Law Times

PAGE 14 FOCUS JuLy 13/20, 2009 • Law Times Cross-border litigation is rampant BY JULIUS MELNITZER For Law Times C ross-border litigation is rampant these days. But what is it? In the Canada-U.S. context, and in its widest sense, cross-bor- der litigation seemingly engages any type of court proceeding or related court proceedings that involve parties on both sides of the border. Th is defi nition cuts a wide swath, which is why a host of Canadian counsel can claim le- gitimately to be "cross-border liti- gation lawyers" — because they've been involved in cases that have a connection to the U.S. But what's not around are many lawyers who have hands-on trial ex- perience in both the Canadian and American legal systems. One of the few is Stephen Maddex of Lang Michener LLP's Ottawa offi ce. Th ere are few Canadian lawyers with extensive expertise in enforc- ing foreign orders and judgments in Canada. And that's where Mal- colm Ruby of Gowling Lafl eur Henderson LLP comes into the cross-border litigation picture. "Judgment enforcement is a very large element of cross-bor- der practice," he says. "At least 50 percent of my practice is de- voted to it." Maddex, a Canadian, gradu- ated from the University of Ar- kansas School of Law in 1999 after obtaining his B.A. from the University of Victoria in 1992. After his call to the bar, Maddex spent time in Japan and worked at two Houston-based U.S. law fi rms as a litigation lawyer. "Th at was a far cry from commercial litigation practice in Ontario," he says. "In my eight years practising in the U.S., I conducted 25 trials, 20 of which were jury trials." Maddex appeared in trial courts all over Texas and also before the Texas Court of Appeal. His experi- ence was broad: it embraced com- mercial litigation, tort cases, oil and gas matters, securities law, employ- ment law, real estate law, environ- mental law, and constitutional law. In September 2008, he joined Lang Michener. "It was always my plan to come back to Cana- da." He now carries on a civil and commercial litigation practice. "About 80 percent of my work has cross-border elements," Mad- dex says. "And there's a lot of it, largely because very few U.S. or Canadian law fi rms have offi ces in both countries despite the fact that there's $600 billion in bilateral trade between the two nations." Maddex has developed both a U.S. and Canadian client base. "My U.S. clients usually come from American fi rms who are rep- resenting clients in Canadian mat- ters," he says. "Sometimes there's a lawsuit that has to be fi led up here, and sometimes they're looking for discrete legal advice." Similarly, Canadian clients are usually looking for advice about issues in the U.S. "Even the most mundane issues can be compli- cated when you're dealing with the U.S. system," Maddex says. Th e lawyer posits the case of a Canadian client considering fi ling a suit against a U.S. defendant. "Often the fi rst question is whether they should fi le in Can- ada or the U.S.," he says. "Th at may seem like a simple question at fi rst blush, and most lawyers with a little bit of knowledge would look at it from the perspective of where the two legal systems allow the defendant to be sued." What would come to mind as venues would be the defendant's principal place of business or the jurisdiction of incorporation. "But under U.S. rules, many defendants could be subject to suit in almost any state," he says. "Picking the right venue is fundamental to a Canadian cross-border practice." U.S. plaintiff 's fi rms, Maddex says, spend a signifi cant amount of time sorting out jurisdictional issues. "Th e way to unravel the problem is to fi gure out what the potential targets are, and then to understand enough about U.S. law to fi gure out which state is the most advantageous venue," he says. But that's only halfway to an answer. "Picking the right county within a particular can mean ev- erything, in the sense of getting the jury you want," Maddex says. "Us- ing a Canadian lawyer to make that decision in the fi rst instance is far less costly than using an American lawyer, who may not be motivated to unravel the question." Maddex remains intimately in- volved on the ground in the U.S. "I'm still conducting a trial in Houston for a former U.S. client, but I'm doing it under the Lang Michener aegis and using my old Houston fi rm as agent," he says. "And because being licensed in Texas allows me to litigate in any state, I can support a law- suit in the U.S. and get deeper into the problem than if I didn't have those U.S. credentials." But obtaining a foreign judg- ment is one thing. Enforcing a foreign judgment in Canada is quite another. It's not just a mat- ter of getting Canadian courts to recognize foreign judgments after the merits of a case have been de- termined. Evidentiary requests, where foreign governments seek to collect information in Canada for proceedings elsewhere, is also a signifi cant part of enforcement specialist at Ruby's practice. Among his more active clients are the U.S. Securities and Ex- change Commission and the U.S. Federal Trade Commission, which has become concerned with trans- border telemarketing practices. In- ternational commercial arbitration awards are also getting attention. From a practical perspective, Ruby invariably faces the task of proving foreign law. He also spends a great deal of time char- acterizing foreign law, because the diff erence between procedural and substantive law looms large in confl icts of law and other interna- tionally oriented jurisprudence. "Th e most common way to deal with these issues is by call- ing an expert in the foreign law under consideration," he says. "So you have to keep building your network of people who are knowledgeable and willing to tes- tify in Canadian proceedings." According to Ruby, the interna- tionalization of trade and Canadian courts' reaction to it indicates that enforcement practice will continue to grow. Until the Supreme Court of Canada's 2003 decision in Beals v. Saldanha, he notes, it was unclear whether the court's rationale in the 1990 case of Morguard Investments Ltd. v. De savoye — the leading case relating to the enforcement of in- terprovincial judgments in Canada — extended to the enforcement of orders made in foreign courts. But Beals has clarifi ed the issue, Cross-Border Litigation Interjurisdictional Practice and Procedure Guidance on all aspects of cross-border litigation for inter-provincial, international and multiple jurisdictions Brian Casey, International Lawyer, Baker & McKenzie LLP • • • • • • • • • Cross-Border Litigation: Interjurisdictional Practice and Procedure offers practical guidance on all aspects of cross-border litigation, covering everything from deciding where to commence litigation to enforcement of a judgment. It is an excellent handbook to help you understand the legal considerations involved and map out the right course of action, such as: where is the best place to sue strategies for challenging the plaintiff's choice of venue how to ensure proper service outside your jurisdiction how to determine which jurisdiction's laws apply obtaining evidence from other jurisdictions responding to requests for evidence from other jurisdictions pleading and proving foreign law pre-judgment cross-border remedies enforcing foreign judgments at home and domestic judgments abroad This resource includes time saving features such as a decision tree to help analyze where a case should be litigated, appendices with related Hague Service Conventions and a glossary of terms. ORDER your copy today Hardbound • 424 pp. • June 2009 • $115 P/C 0291010000 • ISBN 978-0-88804-484-6 and in so doing severely restricted the ability of Canadian courts to reject American judgments. "Th e key to Beals is the court's recogni- tion that international commerce will not work unless domestic courts respect awards made by foreign courts in jurisdictions that have comparable legal systems. Because as long as there is an inter- national boundary, the Canadian and American systems will have some diff erences, and it's impor- tant to the fl ow of commerce that Canadian courts accept these dif- ferences. Essentially, the Supreme Court has done so," says Ruby. Since Morguard, the SCC has continued to liberalize the enforce- ment landscape. In a clear nod to the business realities of globaliza- tion, the court's 2006 judgment in Pro Swing Inc. v. Elta Golf Inc. dra- matically changed Canadian law by permitting the enforcement of non-monetary judgments. Th e ruling means that courts For a 30-day, no-risk evaluation call: 1.800.263.2037 Canada Law Book is a Division of The Cartwright Group Ltd. Prices subject to change without notice, to applicable taxes and shipping & handling. www.lawtimesnews.com MacDonald_cross border litigation (LT 1-3x4).indd 1 7/8/09 2:01:34 PM LT0720 in this country, previously limit- ed by precedent to enforcing only damage awards (unless there was an enabling international treaty in place) may now consider en- forcement of a much broader scope of foreign orders. Th at in- cludes injunctions in general but particularly in intellectual prop- erty and Internet-related matters, as well as family court custody and access orders. LT Kenneth "… This C. MacDonald and will be a very useful timely addition to the library of any litigator involved in inter- jurisdictional disputes." ... and more

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