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Practice Areas > Shoppers Drug Mart

Shoppers Drug Mart

Update

The opt out period is over.

Class members who did not opt out on or before February 21, 2014 at 5:00 p.m. E.S.T. are automatically included in the class, and do not need to take any steps at this time. We encourage you to provide us with your current contact information, so that you receive notices and updates as this case proceeds. We will continue to update this website as well.

Certification

This action has been certified as a class proceeding.  The class members are:

  • All current or former Shoppers Drug Mart Associates resident in Canada (save for Associates with franchised businesses located in Quebec) who entered into an Associate Agreement with Shoppers Drug Mart Inc. and/or Shoppers Drug Mart (London) Limited dated between January 1, 2002 and January 1, 2010  (the “2002 Agreement Class”), and
  • All current or former Shoppers Drug Mart Associates resident in Canada (save for Associates with franchised businesses located in Quebec) who entered into an Associate Agreement with Shoppers Drug Mart Inc. and/or Shoppers Drug Mart (London) Limited dated between January 1, 2010 and July 9, 2013 (the “2010 Agreement Class”).

The court has certified this action as a class proceeding in respect of the professional allowances claims, the cost recovery fees claims and the inventory practices claims.

The certification motion was argued in two parts, the first part, which addressed whether the statement of claim asserted reasonable causes of action, was argued in the last week of August, 2012, with the decision released on October 3, 2012. 

The balance of the certification motion, which addressed whether the remaining claims were appropriate to be prosecuted on a class-wide basis, was heard from June 3 to June 6, 2013, with the decision released on July 9, 2013.

Copies of the court orders and the decisions can be accessed under the "Documents" tab.

Overview

Shoppers Drug Mart operates a large system of franchised pharmacy stores across Canada. Each of these stores is independently owned and operated by franchisees (called “Associates”). Associates are required to enter into standard form franchise agreements with Shoppers Drug Mart (the “Associate Agreement”). The claim is brought on behalf of Associates across Canada, excluding Quebec.

The claim alleges that Shoppers Drug Mart has breached certain terms of the Associate Agreement, as well as its statutory and common law duty of good faith and fair dealing regarding the operation of the franchise system. Particularly, the action seeks compensation for Ontario Associates for damages suffered by them as a result of Shoppers Drug Mart’s failure to remit professional allowances to them.  For Associates governed by the 2002 Associates’ Agreement, the claim alleges that they have been inappropriately charged the Optimum Program Fee.  In respect of all Associates, excluding Quebec, the claim seeks damages for excessive charges by Shoppers Drug Mart in respect of cost recovery fees, imposing penalties when budget targets are not met, and commercially unreasonable procurement and inventory policies.

The claims relating to budget targets have not been certified as part of the class proceeding.

The Defendant denies the allegations made in the claim.  None of the allegations have been proven in court.

FAQ

What is a class action?

A class action, also known as a class proceeding, is a lawsuit in which one party, or a group of parties, may sue or be sued as representatives of a larger class.

Before a class action may proceed, the court must be satisfied that the case meets certain criteria.  The court determines whether the case satisfies the criteria in a hearing called a motion for certification. 

In Ontario, once an action is certified as a class proceeding, a notice is published, which informs members of the class about the class proceeding. 

Everyone who fits the definition of a class member is automatically included in the class action, unless they choose to exclude themselves by “opting out.”  After the action is certified, the class will be provided with a period of time to decide whether they wish to participate or opt out.   Class members who do not opt out of the class are automatically part of the class.

What is the status of the class action against Shoppers Drug Mart?

On July 9, 2013, the Ontario Superior Court of Justice certified an action (Court File No. CV-10-414774-00CP) as a class proceeding against Shoppers Drug Mart Inc. In this action, the plaintiffs allege that Shoppers breached its Associate Agreements in the way it has carried out its inventory practices, and by charging excessive cost recovery fees.  The claim seeks compensation for the class in respect of these alleged overcharges.

The action also seeks compensation for Associates in Ontario (called the “Professional Allowance Class”) for losses claimed to have been suffered by them because Shoppers has not paid professional allowances that it allegedly received on behalf of the Professional Allowance Class.

As part of the certification order, the Court appointed Giovanni Spina, John Spina Drugs Ltd., Romeo Vandenburg and Romeo Vandenburg Drugs Ltd. as the representative plaintiffs on behalf these two classes of Associates. A representative plaintiff is the person who prosecutes the case on behalf of the class, and provides instruction to the lawyers for the class.

Shoppers denies all the claims made against it. By certifying this action as a class proceeding, the court has not decided if any of the plaintiffs’ allegations are true. The plaintiffs will be required to prove their claims at a trial.

The next step is to notify all Associates who are class members that the action has been certified, and provide them with an opportunity to opt out. All known class members will be sent a notice to their last known address which have been provided by the defendants pursuant to a court order.  The notice will contain information about the action.

The next step in the action will be for Shoppers to deliver a Statement of Defence responding to the plaintiffs’ allegations.

Am I a class member?

You are a class member if you are a current or former Shoppers Drug Mart Associate who is or was resident in Canada (save for Quebec) and who entered into an Associate Agreement with Shoppers Drug Mart Inc. and/or Shoppers Drug Mart (London) Limited dated between January 1, 2002 and January 1, 2010 and/or between January 1, 2010 and July 9, 2013.

You are also a class member if you are a current or former Shoppers Drug Mart Associate located in Ontario who performed direct patient care services at any time since October 1, 2006.

I recently received a notice in the mail. What does it mean?

After a class proceeding is certified, a notice is published and/or mailed to the affected people setting out in general terms the details of the action, and explaining how to opt out of the class action, if the individual does not wish to be included in the action or bound by the results of the action. 

If you wish to remain part of the class, you do not need to take any steps at this time.  You are welcome to contact class counsel at any time if you have any questions.

What do I have to do to join the class action against Shoppers Drug Mart?

You do not have to do anything to be included in a class. The court order certifying the class proceeding sets out the definition of the class.  If you fall within the definition of the class you are automatically a member of the class unless you opt out within the specified time period.

If the class action is resolved (after a trial, or as a result of a settlement), class members may be required to provide certain information to a claims administrator in order to receive their portion of the judgment or settlement fund.  We recommend that you keep in a safe place all documentation that you have regarding the expenses you incurred as a Shoppers’ Associate, and the reports you provided to Shoppers regarding patient care services supporting the Professional Allowances claimed by Shoppers.

We endeavour to keep class members advised as the action proceeds by updating our website whenever major events in the litigation occur.  We will also answer direct inquiries sent to us by email or left on the toll-free telephone line’s confidential voicemail.

As a class member do I have to pay the legal fees of the class counsel?

Class Members will not have to pay any legal fees directly in connection with the common issues phase of the Class Action. 

The Lawyers for the Class (“Class counsel”) have entered into a contingency fee agreement with the representative plaintiffs. Class counsel will not be paid for their work unless the Class Action is successful either by a judgment against Shoppers, or by completing a settlement with Shoppers that is approved by the court. 

Under the contingency fee agreement, Class counsel are to be paid a contingency fee of 33 1/3% of the amount recovered in the Class Action, but that amount remains subject to the approval of the court before it can be paid. 

Any court costs received from Shoppers will be used first to pay for the expenses of the action, and secondly towards the payment of Class counsel’s fees if the action is successful. Class counsel and the Class Proceedings Fund will pay for the expenses incurred in prosecuting the Class Action that are not covered by costs awards received from Shoppers.

Before Class Counsel are paid any fees, the fees must be approved by the court.

If the class action is successful, how will class members be affected?

  1. Each class member will be bound by the judgment in the Class Action.  Class members cannot advance an individual claim against the defendants that relates to the same subject matter.
  2. If the plaintiffs reach a settlement with Shoppers or obtain a judgment from the court, the money will be shared amongst the members of the class in the manner the court directs.
  3. If there are individual issues remaining after the resolution of the common issues, (for example to determine the total amount of each class member’s losses) it is possible that there may be some costs to you to present your case to a claims administrator or other adjudicator prove the value of your claim.

If the class action is unsuccessful, how will class members be affected?

The main consequence of any judgment (favourable or unfavourable) is that each class member will be bound by the judgment and cannot advance an individual claim against the defendants on the same subject matter.

An unfavourable judgment in the common issues trial will not have any financial consequences for any class member. The class is protected by funding from an organization called the “Class Proceedings Fund”.  Normally, in a lawsuit, the unsuccessful party must pay a contribution towards the legal fees of the successful party. Because of funding from Class Proceedings Fund, class member will not pay anything in the event of an unsuccessful judgment in the common issues trial.

How can I contact Paliare Roland LLP?

  1. By Mail:
    Shoppers Drug Mart Class Action
    Paliare Roland Rosenberg Rothstein LLP
    155 Wellington St. W., 35th Floor
    Toronto, ON, M5V 3H1
  2. By Phone:1-877-203-2866.
  3. By Fax:  416-646-4301
  4. By Email:  info@Shoppersclassaction.com

If you have any questions that are not answered on the website, please do not hesitate to contact us.

This website will be updated when significant events occur in this proceeding.

This action is receiving financial support from the Ontario Class Proceedings Fund.

The Fund pays for some of the disbursements incurred in the course of prosecuting this action, and it will pay any adverse court costs that might be ordered payable by the representative plaintiff.

There will be a levy payable to the Fund that will reduce the amount of any settlement or judgment award to which the class may become entitled.  The levy will be comprised of repayment of any disbursements paid by the Fund and 10% of the net award or settlement funds.

Last Updated January 2016

  • Action commenced by way of Notice of Action on November 13, 2010
  • Statement of Claim filed and served on December 20, 2010
  • Plaintiffs’ Motion Record for Certification served on April 8, 2011
  • Defendants’ Responding Record on Certification served on October 13, 2011
  • Plaintiffs’ Reply Motion Record served on November 11, 2011
  • Defendants Motion Record for motion to strike served on March 15, 2012
  • Motion to strike and one aspect of the certification hearing heard the week of August 27, 2012
  • Justice Perell’s decision on the motion to strike and one aspect of the certification motion released October 3, 2012
  • Order dated October 3, 2012
  • Plaintiffs’ Fresh as Amended Statement of Claim and Amended Motion Record for Certification served on December 21, 2012
  • Balance of the certification motion was heard the week of June 3. 2013
  • Justice Perell's decision on the balance of the motion for certification was released on July 9, 2013.
  • Order dated July 9, 2013
  • Notice sent to Class Members, November 29, 2013 
  • Opt out period ended February 21, 2014

Last Updated July 2014

If you have any questions or wish to provide documents to us, contact us by way of email, fax, deliver or mail at:

Paliare Roland Rosenberg Rosenberg LLP
Attention: Shoppers Drug Mart Class Action
155 Wellington Street West, Suite 3500
Toronto, ON  M5V 3H1 

E-mail: info@sdmclassaction.com
Phone: 1-877-203-2866
Fax: 1-416-646-4301

Exceptional Advocates.

155 WELLINGTON ST WEST, 35th FLOOR TORONTO ON M5V 3H1

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