On July 7, 2026, the Ontario Superior Court of Justice dismissed a motion[1] to certify a national class proceeding alleging the defendants engaged in unlawful price-fixing conspiracy to fix or manipulate the prices of fragrance products contrary to the Canadian Competition Act (“Act”).[2]
In dismissing the motion, the court provides important commentary on the “some basis in fact” test set out by the Supreme Court of Canada in Hollick,[3] the minimum evidentiary threshold required to certify a putative class pursuant to section 5.1 of the Ontario Class Proceedings Act (“CPA”),[4] along with the role of foreign regulatory investigations when alleging offences under Canadian competition legislation.
Background
The plaintiff commenced a class proceeding alleging the defendants, manufacturers of “fragrance ingredients”, engaged in an unlawful price-fixing conspiracy to fix or manipulate the prices of fragrance ingredients, fragrances and fragrance products contrary to the Act.[5]
The evidence relied on by the plaintiff in support of their motion consisted of various public documents evidencing only the commencement of antitrust investigations in foreign jurisdictions along with unsubstantiated hearsay evidence.
Pursuant to section 5(1) of the CPA, the plaintiff must establish “some basis in fact” for each of the certification requirements other than establishing a viable cause of action under the first stage of the test. Though this standard is low, there must be an evidentiary basis for concluding each of those criteria are met.[6]
The crux of the motion was whether the plaintiff’s evidence met the “some basis in fact” test, i.e. whether there was any factual basis underpinning the action and giving reason to suspect the plaintiff’s allegations may be true.[7]
The Certification Motion Decision
The motion judge dismissed the motion and declined to certify the class proceeding. The plaintiff failed to advance any evidence to support its allegation that the defendants committed an offence under the Act in Canada and accordingly, there is no basis in fact to establish classes of injured plaintiffs who share common issues.
The motion judge acknowledged the evidence put forward by the plaintiff, namely that regulators in certain jurisdictions had reason to suspect anti-competitive conduct, but that the purpose of those investigations were to determine if there had been violations under those respective antitrust regimes. The motion judge found that there had been no prosecutions, no guilty pleas or other admissions of wrongdoing in any of the investigations. One of the foreign investigations was terminated altogether without charges laid. Moreover, the motion judge found there had been no regulatory proceedings or findings in Canada which would support the assertion that anything done by the defendants was in breach of Canadian antitrust legislation.
The motion judge explained that class proceedings are unlike individual civil actions where evidence may be discovered following the close of pleadings:
“Before subjecting a defendant to the onerous requirements of responding to collective action on behalf of millions of potential class members, the court must be satisfied that the criteria for certification are met. This requires that the action has at least an air of reality. […] A class proceeding should not be an unfounded right to conduct an investigation into the affairs of an industry based only on the possibility that wrongdoing took place and the further possibility that the wrongdoing may have resulted in measurable damages.”[8]
The motion judge found that there was no evidence “at all” in relation to liability other than hearsay evidence of unsubstantiated concerns:
“It cannot be that the mere fact of investigations is evidence of wrongdoing. […] Evidence of unsubstantiated suspicion of wrongdoing by foreign regulators is hardly a basis in fact for allegations that statutory breaches or tortious activity exist such as to found liability in Canada.”[9]
Even if the plaintiff established some basis in fact to support issues common to the putative class, the motion judge found that the proposed class would suffer other deficiencies. For example, the number of layers of manufacturing, sub-manufacturing, distribution and sales would likely be different for different products giving rise to the potential for multiple overlapping classes and making it difficult, if not impossible, for a class member to self-identify into the class.[10]
Key Takeaways
Courts have an important gatekeeping role at the certification stage. While the evidentiary threshold for certification is lower than a “balance of probabilities”, and while the motion judge cannot enter into the merits of the action,[11] the plaintiffs must establish “some basis in fact” for their claims and such evidence must be scrutinized:
- Smoke doesn’t mean fire. While Ontario class proceedings legislation does not include a merits-based screening requirement at the certification stage, the requirements for certification do not allow a class proceeding to be certified merely because the plaintiff suspects wrongdoing. It cannot be a fishing expedition. There must be some evidence-based reason to conclude the class proceeding is appropriate.[12]
- Foreign evidence of investigations is insufficient to establish some basis in fact. The fact that investigations have been commenced in other antitrust proceedings does not, in of itself, constitute evidence of wrongdoing. If the plaintiff cannot show that any wrongful conduct took place or any damage was suffered and by whom, it is impossible to conduct the analysis demanded by the Act.[13]
- Pre-certification motions are useful. Preliminary dispositive motions may assist defendants later at the certification stage. The court noted that the defendants brought a preliminary motion disputing the admissibility of evidence relied on by the plaintiff to establish some basis in fact. The court deferred ruling on that motion. The basis of the motion subsequently became the driving reason for dismissing the plaintiff’s action at the certification stage.
Akiva Stern acted for the defendants, International Flavors and Fragrances Inc. and International Flavours and Fragrances (Canada) Ltd., in dismissing this certification motion.
The information and comments herein are for the general information of the reader and are not intended as advice or opinion to be relied upon in relation to any particular circumstances. For particular application of the law to specific situations, the reader should seek professional advice.
[1] Parris v. Firmenich International SA et. al., 2026 ONSC 3922 [Parris].
[2] R.S.C., 1985, c. C-34.
[3] Parris, paras 23-26; Hollick v. Toronto (City), 2001 SCC 68, [2001] 3 S.C.R. 158.
[4] 1992, S.O. 1992, c. 6.
[5] The plaintiff likewise pleaded parallel common law remedies including civil conspiracy and unjust enrichment.
[6] Parris, para 26. The plaintiff need not prove “some basis in fact” that they have articulated a viable cause of action in their pleadings under 5(1)(a) of the CPA. They must however, prove “some basis in fact” in respect of the remaining elements for certification, including establishing issues common to the class. Moreover, pursuant the Ontario class proceeding legislation, those common issues must predominate over any questions only affecting individual class members.
[7] Parris, para 4.
[8] Parris, para 33.
[9] Parris, para 35.
[10] Parris, paras 15-17.
[11] Parris, para 24-25.
[12] Parris, para 4-5.
[13] Parris, para 31.
