Legal Feeds Blog
Former nurse accused of killing seniors to appear in court today, Canadian Press
After years of litigation, the Superior Court of Quebec has ruled in favour of the Jean Coutu Group in a lawsuit with a franchisee over franchise, or royalty, payments. The legality of these fees, paid by pharmacists who are franchisees, has been on the table for years.
The question in Quesnel v. Groupe Jean Coutu was whether a contractual clause providing for a pharmacist-owner in the Jean Coutu chain of drugstores to pay a franchise fee on revenues from the sale of medicines contravened public policy and s. 49 of the Code of Ethics of pharmacists in Quebec. This section of the Code prohibits pharmacists from sharing profits from the sale of medications, or from their fees, with a non-pharmacist.
In 2008, Gatineau pharmacy owner Michel Quesnel was charged by the Ordre des Pharmaciens du Quebec with violating the regulator’s code of ethics by sharing profits with the Jean Coutu Group, which operates a network of 418 franchised stores in Quebec, New Brunswick and Ontario. Quesnel was a franchisee of the Jean Coutu Group. Quesnel pleaded guilty to the charge, but in turn sued the Jean Coutu Group for all the franchise fees he had paid over the nearly 30 years he had done business with Jean Coutu through the six pharmacies he then owned.
Justice Michèle Monast ruled that Jean Coutu’s franchise agreements with pharmacist-owners were not in violation of the Code of Ethics. Jean Coutu Group franchisees pay royalties corresponding to the fair value of the rights granted to them and the goods and services provided in return, Justice Monast found, including support services and benefits obtained through the use of the Jean Coutu Group name and trademarks for the operation of their establishments.
The franchise, or royalty, fee is a percentage of gross revenues of a business paid by a franchisee to the franchisor. Judge Monast found that it was legal for Quebec pharmacists who are franchisees to pay royalty fees to their franchisor, and that it did not constitute a profit-sharing agreement.
Identifying Cadrin c. Pharmaciens (Ordre professionnel des), 2015 QCTP 104 as a precedent, the judge looked at whether the independence of the pharmacist as a professional was put at risk by its payments to Jean Coutu, the franchisor, and found that it was not.
Justice Monast also found that the value of the consideration received by pharmacists working within the Jean Coutu organization was worth the franchise fees that they paid. She also determined that the franchisee agreement did not fit the definition of sharing of profits, because profit represents a bottom line, whereas franchise payments to the Jean Coutu Group are made as a percentage of the gross sales of the franchisee. This does not constitute a sharing of profits, the judge determined, but a payment made by pharmacists for goods and services received from the franchisor. In this case, these services include planning and operation of the pharmacy premises, group-purchase or volume discounts, and benefits related to the reputation of the Jean Coutu trademarks and its advertising.
Also referring to the decision in Cadrin, the judge noted that professionals make other payments, such as rent for premises, which may likewise be calculated at least in part on gross revenues, but do not constitute a sharing of profits nor compromise the independence of the professionals. And referring to Lebeuf c. Groupe S.N.C. Lavalin Inc., she noted the Quebec Court of Appeal’s comments on the relationship of S.N.C. Lavalin, an engineering firm that is a publicly traded company, to its shareholders. The fact that S.N.C. Lavalin pays dividends to its shareholders does not put at risk the independence of the company’s engineers doing their work.
McCarthy Tétrault LLP has acquired e-discovery law firm Wortzmans in an arrangement that will see Susan Wortzman join the firm as an equity partner.
|McCarthy Tétrault LLP CEO Dave Leonard and Susan Wortzman who is now an equity partner at McCarthy's.|
“It’s a little unusual for law firms to do deals like this, but we saw it was a great opportunity for us and we think it’s going to be a great fit,” says McCarthy Tétrault CEO Dave Leonard.
Wortzman says it’s an opportunity for her firm to further develop its platform.
“We’d been thinking about this for some time and the reason we decided to do this now was because the fit was so good with McCarthy’s,” she says.
Wortzmans employs a large group of contract lawyers but in terms of permanent lawyers three will be going over to McCarthy’s.
“We’re a very multi-disciplinary team. We have lawyers, project managers and a forensic engineer and support staff,” she says.
Leonard says the parties are still figuring out “exactly what the structure is going to look like,” but he notes that as Wortzman’s has a “tremendous brand” in the e-discovery area the firm wants to leverage that but must also work through all the potential conflicts.
“For the time being and perhaps for the foreseeable future, we will keep them as separate entities. As of right now, we are keeping them completely separate — both have their own physical space and only Susan’s people will have access to the matters she is working on and vice versa with the firm,” Leonard says. “We will see how that plays out and how our clients react and how Susan’s clients react. So far, the reaction has been positive.”
Ultimately, Leonard says he is hopeful the strength of Wortzmans will be “so strong” that other law firms will continue to engage Wortzmans for managed document review.
“We’ll be having some discussions with some of those firms in the not too distant future about that,” he adds.
Wortzman says it’s currently “business as usual” for Wortzmans as it is dealing with clients to see who will go with them to McCarthy’s.
“For clients it will be seamless because they will have the same pricing and the same team working on their matters,” she says. “No question, it will be challenging for some but for corporate clients and public sector agencies it probably doesn’t matter as much.”
It was two years ago that Deloitte LLP acquired ATD Legal Services PC, launched in 2010 by former Davies Ward Phillips & Vineberg LLP partner Shelby Austin.
Wortzman, who founded the firm in 2007, said she was looking at other options but in the end McCarthy’s was the “best model for me.”
Other important factors to her include the fact McCarthy’s wanted to keep the Wortzman brand alive and that it wants to leverage technology to manage data more for legal analytics.
“It’s an interesting time and some of the accounting firms are interested in this space and in our business and so we’re seeing this as an opportunity to have a good offering for our clients going forward,” Leonard says.
While McCarthy’s has had an e-discovery and information management practice, over time, Leonard says, it became “more of a challenge” to do it in the traditional law firm model as people like Austin and Wortzman started their businesses.
“We think this is going to be a great addition to our ability to deliver services in a more innovative, cost-effective way to clients but with the McCarthy’s quality and Wortzman quality,” he says. “Without having to outsource to a third-party vendor, we’ve now brought it in-house.”
Leonard acknowledges that in a competitive legal market firms like McCarthy’s are competing with the big four accounting firms and e-discovery is one where there will be more competition in the document review/information governance area.
“I think the whole area of information management — wherever you have large buckets of information that needs to be captured, analyzed and reviewed — we want to be one of the choices for our clients for doing that work,” he says. “We’re doubling down in that business because we see it as an area that is synergistic in the rest of the offerings we have for our clients.”
Leonard would not disclose what the investment was in acquiring Wortzmans into the firm, but he says there was “significant scrutiny” on both sides and the McCarthy’s board of partners unanimously endorsed the recommendation to proceed with the transaction. It was rolled out to equity partners of the firm just before Christmas.
“I’ve got nothing but enthusiastic responses. It’s a tough market and we’re all looking for growth and this is an area where we think we can make some gains,” he says.
As Wortzmans is a law firm, the deal is similar to two law firms merging, and while there are rules of professional responsibility that have to be upheld and conflict issues that have to be managed, the transaction did not require law society approval.
Updated on Jan. 5, 2017 to include comments from Susan Wortzman.
Five lawyers were appointed to the Order of Canada last week, in a milestone year marking Canada’s 150th birthday and the order’s 50th anniversary.
|Retired Supreme Court justice Morris Fish was appointed a Companion of the Order of Canada for his “eminent service” as a jurist.|
Retired Supreme Court justice Morris Fish was appointed a Companion of the Order of Canada for his “eminent service” as a jurist, particularly on the SCC bench from 2003-13. A law graduate from McGill University, Fish practiced mostly in Quebec — though he was called to the bars of Prince Edward Island and Alberta as well — and also lectured at various Canadian law schools including holding the post of adjunct professor at his alma mater and teaching at the University of Ottawa and the Université de Montréal. His focus in practice and in his teaching was criminal law.
Appointed to Officers of the Order of Canada are Ellen Irene Picard and Paul Cronin Weiler.
Picard was appointed for her contributions as a judge at the Court of Queen’s Bench and her further elevation to the Court of Appeal. She is forefront in the field of health law in Canada, having helped to establish it through her work as a legal scholar. She co-authored Legal Liability of Doctors and Hospitals in Canada, a book widely regarded as the most comprehensive text on the subject.
A graduate of Osgoode Law School in Toronto, Weiler went on to become a professor of law at his alma mater as well as visiting professor of Canadian studies at Harvard Law School, where he got his Masters of Laws years earlier. He was appointed for “his contributions to reforming labour and employment standards as one of North America’s foremost legal scholars,” including serving as a panelist in the United States/Canada Free Trade Agreement softwood lumber arbitration in 1992.
Benoît Pelletier, for “his efforts to bring about interprovincial-territorial co-operation and for his advocacy on behalf of Francophone communities,” and Alfred Popp, for his “contributions to maritime law” in various positions, were named Members of the Order.
Pelletier, currently a law professor at the University of Ottawa where he also earned his Masters Degree in law, was an active political figure between posts at the university, as well as the author of many books, articles and opinion pieces. A supporter of the federalist cause in Quebec, Pelletier departed from traditional policy by also seeking to help Francophone minority groups from other parts of the country resist assimilating with the English-speaking majority. He is still called upon to comment on constitutional matters.
Following a legal education in South Africa, Popp completed his Masters Degree in law at the University of Ottawa. A member of the Canadian delegation to the Legal Committee of the International Maritime Organization — where he eventually became president — Popp was a driving force in developing major international agreements in the field of maritime law. Retiring from the committee in 2005, Popp was appointed administrator of the Ship-source Oil Pollution Fund two years later.
The Order of Canada, one of Canada’s highest civilian honours, was established in 1967, during Canada’s centennial year, to recognize outstanding achievement, dedication to the community and service to the nation. More than 6,000 Canadians have been invested into the Order since its creation. To celebrate its 50th anniversary, there will be multiple special initiatives and partnerships announced throughout the year.
This year’s recipients will be invited to accept their insignia at a ceremony to be held at a later date.
A British Columbia Human Rights Tribunal has dismissed a complaint filed by a Vancouver lawyer who alleges his former employer asked him not to bring his male partner to a firm social event, and that he remove references in his online firm bio to involvement in the Canadian Bar Association’s Sexual Orientation and Gender Identity group.
|Ellen Low, partner at Whitten & Lublin in Toronto, says complaints are best heard soon after incidents occur.|
The tribunal indicated to both Yuen and Direction Legal that the complaint was filed outside the six-month time limit in B.C. and requested submissions on its timeliness. The Code provides that a complaint must be filed within six months of the alleged contravention.
In determining whether acceptance of a late-filed complaint is in the public interest, the tribunal considers whether there is anything “particularly unique, novel, or unusual about the complaint that has not been addressed in other complaints.”
“Where a complaint raises a novel issue on behalf of a vulnerable group, for example, that is a factor that may be considered in weighing the public interest in accepting the complaint,” the decision states.
In a decision issued Dec. 13 by tribunal member Barbara Korenkiewicz, the complaint was dismissed, rejecting Yuen’s reasons for delay in filing the complaint, saying they “do not weigh in favour of acceptance of the complaint in the public interest.”
Yuen alleged discrimination occurred on or about July 21, 2014 when he says Teng told him he should remove certain references from the Chinese version of his bio that appeared on the firm’s website, such as that he serves as national co-chairman of the CBA’s Sexual Orientation and Gender Identities Conference. He also claimed Teng told him on or about July 28, 2014 that he should not bring his male partner to the firm’s summer social event.
Yuen claims Teng said Chinese clients would not understand his being gay.
He described feeling “degraded, ashamed and worthless.” He ultimately resigned and left Direction Legal on Nov. 18, 2015.
When contacted by Legal Feeds, Teng stated in an email response: “Mr. Yuen’s allegations are unproven. We dispute such allegations. There was neither the need nor the opportunity to respond to same because of the tribunal member’s dismissal of his application for an extension of the deadline for filing a complaint.”
Yuen said he feared that if he filed the complaint while still employed by the firm he would be dismissed. He also stated that he delayed in filing, in part, because he had only recently learned that he could have filed a complaint.
Direction Legal argued that Yuen’s claim in that regard was not credible given that he is actively involved with SOGIC and has practised law in British Columbia for the past eight years.
“Ignorance of the Code, or the time required to become aware of one’s rights, is generally not an acceptable reason, on its own, for the delay in filing,” noted the BCHRT decision. “Mr. Yuen has provided no additional information, and there is nothing in the materials to suggest, why he should be exempt from the application of this general rule.”
Yuen also said he delayed in filing the complaint, in part, following his departure from the firm because he was attempting to negotiate a settlement of outstanding issues between him and the firm. While the parties were ultimately able to resolve certain issues between them via an agreement reached on June 30, 2016, his discrimination complaint was not resolved.
The decision states that: “The Tribunal has held that it is in the public interest to encourage parties to enter into settlement discussions before having recourse to the Tribunal’s processes. In cases where parties were engaged in settlement discussions that commenced within the six-month time for filing, this might be considered a relevant factor when determining whether to accept a late-filed complaint.
“In this case, however, Mr. Yuen did not commence settlement discussions regarding the discrimination allegations until May 12, 2016, nearly 22 months after the alleged incidents occurred.”
Yuen argued further that he was employed by a law firm and that the firm should be held to a higher standard of conduct because they are all lawyers, and that lawyers “have an ethical duty to uphold the law and are leaders in society.”
But the BCHRT disagreed.
“In my view, a lawyer or law firm that is an employer has the same duties and responsibilities under the Code as any other employer —no more and no less,” wrote tribunal member Korenkiewicz, citing Asna-Ashari v. British Columbia (Attorney General), 2010; and Bola v. B.C. (Ministry of the Attorney General and others), 2007 BCHRT.
“This is a complaint concerning discrimination in employment on the grounds of sexual orientation, marital status and race. The Tribunal has frequently dealt with complaints of this nature on each of these grounds. There is nothing in the materials to suggest that the complaint raises an issue that has not already been addressed in other complaints before the Tribunal. Thus, I am not persuaded that the novelty of this complaint outweighs the lengthy delay in filing.”
Yuen says the tribunal should have accepted his complaint based on the reasons he cited. He told Legal Feeds he is still exploring other avenues regarding his complaints.
“As officers of the court, with a duty to uphold the law, lawyers should be held to a higher standard when dealing with issues of discrimination, especially at the workplace,” he said in an email.
He also notes limitation periods for human rights tribunals vary across the country.
However, Ellen Low, partner at Whitten & Lublin in Toronto, says that while the variation in limitation periods can be confusing, especially when the limitation period under the Canadian Human Rights Act is one year, complaints are best heard soon after incidents occur.
“There is an argument that allegations of this nature, which call for remedial action, are best served by a short limitation period so they can be addressed/redressed while the injury is fresh and not over a year after an allegedly discriminatory event,” says Low.
Ryan Edmonds, a labour and employment lawyer in Toronto, agrees that shorter limitation periods are not a bad thing, but he says he sees this case from both the employer and employee perspective.
“When someone is discriminated against or marginalized it’s a pretty significant thing, so to sit on something like that for two years is questionable,” he says. “The applicant here raises the age-old ‘I was afraid for my job,’ but it raises the question that if it happened and two years passes without further incident is it relevant anymore?”
He notes human rights tribunals receive so many claims they need to focus on cases that are “timely” and more “closely connected to an incident worth investigating.”
Halifax family flees after man firebombs home: police, Canadian Press
The discussion around the legalization of marijuana is heating up across Canada, especially because of the Liberal government’s decision to introduce legislation for legalization as early as next spring.
|Lawyer Nathan Gorham says legalization of marijuana could potentially lead to the decrease of violent crimes.|
“I don’t think that people should anticipate that the backlog of the courts is largely due to prosecutions from minor possessions of marijuana,” says Edward Prutschi, partner at Adler Bytensky Prutschi Shikhman Criminal Litigation, when asked whether legalizing marijuana will assist in dealing with court delays. “It will create some opening though because people are not going to be prosecuted for these types of cases anymore and I think that is to the benefit of the system as a whole . . . and it will be a benefit from a police resource perspective.”
Nathan Gorham, partner at Rusonik O’Connor Robbins Ross Gorham & Angelini LLP, agrees with Prutschi, but he adds that he thinks the legalization of marijuana could potentially lead to the decrease of violent crimes often associated with gangs and the selling of marijuana at street level — robbery, assault and even murder — although he is unsure if the potential decrease in these crimes would be enough to make a difference within the justice system.
“If marijuana is decriminalized, presumably we’re not going to have street-level dealers anymore who are able to make a lot of money because there’s a high markup on it. Then you’ll see less of the cases where those dealers are carrying guns or those dealers are the victims of robbery or there’s competition between one another that leads to shootings and other violence,” he adds.
The federal government’s task force appointed to study how marijuana could be regulated and sold once legalized issued a report in early December. The Task Force on Cannabis Legalization and Regulation’s report contains more than 80 recommendations on how the government could tax, market and distribute marijuana.
The task force recommends that sales be restricted to those 18 and older, with a public possession limit of 30 grams of dried cannabis. Unlike cases of marijuana possession (those below the set legal amount), cases that won’t disappear from the courts are those involving trafficking and growing marijuana.
In terms of sentencing, Prutschi thinks it will be situational. For example, a person who is just a few grams over the legal limit will probably be diverted out of the legal system, whereas a person selling it at street level in large quantities without paying the taxes or having a licence to do so will receive a much harsher sentence.
Since those other related activities aren’t being legalized, he predicts those offences will be treated the same way in the courts, perhaps even with the current level of punishment depending on the situation.
Prutschi also predicts that laws surrounding other drugs will see no impact, especially because there’s a “significant difference between the [health] risks that are posted by marijuana” compared with drugs such as cocaine, heroin or fentanyl, for instance.
On the other hand, Gorham anticipates that marijuana legalization might open up the dialogue on whether or not other illicit drugs should be treated with a “health-based” approach rather than an “enforcement” approach. For example, if a health-based approach is taken, more safe injection sites could be built so people wouldn’t be forced to take those drugs “underground.” Similar to what he believes would happen with marijuana, this would perhaps limit other more serious and violent crimes related to these other illicit drugs.
“If the marijuana policy works out, then it may be an important stepping stone to opening up the conversation for change in regards to other illicit substances and how we try to target them and assist the people who are addicted to them,” says Gorham.
Saskatchewan woman found after going missing in Ontario, Canadian Press
Three people injured in Highway 401 crash in Ajax, Canadian Press
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