Class Actions
Commercial LitigationOur Blog
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The philosopher Heraclitus observed that “the only constant in life is change”, a maxim as true for the business world as the natural world. Publicly traded companies operate in a dynamic environment, where commodity prices swing, new laws are passed, and scientific breakthroughs are made. So long as those companies wish to maintain their access to public markets, they must carefully consider how day-to-day happenings (and their own reactions to those events) affect their continuous disclosure obligations. These disclosure judgements are fact-specific and often fast-paced, yet they carry potentially significant consequences.
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Last Friday, the Ontario Court of Appeal released decisions in Owsianik v Equifax Canada Co, Obodo v Trans Union of Canada, Inc, and Winder v Marriott International, Inc—a trilogy of decisions clarifying whether the tort of intrusion upon seclusion applies to the owners of databases when there are data breaches caused by third party hackers. Thankfully for database owners, the Court of Appeal concluded that intrusion upon seclusion cannot apply in those circumstances.
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Class actions are strange creatures, even to other lawyers.
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History has shown that recalls for product defects are often followed by a proposed class action lawsuit. While many products cases in that context have been certified, we have now seen certification of proposed class actions being denied on the basis that there is already an effective recall campaign in place. We have seen this in Maginnis and Magnaye v FCA Canada et al and Richardson v Samsung.
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It has been just under a year since the new dismissal for delay provision in s. 29.1 of the Class Proceedings Act started resulting in dismissals for delay. In essentially all of the decisions rendered to date, judges have strictly construed those provisions to require the dismissal of matters where the statutory criteria for avoiding a dismissal are not present. The recent decision of the Ontario Superior Court in Lubus v Wayland Group Corp is now an outlier that takes a different approach.
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Employment law misclassification class actions are becoming increasingly common. In those cases, the plaintiff says that employees have been misclassified by their employer in such a way as to render them ineligible for certain benefits under applicable provincial employment standards legislation which the employee claims that they should have been eligible for. The two most common categories of alleged misclassification are employees being allegedly misclassified as independent contractors, and ordinary employees being misclassified as managers. While some misclassification cases have been certified, courts have refused to certify many others due to a lack of sufficient commonality. The recent decision of the Ontario Superior Court of Justice in Le Feuvre v Enterprise Rent-A-Car Canada Company is an example of a case that falls into the latter category and was not certified.
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Historically, many class actions practitioners considered certification the primary fight in a case. It was common that cases would settle not long after certification, so the whole ballgame was perceived to be in the certification motion. Yet with the courts consistently reaffirming the low bar for certification, we are seeing a greater number of class actions determined on their merits after certification. And as the recent case of Rebuck v Ford Motor Company shows, success on certification is by no means a guarantee of success on the merits.
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On October 1, 2020, section 29.1 of the Class Proceedings Act (“CPA”) took effect. This provision, designed to address the phenomenon of class actions being started and then languishing in the system without advancement, provides for a mandatory dismissal of an action where, by the one year anniversary of the claim, the plaintiffs certification record has not been filed or there is no established timetable (by consent or Court order). This was a significant improvement to a class actions system that previously had no real tool for dealing with class actions that were languishing.
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Securities law class actions are now common in Ontario. However, courts are still addressing some of the core elements of the conceptual approach to such issues. The recent decision in the Ontario Court of Appeal in Drywall Acoustic Lathing and Insulation, Local 675 Pension Fund v Barrick Gold Corporation (“Barrick Gold”) is a highly significant decision in this area, particularly in its treatment of the “public correction” requirement for securities class actions.
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Referring to living “in an era in which data is constantly flowing across borders”, Canada recently introduced Bill C-11. If enacted, it will radically alter the Canadian privacy litigation landscape. Bill C-11 contains the Consumer Privacy Protection Act (“CPPA” or the “Act”), and the Personal Information and Data Protection Tribunal Act (“PIDPTA”), and makes a number of consequential amendments to existing legislation. Bill C-11 would bring Canada closer to the European Union’s General Data Protection Regulation, which set the standard for data protection in the developed world.
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