Dolden Wallace Folick’s Class Action Newsletter – May 2022

May 10, 2022

Dolden Wallace Folick’s Class Action Newsletter – May 2022

BC Court Permits Novel Public Nuisance Claim to be Maintained in Opioid Class Action

By Balraj Sihota, Dolden Wallace Folick Toronto, Email: bsihota@dolden.com

British Columbia v Apotex Inc. 2022 BCSC 1 is a proposed class action commenced by the Province of British Columbia against approximately fifty pharmaceutical manufacturers, wholesalers and distributors of opioid-related products.

It is broadly alleged that opioids were marketed as less addictive, less subject to abuse and diversion and less likely to cause tolerance and withdrawal than other pain medications, and that suspicious sales volumes and patterns were ignored. This led to the opioid epidemic resulting in extensive healthcare costs incurred by the Province.

On January 4, 2022 the Supreme Court of British Columbia delivered its judgment in relation to various procedural motions brought by the parties. One of these motions was brought by the plaintiff seeking leave to amend its Notice of Civil Claim to advance a new and novel claim of public nuisance.

Public Nuisance

Unlike product liability claims which are based on harm caused by the product alone, the proposed public nuisance claim is not premised solely on injuries caused by the opioids themselves but also on the alleged false and misleading promotion and marketing by the defendants. The plaintiff conceded that a public nuisance claim in this context is entirely novel.

The Court reviewed relevant case law and determined:

  • A public nuisance has been defined as any activity which unreasonably interferes with the public’s interest in questions of health, safety, morality, comfort or convenience.
  • The conduct complained of must amount to an attack upon the rights of the public generally to live their lives unaffected by inconvenience, discomfort or other forms of interference.
  • Any activity which unreasonably interferes with the public’s interest in questions of health, safety, morality, comfort or convenience is capable of constituting a public nuisance.
  • Whether or not a particular activity constitutes a public nuisance is a question of fact. Many factors may be considered, including the inconvenience caused by the activity, the difficulty involved in lessening or avoiding the risk, the utility of the activity and the general practice of others.
  • The law is not static, and novel claims that might represent an incremental development in the law should be allowed to proceed to trial.

The proposed Further Amended Notice of Civil Claim alleged unreasonable interference with the public’s health, safety, morality, comfort, and convenience. The Court endorsed it as properly pleading unreasonable interference to the extent it was not plain and obvious those claims were bound to fail; there was an arguable case that the defendants’ conduct engaged the health and safety of the public.

The Court rejected the defendants’ argument that permitting the claim to continue constitutes a “dramatic” and “undue expansion” of the doctrine of public nuisance particularly when appropriate redress is possible under existing product liability law. The Court agreed there would be some overlap but that would not bar a claim being advanced.

The Court pointed out that “the American experience of attempting to apply nuisance law to product liability situations, with varying degrees of success, is not reflected in Canadian jurisprudence to date”. That said, here the Court rejected reliance upon US case law, for example, State of Oklahoma v. Johnson & Johnson et al., 2021 OK 54 which declined to extend its public nuisance statute to cover the manufacturing and distribution of opioids.

Ultimately, the defendants did not meet the burden of demonstrating that the plaintiff’s public nuisance claims were bound to fail as a matter of law.

Take Away

The Court did not shut the door on the plaintiffs maintaining a public nuisance cause of action in the context of a product liability claim in which false and misleading promotion and marketing of opioid-related products was alleged. While novel, it was not plain and obvious based on the pleadings that such a claim would not succeed. While it remains to be seen whether public nuisance will succeed on the merits in this case, it is expected that this decision will lead to more plaintiffs including public nuisance as a pleaded cause of action in future product liability cases involving allegations concerning the public’s health and safety.

This decision also serves as a reminder that the certification process is not the arena to assess the merits of a case. While this was a pre-certification motion the issue at hand was whether an appropriate cause of action was plead. The plain and obvious test remains the standard and continues to be a relatively low bar to overcome.

Time is Ticking: The One-Year Mandatory Dismissal in Class Action Proceedings

By Christopher Stribopoulos and Elka Dadmand, Dolden Wallace Folick Toronto,
Email:
cstribopoulos@dolden.com and edadmand@dolden.com

Bourque v Insight Productions, 2022 ONSC 174 (“Bourque”) is the first reported decision applying the one-year mandatory dismissal enumerated in s. 29.1 of the Ontario Class Proceedings Act (the “CPA”). Taking a plain language approach to statutory interpretation, Justice Belobaba of the Ontario Superior Court of Justice concluded that s. 29.1 requires the Court to dismiss for delay a proposed class proceeding that within a year of filing has not filed a certification motion record, or taken the other steps in the CPA.

Factual Matrix

The representative plaintiff brought a class action alleging that the defendant group of television production companies had misclassified employees. On February 21, 2020, the representative plaintiff commenced the class action. On October 1, 2020, s. 29.1 of the CPA took effect. Based on the transition provisions, Justice Belobaba deemed the latter as the filing date. On October 5, 2021, the defendants moved to dismiss the proposed class action for delay under s. 29.1 of the CPA. On October 6, 2021, the plaintiff served her certification motion record.

S. 29.1 of the Class Proceedings Act

Section 29.1 of the CPA states that the court “shall” dismiss a class action within one-year of its commencement if: (1) the plaintiff has not filed the certification motion record; (2) there is no agreed-to timetable for the service of the certification motion record or the completion of any steps that would advance the proceeding; or (c) no timetable has been established by the Court.

Arguments of the Representative Plaintiff

The plaintiff argued that the Court established a timetable during a case conference on May 8, 2020. Justice Belobaba disagreed. At most, the parties agreed that the plaintiff would serve the motion record “when she can.” This was the antithesis of a timetable and not a plan on which events were scheduled to take place.

The plaintiff also sought to rely upon the application of s. 12 of the CPA, which states that the Court has wide-ranging case management powers to ensure “fair and expeditious” class action proceedings. Justice Belobaba again disagreed, noting that the wide general powers of the Court could not override the mandatory provisions of the CPA. Moreover, using s. 12 to override s. 29.1 would not be “fair and expeditious” to either the defendants or the class.

The Decision

Justice Belobaba concluded that the statutory language of s. 29.1 was clear, and must be interpreted and applied as written. If none of the requirements of s. 29.1 are satisfied within one year of filing, the Court must dismiss the proposed class action. Justice Belobaba granted the defendants motion to dismiss for delay, with costs awarded.

However, Justice Belobaba left open the possibility for class counsel to re-file the identical action against the same defendants, but with a different proposed class representative.

Takeaway

Section 29.1 of the CPA offers a useful tool in the defendants’ arsenal to dismiss an action for delay within one-year of the commencement of the class action. While it does not eliminate the class action, given the plaintiff’s ability to re-file with a different class representative, it creates compelling incentives for the representative plaintiff to take positive steps to advance class action proceedings quickly. Moving class actions along faster is the stated purpose of the new CPA legislation in Ontario, and this benefits both the plaintiffs and the defendants.

Editor
Christine Galea
Tel: 647 798 0614
Email: cgalea@dolden.com

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