Ontario Class Actions: Videoconferencing Gains Acceptance in Case-Managed Proceedings

June 12, 2020

Are class action judges becoming more comfortable with virtual hearings? A recent Ontario decision ordering a two-day leave motion under the secondary market provisions of the Securities Act “(Ontario)”  to proceed by Zoom suggests that this long-term trend is being accelerated by the COVID-19 pandemic. As the decision shows, the judiciary is increasingly confident in its ability to conduct complex hearings, including leave and certification hearings, via videoconference.

Background

In Miller v. FSD Pharma[1], which was released on April 14, 2020, the Court decided to adjourn a previously scheduled leave motion. At that time, the motion had been set to be heard May 4 and 5, 2020, but counsel for the plaintiff had raised procedural fairness concerns in proceeding by way of a virtual hearing and sought to wait until an in-person hearing became possible. The plaintiff’s counsel was particularly worried about the challenges in managing documents and conferring with a counsel team during a complex and lengthy motion that could impact the right of the entire putative class.  Meanwhile, the defendant’s counsel wanted to move forward with the previously scheduled motion dates and hold a virtual hearing on the two days that the parties already had booked.

The case management judge (the “Judge”) expressed two concerns:

  • the use of remote technology would raise “due process concern” for the unsuccessful party; and
  • it would not be appropriate to compel the moving party to proceed under conditions where the plaintiff’s counsel perceived it may be unable to present the case as effectively as they would in person.

Determining that a one-month delay was not too great a price to pay to ameliorate any perceived disadvantage by the plaintiff’s counsel, the Judge rescheduled the leave motion to be heard in-court on June 23 to 24, 2020.

The Virtual Hearing Decision

While the purpose of the adjournment was to give some time for the suspension of regular court operations due to the Coronavirus pandemic to run its course, and for courts to resume regular operations, by late May, courts had not resumed regular operations and there was no certainty as to when an in-person hearing would be available.[2] Accordingly, on May 27, 2020 the parties appeared before the Judge as to how to proceed with the leave motion. While the defendant’s counsel was happy to proceed by Zoom on June 23 and 24, the plaintiff’s counsel reiterated its desire to wait until an in-person court hearing. Notwithstanding the plaintiff’s concerns, the court refused to adjourn the leave motion and compelled the parties to proceed with a virtual hearing via Zoom on June 23 and 24, as previously scheduled (the “Virtual Hearing Decision”).[3]

The Judge was no longer wary of potential fairness concerns with a virtual hearing, but rather, had “become convinced that counsel and the courts have developed the ability to conduct these hearings in a way that minimizes any of the problems originally foreseen with them.”[4] Drawing on the recent ruling in Arconti v. Smith[5], in which the court denied a request to delay an examination for discovery until an in-person examination could proceed, the Judge noted that since his decision of April 14, remote hearings have become a “far more regularized part of the legal environment”[6]. While the Judge conceded that “glitches in a major hearing leading to a final order”, may “potentially have consequences beyond those in a pre-trial examination that will form only a small of the evidence in a hearing down the road”, he stated that only meant everything should be kept as fair as possible in the present hearing.

In terms of fairness, the Judge observed that:

  • nothing about remote proceedings, including large, complex and potentially final ones, is inherently unfair as all parties are in the same position and have the same opportunity to participate and be heard;
  • the legal community has had time to digest the use of virtual hearing technology and courts are hearing highly complex matters remotely over the objection of some parties (i.e. the multi-party high stakes appeal of a CRTC ruling on broadband rates is to proceed virtually before the Federal Court of Appeal);[7]
  • the Ontario Bar Association’s Best Practices for Remote Hearings, published May 13, 2020, addresses the logistical and practical challenges of remote hearings, and shows that what were initially viewed as “due process concerns” can now be seen as “practical issues to be addressed by work-arounds” that involve cooperation, communication and collaboration between counsel; and
  • the concern that legal teams are not all in one location to assist each other was raised and addressed by the Federal Court of Australia in Capic v. Ford Motor Company of Australia Limited[8], which stated that counsel who are isolated have and can communicate with each other using instant messaging platforms such as WhatsApp.

Key Takeaways

The Virtual Hearing Decision demonstrates the judiciary’s growing confidence in the ability of both counsel and courts to conduct complex virtual hearings that minimize the problems that previously discouraged their use. Because class actions are more likely to be actively case managed than other forms of litigation, they can be expected to progress more expeditiously during the pandemic than many other types of litigation. As a consequence, class action counsel should be particularly prepared for the possibility of virtual leave and certification motions as social distancing measures continue.

The ultimate impact of embracing virtual hearings in the context of complex, high-stakes class proceedings remains to be seen, but the experience gained by courts and practitioners as a result of the pandemic will make for more informed decisions in the future.


[1] 2020 ONSC 2253 (CanLII).

[2] At that time in-court hearings were suspended until July 6, 2020, and there was no guarantee that courtrooms would be available for personal attendances as of that date.

[3] 2020 ONSC 3291 (CanLII) [“Virtual Hearing Decision”].

[4] Virtual Hearing Decision, supra at para. 8.

[5] 2020 ONSC 2782 (CanLII) [“Arconti”].

[6] Virtual Hearing Decision, supra at para. 8.

[7] Virtual Hearing Decision, supra at para. 11, citing Alexandra Posadzki, “Key telecom hearing on wholesale internet rates to go ahead virtually”, The Globe and Mail, May 26, 2020, https:www.theglobeandmail.com/business/article-telecom-hearing-to-go-ahead-virtually/.

[8] [2020] FCA 486.

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