527
THE FUTURE OF SECURITIES CLASS
ACTIONS IN CANADA:
A COMMENT ON THE ARTICLE OF PHILIP
ANISMAN AND GARRY WATSON1
Joseph Groia, Karen Danielson, and Michael Zogala2
The truth is rarely pure and never simple.
– Oscar Wilde, The Importance of Being Earnest
A. INTRODUCTION
In their article “Some Comparisons between Class Actions in Canada and the
U.S.: Securities Class Actions, Certifications, and Costs,” Philip Anisman
and Garry Watson outline the parameters of, and critique the recent
changes to, the statutory civil liability securities law regime in the prov-
ince of Ontario. These revisions to the Ontario Securities Act,3 commonly
referred to as Bill 198, came into effect 31 December 2005 and were, at
least in part, intended to redefine investors’ recourse for secondary mar-
ket corporate disclosure violations.
Proponents of Bill 198 maintain that it provides Ontario shareholders
with a viable mechanism to launch class action lawsuits against compa-
nies whose secondary market stock prices are affected by misrepresen-
tations (or non-disclosures) made by those companies or certain other
parties. They also assert that the system of checks and balances embed-
ded in the legislation empowers the judiciary to shield companies from
frivolous U.S. style “strike suits.”4 However, critics of the legislation decry
1 This paper is a response to Philip Anisman & Garry Watson’s article, “Some
Comparisons between Class Actions in Canada and the U.S.: Securities Class
Actions, Certifications, and Costs,” published in this collection.
2 Joseph Groia is a principal of Groia & Company Professional Corporation,
Toronto; Karen Danielson is counsel at the Investment Dealers Association of
Canada; Michael Zogala is a law student at Osgoode Hall Law School, Class of
2007.
3 Securities Act, R.S.O. 1990, c. S.5 [OSA].
4 A strike suit is defined as a “shareholder derivative action begun with [the] suit is defined as a “shareholder derivative action begun with [the]
hope of winning large attorney fees or private settlements, and with no inten-
