Law Times

Law Times • apriL 7, 2014 Page 11 www.lawtimesnews.com Plaintiff lawyers diverge on success of class actions law Comments come as LCO embarks on review of Ontario's legislation s the Law Commission of Ontario embarks on an ambitious review of the province's class action legislation, it may find that even plaintiffs' counsel have diverging views on the efficacy and success of the two-decade old regime. Won Kim of Toronto's Kim Orr Barristers PC, for example, is ada- mant that the current scheme has been too restrictive. "While the Class Proceedings Act has provided access to justice to many Canadians, the number of serious players on the plaintiffs' side of the bar has dwindled," says Kim. "Although it's true that the profession as a whole has embraced class proceedings, serious cases are being carried by only a small group of firms who, in effect, form an oligopoly." Kim says that only three or four plaintiffs' firms are operating on a na- tional scale, something he blames on "formidable" entry barriers. "We should have dozens of firms acting for plaintiffs but we have just a few," he says. "By contrast, there are pages and pages of defence lawyers listed, so much that it's clear that the current regime has worked way better for defence firms than for plaintiff firms." Kim also believes that won't change unless the system changes. "If things stay as they are, the handful of established law firms will just consolidate their position," he says. "Our loser-pays system will ensure that only the well-funded players will get in on the big cases." Mike Peerless of McKenzie Lake Lawyers LLP in London, Ont., ac- knowledges that high entry barriers may have contributed to a slow start for the plaintiffs' bar. "I believe, however, that the bar has been growing and vibrant," says Peerless. "e courts have been good at compensating plaintiffs and their counsel when we win because they understand that we don't always win." ere's no doubt in his mind that the Class Proceedings Act is fulfill- ing its stated goal of providing access to justice. He cites the proceedings over the anti-inflammatory drug Vioxx as an example. "Nobody would have taken on a large pharmaceutical company by themselves," says Peerless. "But because class proceedings are available and working, 1,000 Ca- nadians will receive payments from the Vioxx cases." Peerless also believes the Class Proceedings Act has achieved its aim of judicial efficiency. "In Ontario, we are blessed by a fantastic bench made of smart judges who are engaged in class actions," he says. "What that means is that each case doesn't have to start off with a con- sideration of first principles and our case management system makes these cases move forward in a rational way." According to Peerless, well-funded defendants can make things move slowly in individual cases. "In my view, delaying tactics don't work nearly as well in class ac- tions," he says. Not everyone will agree with that statement. But Jonathan Foreman of London's Harrison Pensa LLP says that because of their sheer scope, a few bad examples can be misleading. "Bad cases can get a lot of bad publicity, but these cases are by no means a representation of what actually happens in our business most of the time," he says. "ere are tons of great cases with fantastic results that nobody says much about." In an example he says is proof the system is working well, Foreman cites the residential school abuse cases. "ose were hard cases that produced spectacular results that would not be possible without the class action mechanism," he says. FOCUS 2014 COMPENSATION SURVEY law departments grow. partnerships evolve, change, Salaries canadianlawyermag.com/surveys Managing partners and law department leaders, share what's happening in your organization. Survey closes May 5, 2014 Untitled-4 1 14-04-02 2:40 PM Girones_LT_Mar24_14.indd 1 14-03-19 1:32 PM "ere's no denying that the sys- tem, like any system, has problems but there's still much it can achieve and I say let's get on with it." If the law commission has its way, things could very well change. But they might change in ways that the plaintiffs' bar won't like. In early January, it released a paper on the issue. e paper, a framework for the forthcoming review, raises concerns about self- dealing by plaintiffs' counsel and the dangers of third-party funding. To be sure, the law commis- sion acknowledges Ontario courts are aware of the risks and ben- efits posed by third-party fund- ing practices and have done their best to impose terms that protect class members from improper interference in strategic decisions. Still, the law commission raises concerns about situations where plaintiffs' counsel "have effective free rein" and where their inter- ests "may be more closely aligned" with the funder. "In the absence of a savvy or interested plaintiff representative to supervise the litigation, and in the face of the financial tempta- tions that class actions offer, how can the court reduce the risk of self-dealing?" the law commis- sion asks. "Does the [Class Pro- ceedings Act] offer sufficient tools and guidance to the courts to assist in this regard?" And if not, what will the changes mean for the plaintiffs' class action bar? LT 'Bad cases can get a lot of bad publicity, but these cases are by no means a repre- sentation of what actually happens in our business most of the time,' says Jonathan Foreman. BY JULIUS MELNITzER For Law Times A

• Cover