On August 12, 2022, in Palmer v. Teva Canada Ltd., 2022 ONSC 4690, the Ontario Superior Court of Justice dismissed an application for authorization to bring a class action against the manufacturers of a hypertension drug sold under the generic name of valsartan.
The application was filed in 2018, a few days after the manufacturers of valsartan had recalled numerous batches of the medication following their contamination, during the production, by two molecules identified as potentially carcinogenic.
The object of the class action was to obtain compensation for the prejudice related to the increased risk of developing cancer and sustained by all the Canadian patients who had been prescribed valsartan. More specifically, the plaintiffs claimed compensation for the psychological prejudice related to the fear of developing the disease caused by the recall of the drug, as well as the economic prejudice related to the various costs incurred because of the recall, such as follow-ups and medical examinations that the patients have or will have to pay to make sure that they do not have cancer.
In support of their claim, the plaintiffs were raising, among other arguments, the rules applicable in the various Canadian provinces on product liability, dangerous goods, defective products, and consumer protection.
Although Justice Perell refers essentially to Common Law principles and Ontario statutes, his decision — which also affects Quebecers treated with valsartan — resonates in Quebec, especially regarding the hypothetical nature of the alleged damages.
Indeed, in Common Law as in Civil Law, only certain damages can be compensated (art 1611 of the Civil Code of Québec [CCQ]). The increased risk of the occurrence of a damage (in this case, a risk of cancer) is not part of that category.
Justice Perell's reasons contain an exhaustive analysis for each of the legal bases raised by the plaintiffs. The decision, which contains numerous references, provides an interesting perspective on the question of the hypothetical character of the prejudice resulting from a risk, considering the principles already recognized by case law. Here are the points that stand out.
An Increased Risk Is Not a Certain Prejudice
There are three conditions to trigger liability: fault, damage, and causation. Justice Perell highlights in his reasons that the creation of a risk is not by itself a fault likely to trigger the liability of the person who creates the risk (par 165 ss of the decision). The risk must actually cause a real prejudice.
This principle mirrors Quebec law, since the application of the civil law rules on product liability for dangerous [art 1468 CCQ] or defective goods [art 1728 CCQ] also require the existence of a prejudice arising from the risk.
An increased risk of illness is not, however, a certain prejudice. The Superior Court of Quebec also stated that in the context of a class action: in Li c. Equifax, 2019 QCCS 4340, Justice Donald Bisson stated: "The risk of developing a future prejudice, such as an illness or an infection, is not an injury that can give right to compensation under Quebec law. It is an uncertain and hypothetical damage, prohibited under article 1611 CCQ and by the authorities. A risk is not a certain prejudice." [par 29; our translation]
Since the creation or increase of the risk does not by itself give rise to a liability action, the plaintiffs had to demonstrate the existence of a compensable prejudice; in this, they failed, since the alleged prejudice was not certain.
The Fear of Harm Is Not Harm
More precisely, the psychological prejudice alleged by the plaintiffs arose from the anguish created by the sole fact of having learned that their risk of developing cancer had increased after taking the contaminated drug.
Justice Perell applied the solution held by the Supreme Court of Canada in Mustapha v. Culligan of Canada Ltd., 2008 SCC 27,  2 SCR 114, at paragraph 190, which provides that to constitute a sufficiently serious and long-term disorder, the psychological prejudice giving rise to compensation must rise above the ordinary annoyances, anxieties and fears that people living in society must routinely accept.
Even if, within the context of the class action, that certain people treated with valsartan could conceivably have experienced this severe psychological prejudice, nothing in the application allowed the conclusion that all the members of the putative group experienced this prejudice.
The mere fear of sustaining harm does not, by itself, constitute harm.
The Feared Risk Must Be Real And Imminent
The plaintiffs were also asking for compensation for economic prejudice: they were seeking reimbursement of the cost of the contaminated drug and various medical treatments that they had received, or were to receive, to control the occurrence of cancer.
Such costs, even future costs, are not hypothetical and should be compensable. However, as Justice Perell explained, to compensate such costs, the risk must still be real and imminent.
On this point, this case with valsartan brings to mind Zuckerman c. Target Corporation, 2017 QCCS 110, par 73, where the class action had been authorized. In that case, following a data breach incident, the customers of Target stores had to register with credit monitoring services and implement alerts in case of identity theft. This is not unlike medical monitoring because of a risk of illness.
However, the difference between the Target case and this case is that here, the plaintiffs have not based their claim on a certain causal link between the contaminated medicine and the risk of cancer diagnosis, but on a mere increase in the risk of developing a cancer. By contrast, in the Target case, the plaintiffs had alleged that the risk of identity theft had not only been increased, but had been created by the data theft.
As to the economic prejudice, in this case, it is the causal link that is hypothetical. As with hypothetical prejudice, a hypothetical causal link is insufficient
This decision follows the reasoning of Atlantic Lottery Corp. Inc. v. Babstock, 2020 SCC 19, where the Supreme Court of Canada dismissed an application for authorization to institute a class action for similar reasons. The plaintiffs were seeking compensation for the increase in the risk of addiction and suicide caused by video games, but not for situations where the video games would have actually resulted in addiction or suicide.
Absent an allegation of a certain compensable prejudice, this class action did not show a sufficient cause of action to be authorized.
Moreover, Justice Perell points out that the situation would have been different if the class action had been seeking compensation for people who, after having taken the drug, actually had cancer. The risk would then have been materialized for those people and their prejudice would no longer be merely hypothetical.
In short, as Justice Perell summarized, in product liability cases, compensation is allowable only for concrete damage caused by the defective or dangerous product, and not for the abstract apprehension that an increased likelihood of cancer can generate (para 11).
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