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Court File No. CV-18-00611214-00CL ONTARIO SUPERIOR COURT of JUSTICE COMMERCIAL LIST B E T W E E N: SEARS CANADA INC., by ITS CO

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Court File No. CV-18-00611214-00CL ONTARIO SUPERIOR COURT of JUSTICE COMMERCIAL LIST B E T W E E N: SEARS CANADA INC., by ITS CO Court File No. CV-18-00611214-00CL ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST B E T W E E N: SEARS CANADA INC., BY ITS COURT-APPOINTED LITIGATION TRUSTEE, J. DOUGLAS CUNNINGHAM, Q.C. Plaintiff - and - ESL INVESTMENTS INC., ESL PARTNERS LP, SPE I PARTNERS, LP, SPE MASTER I, LP, ESL INSTITUTIONAL PARTNERS, LP, EDWARD LAMPERT, EPHRAIM J. BIRD, DOUGLAS CAMPBELL, WILLIAM CROWLEY, WILLIAM HARKER, R. RAJA KHANNA, JAMES MCBURNEY, DEBORAH ROSATI, and DONALD ROSS Defendants BOOK OF AUTHORITIES OF THE DEFENDANTS WILLIAM HARKER, WILLIAM CROWLEY, DONALD ROSS, EPHRAIM J. BIRD, JAMES MCBURNEY, AND DOUGLAS CAMPBELL MOTION TO STRIKE RETURNABLE APRIL 17, 2019 March 29, 2019 CASSELS BROCK & BLACKWELL LLP 2100 Scotia Plaza 40 King Street West Toronto, ON M5H 3C2 William J. Burden LSO #: 15550F Tel: 416.869.5963 Fax: 416.640.3019 [email protected] Wendy Berman LSO #: 32748J Tel: 416.860.2926 Fax: 416.640.3107 [email protected] Lawyers for the Defendants William Harker, William Crowley, Donald Ross, Ephraim J. Bird, James McBurney, and Douglas Campbell 2 TO: LAX O’SULLIVAN LISUS GOTTLIEB LLP 145 King Street West, Suite 2750 Toronto, ON M5H 1J8 Matthew P. Gottlieb LSO#: 32268B Tel: 416.644.5353 Fax: 416.598.3730 [email protected] Andrew Winton LSO #: 54473I Tel: 416.644.5342 Fax: 416.598.3730 [email protected] Philip Underwood LSO#: 73637W Tel: 416.645.5078 Fax: 416.598.3730 [email protected] Lawyers for the Plaintiff AND TO: BENNETT JONES LLP Barristers and Solicitors 1 First Canadian Place Suite 3400 P.O. Box 130 Toronto, ON M5X 1A4 Richard Swan LSO #:32076A Tel: 416.777.7479 Fax: 416.863.1716 [email protected] Jason Berall LSO #: 68011F Tel: 416.777.5480 Fax: 416.863.1716 [email protected] Lawyers for the Defendants R. Raja Khanna and Deborah Rosati 3 AND TO: POLLEY FAITH LLP The Victory Building 80 Richmond Street West Suite 1300 Toronto, ON M5H 2A4 Harry Underwood LSO #: 20806C Tel: 416.365.6446 Fax: 416.365.1601 [email protected] Andrew Faith LSO #: 47795H Tel: 416.365.1602 Fax: 416.365.1601 [email protected] Jeffrey Haylock LSO #: 61241F Tel: 416.365.0404 Fax: 416.365.1601 [email protected] Lawyers for the Defendants ESL Investments Inc., ESL Partners LP, SPE I Partners LP, SPE Master I LP, ESL Institutional Partners LP, and Edward Lampert TABLE OF CONTENTS TAB CASE LAW 1. Knight v. Imperial Tobacco Canada Ltd., 2011 SCC 42 2. Research Capital Corp. v. Skyservice Airlines Inc. (2008), 170 A.C.W.S. (3d) 47 (Sup. Ct.) 3. Balanyk v. University of Toronto (1999), 88 A.C.W.S. (3d) 1157 (Sup. Ct.) 4. Best v. Lancaster, 2015 ONSC 6269 5. Ontario Consumers Home Services v. Enercare Inc., 2014 ONSC 4154 6. Hostmann-Steinberg Ltd. v. 2049669 Ontario Inc., 2010 ONSC 2441 7. Martin v. Astrazeneca Pharmaceuticals PLC, 2012 ONSC 2744 8. J.G. Young & Sons Ltd. v. Tec Park Ltd. (1999), 92 A.C.W.S. (3d) 198 (Sup. Ct.) 9. Rare Charitable Research Reserve v. Chaplin (2009), 180 A.C.W.S. (3d) 411 (Sup. Ct.) 2011 SCC 42 Supreme Court of Canada Knight v. Imperial Tobacco Canada Ltd. 2011 CarswellBC 1968, 2011 CarswellBC 1969, 2011 SCC 42, [2011] 11 W.W.R. 215, [2011] 3 S.C.R. 45, [2011] B.C.W.L.D. 6757, [2011] B.C.W.L.D. 6758, [2011] B.C.W.L.D. 6759, [2011] B.C.W.L.D. 6761, [2011] B.C.W.L.D. 6832, [2011] B.C.W.L.D. 6931, [2011] B.C.W.L.D. 6932, [2011] B.C.W.L.D. 6933, [2011] B.C.W.L.D. 6948, [2011] A.C.S. No. 42, [2011] S.C.J. No. 42, 205 A.C.W.S. (3d) 92, 21 B.C.L.R. (5th) 215, 25 Admin. L.R. (5th) 1, 308 B.C.A.C. 1, 335 D.L.R. (4th) 513, 419 N.R. 1, 521 W.A.C. 1, 83 C.B.R. (5th) 169, 86 C.C.L.T. (3d) 1 Her Majesty The Queen in Right of Canada (Appellant / Respondent on cross-appeal) and Imperial Tobacco Canada Limited (Respondent / Appellant on cross-appeal) and Attorney General of Ontario and Attorney General of British Columbia (Interveners) Attorney General of Canada (Appellant / Respondent on cross-appeal) and Her Majesty The Queen in Right of British Columbia (Respondent) Imperial Tobacco Canada Limited, Rothmans, Benson & Hedges Inc., Rothmans Inc., JTI-MacDonald Corp., R.J. Reynolds Tobacco Company, R.J. Reynolds Tobacco International Inc., B.A.T. Industries p.l.c., British American Tobacco (Investments) Limited, Carreras Rothmans Limited, Philip Morris USA Inc. and Philip Morris International Inc. (Respondents / Appellants on cross-appeal) and Attorney General of Ontario, Attorney General of British Columbia and Her Majesty The Queen in Right of the Province of New Brunswick (Interveners) McLachlin C.J.C., Binnie, LeBel, Deschamps, Fish, Abella, Charron, Rothstein, Cromwell JJ. Heard: February 24, 2011 Judgment: July 29, 2011 * Docket: 33559, 33563 Proceedings: reversing British Columbia v. Imperial Tobacco Canada Ltd. (2009), 313 D.L.R. (4th) 651, 2009 BCCA 540, 2009 CarswellBC 3307, 98 B.C.L.R. (4th) 201, [2010] 2 W.W.R. 385, 280 B.C.A.C. 100, 474 W.A.C. 100 (B.C. C.A.); reversing in part British Columbia v. Imperial Tobacco Canada Ltd. (2008), 2008 BCSC 419, 2008 CarswellBC 687, [2008] 12 W.W.R. 241, 292 D.L.R. (4th) 353, 82 B.C.L.R. (4th) 362 (B.C. S.C.); and reversing Knight v. Imperial Tobacco Canada Ltd. (2009), 2009 BCCA 541, 2009 CarswellBC 3300, [2010] 2 W.W.R. 9, 99 B.C.L.R. (4th) 93, 313 D.L.R. (4th) 695, 280 B.C.A.C. 160, 474 W.A.C. 160 (B.C. C.A.); reversing in part Knight v. Imperial Tobacco Canada Ltd. (2007), 2007 BCSC 964, 2007 CarswellBC 1806, [2008] 4 W.W.R. 156, 76 B.C.L.R. (4th) 100 (B.C. S.C.) Counsel: John S. Tyhurst, Paul Vickery, Travis Henderson for Appellant / Respondent on cross-appeal, Her Majesty the Queen in Right of Canada Paul Vickery, John S. Tyhurst, Travis Henderson for Appellant / Respondent on cross-appeal, Attorney General of Canada Deborah Glendining, Nada Khirdaji for Respondent / Appellant on cross-appeal, Imperial Tobacco Canada Limited Ryan D. W. Dalziel, Daniel A. Webster, Q.C. for Respondent, Her Majesty the Queen in Right of British Columbia John J.L. Hunter, Q.C., Brent B. Olthuis for Respondent / Appellant on cross-appeal, Imperial Tobacco Canada Limited Kenneth N. Affleck, Q.C. (written) for Respondents / Appellants on cross-appeal, Rothmans, Benson & Hedges Inc. and Rothmans Inc. Jeffrey J. Kay, Q.C. (written) for Respondents / Appellants on cross-appeal, JTI-MacDonald Corp., R.J. Reynolds Tobacco Company, R.J. Reynolds Tobacco International Inc. 1 Craig P. Dennis, Michael D. Shirreff (written) for Respondents / Appellants on cross-appeal, B.A.T. Industries p.l.c., British American Tobacco (Investments) Limited Christopher M. Rusnak (written) for Respondent / Appellant on cross-appeal, Carreras Rothmans Limited D. Ross Clark (written) for Respondent / Appellant on cross-appeal, Philip Morris U.S.A. Inc. Simon V. Potter, Michael A. Feder, Angela M. Juba for Respondent / Appellant on cross-appeal, Philip Morris International Inc. Malliha Wilson, Lynne McArdle for Intervener, Attorney General of Ontario Jeffrey S. Leon, Robyn M. Ryan Bell, Michael A. Eizenga for Intervener, Her Majesty the Queen in Right of New Brunswick Nancy Brown for Intervener, Attorney General of British Columbia McLachlin C.J.C.: I. Introduction 1 Imperial Tobacco ("Imperial") is a defendant in two cases before the courts in British Columbia, British Columbia v. Imperial Tobacco Canada Ltd., Docket: S010421, and Knight v. Imperial Tobacco Canada Ltd., Docket: L031300. In the first case, the Government of British Columbia is seeking to recover the cost of paying for the medical treatment of individuals suffering from tobacco-related illnesses from a group of 14 tobacco companies, including Imperial ("Costs Recovery case"). The second case is a class action brought against Imperial alone by Mr. Knight on behalf of class members who purchased "light" or "mild" cigarettes, seeking a refund of the cost of the cigarettes and punitive damages ("Knight case"). 2 In both cases, the tobacco companies issued third-party notices to the Government of Canada, alleging that if the tobacco companies are held liable to the plaintiffs, they are entitled to compensation from Canada for negligent misrepresentation, negligent design, and failure to warn, as well as at equity. They also allege that Canada would itself be liable under the statutory schemes at issue in the two cases. In the Costs Recovery case, it is alleged that Canada would be liable under the Tobacco Damages and Health Care Costs Recovery Act, S.B.C. 2000, c. 30 ("CRA"), as a "manufacturer". In the Knight case, it is alleged that Canada would be liable as a "supplier" under the Business Practices and Consumer Protection Act, S.B.C. 2004, c. 2 ("BPCPA"), and its predecessor, the Trade Practice Act, R.S.B.C. 1996, c. 457 ("TPA"). 3 In both cases, Canada brought motions to strike the third party notices under r. 19(24) of the Supreme Court Rules, B.C. Reg. 221/90 (replaced by the Supreme Court Civil Rules, B.C. Reg. 168/2009, r. 9-5), arguing that it was plain and obvious that the third-party claims failed to disclose a reasonable cause of action. In both cases, the chambers judges agreed with Canada, and struck all of the third-party notices.
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