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Transaction/Case Details

Ontario Superior Court of Justice Refuses to Certify Sunscreen Class Actions

DATE CLOSED

March 26, 2010

BUSINESS SECTOR

Pharmaceutical / Bio Life Sciences

LEAD OFFICE

Toronto

VALUE

20 Million CAD


OVERVIEW

On January 7, 2010, Justice G.R. Strathy dismissed two related motions for certification regarding sunscreen products manufactured by Schering-Plough Canada Inc. and Playtex Limited.  The plaintiff alleged that the defendants misrepresented the effectiveness of their sunscreen products, sold under the Coppertone and Banana Boat brand names.  Among other things, the plaintiff alleged that by advertising that their products had “UVA/UVB protection” the defendants were misleading consumers into thinking that the products provided equal protection from UVB and UVA rays.  The plaintiff sought damages of $20 million for a putative national class of over three million people.

Justice G.R. Strathy concluded that the plaintiff failed to meet any of the requirements for certification set out in s. 5 of the Class Proceedings Act.

The court held that the plaintiff failed to plead a proper cause of action.  Justice G.R. Strathy found that the pleading did not advance a cause of action for negligent misrepresentation.  The failure to plead reliance was fatal.  Similarly, the claim for breach of the Competition Act could not succeed due to the failure to plead reliance or some other causal link. The fact that there was only an indirect relationship between the defendants (as manufacturers of the products) and the plaintiff (as an ultimate consumer of the product) was fatal to the claims for breach of warranty, breach of the Consumer Protection Act and unjust enrichment.

Regarding the identifiable class criterion, Justice G.R. Strathy held that there was no evidence that anyone other than the plaintiff was seeking access to justice for the alleged wrongs.

Key to the court’s finding that there were no common issues was the lack of evidence to establish any misrepresentation on the defendants’ part.  Similarly, there was no evidence that such a misrepresentation would have affected the value of the products.  Justice G.R. Strathy refused to consider much of the plaintiff’s affidavit evidence, which contained argument, statements of law and expressions of opinion on which the affiant was not qualified to comment.

The court further found that a class proceeding would not be the preferable procedure to resolve the plaintiff’s claims. In the court’s view, such a class proceeding would be unmanageable and inefficient.  Any complaint on the plaintiff’s part could be made in the Small Claims Court or as a test case. Justice G.R. Strathy also considered the fact that sunscreen labelling and advertising is subject to a regulatory regime under Health Canada.

The court questioned the plaintiff’s motivation and interest in the issues given that class counsel had advised him of the litigation that he was not aware of certain key facts regarding the regulation of sunscreen products in Canada and the he continued to purchase and use the products in question.  Finally, the court found that the proposed litigation plan was “rudimentary, vague and boilerplate.”

In reasons released March 26, 2010, the court ordered the plaintiff to pay $200,000 in costs to each of Schering-Plough and Playtex.  Justice G.R. Strathy noted that the costs claimed by the defendants were not at all out of line with costs awarded in recent certification decisions and that “a failure to hold parties accountable for the costs of litigation will only serve to encourage speculative and unmeritorious claims.”

The plaintiff has commenced an appeal to the Divisional Court.

McCarthy Tétrault acted for Schering-Plough with a team that included Glynnis Burt,  Jeffrey Feiner, F. Paul Morrison, and Erica Richler.

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