Trends in Canadian class actions | S2 EP4

Class actions are a rapidly evolving risk for Canadian businesses. COVID-19, employment, privacy, consumer protection: these are just a few areas where activity has increased, and it is happening across multiple industries and jurisdictions. As class actions develop in scope and complexity, so do strategies for predicting and managing what seems like a moving target. In this episode, we look at some key trends in class actions, and compare approaches to certification across the provinces. Joining us are the co-chairs of our Canadian class actions team, Toronto partner Randy Sutton, and Montréal partner François-David Paré.

For more information: No duty of care owed to farmers arising from mad cow crisis

CPD credits: This episode qualifies for 0.58 hours of Substantive credit in Ontario and 0.58 hours of Substantive credit in British Columbia.

Transcript

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Transcript:
Randy Sutton  00:00
I think the last part that I said was, was the most brilliant part, like that was beautiful.

Andrew McCoomb  00:05
Does anyone recall if the glitch happened during the Mad Cow discussion? Because if it did, I'd like to. We could hear that again. 

François-David Paré  00:12
Yes, it was. It was during the Mad Cow discussion,

Ailsa Bloomer  00:14
I would like to hear the Mad Cow discussion again.

Andrew McCoomb  00:25
Welcome to Disputed, a Norton Rose Fulbright podcast. This episode is all about class action trends. We're talking to two lawyers with very different perspectives on class actions in Canada: Randy Sutton from our Toronto office, and François-David Paré  or FDP as he's known within the firm, from our Montréal office.

Ailsa Bloomer  00:44
Class action risk for Canadian businesses continues to develop across many areas of law: health care, consumer protection, competition, privacy, insurance. Strategies for predicting and managing these risks are, of course critical. In particular, how to manage the certification process, and the evidentiary thresholds involved at that stage. And ultimately, is certification still the best battleground to do meaningful damage to a plaintiff’s case? Or is it simply better to consent and move on to challenging the merits?

Andrew McCoomb  01:17
When it comes to certification of class actions, the provinces are going in different directions, both provincial legislatures and the courts. Recent amendments to Ontario's laws have raised the bar to certification. But at the same time, Québec, a class action haven especially for consumer protection claims, is going in the opposite direction. The courts are loosening the authorization process, and the Justice Minister is considering dropping it altogether.

Ailsa Bloomer  01:43
So this discussion focuses heavily on certification strategy, and in particular, the contrast between Ontario and Québec with a look ahead to some trends that we expect to see. Our guests, Randy Sutton and FDP, are the co-chairs of our national class actions team. Randy is also the global co-head of our life sciences and healthcare group, and has represented defendants in class actions across a huge range of areas from multinational pharmaceutical companies to competition law related class actions, and to product recall claims in the medical technology field.

Andrew McCoomb  02:18
FDP chairs the litigation group in Montréal, and has a substantial class actions practice acting for Canadian banks and consumer protection claims over credit card charges, pharmaceutical and medical device companies and product liability matters, entertainment ticket resale companies and acting in a major loyalty program class action under consumer protection legislation.

Ailsa Bloomer  02:41
So without further ado, here is our conversation. 

Ailsa Bloomer 02:53
Okay, Randy, FD, thank you for joining us, and welcome to the podcast. 

Randy Sutton  02:59
Thanks, pleasure. 

François-David Paré  03:00
Thank you. 

Ailsa Bloomer  03:01
Okay, to start off high level, can you give us an overview of the class action landscape in Canada? You know, what are the top issues or developments that companies need to have on their radar?

Randy Sutton  03:12
One of the big things I think we're seeing in Canada is really a movement towards a lot of overlapping multi-jurisdictional class actions. More plaintiffs lawyers are entering the fray and starting class actions in different provinces, we still don't have a way of effectively dealing with those on a national basis. So what you often end up with is a class action filed in more than one province, moving at a different speed managed by a different judge. And obviously, that can give rise to some undesirable consequences, including having, you know, multiple national class actions going on at the same time, all dealing with the same issue, the potential in the long term of having two trials on the same issue and inconsistent results. So it's a real challenge for defendants. That's one of the bigger issues. And then I think as well, we're seeing a real uptick in terms of class actions, the bump from the COVID-19 pandemic, and all of the issues around that. A number of class actions were filed in the early days and are moving through the system. And then I think we're still seeing a lot of growth in other areas like privacy, employment, consumer protection, securities, so more class actions in different jurisdictions and a multi-jurisdictional through the lens, through which we look at them now.

François-David Paré  04:22
I agree with your with your answer, Randy, I think maybe in terms of procedures, Québec is still probably the class action haven in Canada, we definitely see a direction toward loosening the certification process. But in terms of topics that we see, hot topics and trends, I think you've covered it well, Randy.

Andrew McCoomb  04:40
So we can dig into that a little bit more and you're signaling FDP, a good a good place to take the conversation at this-- at the outset. I mean, what are some differences, provincially, in terms of their approach to class actions that maybe afford advantages or challenges for plaintiffs or defendants? What-- What are some things on your radar that you're thinking about when you're talking to a client about the significance of a class action starting in a particular jurisdiction?

François-David Paré  05:08
Well, if I can start with Québec, there definitely are advantages for class counsel to institute an action in Québec. First of all, it's a first-to-file jurisdiction. The first one to file is the one who gets to argue this case. This translates oftentimes into quickly filed actions. And we see-- we see these applications being amended as the case evolves. For defendants though, it means that you have to constantly deal with a moving target, because the actions are quickly filed. And then you have to deal with moving applications and sometimes even moving cause of actions. Like I said earlier, the certification is a criteria and thresholds is extremely low, the certification criterias are loosely applied. And so you definitely have an advantage in at least having the class action certified with less up position. And even if you are not successful, we've seen trends from our Court of Appeal where the reverse decisions refusing to grant certifications in the past, I'd say, I don't know, five to six years.

Ailsa Bloomer  06:17
Okay, so moving to the opposite end of the spectrum then, Randy, what can you tell us about Ontario's approach to certification and class actions?

Randy Sutton  06:26
Well, much remains to be seen, because there were recent amendments brought in in Ontario, which I think have tried to make the bar a bit higher for certification, my question is how effective those will be. But certainly, that's the-- the idea behind many of them looking more at preferability, looking more at predominance of common issues, those types of things. So I think there is a desire in Ontario to increase the bar. The judges in Ontario are extremely experienced in class actions. They're sort of a set group of judges who deal with them, and they tend to make law in the common law provinces. So it'll be interesting to see how they interpret those provisions and whether there is in fact, an increased bar for certification. And then, of course, there are, you know, similar provisions in other jurisdictions, British Columbia, I think has been viewed as a sort of a relatively low bar in common law for-- for class action certification. But again, I think we're seeing some more rigorous approach to some of the cases in British Columbia, particularly around evidentiary issues, and really focusing in on cases which don't have merit at the early stage. So, again, I don't think it's an easy, it's certainly it's not as easy as it is in Québec for plaintiffs. And I think defendants have more options in these other jurisdictions.

François-David Paré  07:31
Maybe I can add to the--, to the Québec aspect of it is that we've seen a trend in recent years where the Court of Appeal would refuse to certify a class action if it's based on prima facie factual evidence that there is just no case. Or if it's only pure question of law, if a pure determination of a pure question of law can carry the faith of the action at the certification stage, then the Court of Appeal will recognize those situation and refuse to certify. There is actually right now a public consultation on class actions in Québec. And the idea is to consider some changes to our class action regime. The Justice Minister is actually looking into tightening the management of class actions. Class actions are-- are complicated pieces of litigation. And so oftentimes, they're complicated to move forward, and they take time. And so they're looking into tightening up that process. They're also looking into importing the concepts of proportionality and appropriateness into the certification stage, because I've not mentioned it earlier, but in terms of differences with Québec, there is no preferable procedure criteria in Québec, so they're looking into kind of importing that also into the class action process. They are contemplating integrating the authorization process into the main proceeding. In layman terms, this means just dropping the certification process altogether. So you really see a difference there, with what Randy was explaining was happening, at least in Ontario, where you see a tightening or raising the bar for certification, Québec is doing the exact opposite. We are loosening the certification requirement, and even the Justice Minister is considering dropping the certification process altogether. And finally, the last aspect of that consultation and reform is the tightening of the fee approval process. We've seen situations where class counsel has received good amount of money with early settlements, often time with a contingency-based agreement and they're looking into the reasonableness of some of those agreements and awards.

Ailsa Bloomer  09:51
It just is so interesting, this complete polarization between Québec on one end and Ontario on the other, and I just-- I just wonder where it's all coming from. And even with the recent consultation and doing away with the-- the authorization process in itself, and then you just have Ontario just seems to be the completely opposite end. And so I’m just interested in how where it all comes from why-- why Québec is so-- is so different. I mean, maybe that's just an impossible question to answer. But why is there still momentum to put the bar even lower, as opposed to find some sort of consistency across the whole country?

François-David Paré  10:26
It's a very good question, Ailsa, and I'd like to be in the in the judges minds to answer this. But from my experience, Superior Court judges that have refused to certify actions have been reversed. And-- and they've been reversed either by the Court of Appeal and confirmed by the Supreme Court, or they've been reversed ultimately by the Supreme Court. And so the message that they get is that you should bring the bar lower, because it's just a simple process to expunge from the roster, the class actions that are more frivolous. And if they're not frivolous on their face, it's just a simple process where you rubber stamp it, and you move along to the merits. And this is where the real issues should be dealt with.

Randy Sutton  11:13
Just picking up a little bit on that in terms of the impetus behind the Ontario. I mean, it is, you know, it is political, to some degree, I mean, the Ford government came in with a view to, you know, reducing unnecessary legislation, modifying legislation, there was an extensive consultation process that the government did with both plaintiffs and defendants looking at the issue and that’s sort of where they landed. And-- and so I do think, you know, in the context of what Québec is doing now, you know, defendants should be considering whether they want to provide comments on this and provide us, you know, input as to why they face challenges, because the reality is, you know, in Ontario class action, from through the commencement, even through certification, can be a significant and expensive process. And so I think there was a pushback on-- on many defendants who are frequently targeted to say there needs to be a bit more of a robust review of this, and the legislature responded with that. So again, it's-- it's the legislature has decided that that should be the approach and that probably is consistent with sort of the government's approach generally to being sort of pro-business.

François-David Paré  12:10
Yeah. Another reason is that Québec is a very consumer-oriented province. And we've seen that a lot of those class actions were on the consumer protection area. And so, obviously, you would see judges and courts being, or inclined into giving someone a chance to present their case. And that's probably one of the other reasons why the certification threshold has lowered-- lowered through-- through the years.

Ailsa Bloomer  12:41
Let's talk a bit about what a defendant can do if it seems that a class action in Québec is somewhat inevitable, let's say maybe, what are the types of dispositive motions, procedural tactics that can be employed in Québec to deal with this risk? And-- and can we contrast those with other options in the common law provinces?

François-David Paré  13:03
Alright, dispositive actions, there are very few. In terms of preliminary measures that could be presented, you could seek leave to present evidence. So in Québec, if a defendant wants to do evidence for purposes at a certification stage, you need to leave so a defendant would need to seek leave to present evidence, be it by way of documentary evidence, or even an examination of the class representative, you need leave for that as well. And so this is an option, but in terms of like summary motions or motion to dismiss, like a judge will not hear a motion to dismiss before the certification. So it’s non-existent, basically.

Ailsa Bloomer  13:45
And I think in Ontario, hasn't the Court recently said that the defendants have a presumptive right to have a dispositive motion heard at the certification stage? So, Randy, can you tell us a bit about that?

Randy Sutton  13:57
Even prior to certification, I think there's a desire on the part of judges to deal with this. And I think things like summary judgment motions to strike are still certainly within the defendants toolbox in Ontario, I think courts are prepared to hear those pursuant to that direction, in the legislation. So certainly, there's a lot more scope of challenging, dealing with these cases at an earlier stage. You know, even when it was released evidence, I mean, there's issues around admissibility of evidence, what is a proper admissible evidence for a certification application in British Columbia or a motion in Ontario, and the courts are pushing back and saying it has to be properly admissible evidence. So again, there's more rigor, I think, in the approach, and I think the courts are, are particularly wanting to both eliminate cases at an early stage that don't have merit. You know, there's a concept in-- in law called waiver of tort which was put out there maybe 20 years ago by, maybe 15 years, ago by a cla-- in a class action. And it took a number of years for it to get to the Supreme Court of Canada and the Supreme Court of Canada said there's just nothing there. But that is one that sort of continued on and most class actions because it was a novel cause of action. And I think the court, particularly the Supreme Court of Canada said, you know, we need to be able to deal with cases and these novel causes of action at an earlier stage. And so that's certainly something that we're seeing more of.

Andrew McCoomb  15:10
You know, my sense is that a lot of these efforts are directed towards getting rid of faulty class actions, you know, truly faulty class actions, or cases that are maybe built on one premise that is justified at law or arguable at law, but that include a whole bunch of other causes of action, you know, pleading the kitchen sink, where it's just not justified. But when we're talking about cases that are based on logical, well-argued concepts, something that makes sense of law, that's worth taking forward to trial. Would it be fair to say, Randy, while the threshold in Québec may be low, it's still pretty low in other provinces, when the evidentiary threshold for certification, for example, is just showing some basis, in fact, for the things that you're trying to plead?

Randy Sutton  16:01
Yeah, certainly, I mean, certification is not designed to deal with the merits. And if there's something there, you know, a clear cause of action with supported evidence that sort of outlines the central allegations, you're going to find any judge is going to is going to push that forward. So, you know, I think you're right, Andrew, that the desire is to get rid of, you know, things that just don't make sense in the context of a case, pleadings that are overbroad, cases they just don't have any there there. And I think you'll see some of the real, you know, experience plaintiff's counsel, focusing their cases and understanding that and that's going to be much more effective at moving forward than sort of the your point in the kitchen sink approach.

Andrew McCoomb  16:37
And I know on a couple of the cases being from my own experience, with that shifting away, maybe from thinking that on it on a well-pleaded case or a case that has a foundation, you know, certification, it doesn't seem like the battleground that maybe it once was, or once perceived to be for defendants for reshaping a case have, is this a place to have a good fight anymore? To do meaningful damage to a plaintiff's case? Or is it something that you might consider consenting to and just moving on to the merits?

Ailsa Bloomer  17:07
Yeah, particularly if your costs aren't recoverable as well, like in BC.

Randy Sutton  17:11
From-- from my perspective, I think there's a desire to focus certification. I'm a big believer, as a defendants counsel, and that you make every opportunity to explain the flaws in cases. And so to some degree, it's a strategic decision as to whether you want to take the time, particularly in a jurisdiction, like British Columbia, where your certification judge is your trial judge. So there are opportunities to, you know, indicate to the judge on certification, some of the flaws, even though it may be certified and potentially whittle down the case, or limit what it is, but certainly at the strategic decision and discussion, you have to have with your clients, and clients have different sort of interests in terms of where they want to go, and what they want to do. And, you know, just depends on the client.

François-David Paré  17:51
We definitely see more of that in Québec and defendants deciding not to oppose certification. We see a lot of negotiation with plaintiffs’ counsel to limit the scope of an action to what make sense, both factually and legally, in exchange for not opposing certification. And we also see contesting certification, but not really with the real hope of having it completely dismissed, but more in the hope of having the scope of the action limited.

Ailsa Bloomer  18:22
And-- and going back to the multi-jurisdictional point we were talking about, and how do you manage that process of consenting to this at the certification stage?

Randy Sutton  18:30
Very carefully. It is, it's complicated. And it certainly is, you know, something, you have to really take a high-level approach and look at Canada as a jurisdiction nationally, and then they also have to think about, you know, your, if there's other litigation and other jurisdictions where you want to be. And you know, certainly, if you're consenting to certification in one jurisdiction, not consenting in another jurisdiction, that fact will be known to the judge who is dealing with the opposition. Again, there's different rules, different requirements, but I certainly think you just have to have an overall national or even global strategy and understand where you're fighting something, where you're not fighting something and make sure that you've got an explanation as to why you're fighting it in one jurisdiction and perhaps not in another. And when we were, FDP and I, have a lot of international cases where we've got counsel in other jurisdictions, we're dealing with multiple litigation matters. And so it's really part of making sure that we fit into that, and that the class actions in Canada globally fit into that whole overall strategy.

François-David Paré  19:27
Yeah, I mean, the process can differ from one jurisdiction to the other. The discovery process can be different before certification, the evidentiary process can be different, and all those aspects need to be taken consideration because what can be induced advantageously in one jurisdiction, could be detrimental in another. So the strategic considerations for those multi-jurisdictional or even potentially multi-jurisdictional class actions before they're even sued, need to be considered if the case is further reaching than in one jurisdiction.

Ailsa Bloomer  20:02
What opportunities are there for sealing and protective orders in circumstances where you've consented to certification? Does that give you more goodwill with plaintiffs’ counsel to perhaps negotiate a sealing order that will prevent a lot of the evidence has been produced in this class action becoming publicly available?

Randy Sutton  20:20
In my experience, certainly, consenting to certification is something that there is a discussion with your opposing counsel on what the quid pro quo might be, you know, in the area that I do a lot of work in, frequently, confidentiality rules are put in place. And again, in-- in Canada, again, with the implied undertaking and the fact that documentation doesn't become public until it's filed in the Court, there is a level of protection that you get that you don't get in the US. My view is that when we're having discussions with our, our friends opposite, at any point, where we're consenting to something and agreeing to something, there should be a discussion about how to facilitate something that we might feel is appropriate in the context of our discussion. So that's certainly on the table.

François-David Paré  20:59
I mean, a litigant needs to consider that we have a public legal system. So the rule is that anything that is induced into the record is public, the court retains its discretion. So even though you agree with opposing counsel, the court still gets to decide. And where we have been the most success is where we've been able to produce evidence of the fact that the disclosure of an information could be business sensitive or detrimental to a business, we would do this by way of a sworn declaration of some sort. These are the situations where we've been most successful in protecting sensitive information, because otherwise, the court will-- will follow the rule of having everything public.

Ailsa Bloomer  21:41
But there's also the risk of regulators and investigators picking up information as well, right? Because let's take greenwashing claims as an example, if we see a rise in greenwashing class actions where companies are allegedly overstating the environmental benefits of their product, we've seen the kind of the competition grow in Canada step in and say we might want to see what's going on in this claim, see what evidence there is of this greenwashing activity and that could trigger an investigation. So there's, it's not just a reputational and business sensitivity issue, it's also the risk of regulatory investigations.

Randy Sutton  22:18
Yeah, I mean, they go hand in hand, you’ve got out of the Competition Bureau start something and then there tends to be a follow on class action or in certain circumstances, I guess there could be a class action and the Competition Bureau does undertake an investigation. I mean, greenwashing is a good example of, you know, there's a recent decision, fine of a company who allegedly made statements that were a bit over the line in terms of the recyclability of their products, Competition Bureau has recently issued further guidance on greenwashing issues. The fact though, is that if there is an allegation of greenwashing, it's going to be in the pleading, Competition Bureau will pick up on that. And they'll presumably come after you with whatever force they have without being too concerned about confidentiality on your senior civil litigation. So I think you just have to be aware of that. And greenwashing is one that we're certainly concerned about for a lot of clients, you know, making sure they've got adequate disclosures. And you know, there's a lot of consumer protection legislation out there that allows for a lot of claims to be brought. So it's an important thing to think about. And again, think about the regulatory side of it.

Ailsa Bloomer  23:17
Yeah, it just is an interesting point, when we're thinking about, do you go to challenging a certification motion? Or do you consent to certification? Because if the, say you go to the certification hearing, and the judge says, well, there's no real evidence here of this activity, and the case gets thrown out, I mean, that is potentially better than consenting to certification and not having a judge say, well, there's literally no evidence of this activity here at all.

Andrew McCoomb  23:41
Yeah. And then you run the risk of the opposite happening as well. I mean, I think part of what I'm taking away from this conversation is that, particularly when you're dealing with global issues that could be affected by parallel litigation in the United States or the UK for a global brand or a product that's distributed in a lot of different places, timing is key as well. Like Ailsa mentions, when you're dealing with regulators potentially timing is key. If you're pursuing a case quickly, you run the risk of front running, right, and exposing a global product to, or a global brand to the signal to other markets and other jurisdictions that the Canadian answer to the question might be the right answer. And maybe that's good, or maybe that's bad. But if you move more slowly, you have the opportunity to see what a regulator says, because a regulator could throw a case out and that could have an impact on what a Canadian court’s gonna think about it, or an American court, or an English court could say, there's really not a lot of substance to this, and that could help you. Or, they could say, this actually looks pretty bad for your client. And so a Canadian court’s gonna have reference to that. I mean, there's a lot for you guys as class actions counsel to be monitoring as you particularly as you sit with a global-- a global business and try to figure out what their risk profile is for a case like this.

François-David Paré  25:03
And it's also true in the in the securities class actions field.We've seen situations where an issuer is being sued both in Canada and the US, because their securities is being traded on different platforms, both in Canada and the US. And you would see situations where be it the regulator, or even the courts in the US would allow discovery, where in Canada, you would not allow discovery, at least not in Québec, by plaintiff, the certification stage. And so coordinating that, making sure that the evidence is not out in one jurisdiction that would allow another jurisdiction to benefit from it is very important. And people need to be mindful that class counsel talk to each other, even if they're in different jurisdictions. I mean, a Québec class counsel will talk to an Ontario class counsel and they will talk to US class counsel as well. So it's absolutely important for defence counsel to coordinate and to prevent and foresee situations where it could go beyond the scope of one jurisdiction.

Randy Sutton  26:04
Now, I would certainly agree with that. And it's part of just an overall strategy that you've got to have. And I think the challenge in-- in class actions is that it used to be that you'd get a consumer complaint over a small little issue and you think, oh, well, what's the what's the exposure here, what's the big deal? But when you start adding that up into class actions in different jurisdictions, it can become a real issue. So, you know, it's a reminded of a story I once heard where, you know, a significant piece of litigation arose because it was a small claims action brought in one jurisdiction that the company didn't deal with effectively, and that just ballooned, it just became a huge issue for them.

Andrew McCoomb  26:38
Randy, can you dig a little deeper for us on-- on the types of claims that we're seeing with a link into COVID-19?

Randy Sutton  26:46
Sure, Andrew, I mean, COVID-19 obviously changed and disrupted so much in society. And, you know, as soon as there's disruption, there's class action lawyers out there. So whether it's cancellation of events, cancellation of tickets, flights, that was sort of a big area initially, I think many businesses have sort of responded to that by dealing with the fact that, you know, there's refunds or whatever. And so the question is whether those class actions continue on. There's a whole group of class actions around the long-term care facility issues, particularly in Ontario and some of the other provinces, where there were real concerns. Those I think, will continue on for a number of years, the scope of the duties will become critical. And then there were a bunch of litigations around business interruption loss and the insurance issues around that. And again, you know, is this one that is actually covered, and there's been a couple of cases certified, very large cases, again, with significant exposure. So those will work their way through the system and much of the stuff with COVID-19 is all sort of brand-new, we don't really know what COVID-19 was in the context of, you know, is it a foreseeable loss? Is it a pandemic, that doesn't give rise to-- to those types of coverages? Or is their ability to, you know, exit contracts because of COVID-19. So, that's something that will sort of manage its way through the system in the next few years, I think we'll see some interesting cases arising from it. One of the cases that recently came up, which I did want to flag, is a recent decision, which arose from a class action in the trial decision, a class action. And you’ll recall it about 15 years ago, there was a significant issue around Mad Cow disease, and particularly in a number of jurisdictions. And a number of Canadian farmers brought a class action alleging that the government hadn't dealt with that effectively, and was negligent. The case went to trial this past year, and the case was dismissed on the basis that the government didn’t owe a duty to the farmers as it related to the Mad Cow crisis. And if they had, they had met the duty. And so I think that's sort of a good example of again, you know, in the context of a public health crisis, where government does intervene, provide support, you know, what are the duties that are owed. And I think that's probably applicable, and will be similar to the COVID situation, where you've got many cases which, you know, resolve themselves along the way, they don't become issues, but there may be cases where we need to define what exactly the rights and liabilities arising from COVID are and whether government or other health officials owed certain duties to the population and, and didn't meet those-- those requirements. So I think that'll be interesting to see, it'll probably take 10 or so years to get through the system. But again, it's sort of an interesting way to look at it and to think about it.

Ailsa Bloomer  29:11
That was a comment I was gonna make is that Mad Cow disease, as you said, is this 15 years ago. So is it really going to be that we will be dealing with these long-term care COVID-related class actions for another 15 years? Or is there going to be some additional legislation that says, look, there's no cause of action here for on public policy grounds.

Randy Sutton  29:26
And there is some legislation which insulates certain actors within the government actors or parties acting in-- in employers, those types of things. So again, you know, those cases may be dismissed early, because though that legislation insulates certain people. But again, it does take some time, we just did a case involving the SARS vaccine, that just finally made it through the Court of Appeal. So again, it does take time to make it through the system.

Ailsa Bloomer  29:49
So another trend that I think we want to talk about in terms of a specific area of law is what's going on with privacy class actions. And again, there is a difference here between what's going on in Québec and what's happening in other common law provinces, can we talk a bit about recent developments in the ability to bring or have certified a privacy class action?

Randy Sutton  30:10
Sure. So why don't I start off with the common law, privacy data breach has always sort of been viewed as a really fertile ground for class action lawyers. I mean, it's data is sort of money nowadays. And I think the fact that data is, is either lost or stolen or used improperly, plaintiffs’ lawyers thought that would be a good area to recover. What we've sort of seen recently, though, is a set of cases focusing in on sort of, what's the actual outcome of a data breach or data loss? And does it give rise to compensable loss? What are the sort of central allegations of that case? And a few that have not been certified. Recently, one in British Columbia, involving Facebook, you know, the court said that this case looked like they had been downloaded from the Internet, and their evidence didn't support the central allegations which were actually being made. And there's been a couple of other Facebook cases, there was a case involving Uber, all of which the judges have just sort of said, again, there just doesn't seem to be any real problem here. You know, the data may have been lost. There's no evidence it was improperly used, though. No evidence of any loss here. And so why are we certifying a case? And I think that goes back to the general notion in the context of privacy class actions that we've seen is they haven't been that lucrative for plaintiffs’ counsel. I mean, you know, there's credit monitoring those types of things where there's actually a data breach, but there often isn't the significant amount of loss for the class. And so they haven't given rise to sort of the huge paydays that I think maybe class counsel wanted.

François-David Paré  31:33
The situation has been a bit different in Québec in the sense that we've seen a couple of those actions being certified because of our low threshold, basically. But that doesn't mean that it's the Klondike already. We've seen the first decision on the merits in Canada, in a privacy class action being rendered last year in 2021. And-- and the court dismissed the action. It was an issue with a lost laptop on a commuter train by an IIROC inspector, that contained private information and the issue there was whether or not there was a real liability to be recognized. You know, in Québec, liability is a faulty damage and a causal link between the two. And there was no evidence of the actual use of that private information, and ergo, any real consequences, any real damages being suffered by the class representative or the class members. And so, even though these actions, and we've seen recently with another action against Facebook, where they might get certified, it doesn't mean that on the merits when you-- when you drill down into the issues and the factual evidence that necessarily the plaintiff's counsel or the class members will be successful.

Andrew McCoomb  32:51
One last question for you guys. We recently ran an episode where we had a really good conversation with Paul Rand from Omni Bridgeway about all things litigation finance, are you seeing litigation funding playing a bigger role in class actions in Canada? Is it affecting strategy? Is it changing the landscape at all from where you're sitting?

Randy Sutton  33:11
I'd say, yes, definitely. You're seeing more of it in the class actions context. I think it is changing the strategy. I think it's changing the dynamic of litigation, and something you can expect in the context of your litigation and plan accordingly.

François-David Paré  33:24
There is-- there is private funding, but there's also public funding. In Québec, there’s an entity called the le Fonds d'aide aux actions collectives, which is a public entity that funds class action. And as a matter of fact, this entity is being itself funded with awards or settlement. A portion of those awards in class actions proceedings or settlement, would go to the, what we call, the Fonds d'aide. And so that's also something that exists in Québec. And  almost all the time plaintiff's counsel will seek funding from-- from the Fonds d'aide.

Ailsa Bloomer  33:58
That is a really interesting difference actually with-- with Québec and-- what was it called? The Fonds d'aide…

François-David Paré  34:04
Fonds d'aide aux actions collectives.

Ailsa Bloomer  34:08
And with the presence of private litigation funders is that potentially another tactic for a defendant to employ, is to challenge the Litigation Funding Agreement? Is it possible to do that at the certification stage?

Randy Sutton  34:18
Because litigation fundings tend to have to be approved by the courts, there is a scope for defendants to raise issues. You know, we have done that, I've done that in a couple of cases where there have been concerns and the judges have-- have responded to those and have looked at them. But again, at the end of the day, that tends to be between the plaintiff and their litigation funder and so we have some scope to seek changes or raise issues for the judge. But ultimately, it's up to the judge to decide whether that's appropriate. But given that it is in the class action, there is a normal requirement that a litigation funder would get approval for litigation funding agreement because it does affect the class potentially. And so the judge will want to have a look at that.

Andrew McCoomb  35:00
Thank you so much for joining us. I'm sure we'll have more questions for you in the future. If you'll give us some more of your time, but we appreciate you guys coming on the podcast.

Randy Sutton  35:10
No problem at all. Thanks for having us. Thanks.

François-David Paré  35:12
A pleasure. Thanks. 

Ailsa Bloomer  35:14
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