B.C. appeal court gets it right in price fixing decisions
The B. C. Court of Appeal has ruled in two landmark decisions that indirect purchasers of a product that was the subject of a price fixing conspiracy can’t sue for losses, says Toronto competition lawyer Michael Osborne.
The cases – which are expected to move on to the Supreme Court of Canada in October – are Sun-Rype Products Ltd. v. Archer Daniels Midland Company, 2011 BCCA 187 [Sun- Rype]; Pro-Sys Consultants Ltd. v. Microsoft Corporation, 2011 BCCA 186 [Microsoft], says Osborne, a partner with Affleck Greene McMurtry LLP.
Osborne says he agrees with the decisions, noting, the Supreme Court of Canada has held in earlier cases, Canfor and Kingstreet, ”that passing-on is no defence. This means that direct purchasers are entitled to claim the entire loss, without deduction on account of passing-on. If we allow indirect purchasers to claim as well, then there will be double recovery.”
Direct purchasers, explains Osborne, are “those who bought directly from price fixing conspirators. Indirect purchasers are those who bought from the direct purchasers, or other indirect purchasers. Indirect purchasers suffer a loss if the purchasers ahead of them in the distribution chain pass on some or all of the overcharge attributable to the conspiracy.”
He notes however, “This is not as big a problem as it may seem, since the total amount actually recovered by consumers in all of the price fixing class actions to date in Canada is: $0.” Read More in The Litigator Blog