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sure she wasn't pre-supposing the case. Simply put, just because the case has merit doesn't mean the plaintiffs are going to win. "In undertaking this evaluation the Court of Appeal. We have taken two approaches to the appeal because the law is unsettled as to whether [there] is an automatic right of appeal to the Court of Appeal from a decision deny- ing leave. The plaintiffs have moved to quash the appeal to the Court of Appeal. Either way it is being appealed." For corporate lawyers watching the events unfold in Ontario and wonder- ing if Canada is bracing for these types of securities class actions more com- mon of its southern neighbours, they can take some solace. While the values of securities class actions in Canada in the past year are above $14.7 billion, a total of $10 billion is from the CIBC class action related to the sub-prime mortgage fiasco in the United States. Even though the court has certified its first secondary market class action, there hasn't been an avalanche of simi- lar cases. One of the key factors in IMAX was a section of the legislation that forced the court to anticipate something never before seen in Canadian law: the idea that at the leave stage the plaintiffs had to prove the case had, what the legisla- tion calls, a "reasonable" chance for success at trial. This provision was a key ingredient Ontario used to whip up amendments to the Securities Act — a desire to pre- vent strike suits. Sometimes considered legal blackmail, strike suits are where a plaintiff or group of plaintiffs launches a claim prompting a company to settle out of court, rather than going to trial. The specific section states: "No action may be commenced under s. 138(3) without leave of the court grant- ed upon motion with notice to each defendant. The court shall grant leave only where it is satisfied that: the action 26 • APRIL 2010 INHOUSE is being brought in good faith; and there is a reasonable possibility that the action will be resolved at trial in favour of the plaintiff." The second part, wrote van Rensburg in the IMAX ruling, is entirely unique in Canadian law. "The phrase 'a reasonable possibility that the action will be resolved at trial in favour of the plaintiff ' does not appear to have any direct antecedent in Canadian leg- islation." Lawyers for both plaintiffs and those who traditionally represent cor- court must keep in mind that there are limitations on the ability of the par- ties to fully address the merits because of the motion procedure. There is no exchange of affidavits of documents, no discovery [although affiants may be cross-examined], and witnesses cannot be summoned," said the ruling. "The credibility of a witness' evidence given by affidavit in a motion, irrespective of how searching an out-of-court cross- examination may be, can only be fully determined when it is tested in open court." Dimitri Lascaris, the Siskinds LLP partner who heads the IMAX class on In undertaking this evaluation the court must keep in mind that there are limitations on the ability of the parties to fully address the merits because of the motion procedure. JUSTICE KATHERINE VAN RENSBURG in Silver v. IMAX Corp. porations say van Rensburg walked an interesting line when deciding the "reasonable chance." With little direc- tion and less law to go on, she decided "reasonable" would be at least greater than a de minimis chance of success, or else the law would have used the word mere. From the Latin phrase de minimis non curat lex, meaning the law does not concern itself with trifles, the test is often used to decide whether a criminal case is important enough to go forward. In this context, greater than de mini- mis means the suit has merit, and in walking the line the judge had to make the plaintiffs' side, agrees such a merit test whereby a plaintiff must prove they have at least a reasonable chance for success is completely unique in Canada. However, he doubts the courts could have done anything to change it. "I don't know that there is anything a court can do about that because the legislation has required plaintiffs to induce evidence without the benefit of full discovery that is sufficient to the statutory threshold, there is no other class action in Canada that confronts this barrier." Lascaris doesn't believe the merit test needs to be there, saying Canada