It All Comes Out in the Wash: Regulatory Action on AI Washing Ramps Up
February 25, 2025Securities-related regulatory action regarding “AI washing” has been increasing in the United States, serving as a warning of potential future developments in Canada. AI washing, as defined by the Canadian Securities Administrators (the CSA), refers to an issuer making false, misleading or exaggerated claims about its use of AI systems in its products or services to capitalize on the growing use of and investor interest in AI systems. The CSA reported that it identified disclosure and promotional campaigns that included AI washing during its most recent continuous disclosure review program. We are also seeing securities class actions alleging AI washing being filed in the United States.
BC Court Holds That Non-Parties Required to Respond to Document Production Applications are Not Entitled to Full Indemnification of their Legal Costs
February 06, 2025In Bowman v Kimberly-Clark Corporation, 2024 BCSC 1975, the British Columbia Supreme Court held that non-parties are entitled to tariff costs for responding to document production applications—but are not entitled to full indemnity costs. The plaintiff had initially sought records from various non-party retailers but abandoned the application after oral argument.
Ontario Superior Court Reminds Plaintiffs’ Counsel that Class Actions Notices Are Not Vehicles For Recruitment
February 04, 2025Pugliese v Chartwell, 2024 ONSC 7146 (Chartwell) explores the limitations of notice provisions under class proceedings legislation. Justice Morgan refused to authorize a notice plan providing for direct notice to proposed class members advising of a discontinuance after certification was refused. In doing so, Justice Morgan distinguished notice to class members whose claims had been certified from notice to putative class members for whom certification was refused. Justice Morgan also emphasized that notices should not be used to recruit new representative plaintiffs or to advertise for class counsel.
BC Court Declines to Certify Overdose Prevention Class Action After Finding No Basis in Fact for Causation
January 22, 2025A recent decision from the Supreme Court of British Columbia underscores the court’s cautious approach to certifying class actions in nuisance cases, particularly when the alleged harm arises from varied and diffuse conduct. In 1111 Seymour Residences Ltd. v Vancouver (City), 2024 BCSC 2304, the Court dismissed an application to certify a proposed class action for claims in public and private nuisance relating to the operation of an overdose prevention site in downtown Vancouver.
Ontario Court of Appeal Endorses a Flexible and Contextual Approach to Dismissal for Delay Under the Class Proceedings Act, 1992
January 17, 2025In Tataryn v Diamond & Diamond Lawyers LLP, 2025 ONCA 5 (Tataryn), the Ontario Court of Appeal clarified the test for determining whether a proposed class action should be dismissed for delay under section 29.1 of the Class Proceedings Act, 1992, SO 1992, c 6.
Ontario Court of Appeal Changes the Test Under Rule 24.01—The Passage of Time is Prejudicial
January 06, 2025In Barbiero v Pollack, 2024 ONCA 904 (Barbiero) the Court of Appeal for Ontario upheld the motion judge’s dismissal of a class proceeding for delay under Rule 24.01 of the Rules of Civil Procedure. The plaintiff had not set down the action for trial for over 20 years, which was found to be inordinate and inexcusable delay.
Ontario Court of Appeal Holds That a Claim is Limitations-Barred for an Entire Class
December 05, 2024In Fehr v Sun Life Assurance Company of Canada, 2024 ONCA 847, the Ontario Court of Appeal dismissed the representative plaintiffs’ appeal seeking post-certification leave to amend their statement of claim and to certify an additional common issue. The Court concluded that the proposed common issue arose out of a previously unpleaded cause of action, triggering limitations considerations, including for the entire class.
The Function and Limits of Directors and Officers Insurance Policies in Class Actions and the Companies’ Creditors Arrangement Act
December 03, 2024The Ontario Superior Court has held that claims made by insurance policies issued to directors and officers upon a company filing for protection under the Companies' Creditors Arrangement Act, RSC 1985, c C-36 (the CCAA) could not provide coverage for past unpaid wages and benefits that were the subject of a class proceeding that was scheduled for trial only months after the CCAA filing.
Plaintiffs Fail to Show "Some Basis in Fact" for Certification in Two Proposed Vehicle Defect Class Actions at Saskatchewan Court of Appeal
November 25, 2024Class proceedings are frequently proposed after automakers issue recall notices. Two recent decisions from the Court of Appeal for Saskatchewan, Kane v FCA US LLC, 2024 SKCA 86 (Kane) and Evans v General Motors of Canada Company, 2024 SKCA 87, (Evans) provide insight into how notices issued by automakers can and cannot provide "some basis in fact" for certification.
Ontario Superior Court Refuses to Dismiss for Delay, Taking Functional and Contextual Approach to Section 29.1 of the Class Proceedings Act, 1992
October 25, 2024In McRae-Yu v Profitly Incorporated et. al., 2024 ONSC 5615 (McRae-Yu) the Ontario Superior Court of Justice refused to dismiss a proposed class action for delay under section 29.1 of the Class Proceedings Act, 1992. McRae-Yu aligns with other decisions that have refused to dismiss proceedings that are not wholly dormant and are being actively pursued in some way. These cases take a functional and contextual (rather than literal) approach to the interpretation of the language of section 29.1, underscoring that section 29.1 is not a “zero tolerance” regime designed to “catch plaintiffs out”.
Mixed Success at the B.C. Supreme Court in Rare Common Issues Trial in Employment Class Action
September 26, 2024While applications for certification of class proceedings are commonplace, trials to decide certified common issues on their merits are comparatively rare. The decision in one such common issues trial was recently released in Escobar v Ocean Pacific Hotels Ltd., 2024 BCSC 1575, in a class action brought on behalf of hourly employees of a Vancouver hotel who stopped receiving regular shifts after the outbreak of COVID-19. Success was split between class members and the defendant.
B.C. Supreme Court Confirms that British Columbia's No-Costs Rule Does Not Apply to Pre-Certification Applications
September 17, 2024British Columbia is often referred to as a "no costs" jurisdiction for class proceedings because section 37 of the B.C. Class Proceedings Act creates a presumptive no-costs regime in British Columbia for certification applications and after actions have been certified as class proceedings. This is in contrast to some other provinces, such as Ontario, where there is no such rule. However, two recent decisions from the British Columbia Supreme Court confirm that the normal cost rules still apply in British Columbia prior to certification, including to pre-certification applications that are heard concurrently with certification.
Superior Court of Quebec Warns of the Risks of Making Settlement Approval Contingent on Approval of Class Counsel Fees
September 06, 2024In Walid c. Compagnie Nationale Royal Air Maroc, 2024 QCCS 2674, the Superior Court of Quebec refused to approve a settlement agreement because Class Counsel’s fees were unreasonable and excessive, even though the settlement was otherwise fair, reasonable and in the interest of class members, and no class member objected. This case is a reminder to parties of the risks of settlement agreements under which approval of the settlement is contingent on approval of Class Counsel fees.
Ontario Court of Appeal Affirms that Class Actions Cannot be Certified Without Evidence of Common Issues
August 26, 2024In Lilleyman v Bumble Bee Foods LLC, 2024 ONCA 606, the Ontario Court of Appeal affirmed the motion judge’s dismissal of certification for a class action alleging price-fixing of canned tuna. The Court unanimously affirmed that representative plaintiffs must meet a two-step evidentiary test to satisfy the commonality requirement of section 5(1)(c) of the Ontario Class Proceedings Act, 1992: there must be some basis in fact that the proposed common issues (1) actually exist, and (2) can be answered in common across the entire class. The Court described this approach as “a matter of logic and common sense.”
Ontario Superior Court Decides Bellwether Individual Issues Trials in Class Action
July 23, 2024In Reddock v Attorney General of Canada, 2024 ONSC 3238, the Ontario Superior Court released a post-common issues trial decision regarding the additional damages, if any, five plaintiffs were entitled to as a result of the placements in administrative segregation in Canadian prisons.
B.C. Court of Appeal Finds that Allegedly Reckless Database Custodians may be Liable for "Wilful Violations" of Privacy Under the Privacy Act
July 16, 2024In a pair of decisions released on July 5, 2024, the B.C. Court of Appeal (BCCA) found that an alleged reckless failure to safeguard personal information may be sufficient to make out Privacy Act claims of "wilful violation" of privacy against database defendants who are victims of data hacks. In doing so, the BCCA interpreted statutory Privacy Act claims to be potentially broader than the common law tort of intrusion upon seclusion, which the Ontario Court of Appeal in its 2022 "trilogy" of decisions in Owsianik, Obodo and Winder limited to claims against the hacker who committed the "intrusion", not the database defendant who allegedly failed to prevent it.
Only B.C. Residents Can File Class Actions in British Columbia
June 19, 2024In MM Fund v. Excelsior Mining Corp., the B.C. Court of Appeal upheld a decision striking a plaintiff's certification application because the plaintiff mutual fund was not a resident of British Columbia. Under s. 2(1) of the B.C. Class Proceedings Act (BCCA), only B.C. residents have standing to commence class proceedings in the province. The BCCA endorsed the "central management and control" test for determining the residency of a corporation or trust under the Class Proceedings Act.
Ontario Court Denies Certification of Common Issues Due to Disconnect Between Alleged Misrepresentations and Alleged Losses
June 14, 2024Despite certifying the class action in Thompson-Marcial v Ticketmaster Canada LP on the basis of breach of contract, breach of legislation, conspiracy, negligence and unjust enrichment, the Ontario Superior Court declined to certify certain proposed common issues that were based on alleged misrepresentations by the defendant. The action was brought on behalf of purchasers of live performance event tickets in Canada, initially purchased through Ticketmaster and subsequently resold through Ticketmaster or one of its affiliates. The plaintiffs alleged losses associated with the difference in price of tickets subsequently purchased, plus allegedly superfluous fees.
Federal Court is Reviewing its Class Action Rules
June 05, 2024The Federal Court Rules Committee is conducting a review of the Federal Court Rules, and is considering changes to the rules applicable to class actions to "reflect procedural changes in the provinces" and, in particular, the 2020 amendments made to Ontario's Class Proceedings Act.
Bennett Jones