In May 2009, approximately 200 General Motors dealers were eliminated in connection with the federal auto bailout. This class action lawsuit seeks $750 million in damages on behalf of those dealers.

The lawsuit claims that General Motors of Canada Limited, a subsidiary of General Motors Company, breached franchise laws in connection with the agreements which GM obtained from the dealers it selected for elimination as part of the federal bailout. The lawsuit claims that many of the dealers have a right under provincial franchise laws to rescind or cancel the agreements and that all dealers have a right to sue for breach of the duty of fair dealing under Ontario’s franchise statute. The bailout was the largest government subsidy given to a corporation in Canadian history.

Also named in the suit is Cassels Brock & Blackwell LLP (“CBB”), a Canadian law firm which had been retained in advance to represent Canadian dealers in a GM restructuring or bankruptcy. The claim alleges that CBB failed to disclose to the dealers that it was simultaneously acting for the Canadian Government in the GM auto bailout and that it breached its duties to the dealers.

The representative plaintiff, Trillium Motor World Ltd. of Toronto Ontario, brought the action under Ontario’s Class Proceedings Act, 1992. The members of the proposed class include automotive dealerships in every province of Canada.

On March 1, 2011, the Ontario Superior Court of Justice released a decision certifying the action as a class proceeding. The class consists of all dealers who signed the wind-down agreements terminating their franchises.

On June 22, 2011, the Honourable Justice W. Low of the Divisional Court granted leave to appeal in part to the defendants. The appeal in the Divisional Court will likely take place in the fall.

Pleadings

• Statement of claim (Feb 12, 2010)
• Déclaration (12 Février 2010)
• Statement of defence (Cassels Brock & Blackwell LLP) (April 29, 2011)
• Statement of defence of Cassels Brock & Blackwell LLP (version française)
• Statement of defence and counterclaim (GM Canada Ltd.) (May 2, 2011)
• Statement of defence and counterclaim (GM Canada Ltd.) (Version française)
• Reply to Cassels Brock defence (June 17, 2011)
• Réponse à la défense de Cassels Brock (17 juin 2011)

Court Decisions and Orders

• Reasons of Justice Low granting appeal to Divisional Court (June 22, 2011)
• Décision de Madame le juge Low (version française) (22 Juin 2011)
• Certification Order (Mar 1, 2011)
• Reasons of Justice Strathy certifying the action as a class proceeding
• Raisons de la Cour Supérieure de Justice (version française)

More information

• Class Action Update May 18, 2010
• Mise à jour 18 Mai, 2010 (version française)
• Class Action Update Feb 11, 2010
• Mise à jour 11 Fév, 2010 (version française)
• Class Action FAQ

• January 12, 2012: An appeal was heard before the Divisional Court in Toronto. Under appeal was whether 2 of the common issues against GMCL were properly certified for a class action, and whether 3 of the issues against Cassels Brock & Blackwell LLP were properly certified. Many former GM dealers were in attendance in the courtroom. A decision will be released in the coming months.
  
• October 11, 2011: The appeal from the certification order will be heard on January 12, 2012 at Osgoode Hall in Toronto.
• June 22, 2011: The Honourable Justice W. Low of the Divisional Court granted leave to appeal in part to the defendants. The appeal in the Divisional Court will likely take place in the fall.
• March 1, 2011: The Ontario Superior Court of Justice released a decision certifying the action as a class proceeding. The class consists of all dealers who signed the wind-down agreements terminating their franchises.

Andy Seretis
t: 416.977.5333 x 306
f: 416.977.0717
e: aseretis@sotosllp.com

Allan Dick
t: 416.977.5333 x 309
f: 416.977.0717
e: adjdick@sotosllp.com

David Sterns
t: 416.977.5333 x 313
f: 416.977.0717
e: dsterns@sotosllp.com