In a class action battle
who comes out on top?
It was predictable that the very public securities
law controversy that has surrounded Sino-Forest
Corp. would result in a feeding frenzy of class action
plaintiffs’ counsel. In the end, at least four separate
securities class actions were commenced by three sets
of plaintiffs’ counsel. This multiplicity of proceedings
triggered an inevitable carriage motion to determine
which plaintiffs’ counsel would be granted the opportunity to proceed, and which plaintiffs’ counsel would
be left disappointed on the sidelines.
As the plaintiff-side securities class action bar in
Canada grows in sophistication and in numbers, this
sort of internecine battle is likely to become increasingly frequent and increasingly hard-fought. In that
respect, the analysis and decision in the Sino-Forest
carriage motion is a preview of things to come.
A carriage motion is a unique proceeding. The
court decides nothing substantive and even in the
context of class action procedure, it decides nothing procedural. The court simply decides which
one of a group of overlapping class actions goes
ahead, and which ones get stayed—based upon
the court’s view of which action is most likely to
advance the interests of the class. Although this
decision is not meant to be a beauty contest
among the proposed plaintiffs’ lawyers, the
“resources and experience of counsel” are explicit
factors in the analysis and can become an important battleground.
The Sino-Forest carriage motion was a three-way
tug-of-war between Koskie Minsky and Siskinds
(acting as a team), Kim Orr, and Rochon Genova.
Ontario Superior Court Justice Paul Perell’s decision
granting carriage to Koskie Minsky/Siskinds was
released on Jan. 6.
In a detailed 55-page decision, Justice Perell analyzed a series of factors related to the nature of the
claims that had been commenced, the proposed representative plaintiffs and the counsel representing them.
He held that the determinative factors in the carriage
n;attributes of the representative plaintiffs;
n;definition of class membership;
n;definition of class period;
n;theory of the case;
n;causes of action;
See Motion Page 15