drug

Sinziana Tugulea -

For the first time, a Quebec court has refused to authorize a class action proposed after a drug manufacturer announced a voluntary withdrawal. The proposed class action concerned sibutramine, a weight-loss drug for obese patients. From 2000 to 2010, sibutramine was manufactured by Abbott Laboratories and marketed in Canada as the patent medicine Meridia®. Apotex also marketed a generic version, Apo-Sibutramine, in 2010. Both companies voluntarily withdrew the drug in October 2010 at Health Canada’s recommendation, after a study linked sibutramine with increased risk of heart attack and stroke in patients with a history of cardiovascular problems. The proposed class action was commenced four days later. The Quebec Superior Court held that the plaintiff had no cause of action against Apotex, and had alleged insufficient facts to warrant authorizing the class action against Abbott.  

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Court rejects plaintiffs' request for in camera funding approval motion

Jennifer Imrie -

The plaintiffs in this putative class action unsuccessfully sought to exclude the defendant, Sun Life, from participating in a motion for the approval of a third party funding agreement. In particular, the plaintiffs sought orders permitting them to (i) to bring the funding approval motion on an ex parte basis (ii) close the motion to the public, and (iii) have the motion materials for the motion sealed.  Justice Perell dismissed the plaintiffs’ motion in its entirety and pursuant to s. 12 of the Class Proceedings Act, set out the procedures to be followed by the parties on the funding approval motion.

The plaintiffs submitted that the disclosure of the third party funding agreement would reveal privileged information regarding the legal advice and the plaintiffs’ litigation strategy.  It was argued that the disclosure of the agreement would imperil the privilege which, in turn, would adversely affect access to justice for the class, risk a fair trial and harm the administration of justice.  Sun Life opposed the motion.

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Ontario judge denies certification in overtime class action - individual nature of issues incapable of resolution on a common basis

Randall Boessenkool -

In Brown v. Canadian Imperial Bank of Commerce, Justice Strathy of the Ontario Superior Court of Justice examined the plaintiff’s motion to certify the proceeding as a class action under the Class Proceedings Act, 1992 on behalf of a class of employees of the defendants Canadian Imperial Bank of Commerce (CIBC) and CIBC World Markets Inc. (CIBCWM) (referred to collectively as CIBC).

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Motion to lift Timminco stay of proceedings denied

In the CCAA proceeding of Timminco Limited, on April 27, 2012, Justice Morawetz of the Ontario Superior Court of Justice denied, for the time being, a motion brought by the plaintiff in the securities class action Pennyfeather v. Timminco Limited to lift the stay of proceedings against Timminco and the other defendants to allow the class action to continue.

Timminco consented to a partial lifting of the stay to allow the plaintiff to apply to the Supreme Court of Canada for leave to appeal a recent decision of the Court of Appeal for Ontario relating to limitation period issues under Part XXIII.1 of the Ontario Securities Act.

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Leave to commence a Part XXIII.1 Securities Act claim and certification granted on consent

On March 27, 2011 Justice Perell of the Ontario Superior Court of Justice granted a consent motion in Sorenson v. easyhome Ltd. for certification of the action as a class action and leave to advance a claim against easyhome Ltd. and its CEO and President, its Senior Vice President, and its Chief Financial Officer (as they were during the relevant period).  The motion also included the consent dismissal of a parallel action against certain other defendants.  

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Statement of defence ordered in advance of certification motion despite objections

Vanessa Voakes

In a recent decision on a procedural motion in Labourers’ Pension Fund of Central and Eastern Canada v. Sino-Forest Corporation (one of the largest proposed securities class actions to be brought in Canada to date), Justice Perell added to the list of cases in which he has ordered the Defendants to deliver a statement of defence in advance of the hearing of the certification motion.1

On the same motion, Justice Perell also considered the fairness and efficiency of allowing the certification motion and the motion to obtain leave to advance secondary market claims under Part XXIII.1 of the Ontario Securities Act (OSA) to be heard at the same time.  The Defendants advocated for a sequential approach to the hearing of the motions (leave motion, Rule 21 motions, followed by the certification motion), however Justice Perell, anticipating appeals from every motion, found judicial economy in hearing everything at once and denying the appellate courts “the pleasure of three visits from one or two generations of Class and Defence Counsel.”

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Quebec court authorizes Canada's largest environmental class action to date

Sinziana Tugulea*

The Quebec Superior Court has recently authorized what may be the largest environmental class action ever instituted in Canada. The lawsuit concerns the release of a cloud of toxic gas from Canadian Electrolytic Zinc’s refinery in Quebec in August 2004. The Court has authorized representative plaintiff François Deraspe to act on behalf of all persons in certain specified areas who claim to have experienced noxious symptoms including eye, skin, and throat irritation, respiratory problems, coughing, and asthma attacks, when they were exposed to the gas cloud. Counsel has indicated that Mr. Deraspe will seek between $5,000 and $10,000 in damages, plus $5,000 in punitive damages, for each class member. It has been reported that the total damages could be up to $900 million.

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Certification granted in lawyers' copyright infringement class action

James S.F. Wilson -

An Ontario lawyer successfully moved for certification of a class action alleging that the Carswell database search and retrieval service known as “Litigator” infringes the copyright of the authors of legal documents that have been filed in Canadian courts.  In Waldman v. Thomson Reuters Corporation, Justice Perell of the Ontario Superior Court of Justice stressed that the merits of the action would be considered on another day; at the certification stage, the court’s “gatekeeper” function was limited to ensuring that the technical and procedural elements of the test for certification were satisfied.  In this case, His Honour found that the test was met.  

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Additional thoughts on Sharma v. Timminco

As reported earlier, in Sharma v. Timminco Limited the Court of Appeal for Ontario determined that representative plaintiffs seeking to commence actions under the Ontario Securities Act for misrepresentations by public companies in their secondary market disclosures must obtain judicial leave within three years of the alleged misrepresentations.  Additional commentary on this decision can be found in Stikeman Elliott LLP’s Special Class Actions Bulletin, Court of Appeal Provides Guidance for Securities Class Actions Limitation Periods, written by Alan D’Silva, Daniel Murdoch and Lesley Mercer.   

Court of Appeal makes it clear that plaintiffs must obtain leave for secondary market class action within 3 year limitation period

Alan D’Silva, Lesley Mercer and Ingrid Minott  -  

In Sharma v. Timminco Limited, a decision released on February 16, 2012, the Court of Appeal for Ontario determined that section 28 of the Class Proceedings Act, 1992 (CPA) which allows for the suspension of a limitation period applicable to a cause of action asserted in a class proceeding, is not triggered until after leave is granted under Part XXIII.1 of the Securities Act to commence a statutory cause of action for misrepresentation.1

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