Despite concerns it could lead to “chaos” a joint trial announced to divvy up the $9 billion from the liquidation of Nortel Networks could be a creative solution that might just work.

Judges in both Delaware and Toronto will hear the Nortel liquidation trial. (Photo: Mike Cassese/Reuters)

Last Friday, a U.S. judge and a Canadian judge agreed to a joint, simultaneous trial, overruling objections to the unusual arrangement. Kevin Gross, a U.S. Bankruptcy Court judge in Wilmington, Del., told the parties on a conference call held jointly with Ontario Superior Court Justice Geoffrey Morawetz in Toronto that the litigants should prepare for a trial late this year.

Gross and Morawetz have been overseeing the liquidation of the former telecom giant.

It may be the “best option of the options that remain,” says Linc Rogers, a partner with Blake Cassels & Graydon LLP.

“Although not desirable in the sense that a consensual mediation would have had a resolution to it that all the parties would have bought into and would have been preferable, since that didn’t work they were left with little choice as to how to resolve this,” he says.

Given the judges in charge of the process, Rogers believes they will strive to get a consensus because there’s no overseeing body to ultimately determine any divergence in opinion.

“That’s the real issue in this proposed cross-border trial that sets it apart from some of the other procedural issues that have been dealt with in a  cross-border manner in the past,” says Rogers.

Brandon Barnes, a lawyer with Davis LLP, doesn’t see why it can’t succeed and applauds the judges involved for coming up with a creative approach.

“I think it’s quite a wise decision in the sense there is a reluctance sometimes to acknowledge the limits of the jurisdiction of the court,” says Barnes. “By that I don’t mean the legal jurisdiction but the geographic jurisdiction. There’s a tendency to think ‘the assets are overseas and it’s out of our reach.’ Looking at this from a global perspective and recognizing the business of Nortel was essentially global in nature, why not allow the courts to rise to that level?”

Barnes says it’s important to understand the Nortel insolvency has a number of relatively unique features. While that may lead some to also think it will result in large legal bills and a lot of procedural hurdles the reality is — particularly in insolvency cases — there’s “only so much runway.”

He says the Commercial List court, in particular, often makes use of aspects of the rules that allow for liberality of procedure to try and achieve efficiency.

The alternative would be an out-of-court procedure involving arbitrators from both sides of the border. Administrators for former Nortel units in Europe had requested the judges send the matter to binding arbitration. They can appeal the ruling.

After Nortel filed in 2009 for protection from creditors in courts around the world, its units in the United States, Canada, and Europe agreed to sell Nortel’s operations as global businesses as a way to increase their value.

However, those units in different countries never tackled the complex question of how to split the money that was raised. Until each Nortel unit knows how much money it has, it is nearly impossible to negotiate and settle the more than $30 billion of claims of their creditors.

The U.S. and Canadian units wanted a public trial after three attempts to mediate the dispute failed. Their lawyer told a hearing in Wilmington on Thursday that he wanted court scrutiny of the European units’ claims to the $9 billion.

Derek Adler of Hughes Hubbard & Reed, the lawyer for the European units, says a joint trial would lead to chaos if the judges in the Canada and the United States reached conflicting rulings with no appeals court to bind them both.

“I think that concern is a valid one, but given the history of the courts and how they have been able to work together I think they can come to a single conclusion,” says Rogers. “I think they will be looking for what’s reasonable in the circumstances. The judges are going to be looking for something that splits the difference.”

There is also a concern about logistics. The Canadian and Delaware courtrooms last Thursday experienced technical glitches that rendered portions of the Toronto proceedings inaudible in Wilmington. Adler questions whether such difficulties might make it impossible to cross-examine witnesses, denying his clients due process.

Rogers says those concerns are “wildly overstated.”

“What it comes back to is the experience of the judges overseeing this proceeding. I think the technology and infrastructure is there to make this efficient. If the feed goes down and people have to take a break that won’t be a problem. But I fully expect procedural fairness will be respected in this forum.”

After 23 years as it’s external counsel Gilles Daigle has joined the Society of Composers Authors & Music Publishers of Canada as general counsel and head of legal services.

Gilles Daigle joins SOCAN as significant challenges face the music industry.

Daigle, considered one of the foremost experts on copyright law, is no stranger to SOCAN having helped the society to protect and fight for the rights of Canada’s music creators and publishers as the society’s external legal counsel while at Gowling Lafleur Henderson LLP. During that time he has represented SOCAN in numerous legal proceedings before the Copyright Board of Canada and the courts.

Daigle succeeds Paul Spurgeon, who retired after 35 years as SOCAN’s general counsel.

“It’s a very interesting role and I have huge shoes to fill,” says Daigle.

“Gilles Daigle joining SOCAN is a major plus for Canadian songwriters and music publishers,” said SOCAN CEO Eric Baptiste in a statement. “He will be a key player in SOCAN’s plans to be a global trailblazer on behalf of our rights-owners in the increasingly digital, mobile, borderless and innovative world of music consumption.”

The high profile copyright legal challenges facing SOCAN include decisions of the Supreme Court of Canada rendered last year.

Daigle says several sections of the new Copyright Modernization Act, which came into force last November, also pose challenges for the music industry.

“Now what we have is the advent of a new right of making works available in the Copyright Act and there is already a legal discussion taking place before the Copyright Board to see what impact if any that new provision serves to change the conclusions of the Supreme Court decision on the issue of downloads,” says Daigle.

He also takes on the job at SOCAN as other significant challenges face the music industry.

The development of new Internet music services that go beyond downloading like iTunes pose other questions for artists regarding compensation. Streaming services such as Pandora and Spotify give rise to legal and business issues as well in terms of what an appropriate level of royalties would be for that type of music use.

“There’s been a lot of talk too about YouTube and the difficulties around the world with it and Google reaching agreements with performing rights societies. In some cases there have been agreements but others have been established but not renewed,” he says.

Daigle will be managing about a dozen people in SOCAN’s legal department, which includes two internal counsel and a support team of paralegals. He is also a frequent speaker at copyright law events and a regular guest lecturer at the University of Ottawa’s Faculty of Law.

For the first time a lawsuit against a Canadian mining company over alleged human rights abuses abroad will be heard in Canadian courts.

Lawyers for the alleged victims of rape and murder at a Guatemalan mine will be able to sue HudBay Minerals for the alleged gang-rapes of eleven women, the killing of its community leader Adolfo Ich, and the shooting, and resulting paralysis, of German Chub at HudBay’s former mining project in Guatemala.

In August 2011, HudBay announced

Angelica Choc stands next to a sign that says 'Adolfo Ich murdered by CGN. Mining is responsible.' Photo: Daniel Sosa

it had sold the Fenix ferro-nickel mining project in Guatemala to the Solway Group, a private Russian company incorporated in Cyprus, but lawyers for the victims vowed to keep pushing for the lawsuits to be heard against the company in Canada.

A week ago, just before an Ontario court was set to determine the issue, HudBay abandoned its legal argument that the lawsuit should not be heard in Canada.

“HudBay fought this issue of whether the trial could be in Canada tooth and nail for over a year,” says Murray Klippenstein, lawyer for the Guatemalan Mayan plaintiffs. “Then they gave up at the eleventh hour, we think, based on the overwhelming collection of evidence. Certainly a major Canadian mining company represented by the preeminent Canadian mining law firm would not give up such a central point in such a key defence without careful consideration.”

HudBay is represented by Fasken Martineau DuMoulin LLP. The defence had filed extensive legal briefs arguing that the lawsuit should be heard in Guatemala, not Canada, despite evidence indicating that Guatemala’s justice system is dysfunctional, making it impossible for the victims to get justice there.

According to the United Nations, Guatemala is one of “the world’s most violent countries officially at peace.” Human Rights Watch says 99.75 per cent of violent crime in Guatemala goes unpunished due to corruption, and intimidation and attacks against judges and witnesses.

While the development effectively removes the legal argument that the case cannot be heard in Canada, Klippenstein says HudBay “continues to rely on antiquated corporate law concepts” to argue in that its corporate head-office in Canada is not legally responsible for the abuse committed by its wholly-owned and controlled overseas subsidiary corporation.

“While HudBay has dropped its forum non convenience defence it will still be relying on other corporate law concepts we think are not appropriate in this day and age,” he says.

Extensive cross-examinations of witnesses and experts took place in December via Skype from Guatemala as well as having some of the plaintiffs travel from the remote mountains of Guatemala to Toronto. There was also video and photographic evidence made available.

“This kind of cross-border overseas litigation is now entirely feasible. I think this is a sea change development because Canadian corporations have always been allowed to rely on a forum non conveniens argument but this case shows that when a case is properly brought with all the evidence properly presented that defence no longer can be counted on,” says Klippenstein. “In this globalized world with video cameras everywhere and examinations by Skype, corporate boardrooms should realize this is now the state we’re in.”

The lawsuits continue in Ontario courts.

Update Feb. 28: Name of law firm representing HudBay corrected.

A British Columbia Court of Appeal judge has ruled the “impoverished” should not be the only ones exempt from court hearing fees in civil cases and the exemption to pay should be broadened.

West Coast LEAF lawyer Kasari Govender says the ruling could go further but will improve access to justice for women.

In the family law case Vilardell v. Dunham, the mother in the case, Montserrat Vilardell, made an application to waive the fees she was being charged for every day of her court hearing.

After considering constitutional arguments by the Canadian Bar Association, B.C. Trial Lawyers Association, and the West Coast Women’s Legal Education & Action Fund, the B.C. Supreme Court ruled the fees were unconstitutional. On appeal, the B.C. Court of Appeal overturned the lower court decision.

West Coast LEAF says the decision will improve access to justice for women, but it doesn’t go as far as they had hoped.

West Coast LEAF had argued hearing fees in family law cases have an unequal impact on women because they are less likely to have the resources to afford them than men. It argued hearing fees “violate women’s equality and security rights and the principles of fundamental justice, and should be struck down on that basis.”

In his decision the trial judge had struck down the hearing fees charged by the Crown in Supreme Court trials as unconstitutional, saying the fees “materially hindered” access to the courts.

The Crown justifies the fees as legitimate efforts to recover costs and promote efficiency at cost recovery.

The Attorney General of British Columbia had argued the case did not present an access to justice problem. If the fees would hinder a litigant, the attorney general says the rules allow the judge to make an exemption.

However, appeal court Justice Ian T. Donald rejected that argument based on the fact the indigency rule applies only to the poor, not to the “struggling middle class who, while not poor in the ordinary sense, cannot afford the fees.”

He wrote: “In my opinion, were it not for the power of the courts to give relief from the hearing fees, they would be an unconstitutional impediment to justice. The power is found in an enlarged interpretation of the indigency provision.”

The Court of Appeal found hearing fees do pose an unconstitutional obstacle to the courts for many people, including the middle class, without adequate provision for those who are unable to afford them.

The court recognized the current “indigency” exemption was insufficient to capture those who can’t afford the fees, and ordered it be broadened to cover those could not meet their everyday expenses if required to pay fees.

In his decision Donald wrote: “The enlarged scope of the exemption in Rule 20-5, then, should be read as saying ‘impoverished or in need.’ The phrase is intended to cover those who could not meet their everyday expenses if they were required to pay the fees. Courts will continue to use their discretion to determine whether a litigant is impoverished or in need to the point that but for the hearing fees, they would be able to pursue their claim, thus qualifying for an exemption.”

Donald allowed the appeal and set aside the order striking the hearing fees rule. While the court did not go so far as to strike down the hearing fee structure as requested it was seen as a small victory.

“Importantly, the court recognizes that women in family law cases, aboriginal persons, those with disabilities, and recent immigrants are disproportionately impacted by the current hearing fee system,” said Kasari Govender, executive director and co-counsel for West Coast LEAF. “While the court did not go as far as we hoped, it is clear that more people — including women in family law matters — will have access to the courts as a result of this decision.”

The Association of Corporate Counsel has hired a director of Canadian initiatives to help co-ordinate its efforts in this country.

Silvi Alzetta-Reali is the new director of Canadian initiatives for ACC in Canada.

Silvi Alzetta-Reali will be responsible for helping the ACC expand its membership in Canada and assist in the development of programming and resources for members. She was officially hired for the full-time role in January, but the association has been searching to fill the position for more than a year.

Alzetta-Reali was previously general counsel of Coca-Cola Ltd. in Canada. She started at the bottling company as a junior lawyer in 1992, becoming vice president, secretary and general counsel of Coca-Cola Ltd. in 1997.

During her last year at the company, Alzetta-Reali says she became a member of ACC as part of the company’s large law membership. “I remember exploring the site and thinking wow, this is a real boon. It had 
amazing resources, and would actually be useful to me in my practice.”

After her many years at the soft drink giant, Alzetta-Reali retired from law in 2008. When the opportunity at the ACC came up, she says she “jumped at it.”

“I’m really looking forward to helping the ACC continue to grow and develop in a Canadian context and I love being involved with the legal world again. It’s funny but absence does make the heart grow fonder,” she told Legal Feeds.

There are currently three ACC chapters in Canada  — Ontario, Quebec and British Columbia — which have their own executive and organize programming locally. Between the three chapters there are about 50 programs a year. There are also efforts being made to launch an Alberta chapter.

“We are happy to have an executive of Silvi’s calibre to further carry out our Canadian initiatives. As ACC’s director of Canadian initiatives, Silvi will enhance ACC’s strategic membership initiatives and support the needs of our members,” explained ACC president and CEO Veta T. Richardson.

“ACC’s primary goal is to meet the needs of our growing membership in Canada, which totals more than 1,000 in-house counsel. As our in-house community grows, we want to continue to offer the resources, networks and educational programs necessary to meet the demands of today’s busy in-house counsel,” added Richardson.

Two Ontario law firms are putting a face to a mass tort case and using video to get the word out to others who may have been affected by an acne medication prescribed to many since the early 1980s.

Law firms are using video to publicize a case against the makers of Accutane.

An $8-million lawsuit has been launched against Hoffman-La Roche Ltd., the makers of Accutane, on behalf of Jennifer Twamley who was prescribed the drug at age 17 to control her acne. She now suffers from ulcerative colitis, an inflammatory bowel disease, which lawyers from Legate & Associates LLP and Harrison Pensa LLP say is a side effect of Accutane. The lawyers say Canadians weren’t warned about the drug’s potentially dangerous side effects. Studies in the United States have found Accutane is linked to inflammatory bowel disease.

Twamley, 33, a television producer, is suing Hoffmann-La Roche in a mass tort, one of the first in Canada involving the acne drug. The lawsuit was filed in the Ontario Superior Court of Justice.

A mass tort is a group of lawsuits involving individuals who share similar complaints as a result of their experiences with a drug or defective product. As Accutane affects each person differently, the harm suffered varies widely. By bringing a mass tort, versus a class action, the lawyers say the victims are well served as their medical damages can be assessed on an individual basis.

Mass torts are common in the United States, where Roche has already been successfully sued for millions of dollars in connection with the manufacture and sale of Accutane. Roche stopped selling Accutane in the United States in 2009 for business reasons, but the drug is still sold in Canada.

The Twamley case is being put forward as a test case for more than a dozen similar ones the lawyers are preparing to file against the company.

As demographics and means of communication evolve, how law firms get the word out about such cases is changing, says Dave Williams of Harrison Pensa.

“For a standalone single case this is a first for me,” says Williams. “I think it’s just a changed world. The other aspect of this is the demographic — the people who took this drug as teenagers and have the problems with IBD as early adults just communicate differently.”

In the past mass actions like the Accutane case were heard about largely via word of mouth. To date, some individuals have found out about the action by using search engines when researching the drug or their own symptoms.

“In this day and age it just doesn’t work that way,” says Williams. “Certainly thus far the communication has been through the web site and we’ve had well over 125 serious contacts that way. We follow up with each and every one and do a detailed briefing as if they’d walked in the office. It’s just a modern way of dealing with potential clients than we had before,” says Williams.

Employment law firm Rubin Thomlinson LLP celebrated its 10^th anniversary with clients, colleagues, family and friends Jan. 31 at the Granite Club in Toronto.

 

Photos: Jennifer Brown

The Human Rights Tribunal of Ontario has rejected a complaint from some Carleton University students who claimed they were discriminated against when the school removed posters it circulated on campus to publicize Israeli Apartheid Week.

The events of the case in SAIA v. Carleton University took place in February 2009 when the Students Against Israeli Apartheid, a club at the school, tried to publicize Israeli Apartheid Week with about 100 posters around campus. The posters depicted an image of an Israeli helicopter gunship aiming a missile at a Palestinian child holding a teddy bear.

The school’s equity services department received several complaints including one brought forward by Hillel, a Jewish student group, regarding Jewish students who were feeling threatened by the posters.

At the same time Carleton’s administration was aware of recent events at York University where there had been large, heated demonstrations, including confrontations between the SAIA and Hillel groups, and situations requiring security and police to intervene.

The incident occurred at the same time similar activity was occurring at other Canadian universities related to the Palestinian-Israel conflict, in particular when Israel was engaged in a military offensive in Gaza with casualties and an attack on the Islamic University of Gaza.

University staff removed the posters and made a decision not to permit such postings on campus.

SAIA alleged the actions of the school were unjustified and discriminatory. It argued the poster was lawful and protected speech under s. 13(2) of the Human Rights Code and that by banning the poster, the university infringed its rights. The group argued the school was motivated by a preference for concerns expressed by Jewish students over the rights of Palestinian students.

SAIA also alleged that an e-mail from Carleton’s provost circulated to the entire university community unfairly targeted the group.

For its part Carleton argued its actions were a justified response to safety concerns and the actions were not related to the grounds of discrimination under the code.

“While the ability to engage in lawful political activity and free expression of political opinion are fundamental rights in Canadian society, and may be the subject of other laws or policies, they are not proscribed grounds of discrimination under the code. To the extent the applicant argues that, as a human rights advocacy organization, it was denied a right of free political expression, as legitimate as that claim may be, it is outside the scope of the tribunal’s jurisdiction,” tribunal adjudicator Michael Gottheil said in his decision.

He found the school had not violated the student group’s rights under the code and that the school’s president did not demonstrate an anti-Palestinian, pro-Israel bias.

In his decision Gottheil said: “SAIA called no evidence with respect to these allegations. Accordingly, I have not considered these allegations, except to note that there is no direct evidence before me of the respondent having an anti-Palestinian bias.”

“I am satisfied that the respondent had a good faith concern about student safety, and the possibility that the situation on campus might further deteriorate,” said Gottheil, noting that reported incidents to the equity services department warranted a response to the posters.

In-house counsel with responsibilities around public procurement can now reach for a guide that will provide a snapshot of the requirements in Europe and 20 other countries around the world.

The International Public Procurement Guide for In-House Counsel is a 74-page guide developed by the International Technology Law Association’s in-house counsel committee.

“The great utility of the guide is that it provides you with a flavour of what the procurement regime is like in a particular country, says John Beardwood, president of ITechLaw and a partner with Fasken Martineau DuMoulin LLP in Toronto. “You can go into a discussion knowing what questions to ask. The procurement regimes in some countries can be somewhat arcane, so getting a first glance at a briefing note is very useful.”

The guide reviews public procurement requirements with the goal of assisting in-house lawyers in deciding how to proceed with procurements in other jurisdictions and helping them avoid pitfalls in local procurement law.

“We developed this guide to help in-house counsel who find themselves in the difficult situation of being asked to advise on the procurement legal context for jurisdictions for which they lack even a basic understanding of local public procurement requirements,” said Christian Ringeling, international counsel with MicroStrategy, the guide’s editor.

“This situation arises because it’s not cost-effective for most companies either to maintain a staff of in-house counsel with procurement expertise in every applicable jurisdiction, or to engage applicable legal expertise from external qualified local counsel in the initial phase of a public RFP review. The ITechLaw guide is intended to fill this gap and provide in-house counsel with helpful roadmaps through unfamiliar territory.”

The guide also points out the effects a country’s political structure, history, or social/cultural challenges have had on its public procurement legislation.

Often history has influenced current processes, says Beardwood. For example, in Ontario the current procurement regime emerged as a result of concerns around the eHealth scandal and Smart Systems for Health scandal that followed.

“It was really those sorts of instances that led to the development of a more structured procurement regime here. Public procurement principles are developed to effectively ensure that when the public sector is procuring goods and services they do it in a fair and even handed way,” he says.

The guide covers the legal fundamentals of public procurement law for a country so lawyers unfamiliar with local requirements can brief themselves quickly. Each section has been prepared by lawyers in public procurement law from that country. Links to contract templates are also provided, as are references to local law specialists (the authors) if further information is required.

With members in more than 60 countries, ITechLaw is a worldwide organization for legal professionals practising in the global technology sector. About 85 per cent of members are private practitioners and 15 per cent are in-house counsel, academics, and government lawyers.

The procurement guide is now available to ITechLaw members, and it will be offered to all as a public service in April at no charge.

Following her high-profile role at the Competition Bureau, former commissioner Melanie Aitken has rejoined Bennett Jones LLP and will head up the firm’s new Washington, D.C. office.

Melanie Aitken will head up Bennett Jones’ new Washington, D.C., office.

“I’m excited because I’ve believed for a long time there is an opportunity for a Canadian firm to be in Washington, particularly in the area of anti-trust, but even more broadly given the breaking down of geographic barriers,” Aitken told Legal Feeds. “I think there’s a real opportunity to have the accessibility to engage directly with the folks we work regularly with on cross-border deals. “

Aitken, who stepped down from the Competition Bureau last September, three years into her five-year term, was a partner at Bennett Jones when she first went to the Competition Bureau in 2005. She was appointed commissioner in 2009 and became the face of the bureau’s enforcement agenda on a range of matters, many involving consumer-focused issues such as Visa/Mastercard’s loyalty card program and the real estate industry’s Multiple Listing Service.

Now living stateside, Aitken will manage the law firm’s Washington office and serve as co-chairwoman of its antitrust and competition practice, advising Canadian and foreign clients on issues arising for those carrying on business or investing in Canada.

While she has chosen to live in Washington for personal reasons, Aitken says she hopes working from the U.S. office will also translate into a good opportunity to further the firm’s cross border business and her career.

“I think it’s exciting because it allows a Canadian antitrust lawyer to have an even more interesting job,” says Aitken. “There’s going to be a client need that I hope we can satisfy with this foundation of the Bennett Jones group. For me it does accommodate my personal circumstances, but I think it’s a really exciting opportunity too and I’m thrilled.”

During her time at the bureau, Aitken played a leading role fostering co-operation among enforcement authorities around the world through an active role in the International Competition Network and the Organization for Economic Co-operation and Development.

While she stepped down from her position as commissioner two years early, she says she did so feeling she had accomplished what she originally set out to do.

“When I took the job I had already been in Ottawa for four years and I thought I had very clear instructions from Parliament in terms of what they wanted me to do in leading the bureau to a place where enforcement was a big part of what we did and the discipline that comes along with that,” she says.

“I felt after three-and-a-half years we had achieved a lot of what we had set out to do in terms of reinvigorating the enforcement will at the bureau, and it was time for personal reasons and time for the institution to move forward under new leadership. I hope they stay the course but also take it forward.”