Court File and Parties

Court File No.: CV-17-577371 and CV-17-584058-00CP Date: 20181121 Superior Court of Justice - Ontario

Re: 1523428 Ontario Inc., Plaintiff – AND – The TDL Group Corp., Tim Hortons Advertising and Promotion Fund (Canada) Inc., Restaurant Brands International Inc., Daniel Schwartz, Elias Diaz Sese, Andrea John and Jon Domanko, Defendants

AND RE: JB & M Walker Ltd. and 1128419 Alberta Ltd., Plaintiffs – AND – The TDL Group Corp., Tim Hortons Advertising and Promotion Fund (Canada) Inc., Restaurant Brands International Inc., Daniel Schwartz, Elias Diaz Sese, Andrea John and Jon Domanko, Defendants

Before: E.M. Morgan J.

Counsel: Richard Quance, Tom Arndt, and Peter Proszanski, for the Plaintiffs Mark Gelowitz, Jennifer Dolman, and Geoffrey Hunnisett, for the Defendants

Heard: Costs submissions in writing

Costs Endorsement

[1] On October 22, 2018, I released my reasons for judgment in these two related motions. The Defendants in each action (Court File No. CV-17-577371, hereinafter the “152 Action”, and Court File No. CV-17-584058-00CP, hereinafter the “Walker Action”) had moved under Rule 21 of the Rules of Civil Procedure to strike the claims. They were largely successful. I struck a number of causes of action in each claim without leave to appeal, which resulted in the termination of the claims as against all Defendants except for The TDL Group (“TDL”). I left open the possibility of claims in each action as against TDL, but required that those claims be re-drafted in a legally cognizable way.

[2] I see no reason to depart from the usual practice that the unsuccessful side pay the costs of the successful one. As the successful parties, the Defendants deserve their costs. Their counsel have submitted Bills of Costs seeking a total of $48,115.77 for the 152 Action and $44,759.27 for the Walker Action.

[3] Counsel for the Plaintiffs submits that the hourly rates, and the overall request for cost submitted by the Defendants, is excessive. The hourly rates, although high, strike me as within the current norm for large firm litigation. It is not surprising that the Defendants used a high quality, expensive law firm; they were facing claims amounting to hundreds of millions of dollars, including a number of causes of action levelled at personal Defendants acting in their corporate capacities. If the Defendants’ fees were high, the Plaintiffs brought that on themselves by the very way in which they fashioned their claims. In any case, the Defendants’ investment in this level of counsel paid dividends in the result of the two motions, and I am not inclined to second guess that investment.

[4] Counsel for the Plaintiffs suggests a comparison to other Rule 21 motions in which the courts have awarded costs to successful parties in Rule 21 motions – in one of them the court awarded $39,676.14, and in another the court awarded $35,000 to the successful parties. Likewise, Plaintiffs’ counsel suggests that a comparison to its own costs in the matters before me. It would have sought costs in the amount of $26,411.40 in the 152 Action and $41,740.09 in the Walker Action.

[5] I take some comfort in the fact that the costs sought by Defendants’ counsel are roughly in the same range as those sought by Plaintiffs’ counsel. Similarly, the costs sought in the other cases posed by Plaintiffs’ counsel are roughly in the same range as those sought by Defendants’ counsel. While Defendants’ costs requests are indeed somewhat higher than the comparators suggested by Plaintiffs’ counsel, it stands to reason that it is more time consuming and labour intensive to analyze and challenge a pleading that one did not draft than it is to defend a pleading that one drafted. With this in mind, Defendants’ counsel’s cost requests are not so out of range that they would take the Plaintiffs by surprise or would be beyond what the Plaintiffs might reasonably expect: see Rule 57.01(1)(0.b) of the Rules of Civil Procedure.

[6] Costs are always discretionary under section 131(1) of the Courts of Justice Act. Given that the Defendants were not 100% successful in achieving their aim of having the actions dismissed without leave to amend, I will exercise my discretion to round down their costs requests.

[7] The Plaintiff in the 152 Action shall pay the Defendants in the 152 Action costs in the all-inclusive amount of $44,000. The Plaintiffs in the Walker Action shall pay the Defendants in the Walker Action costs in the all-inclusive amount of $40,000.

Morgan J. Date: November 21, 2018