The plaintiff in Gifford commenced a proposed class action arising from allegations that the defendant airlines “engaged in price fixing airline tickets imposed for air travel between Canada and the USA and in a uniform course of anticompetitive conduct, by conspiring to lessen the supply of air travel between USA and Canada (referred to as “capacity discipline”) thereby unreasonably enhancing the price of air travel services in Canada for travel between the USA and Canada, causing like harms to all members of the class.” In this regard, Gifford was framed as a “supply suppression” conspiracy case, as opposed to a more “typical” price-fixing conspiracy case.
Gifford is the latest in a series of recent cases where courts have either denied certification altogether in competition cases, or refused to certify conspiracy claims advanced under Section 45 of Canada’s Competition Act (which prohibits cartel agreements among competitors concerning price-fixing, market allocation, and supply suppression): See Jensen v. Samsung Electronics Co. Ltd., 2021 FC 1185 aff’d 2023 FCA 89; Lilleyman v. Bumblebee Foods LLC, 2023 ONSC 4408 aff’d 2024 ONCA 606; Difederico v. Amazon.com, Inc., 2023 FC 1156; Qualcomm Incorporated v. Barroqueiro, 2025 BCCA 65; Karras c. Maple Leaf Foods Inc., 2025 QCCS 4419. The decision in Gifford is yet another reminder that Courts will carefully scrutinize pleadings, and that it is not a given that conspiracy claims will be certified.
Gifford is a reminder that the existence of U.S. proceedings is not by itself sufficient to provide a basis for certification in Canada, even where the U.S. proceedings have survived potentially dispositive motions and resulted in settlements. This is particularly true where the allegedly cartelized product, as well as the members of the alleged conspiracy, are different in Canada.
Gifford is a reminder that expert economic methodologies must sufficiently grapple with the complexities of a case in order to satisfy the requirements set out in Pro-Sys Consultants Ltd. v. Microsoft Corp., 2013 SCC 57 for the certification of loss-related common issues in proposed competition class actions. As set out in Pro-Sys, to certify loss-related common issues in a competition class action, a plaintiff must tender expert evidence at certification which offers “a realistic prospect of establishing loss on a class-wide basis so that, if the overcharge is eventually established at the trial of the common issues, there is a means by which to demonstrate that it is common to the class”. Moreover, the proposed methodology relied “cannot be purely theoretical or hypothetical, but must be grounded in the facts of the particular case in question”. Simply put, “the expert methodology must be sufficiently credible or plausible to establish some basis in fact for the commonality requirement.”
The Court concluded that the plaintiff’s proposed expert methodology was not sufficiently credible or plausible within the meaning of Pro-Sys, finding that it “does not address the complexities he will encounter in undertaking his analyses”. The Court agreed that the plaintiff’s proposed methodology could not overcome the “unique challenges posed by the complex and multi-faceted nature of defining and accounting for the thousands of separate markets for transborder air travel.” The Court also concluded that the inability of the plaintiff’s expert to control for broader macroeconomic conditions (such as the Great Recession) “renders his analysis purely hypothetical”, because he would not be able to account for non-conspiratorial explanatory variables affecting prices.
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