June 4, 2010
On June 3, 2010 the Supreme Court denied leave to appeal in the DRAMS price-fixing class action case (Infineon Technologies AG et al. v. Pro‑Sys Consultants Ltd.).
In this important case, leave to appeal to the Supreme Court was sought from the British Columbia Court of Appeal that had approved the DRAM memory price-fixing class action. The British Columbia Court of Appeal had reversed the British Columbia Supreme Court’s decision and certified the class action against a group of five technology manufacturers accused of fixing their prices for computer memory chips.
The Court of Appeal held that the British Columbia Class Proceedings Act should be “construed generously in order to achieve its objectives” – for example, to improve access to justice and avoid duplication in legal proceedings. The impact of the recent Supreme Court decision to deny leave in this case is that the British Columbia Court of Appeal’s decision is now the latest appellate judgment on the certification of competition law class actions in Canada and the first Canadian appellate decision certifying a contested competition law class action.
It is also thought that the Court of Appeal’s decision has significantly lowered the bar to certify competition law class actions in Canada, including those involving indirect purchasers, which has been a significant obstacle to obtaining certification in past cases.
The respondent computer firms in this case include Infineon, Hynix Semiconductor Inc., Samsung Electronics Co. Ltd., Micron Technology Inc. and Elpida Memory, Inc., who together represent approximately 76% of the global production of “dynamic random access memory” (or “DRAM”) that provides electronic memory and information retrieval for computer and telecommunications products. Three of the respondents have settled U.S. class action proceedings for USD $160 million and all of the respondents, with the exception of Micron, have pleaded guilty to criminal cartel charges in the U.S. and have paid fines totalling about USD $731 million.
This case is one of several recent plaintiff-favourable price-fixing class actions under the Competition Act, including a recent Ontario indirect purchaser certification judgment (the hydrogen peroxide case) in which the Ontario Superior Court granted certification in a case involving an indirect and direct class.
Together with the recent sweeping changes to the Competition Act, which have significantly lowered the bar to establish criminal conspiracies in Canada, this most recent plaintiff-favourable price-fixing class action case is expected to lead to a marked increase in competition law class action activity in Canada.
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