A Cautionary Tale: Saskatchewan Court Refuses To Approve $20 Million Class Action Settlement

The recent decision in Perdikaris v. Purdue Pharma et al., 2018 SKQB 86 refusing approval of a $20 million class action settlement is an important reminder that settlement approval is not a "rubber stamp" process. Canadian Courts have generally exercised their supervisory jurisdiction over class action settlements liberally and approved them unless the settlements are clearly unfair. However, Perdikaris is an important reminder that Courts may closely scrutinize the proposed settlement—including the evidence, assumptions, and calculations put forward by class counsel to justify the settlement amount—to ensure the settlement is in the best interests of the class.

Perdikaris involved a proposed $20 million settlement of a class action against the makers of OxyContin® and OxyNEO® on behalf of persons who became addicted to the drugs prescribed by their physicians. The settlement had already been approved in Ontario, Nova Scotia and Québec but, in Saskatchewan, Justice