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Page 12 April 16, 2018 • lAw Times www.lawtimesnews.com brella Purchasers are included in the class, it is not clear how the respondents would even know how many such purchasers they might be found liable to." In Godfrey, B.C.'s appeal court considered an alleged conspiracy among the manufac- turers of optical disc drives and products containing them that resulted in higher prices between 2004 and 2010. Writing for him- self and two colleagues on the bench, B.C. Appeal Court Justice John Savage said that he was con- vinced the language of s. 36 of the Competition Act is capable of allowing umbrella claims. "I acknowledge there is a ten- sion between, on the one hand, concerns over what some may view as a very broad scope of li- ability resulting in unfairness to defendants accused of price-fix- ing and, on the other hand, the need to give effect to the objec- tives sought by the Competition Act such as compensation, de- terrence, and behaviour modi- fication," Savage added. "To the extent that such a tension arises in the present context, how- ever, I am convinced it must be resolved in favour of the latter policy objective." From an international point of view, Paul-Erik Veel, a partner at Toronto litigation boutique Lenczner Slaght Royce Smith Griffin LLP, says the B.C. line of jurisprudence fits with the Euro- pean approach to umbrella pur- chasers, while Ontario's more restrictive view is ref lected in the U.S., where similar claims are in- creasingly failing at trial. He says he would rather see umbrella claims blocked, but he adds he would appreciate a Su- preme Court ruling on the issue. "It's unusual with these types of cases to see such a stark and clear divergence between courts of different provinces," Veel says. "Although I'm sympathetic to the very valid policy goals of the Competition Act, in my view, umbrella purchasers are a bridge too far. "Competition class actions are already unwieldy and cumber- some enough and will become substantially more so with the addition of umbrella purchasers without much benefit to con- sumers ultimately," he adds. LT • procedural safeguards of ad- equacy of representation and notice, as well as the right to opt out, are provided. "In my view, this framework provides the necessary safe- guards to establish that jurisdic- tion properly exists and ensures the protection of the values of order and fairness," Appeal Court Justice Sarah Pepall wrote on behalf of the panel, before go- ing on to find that the foreign claimants in the air cargo case met the test for jurisdiction. Despite their disappoint- ment, those on the defence side of the bar admit they saw the ap- peal court reversal coming. "I thought Justice Leitch's ap- proach was a rational and logical way to deal with absent foreign claimants," says Ranjan Agar- wal, a partner in the Toronto office of Bennett Jones LLP, not- ing that most of the case law in- volving the "real and substantial connection" test relates to defen- dants, rather than plaintiffs. "On the other hand, I wasn't surprised that the Court of Ap- peal didn't want to stray too far from the existing test for defen- dants and apply a different one to plaintiffs," he adds. Still, Agarwal says the unique circumstances presented by class actions justifies a final word from the Supreme Court. "It's too bad if they don't take the case, because if you poll members of the bar, you'll find there is desperation for the Su- preme Court to finally offer a comprehensive take on the mul- titude of jurisdictional issues that have vexed multi-jurisdictional class actions," he says. "It's an interesting issue that has hallmarks of going up to the Supreme Court," says Naudie, who also has his fingers crossed. "Jurisdiction is a core issue and more and more claims are in- cluding foreign class members with Canadian proceedings." If the Supreme Court denies leave to appeal, Alexandra Teo- dorescu, a litigator with Toronto firm Blaney McMurtry LLP, says defence lawyers can con- sole themselves with the fact that the appeal court judgment provides a road map for future cases to follow. "It simplifies the framework and lets everyone know what they can expect going forward," she says. In addition, Teodorescu says the potential financial gains to class from the addition of ab- sent foreign claimants will be tempered in many cases by the procedural burdens they bring with them. "There is a heavy onus on plaintiffs' counsel to get out no- FOCUS Continued from page 10 Continued from page 11 'Only time will tell how important a decision it is' tices, which can be an expensive and time-consuming process," she says. For example, the appeal court judgment notes that, fol- lowing a settlement with some of the defendants in the air cargo case, the plaintiffs spent more than $5 million to effect notice to 310,000 people in 140 countries. If the appeal court decision stands, Agarwal says, defendant lawyers will need to warn their clients about the risk of double recovery in countries that will not recognize any judgment that results in an Ontario action. "It's an open question as to how companies will respond to that risk," he says. By making common issues a part of the test for jurisdiction over absent foreign claimants, Agarwal says, the appeal court may have also created eviden- tiary issues for defendants. "It can take lot of money and resources to marshal evidence that narrows and addresses com- mon issues earlier in the proceed- ings, which may be too much for some defendants to bear," he ex- plains. "But I've learned over the last 15 years that our clients are very good at responding to risk factors. To the extent that this presents a new one, they will find a way to respond. "Only time will tell how im- portant a decision it is," Agarwal adds. 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