Published by the Litigation Group
Litigation Co-Counsel
McCarthy Tétrault 2011

Letter from the Editors

Letter from the Editors
Welcome to Volume 4, Issue 3 of McCarthy Tétrault Co-Counsel: Litigation. In this issue, as in all our publications, we aim to provide you with a deeper level of analysis to current legal developments.


Widening The Net of Federal Government Liability: Canada (A.G.) v. TeleZone Inc.
Must a litigant who wishes to bring a civil damages claim arising from the unlawful decision of a "federal board, commission or other tribunal" (FBCT) under the Federal Courts Act (Canada) first bring an application for judicial review of the decision in the Federal Court? In Canada (A.G.) v. TeleZone, 2010 SCC 62, the Supreme Court of Canada said "No." TeleZone not only resolves an existing conflict in the jurisprudence, but widens the net of federal government liability by allowing litigants to choose between two different avenues of relief against the decision of an FBCT.

Bankruptcy and Restructuring

Comments on the Supreme Court of Canada’s Landmark Insolvency Decision in Ted LeRoy Trucking
The Supreme Court of Canada decision in Century Services Inc. v. Canada (Attorney General), which arose from the restructuring proceedings of Ted LeRoy Trucking Ltd. and was released on December 16, 2010, is a landmark decision in Canadian insolvency law.

Class Action

An Uncommon Prejudice: Goyette v. GlaxoSmithKline inc. and the need to demonstrate the existence of a common prejudice at the authorization stage of a class action
Must all class members have suffered an identical "prejudice" or harm in order to justify the authorization of a proposed class action? According to a recent decision of the Québec Court of Appeal, this question must be answered with a Yes. In Goyette v. GlaxoSmithKline inc. (as well as in the Supreme Court of Canada’s recent decision in Bou Malhab c. Diffusion Métromédia CMR inc.), the Court of Appeal reaffirms the principle that the harm alleged by members of a proposed class must be common to all members. The injuries cannot be susceptible of infinite variation.


Guidelines on Responding to a Competition Bureau Search
The Competition Bureau has substantial investigative powers, the most intrusive of those being the power to conduct searches of premises. If it has reason to believe that the Competition Act has been contravened, the Bureau can obtain and execute search warrants to enter and search premises and seize all relevant documents and records without any prior warning.


Litigation as a commercial activity?
In October 2010, the Supreme Court of Canada released a decision dealing with recognition and enforcement of a foreign judgment against a foreign state. The decision will have particularly interesting ramifications in matters involving claims of state immunity and alleged commercial activity by foreign states but it also clarifies certain evidentiary rules governing recognition and enforcement proceedings.


Using Litigation Support to Control e-Discovery Costs
In 2007 (the last year for which such statistics are available), North America’s largest corporations reported that approximately 40 per cent of their total litigation budget was spent on e-discovery issues. Anecdotal evidence suggests that, for some organizations, litigation is becoming so expensive that organizations opt not to go to court and instead to just settle.


Case Summary: Halliburton Group Canada Inc. v. Alberta
The Alberta Court of Appeal recently rendered a decision that will be of interest to pension plan sponsors who are considering converting their registered pension plans from defined benefit to defined contribution. In Halliburton Group Canada Inc. v. Alberta, the Alberta Court of Appeal considered whether the plan sponsor could freeze earnings at the date of plan conversion for the purposes of calculating a defined benefit amount at retirement.


OSC Provides Guidance on Use of Rights Plans: Baffinland
Recent decisions of the Ontario Securities Commission and the British Columbia Securities Commission have led to some debate about the ability of a target board of directors to effectively use a shareholder rights plan to fend off a bidder in a hostile takeover bid.

Farley's Reflections

Does the Left Hand Know what the Right Hand is Doing?
This is the unfortunate tale of two decisions concerning the tort of unlawful interference with economic relations: Barber v. Molson Sport & Entertainment Inc., 2010 ONCA 70 (CanLII) released September 3, 2010, just 10 days after Alleslev-Krofchak v. Valcom Limited, 2010 ONCA 557 (CanLII) was released on August 24. The puzzling problem is that the two panels (which shared a common member) have left up in the air the proper meaning of "by unlawful means," a key element in the test as to this intentional tort. Both these cases were heard in March 2010.