Copyright 2008, Blake, Cassels & Graydon LLP
Originally published in Blakes Bulletin on Class Actions, August 2008
Two recent decisions in the Canadian Vioxx litigation, one from Saskatchewan and the other from Ontario, should be of concern to all corporations conducting business in Canada. These decisions raise the prospect of Canadian defendants having to defend multiple competing national class actions and plaintiffs' counsel pushing their cases forward more quickly (with a view that the race will go to the swiftest), both of which have the potential to significantly increase the cost and burden on corporate defendants facing class actions in Canada.
In Wuttunee v. Merck Frosst, Klebuc C.J.S. originally certified a class action brought by the Merchant Law Firm which included all persons resident in Saskatchewan and all persons resident elsewhere who elected to participate in the class action. Subsequently, The Class Actions Act (Saskatchewan) was amended to allow for multi-jurisdictional (or "national") class actions, and the representative plaintiff in Wuttunee applied for an order expanding the class definition.
In Ontario, there had already been a previous carriage fight between the Merchant Law Firm and a consortium of plaintiffs' law firms (the Consortium) that had banded together for purposes of having a national class action certified against Merck in Ontario. The Ontario court had considered the scope of the competing class actions as well as factors pertinent to the choice of counsel (i.e., degree of preparation, relative experience and resources) and concluded that it was in the best interest of the class that the Consortium prosecute the class action, not the Merchant Law Firm. The Ontario court therefore stayed the Merchant Law Firm's Ontario class action.
On the motion in Wuttunee to expand the scope of the Saskatchewan class action, counsel for the Consortium appeared and maintained that the Wuttunee action should be stayed pending a decision by the Ontario court as to whether the Ontario action should be certified. In his decision, Klebuc C.J.S. held that the Saskatchewan class should be expanded to include residents of all provinces, except for Quebec. Klebuc C.J.S. refused to grade the respective abilities of the Merchant Law Firm and the Consortium, finding both were capable of effectively prosecuting the national class action against Merck.
The Consortium proceeded with their motion to certify a national class action in Ontario. In addition to the certification motion, the Ontario court had to consider whether, having previously rejected the Merchant Law Firm as counsel that should represent a national class, the Ontario court should now stay the Ontario action because the Saskatchewan Court had certified a national class.
In a July 28, 2008 decision, Cullity J. of the Ontario Superior Court of Justice dismissed the stay motion and indicated he was prepared to certify a national class comprised of all persons in Canada, other than residents of Quebec and Saskatchewan, who were prescribed or ingested Vioxx. Noting that comity is a two-way street, Cullity J. was of the view that the plaintiffs and their counsel in the Wuttunee action should not be permitted to undermine the earlier decision of the Ontario court by moving to expand the size of the class in the Saskatchewan proceeding. It is noteworthy that the Saskatchewan Court of Appeal recently gave leave to appeal the Wuttunee decision certifying a national class action.
The Wuttunee decision raises serious comity issues. There is no process in Canada like the U.S. Multi-District Litigation Rules that could be used to compel co-ordination of cases in different provinces. Referencing the difficulties created by certifying a second national class action, Cullity J. noted that if decisions of provincial courts on carriage motions are not to be respected throughout Canada, then the need for an agreement or protocol among the provincial superior courts that provides for nationally-accepted carriage motions and which determines the jurisdiction in which such motions will be heard becomes even more urgent.
The Supreme Court of Canada will soon hear a case involving enforcement of a national class settlement approved by the court of another province as against Quebec residents, and may take that opportunity to provide guidance to the Canadian bench and class action bar on co-ordination of multi-province class actions. It remains to be seen whether the Supreme Court of Canada or provincial appellate courts will provide much needed direction in this area.
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