Canadian Lawyer

January 2012

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LEGAL REPORT/LITIGATION J Tipping toward the plaintiffs Class action defence counsel say the certification game is becoming increasingly stacked against them and the courts are helping the other side. BY RICHARD FOOT ustice Paul Perell cracked open a hornets' nest last July when he delivered a decision from the Ontario Superior Court order- ing a group of corporate defen- dants to file their defence in a proposed class action, even though the case hadn't yet been certified. The judge's order in Pennyfeather v. Timminco Ltd. — a shareholder lawsuit — ignited a wave of commentary among class action practitioners, bloggers, and Twitterers. "This decision represents a marked departure from the prevailing procedure in class actions," said an ar- ticle co-written by Bennett Jones LLP defence litigator Robert Staley. Mary Jane Stitt, a partner at Blake Cassels & Graydon LLP, was more blunt. Defen- dants, she told the Globe and Mail, are now "being asked to fight the battle be- fore you even know whether you'll have to go to war." Although Perell's ruling actually re- flects the wording of Ontario's class ac- tion statute, it undercuts a 15-year, un- written custom in which defendants typ- ically wait until a case is certified before filing their defence. Perhaps the noisy re- action to it was less aimed at the decision itself, and more an expression of years of built-up frustration among the defence bar — a sense that the certification game is becoming increasingly stacked against them, and that courts are offering advice, re-interpreting conventions, and other- wise ushering plaintiffs through the cer- tification gates. Perhaps Perell's ruling was simply the last straw. "There's been a real surge in the common-law provinces in a liberal- ization in the courts' approach to certifi- cation," says Adrian Lang, a class action litigator with Stikeman Elliott LLP. "I'd like to think as a defendant that we will start to see a bit of retrenching. . . . We certainly can't get more liberal than we are right now." Certification may be simply a proce- dural matter, but the stakes are high for both sides. Corporate defendants say a certified class action creates lousy optics: an impression in the public's mind that the company has committed a wrong, even though the merits of the claim have yet to be judged. For plaintiffs, certi- fication can be a tool to apply pressure against a defendant to settle before the case goes to trial. Lang and her colleagues in the de- fence bar say in the early years, Cana- dian courts outside Quebec took a more cautious approach to certifying cases, following the introduction of class ac- tion legislation in Ontario and British Columbia in the 1990s. Individual pre- liminary motions were routinely ac- cepted from defendants in advance of www.CANADIAN Lawyermag.com JAN UARY 2012 47 sara tysoN

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