By: Anthony Pugh, Law Works
Editor: Ben Hanuka, Law Works
In Spina v. Shoppers Drug Mart Inc., a June 27, 2020, decision of the Ontario Superior Court of Justice, Perell J. dismissed the class representative plaintiffs’ motion to compel non-parties to produce documents and attend examinations. The court allowed only part of the plaintiffs’ refusals motion. Underlying the court’s decision was its view that it was time for the discoveries in this matter, which had been going on for about five years, to end, and to move towards final adjudication.
About 10 years ago, the class representative plaintiff pharmacists started the multi-billion-dollar action against Shoppers Drug Mart and related parties. The pharmacists allege that Shoppers ought to have shared professional allowances with them under the franchise agreement, or that the professional allowances should have been paid directly to the franchisees.
In 2015, the parties agreed to a discovery plan. Shoppers delivered 26,703 documents between April 2015 and March 2017. The parties agreed that pharmacists could examine two witnesses on behalf of Shoppers. Perell J. ordered at the time that the pharmacists could examine those witnesses for a total of 63 hours. The pharmacists ultimately asked the first witness 1,797 questions, and the second witness 6,645 questions, about 4,000 of which dealt with professional expenses.
Between June 2017 and September 2018, Shoppers answered further additional questions in writing and produced further documents. The pharmacists started a discovery motion – first to compel answers to questions and then to compel Shoppers to produce an additional executive for examination, arguing that the other two witnesses had been unable to satisfactorily answer various questions about the professional allowances. Shoppers acquiesced to the pharmacists’ request to examine the additional witness. Further examinations took another four days.
The pharmacists then brought the present motion for an order requiring Shoppers to answer further 88 questions. The pharmacists also requested an order requiring three non-party individuals, who were no longer involved in Shoppers, to submit to examinations, and for two non-party drug manufacturers to provide documentary discovery.
The court ordered Shoppers to answer only some of the refusals
The court held that the category of questions and production requests about whether Shoppers was collecting professional allowances under “lawful agreements” with manufacturers was irrelevant to the issues in dispute (despite being pleaded in the Statement of Defence). Justice Perell observed that the claim was that Shoppers took professional allowances that belonged to the pharmacists, not that Shoppers violated the statutory regime. The fundamental questions were about the franchise agreement, not statutory issues.
The court also held that further questioning would be disproportionate, and that Shoppers had already answered the questions. The pharmacists had all they needed to argue that the agreements with manufacturers circumvented the statutory regime.
The court ordered Shoppers to produce other documents related to payments that Shoppers received over and above professional allowances and other amounts because those were relevant to the amount of over and above charges or receipts.
The pharmacists also requested answers to various questions about Shoppers’ relationship to the drug companies, which the court dismissed as a fishing expedition.
The court refused to compel the non-parties to submit to examinations or provide document disclosure
The court held that the pharmacists were able to obtain all the information that they needed from Shoppers. The pharmacists already knew how professional allowances were allocated and the amounts that Shoppers received. The court reiterated that the question of compliance with the statutory regime was irrelevant to the issues in dispute.
The court declined to order documentary discovery from a non-party. Documentary discovery from a non-party may be ordered when it would be unfair for the moving party to proceed to trial without it. It requires balancing this against the non-party’s interests, including privacy, inconvenience, and exposure to liability. The threshold is high, and the order should only be made in exceptional circumstances. The court held that this case did not meet the exceptional circumstances requirement for an order against a non-party.