Lexpert US Guides

2019 Lexpert US Guide

The Lexpert Guides to the Leading US/Canada Cross-Border Corporate and Litigation Lawyers in Canada profiles leading business lawyers and features articles for attorneys and in-house counsel in the US about business law issues in Canada.

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e second reason Godey is impor- tant is that it will get the Supreme Court to reconsider guidance it gave in a trilogy of cases in 2013 in which it held that in- direct purchasers could advance Class Ac- tions for recovery of unlawful price-fixing, and, "in particular as to whether the very lenient interpretation of the certification thresholds that have been adopted by a few of the trial judges is or isn't an appropriate approach for class-action certification in the competition area," Campbell says. "It's going to be an important decision … on what the legal standard is," and should decide whether the dependent action by those suppliers who are not part of a cartel creates a right of recovery if the umbrella purchasers paid higher prices. Although the decision in Godey may not expose companies to more damages, "because it's so hard to prove causation," it "will be significant because it really has the potential to expand the number of people who could make a claim," says Blakes's Fac- ey, who believes the Competition Act needs to be updated. Price fixing is a criminal of- fence carrying a penalty of 14 years in jail, he says, "which is the same as treason. It's a little overboard." Globally, this is certainly an interesting time to be in anti-trust law, says Banicevic. "It is getting a lot more attention, particu- larly in the tech sphere." Debate over what direction anti-trust enforcement should take, and whether it should be increased in certain industries, makes it "an interest- ing area to watch in the next little while," she says. "ere's an opportunity for [the Com- petition Bureau] to take the lead and shape policy." Important competition case law is also expected to be decided in 2019, includ- ing in the area of abuse of dominance (the Vancouver Airport Authority case), and class actions (i.e., Godey v. Sony Corporation), with the potential for com- petition law liability to become more ex- pansive in 2019. e Vancouver Airport Authority case will be heard by the Competition Tribu- nal. Launched in 2016, the Competition Commissioner has argued that the airport authority, which operates Vancouver Inter- national Airport, had exploited its market position by denying new suppliers access to the airport, resulting in higher prices and poorer service. Addy says this is the first case he knows of in which the Competition Bureau will look at how a local airport authority op- erates; prior to the 1990s, when airports were privatized, the government had mo- nopolies for running airports, he says. In the Vancouver Airport Authority case, "the theory of harm that the Compe- tition Bureau is employing is based on an aggressive extension of some statements that came out of the Toronto Real Estate Board [TREB] litigation, the previous big case," says Campbell. In that case, the Toronto Real Estate Board had aimed to prevent its agent members from publishing home sales data, arguing that it would violate home- owners' privacy. In 2011, the Competition Bureau challenged TREB's policy prevent- ing the publication of such information, charging that it impeded competition and digital innovation. e Supreme Court of Canada dismissed TREB's appeal in Au- gust, and sales prices for Toronto homes are now publicly available. Campbell predicts that the Competi- tion Tribunal's decision on the Vancouver Airport Authority will be appealed to the Federal Court of Appeal by whichever side loses, "based on novelty, and the impor- tance of the issues. If the Bureau is success- ful, … it will signal greater risks, liabilities and exposures by companies that have a strong market position." e decision is ex- pected to be released by August. Godey v. Sony Corporation is a class action that was certified by the BC Su- preme Court on behalf of both direct and indirect purchasers of optical disc drives, where price-fixing was alleged. Included in the class were so-called umbrella purchas- ers, who made purchases from suppliers who were not part of the alleged cartel but whose sales prices, they argued, had been elevated because of the alleged cartel's price fixing. "It's a pretty important case," says Campbell, who represented global elec- tronics manufacturer Philips in the case. e reason for that is twofold, he says: i) "the plaintiffs' bar is bringing cases in almost every situation that could be at is- sue under the Competition Act," including the Canadian component of big interna- tional cartel cases such as Godey. So, the Supreme Court of Canada's decision in Godey, the appeal of which it has already heard, will be important to the Competi- tion Bureau in terms of which cases it pur- sues for criminal prosecutions. "From the point of view of Canadians as a whole, one of the best investments you could make is to properly resource the Competition Bureau to do the work that it does." Regulatory "As a lawyer, he will be more sensitive to evidence over economic theory and less focused on internal institutional issues like organizational structure. I hope to see him spending time trying to address the timeliness of performance or timeliness of review." George Addy, Davies Ward Phillips & Vineberg LLP, Toronto 58 | LEXPERT • June 2019 | www.lexpert.ca/usguide

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