In what may become a landmark decision, the BC Court of Appeal
in Pro-Sys Consultants Ltd. v. Infineon
Technologies AG has certified a claim brought on behalf of
purchasers of DRAM ("dynamic random access memory"
— a kind of electronic memory used in everything from
computers to cell phones). The plaintiff alleges that the price it
paid for a laptop computer was improperly inflated due to a
price-fixing conspiracy among the defendants — the main
international manufacturers of DRAM.
DRAM as a Test Case
The DRAM litigation has been closely followed by specialists in
the fields of class action and competition/anti-trust law, both in
Canada and the United States, where several parallel actions are
underway. Until recently, no Canadian court had ordered a
price-fixing case certified for a proposed class, like this one,
which comprises both direct and indirect purchasers (at least where
certification was contested).
The main problem for plaintiffs in these cases has been the
difficulty in showing that the class as a whole suffered harm. It
is not clear how a plaintiff can prove which buyers actually paid
for the alleged price increase, and which suffered only some or no
loss at all (either because it was absorbed by someone else or
passed on, in whole or in part, to another buyer). These issues
threaten to complicate the trial with countless individual
inquiries, rendering the case as a whole unmanageable as a class
The BC Court of Appeal ordered the case to be certified despite
these concerns, but in so doing resorted to some unconventional
devices. First, it held that the plaintiff's burden of proof on
a certification motion should be relaxed, given the early stage of
the proceedings. Second, the court held that the plaintiff need not
face those individual issues if it pursued certain novel kinds of
claims, such as "waiver of tort." Such claims purport to
offer the prospect of liability focused on the defendant's gain
rather than the plaintiff's loss. Despite the controversy
surrounding the validity of such claims, the case was certified in
the expectation that the problems would be addressed at trial.
McCarthy Tétrault Notes
This decision breaks new ground in a number of ways. For
No other appellate decision has gone so far as to say that the
burden of proof applicable to a certification motion is
Although there have been other certification orders that rely
on claims like "waiver of tort," this decision goes
further by finding that the defendants can be found liable under
such gain-based claims simply by being found to have earned a
wrongful gain, without any need to prove a connection between the
class and the gain.
DRAM — Part III?
The jury on the DRAM certification question may still be out.
The defendants have filed an application for leave to appeal to the
Supreme Court of Canada.
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