CANADA Trends and Developments Contributed by: David Gadsden, Brendan O’Grady and Anton Rizor, Baker McKenzie
motion concerned whether the plaintiff’s evidence met the “some basis in fact” test for the certification criteria other than the cause of action requirement. While this standard is low, there must nonetheless be an evidentiary basis (or an “air of reality”) to conclude that these criteria are met. In this case, the plaintiff tendered public documents demonstrating the commencement of investigations by regulators in other jurisdictions (eg, Switzerland, Mexico, the European Union, and the United King - dom). The plaintiff also asserted that a class proceed - ing in the United States had been settled with one of the defendants. The court found the evidence tendered by the plaintiff insufficient. While the evidence established that regu - lators in certain foreign jurisdictions were concerned that there may have been collusion in relation to the supply of fragrances, the court concluded that the pur - pose of those investigations was to determine if there has been a violation of relevant antitrust regulations. The court highlighted that (i) there had been no pros - ecutions, no guilty pleas or admissions of wrongdoing, (ii) some of the investigations had been terminated without charges being laid, and (iii) there had been no regulatory proceedings or findings in Canada sup - porting allegations that the defendants violated the Competition Act. That said, the court acknowledged that some of the investigations remained ongoing and there had been no finding that there was no wrongdo - ing or that any investigation was ill-founded.
The court concluded that there was “no evidence at all in relation to liability other than hearsay evidence of unsubstantiated concerns”. The court wrote that it “cannot be that the mere fact of investigations is evidence of wrongdoing” and that evidence of “unsubstantiated suspicion of wrongdoing by foreign regulators is hardly a basis in fact for allegations that statutory breaches or tortious activity exist such as to found liability in Canada”. Separately, the court identified other deficiencies in the case. For example, the court expressed concern about the “lumping together” of direct, indirect, and umbrella purchasers in the same class. Additionally, the court found that class interests would be better addressed by a remedial scheme or programme out - side of a civil class proceeding. Given the “minimal damage that could possibly be suffered by individual class members”, the court noted that the most signifi - cant benefit of a class proceeding would be to expose the wrongdoers, deprive the beneficiaries of the con - spiracy of their ill-gotten profits and discourage similar behaviour in the future. The court found that a regula - tory process could equally achieve these goals.
61 A NTITRUST LI T IGATI O N 2026
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