With the growing perils of data breaches and the increase in consumer activism, privacy, consumer and product liability class actions remain a reality for businesses in Quebec. As the class action landscape continues to evolve, so do the risks.
In this article, we discuss recent trends in privacy, consumer and product liability class actions in Quebec to keep businesses informed of the latest developments.
1. Rise in Consumer Class Actions Based on Alleged False or Misleading Representations
We have seen a substantial rise in consumer class actions under the Quebec Consumer Protection Act (CPA) in which plaintiffs claim that a defendant made false or misleading representations respecting important characteristics of a product or service it provides. These include whether chicken sandwiches sold in fast-food outlets are made of chicken, whether a drink that is said to contain ginger is actually made with ginger or whether reusable bags sold in grocery stores bearing a "recyclable" logo are recyclable in Canada.
With an absolute presumption of prejudice being applied under the CPA in case of false or misleading representations, plaintiffs see such claims as "low hanging fruit." Accordingly, businesses must remain alert to the representations they make to consumers about their products.
2. Rise in "Drip Pricing" Consumer Class Actions
We have also seen a substantial rise in consumer class actions under the CPA in which plaintiffs claim that a defendant has charged a higher price than advertised for goods or services. This practice known as "drip pricing" is prohibited under the CPA.
For instance, plaintiffs claim that various charges are added to the price initially indicated on a website for plane tickets or other goods, such that the price actually paid when the transaction is completed ends up being substantially higher. While these claims remain a concern, a recent decision by the Superior Court of Quebec indicates that in the absence of a prejudice to the plaintiff, the claim could not be sustained.
3. Rise in Novel Plaintiffs' Theories in Product Liability Claims
There is an increasing trend of advancing product liability claims in the absence of traditional design defect or failure-to-warn allegations. Plaintiffs posit that the subsequent introduction of an "improved" or "safer" product is evidence that an earlier version was substandard or defective. While there are no reported trial decisions yet on such theories, businesses should be alert to this increasing trend.
4. Seeking Broader Class Definitions
There is another concerning trend of plaintiffs seeking to substantially broaden the class for which they seek the authorization to launch a class action, in order to artificially increase the defendant's exposure. For instance, instead of seeking the authorization to represent a Quebec class of persons allegedly affected by the claim, as is the norm, plaintiffs increasingly seek to represent a national or even a worldwide class.
For product liability claims, plaintiffs may also seek to represent all purchasers of a product rather than only those who would have incurred damages as a result of an alleged defect. The plaintiffs have had mitigated success in that regard, and we will keep monitoring how courts react to these requests.
5. Proof of Harm in Quebec Privacy Class Actions
In Quebec, under the so-called "de minimis" rule, civil law damages principles require plaintiffs to prove current harm that rises above the ordinary annoyances of life. The Quebec Court of Appeal upheld a merits decision dismissing a privacy class action, emphasizing that plaintiffs need to prove a causal link between a privacy breach and subsequent incidents of fraud or identity theft. The case also reaffirmed that anxiety or inconvenience following a cyberattack is not compensable unless serious and prolonged.
That said, Quebec courts recently held that a plaintiff's out-of-pocket purchase of credit-monitoring services following a data breach is sufficient alleged harm for purposes of authorizing a class action.
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