Court File and Parties

Court File No.: 07-CV-333992CP
Date: 2012-03-23
Superior Court of Justice – Ontario

Re: Donna Pollack, Daniel Pikelin et al ., Plaintiffs/Moving Parties

And: Advanced Medical Optics, Inc. and AMO Canada Company , Defendants/Respondents

Before: G.R. Strathy J.

Counsel:
Joel P. Rochon for the Plaintiffs/Moving Parties
Malcolm Ruby and Nicholas Kluge, for the Defendants/Respondents

Heard: By written submissions

C O S T S E N D O R S E M E N T - C E R T I F I C A T I O N

[ 1 ] The endorsement deals with the costs of the certification motion and of the motion brought by the defendants (“AMO”) to strike one of the plaintiff’s affidavits.

[ 2 ] I am required to arrive at an award that is fair and reasonable in all the circumstances, considering the factors in rule 57.01 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 as well as s. 31 of the Class Proceedings Act, 1992 , S.O. 1992, c. 6 and the overall goals of that statute. I do so with the advantage of having been, for at least the past two years, the case management judge in this action and the judge who heard the certification motion. I am able, therefore, to look beyond what is described in my reasons on certification, to consider what was really involved in the events leading up to certification and on the motion itself.

[ 3 ] The plaintiffs request costs of the certification motion in the amount of $191,136.00 and disbursements of $32,701.13. The costs cover six broad areas of work. In approximate terms, the costs claimed in each area are as follows:

(a) preparation of certification record and materials: $86,000;

(b) review of defendants’ responding materials: $5,000;

(c) preparation of plaintiffs’ responding materials: $18,500;

(d) preparation of certification factum: $46,500;

(e) preparing for and attending certification motion: $19,000; and

(f) services post-certification (order, notice plan, costs): $12,500.

[ 4 ] AMO claims costs, including disbursements, of approximately $15,500 plus HST for the successful motion to strike.

[ 5 ] Dealing with first things first, it is reasonable in my view to follow the general rule (a rule which AMOdoes not dispute) that costs follow the event in class proceedings as they do in other forms of litigation. As a general rule, as well, costs of a motion are payable forthwith. AMO suggests that this is a case in which I should depart from the general rule and order that costs be payable in the cause, as Justice Perell did in 2038724 Ontario Limited v. Quizno’s Canada Restaurant Corp ., 2010 ONSC 5390 () , [2010] O.J. No. 4208 (S.C.J.). Suffice to say that in this case, there are no particular reasons to depart from the general rule and practice. I do not regard this as a case of “divided success” even though the defendants were partially successful in reducing the scope of the certification order. The plaintiffs were successful on an important threshold motion that was opposed by the defendants and they should receive their reasonable costs.

[ 6 ] That said, there are two features of this case that merit particular attention. First, the motion materials were relatively modest and (apart from the plaintiffs’ materials that were struck) not particularly contentious. There was limited factual and expert evidence. Significantly, there were no cross-examinations, reflecting the lack of real controversy about the underlying facts. The certification motion lasted just over half a day. As I noted at the certification motion, the parties deserved the court’s appreciation for focussing their submissions.

[ 7 ] Second, and most important in my view, the defendants made reasonably timely concessions. They conceded that the plaintiffs had met the requirements of subsections 5(1) (a), (b), (c) and (e) of the Class Proceedings Act, 1992 , S.O. 1992, c. 6. The only serious bone of contention between the parties on the certification motion was whether a class proceeding in Ontario was the preferable procedure for dealing with the negligence common issue, in light of a parallel proceeding pending in British Columbia. I rejected this submission as well as AMO’s related request for a stay of this proceeding. I acknowledge that there were some other contested issues on the motion, as identified in the plaintiffs’ submissions, including (a) the scope of the class; (b) whether the claims for waiver of tort and punitive damages should be common issues, but these were not major issues and did not consume a great deal of time or attention.

[ 8 ] The result was that AMO’s reasonable concessions, restricting its objections to fine-tuning of the class definition and the common issues, and the preferable procedure analysis, resulted in a much simplified and expedited certification motion. I contrast this with the approach so frequently taken by defendants to fight every aspect of the certification motion. In my view, parties should be encouraged to take reasonable positions on the certification motion and to cooperate in defining those matters that are truly in dispute and those that are not. A costs award must be fair to the defendants and should reflect their reasonable and effective efforts and concessions to limit the scope of the motion.

[ 9 ] In considering the plaintiffs’ costs outline, and the costs the defendants should be reasonably expected to pay, it strikes me that: (a) the defendants’ concessions should be taken into account in considering the amount of time required to prepare for the certification motion; and (b) the defendants should not reasonably be expected to pay for the work of multiple time-keepers at various stages of the proceeding. I am not suggesting that the work done by Class counsel was not necessary or appropriate from the perspective of the plaintiffs or their lawyers, but there was undoubtedly some overlap and inefficiency and these costs should not be borne by the defendants.

[ 10 ] The defendants make a number of arguments as to why the court’s discretion should be exercised in their favour, including (a) the plaintiffs’ alleged failure to follow the schedule leading up to certification; (b) improper case-splitting; (c) delays in abandoning causes of action and issues that were ultimately dropped; (d) failing to communicate the revised list of common issues; and (e) refusing to acknowledge the significance of AMO’s submissions. I do not regard any of these factors as reasons to significantly discount the costs claimed by the plaintiffs, but they are factors to be taken into account.

[ 11 ] The factors set out in rule 57.01 are a useful guide to the award of costs. I will summarize my consideration of the most important factors:

a. The result of the proceeding : As I have said, the plaintiffs were successful on their motion for certification. The defendants were successful on their motion to strike.

b. Offers to settle : There were no offers to settle.

c. The principle of indemnity : I have noted the time spent by counsel, the rates charged and the experience of the lawyers involved. In my view, there should be a reasonably significant discount from the straight “docketed” time to reflect the involvement of a number of lawyers with potential inefficiencies and duplication that takes place in even the most efficient law firm.

d. The reasonable expectations : Each party was aware that this is reasonably significant class action litigation and that the losing party could expect to pay a reasonable partial indemnity award.

e. The amount claimed : It is difficult to assess the amount really at issue here. In my reasons on certification, I found that the number of Canadian AK cases was in the range of 30-40. It has not been established that the use of the AMO solution was causally linked to the development of AK. The amount ultimately recovered could well depend on the uncertain outcome of the waiver of tort claim and causation issues. This factor does not give me particular reason to either increase or decrease the costs awarded.

f. The complexity of the proceeding : As I have noted, in comparative terms this proceeding is not particularly complex.

g. The importance of the issues : The issues are of importance, obviously, as they involve potential issues with a health care product, and although all users of the product are potentially affected, the number of persons most seriously affected is relatively small. Certification itself is, of course, an important issue.

h. Conduct of parties/unnecessary steps/refusal to admit : I have commented on the useful admissions by the defendants that had the effect of shortening the proceedings and saving costs. I am not prepared to find that there was any other significant misconduct of either party that ought to be taken into account in increasing or reducing the costs.

i. Other relevant matters : I agree with the plaintiffs’ submission that it is appropriate to take other costs awards into consideration in deciding whether the costs claimed are reasonable and proportional in the circumstances. I also agree that the costs award should take into account the goal of access to justice and the need to ensure that class proceedings are affordable and that meritorious claims are not deterred by low costs awards.

[ 12 ] The consideration of all these factors persuades me that this is a case in which a relatively conservative award is required to do justice as between the parties. This certification motion was at the lower end of the scale in terms of the size and complexity of the evidentiary record and the complexity or novelty of the legal issues.

[ 13 ] In all the circumstances, it is my view that it would be appropriate to award the plaintiffs the costs of the certification motion fixed at $110,000 plus disbursements of $25,000, plus taxes. Although at the lower end of the scale, this is not out of line with the amounts awarded in Nantais v. Telectronics Proprietary (Canada) Ltd. , [1996] O.J. N0. 5205 (Gen. Div.) and Boulanger v. Johnson & Johnson Corp. , [2007] O.J. No. 2403 (S.C.J.) . Offset against this will be the sum of $10,000, all inclusive, payable to the defendants for their motion, leaving a net payable to the plaintiffs of $100,000 plus $25,000 for disbursements plus taxes, payable within 30 days.

G.R. Strathy J.

Date: March 23, 2012.