Law Times • sepTember 7, 2009
FOCUS
PAGE 13
'Certification is no longer the end game,' says lawyer I
BY JULIUS MELNITZER For Law Times
t was March 1998 when Karen Webb and several oth- er former Kmart employees
consulted Windsor lawyer David Deluzio. Th e workers, part of a group of some 5,000 employees, had been fi red by Kmart. Deluzio, with the assistance of
Michael McGowan, a class action specialist with Th eall Group LLP, initiated a class action on behalf of the terminated employees. At fi rst, the case proceeded ex- peditiously. A little more than a year after Deluzio and McGow- an started the action, the Ontar- io Superior Court certifi ed the proceeding, granted judgment on the common issues, and ordered a reference on damages. From the plain-
tiff s' perspective, things were
going
smoothly, too much so, as it turned out. From that point on, Kmart's counsel, Douglas Gray (since appointed to the Ontario Supe- rior Court) and John Field of Hicks Morley Hamilton Stew- art Storie LLP, fought every- thing tooth and nail. Ironically, Ontario's class action bar was keeping an eye on Webb v. K-Mart Canada Ltd. as a procedural prototype in the resolution of individual damage claims. But arguably, the case became a prototype for everything class action liti- gation should not be. To begin with, only 1,000 of the 5,000 severed employees fi led claims for damages; 130 of the fi lings have been withdrawn; about 250 cases have settled; and 24 have been adjudicated. Some 600 claims are still pend- ing. Progress has been delayed by procedural battles and appeals on almost every imaginable issue. So little, so late. More than
11 years have passed since Webb was launched. And that, claims the defence bar, is the morass to which many certifi ed claims are heading. In other words, the front lines of class actions are moving from certifi cation motions to trial. "Certifi cation is no longer the end game," says Tim Buckley of Borden Ladner Gervais LLP's Toronto offi ce. Part of the reason lies in the multi-jurisdictional potential of many class actions and the vary- ing fates they suff er in diff erent forums. "We're at a point where plain-
tiff s are still having success in certifying claims that wouldn't get certifi ed in the U.S.," says Caroline Zayid of McCarthy Tétrault LLP's Toronto offi ce. "So Canadian defendants are just coming to terms with the fact that some class actions will have to go to trial. Th at process will, in itself, give the courts and parties some sense of the prac- tical diffi culties involved, and then the pendulum may start to swing the other way." Certainly, that has been the
Caroline Zayid
experience in Quebec, where since 2004 judges hearing certifi - cation motions must also try the cases. Since then, Quebec's repu- tation as a class action haven with liberal certifi cation requirements has taken a bit of a beating. "Sometimes, I think that de- fendants are actually better off in Quebec now, because judges have had to live with what they authorize," says Sylvie Rodrigue, of Ogilvy Renault LLP. "Th ey're seeing that a case with one or two common issues can potentially give rise to 20,000 mini-trials." Moving beyond certifi cation
also elevates the risk for plaintiff s' counsel, who are working on contingency fees. "As defendants
have been refusing to bend or settle, the economic feasibility of moving forward becomes more of an issue for plaintiff s' counsel because of the huge costs of preparing for and at- tending at trial," says Buckley. "Already, we're seeing a grow-
ing number of certifi ed actions that aren't being pressed ahead." It remains to be seen, for ex- ample, what fate awaits Lambert v. Guidant Corp., the largest pace- maker class action in Canada that was recently certifi ed by the On- tario Superior Court. Still, despite the trends to-
wards a more aggressive defence, there's one important distinction between the Webb experience and the law today: the liberal judicial approach to aggregate damages
evidenced by the Ontario Court of Appeal's MacDonald_cross border litigation (LT 1-4x3).indd 1
judgments in Markson v. MBNA Canada Bank and Cassano v. Th e Toronto-Dominion Bank weren't even on the radar in Webb. In those cases, the Court of
Appeal ruled the aggregate dam- ages provisions of Ontario's Class Proceedings Act were engaged where "potential" liability could
be established on a class-wide basis but where entitlement to monetary relief might depend on individual assessments. Th e provisions permit courts to determine the aggregate or part of a defendant's liability and give judgment accordingly where these can be reasonably
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