16 | LEXPERT • December 2015 | www.lexpert.ca
CLASS ACTIONS
PHOTO:
SHUTTERSTOCK
CLASS ACTIONS
HAVEN FOR
NO
IN THE FINANCIAL PAGES, Canada, the polite neighbor to the north, is
better known for its stock market frauds than for the size of its shareholder class-action awards.
Justices across the country have kept the door firmly shut against the type of award that could
threaten a company's stability.
With corporations freed of the fear of ruinous financial penalties, many are fighting share-
holder class actions for a lot longer — with predictable results.
"Most secondary market class actions settle only aer a number of years of litigation," says Paul
Morrison of McCarthy Tétrault LLP in Toronto, who does corporate defense work. "And the
amounts for which they are settling are really not that big."
e result? "ere aren't as many as people thought there would be when the legislation first
came into force."
A trio of recent decisions suggests the basic paradigm is not likely to shi anytime soon.
e first decision deals with the subject of which international shareholders are eligible to have
their case heard before a Canadian court.
In the world post-Morrison v. National Australia Bank, some plaintiffs' counsel had been
looking to Canada as a forum for global class actions in cases in which shares were bought on
multiple exchanges.
Kaynes v. BP, PLC, brought in Ontario, would appear to dampen those hopes. In terms of
influence, Ontario – as home to the Toronto Stock Exchange – is the jurisdiction closest to the
Southern District of New York.
Recent case law indicates Canada
is not a forum for global class actions
that some expected after it created
a statutory cause of action
BY SANDRA RUBIN
