Osgoode experts warn about the legal impact of the metaverse and other next-gen technologies

Person wearing an VI visor with Metaverse written on it

Lawyers and law students beware: Next-generation technologies like the metaverse, Web 3.0, ChatGPT, blockchain and cryptocurrency could pose enormous challenges to legal systems that those in the profession are only beginning to grapple with.

That was one of the warnings to come out of a recent panel discussion featuring Osgoode professors with expertise in the areas of labour law, intellectual property (IP), human rights, tax law, privacy law and tort law.

The event, titled The Legal Implications of the Metaverse, took place March 9 at the law school and was hosted by the Osgoode-based Jack & Mae Nathanson Centre on Transnational Human Rights, Crime and Security. A full video recording is available here.

“Web 3.0 (or Web3) is on the verge of happening and, as lawyers, we haven’t even mastered Web 2.0,” said labour law Professor Valerio De Stefano, who holds the inaugural Canada Research Chair in Innovation, Law and Society.

“No one could have imagined that social networks could be at the centre of revolutions around the world,” he added. “We as lawyers weren’t prepared for that.”

De Stefano was joined on the panel by Professors Barnali Choudhury, director of the Nathanson Centre and an expert on business, global economic issues and human rights, Carys Craig, an IP law expert, Jinyan Li and Ivan Ozai, both tax law experts, Dan Priel, a tort law expert, and Jonathan Penney, an expert in privacy law, cybersecurity and artificial intelligence.

While the concept of the metaverse remains in flux, it is generally conceived as a virtual world made up of 3D technology, avatars and digital marketplaces. Some of the most popular examples include games or multimedia entertainment platforms such as Second Life, Fortnite or Roblox.

Craig noted that non-fungible tokens or NFTs have become important objects of ownership in the digital world, sometimes fetching astronomical prices, like a one-of-a-kind NFT of the Birkenstock sandals worn by Apple co-founder Steve Jobs, which sold at one point for over $200,000. Amid a meta-marks gold rush, she said, applications for trademarks in the metaverse have even extended to Velveeta cheese in virtual restaurants and virtual Band-Aids.

Increasingly, she added, trademarks in the virtual world are seen as pieces of property in themselves and some investors see a new universe of commercial opportunity. Citing a 2003 article by Duke University law professor James Boyle, Craig said we could be seeing a “second enclosure movement,” akin to the push in 18th and 19th century Britain to take land that had formerly been held in common by members of a village and changing it to privately owned land.

“Now there’s not just a cyberspace to be conquered and claimed but a whole metaverse,” she said. “The future of this for-sale doctrine is really uncertain.”

On the human rights front, Choudhury said the metaverse could contribute to progress in advancing the right to education, the right to health and the right to freedom of expression. But it also poses potentially serious risks to other freedoms like the right to privacy, especially with its tendency towards “data collection on steroids.”

In the offline world, governments have an obligation to protect rights, she said. Not so in the corporate-controlled metaverse. Its expansion could eventually put pressure on companies to take on new responsibilities to protect human rights, she added.

“Unless we want the metaverse to continue to resemble the wild west,” said Choudhury, “we need states and corporations to step up to do their part to protect human rights.”

The task of taxation in the metaverse could be just as troublesome, said Ozai. For starters, the questions of who and what is being taxed, where (as in what jurisdiction) and how much to tax are more difficult to answer. “Tax systems today are designed for a bricks and mortar economy,” he said.

The complications are only compounded by the fact that there is not one metaverse, but different metaverses run by different companies. Ozai said one option would be to treat each metaverse as a “black box” and only tax economic activity when it’s reflected in the outside world. But that approach would risk perpetual deferral of taxation.

Li observed that while the existence of a virtual world, a tax world and a legal world are certainties, how to marry the three is anything but certain. “The multiverse could become a huge tax haven,” she added, “if governments can’t figure out who’s doing what.”

Still, she noted, similar fears accompanied the rise of e-commerce in the 1990s and, ultimately, they were unfounded.

In the age of megadata, concerns about privacy may be more warranted, said Penney. “To be a privacy lawyer today in the world of metaverses,” he joked, “is to feel the glass is empty, broken and I’m going to cut my hand.”

He pointed out that only 20 minutes spent playing a virtual reality game can generate two million data elements on the individual player. The rise of big data and the metaverse is part of a broader trend towards surveillance capitalism, he added. Huge tech firms, meanwhile, are attempting to evade regulation by arguing that their products are only games.

“But if we want to be serious about privacy,” said Penney, “we need to advocate for better privacy protections.”

Despite the potential problems, Dan Priel expressed optimism that traditional tort law could be the solution for many of the disputes that arise in the metaverse.

“Technology may change,” he said, “but there’s one thing that doesn’t change and that’s human nature.”

Participants in the metaverse are still liable to encounter potential torts like identify theft, fraud, passing off, defamation and even malpractice.

“You will have all this in the metaverse just as you do in the offline world,” he said. “But as long as it has real-world implications, then tort law will be able to adapt.”

 

Professor probes the right to housing, homelessness and Indigenous land rights

What does the right to housing mean in Canadian law?

That’s one of the fundamental issues that Osgoode Professor Estair Van Wagner wrestles with in her research and teaching around the often controversial areas of property law and natural resources law.

Along with her work on homelessness and public space, Van Wagner also focuses her research on Indigenous land rights and property law.

Since the onset of the COVID-19 pandemic, she’s been a sought-after expert on the topic of homeless encampments, especially in the wake of a recent decision by an Ontario Superior Court judge rejecting the Region of Waterloo’s application to forcibly remove a homeless encampment from property it owns because of the lack of shelter space in the area.

Influenced by a series of B.C. court decisions starting with Victoria (City) v. Adams in 2008, Justice M.J. Valente ruled that the legal remedies sought by the Region of Waterloo violate the encampment residents’ rights to life, liberty and security of the person under the Charter of Rights and Freedoms.

Van Wagner, who also serves as the co-director of Osgoode’s Environmental Justice and Sustainability Clinic, said the same issues will resurface later this year when the courts rule on the City of Hamilton’s eviction of residents of a homeless encampment.

Among other projects, Van Wagner has overseen or contributed to research that takes a human rights approach to homeless encampments, including an analysis of the City of Toronto’s approach to the encampments during the pandemic and an overview of homeless encampments across Canada, prepared for the Office of the Federal Housing Advocate.

“My hope,” she says, “is that our research is useful to groups working on the ground to mobilize change at the local level – saying to municipalities that the way you’re dealing with homeless encampments is violating human rights and is a manifestation of our failure to realize the right to housing.”

“Ultimately,” she adds, “my research is really aimed at understanding how property and property law contribute to various forms of injustice.”

Under Canada’s colonial system of property law, says Van Wagner, the concept of ownership is often understood as exclusionary: “It’s our property, we own it, and we get to decide.”

“We need to really rethink that in order to put human rights and social justice and equity at the centre of our decision-making,” she says. “There needs to be a much more nuanced approach to how we share property.”

In this regard, said Van Wagner, there is much to learn from Indigenous legal orders and property relations, which go beyond ownership to encompass complex systems of obligations and responsibilities with regard to culture, spirituality, the environment and all that live within these ecosystems. One of her other research projects explores Indigenous jurisdiction and private property in the territory of the Hul’qui’min’um Treaty Group on Vancouver Island in British Columbia.

“Until we address the violations of the right to housing that are going on across the country,” she added, “we will continue to see court cases, but litigation is not the way this issue (of homelessness) will be resolved.”

So what about that right to housing?

While the individual right to adequate housing is recognized in the International Covenant on Economic, Social and Cultural Rights, to which Canada is a party, and in the federal National Housing Strategy Act, which came into force in July 2019, Van Wagner said Canadian courts have not recognized a right to housing under the Canadian Charter of Rights and Freedoms. However, some municipalities such as Toronto have recognized a right to housing in their policy documents.

“In my view, this is still an open question,” said Van Wagner, “because while we don’t at the moment have a court decision that says there’s a Charter right to housing there absolutely is a right to housing in international and now federal law and that should be informing government decisions at all levels.”

Team Osgoode will compete at a major international law moot court competition this June

Osgoode students will compete this June in the global round of the International Criminal Court Moot Court Competition (ICCMCC) in The Hague, Netherlands, following a strong performance in the regional round on March 11 and 12 at the Elisabeth Haub School of Law at Pace University in White Plains, NY.

The Osgoode team made up of Daniel Legris (2L, oralist), Carleigh Hobson (2L, oralist), Bunisha Samuels (3L, oralist), Stefania Perrella (3L, researcher) and Rebecka Arraial (3L, researcher) advanced to the semi-finals of the Regional Round for the Americas and Caribbean and won third place for the best memorial (defence).

“This year’s regional round included some of the hottest benches I’ve seen in a moot competition, and our students handled themselves with professionalism, self-possession and confidence,” said Professor Heidi Matthews, one of the team’s co-coaches. “Perhaps most impressive to me is the speed with which they are able to take on and synthesize new information, as well as the oralists’ composure under pressure.”

The Osgoode team is also coached by international lawyer Paul Clark of Garden Court Chambers in London, England, and Osgoode LLM alumnus Vlad Hachinski, who was a member of the team last year.

The annual international criminal law competition is organized by the Grotius Centre for International Legal Studies on The Hague campus of Leiden University with support from the International Criminal Court (ICC) and the International Bar Association. It is the world’s largest competition focused on international criminal law and its judges include ICC jurists and officers.

Osgoode’s ICCMCC result is one of several strong performances achieved by students at the law school during the 2022-23 academic year.

 

Four alumni recognized with 2023 Law Society of Ontario awards

Four Osgoode alumni are recipients of 2023 medals and awards from the Law Society of Upper Canada (LSO).

At a special awards ceremony in May, grads Reva Devins ’81 and Ena Chadha ‘08 (LLM) will receive the Law Society Medal, Tami Moscoe ’96 will receive the J. Shirley Denison Award, and Courtney Harris ’02 will be presented with the Laura Legge Award.

All recipients were announced in an LSO news release dated March 10, 2023.

In the release, the LSO pays tribute to Reva Devins as a specialist in labour, employment and human rights matters and a leader in the field of mediation, arbitration and the administration of class action settlements. “She has sensitively adjudicated claims under many social justice-based settlements,” notes the release – including claims for historic abuse at Federal Indian Day Schools. “Most recently, she was appointed to oversee the assessment of claims for sexual misconduct in the Canadian Armed Forces/Department of National Defence.” The law society also describes her as a dedicated mentor. “Colleagues,” it notes, “cite her special blend of expertise and generosity which make her particularly appreciated.”

Ena Chadha is a litigator, lecturer, adjudicator, mediator and public service leader who has held leadership roles with ARCH: Disability Law Centre, the Human Rights Tribunal of Ontario and the Human Rights Legal Support Centre. She also served as chief commissioner of the Ontario Human Rights Commission from July 2020 to August 2021, putting her among a small coterie of individuals who have served in the most senior leadership roles in all three pillars of Ontario’s human rights system. Through her legal activism and extensive scholarship, Ms. Chadha has been a strong advocate for social justice reform and addressing systemic inequities to improve the lives of all Ontarians.

Tami Moscoe is a family lawyer who has worked for 10 years as senior family counsel at the Superior Court of Justice and is currently on secondment at the Office of the Children’s Lawyer. She has been instrumental in many significant family justice improvements, the LSO release notes, including the recent Unified Family Court and Dispute Resolution Officer program expansion, the introduction of automatic disclosure orders and Ontario’s unbundled legal services and binding judicial dispute resolution projects. “Her leadership, unlimited energy and zealous commitment,” it says, “have had a significant impact on advancing the interests of separating families in Ontario and ensuring that vulnerable family litigants can access the justice services they need.”

As a leading advocate for mental health in the public service and a skilled advocate who promotes civility and empathy, Courtney Harris exemplifies leadership in the profession, says the LSO release. She is a founding member and the de facto leader of Voices for Mental Health, a group of Ministry of the Attorney General employees who have fundamentally changed the landscape for mental health within the Ontario Public Service, and has played a critical role in the creation and development of the Law Society’s Mental Health Summits. “She has an extraordinary ability to empower people,” says the LSO release, “which in turn has led to many others undertaking initiatives to make the legal profession more inclusive – leading the way for a cultural change.”

 

Osgoode Indigenous Students’ Association organizes Moose Hide Campaign to counter gender-based and domestic abuse

OISA exec members Levi Marshall and Justin Thompson stand next to table with Moose Hide pins
OISA executive members Levi Marshall (left) and Justin Thompson with Moose Hide pins and OISA logo.

As a young Mi’kmaw man and a member of Membertou First Nation in Nova Scotia, Levi Marshall ’23 has seen the suffering first-hand.

“We see it a lot in our families and friends – women and girls going through hard times in their personal relationships and families,” said the third-year Osgoode student.

“I wanted to do something that would somehow help and bring awareness to an issue that’s super-important and personal for me,” he added.

That’s the motivation behind the Osgoode Indigenous Students’ Association’s (OISA) Moose Hide Campaign, which will culminate on March 8, International Women’s Day, with a photo booth in Gowlings Hall to capture images of support for the national Moose Hide Campaign Day on May 11. In the days leading up the main campaign event, OISA members will be distributing moose hide pins, the symbol of the campaign.

The idea for the national campaign was born in 2011 by campaign co-founder Paul Lacerte, a member of the Nadleh Whut’en Band in northern British Columbia, and his daughter Raven Lacerte as they hunted for moose to help feed their family for the winter and for cultural purposes. It has since grown into a national, Indigenous-led, grassroots movement to undo the toxic effect of residential schools and to engage men and boys in ending violence against women and children.

Campaign literature notes that the need to take action against gender-based and domestic violence is more critical than ever because the rate of such violence has increased dramatically during the COVID-19 pandemic.

Fittingly, the OISA event comes immediately after the association’s RedDress Week, which honours missing and murdered Indigenous women and girls. Marshall, who serves as OISA’s co-director of communications, and his Moose Hide Campaign co-organizer, OISA co-chair Justin Thompson ‘23, said OISA decided to hold the event before the national day because classes at Osgoode will not be in session in May.

Thompson, a member of Nipissing First Nation, said the campaign is about education, awareness and action. And while it seeks to address violence against all women and children, he pointed out that Indigenous women are disproportionately affected. According to statistics listed on the Moose Head Campaign website, spousal violence against Indigenous women is three times higher than violence against non-Indigenous women and Indigenous women are killed at six times the rate of non-Indigenous women.

The co-organizers said those numbers reflect the horrible legacy of European colonization, the Indian Act and residential schools.

“Not knowing what a healthy relationship looks like, that can be troubling,” said Marshall, “and many people haven’t been able to get the support they need.”

Thompson said there’s a lack of funding for community-based social and mental-health services and many Indigenous survivors of abuse are reluctant to use government-based services.

“The way Indigenous people have been treated by governments hasn’t instilled trust,” he noted, “and that underlines the need for community-based options for these services.”

Thompson and Marshall said that wearing a moose hide pin signifies that individual’s commitment to honour, respect, and protect all women and children and to speak out against gender-based and domestic violence. To date, more than three million moose hide pins have been distributed free of charge to communities, schools and workplaces across Canada.

Among other activities, the Moose Hide Campaign challenges supporters to fast and gather together in solidarity to put the national spotlight on the issue of ending domestic and gender-based violence. During the 12th annual Moose Hide Campaign Day on May 11th, said Marshall and Thompson, there will be a live stream and online interactive workshops designed to help thousands across the country to fast to end violence and take action in their own communities.

The two co-organizers expressed their gratitude to other OISA executive members and volunteers for assisting with this year’s Moose Hide Campaign, which was suspended for the past two years due to the pandemic.

After completing their legal education at Osgoode, both Thompson and Marshall will be articling for the law firm of Olthuis Kleer Townshend LLP, one of Canada’s leading Aboriginal law firms.

 

Alumni establish $1.2-million Davies Fellows Award

Senior Davies lawyers holding a large cheque for $1.2 million surrounded by Osgoode students.
Dean Mary Condon holds a cheque for $1.2 million surrounded by students. L-R Jay Swartz ’73, Patricia Olasker ’77, Mary Condon and Chan Sethi ’12.

Osgoode Hall Law School and Toronto-based Davies Ward Phillips & Vineberg LLP have jointly announced the $1.2-million Davies Fellows Award to help break down barriers to legal education.

The new bursary is created with donations from Osgoode alumni at Davies with matching funds from the law school.

At a special event March 1 at Osgoode, Davies senior partner Patricia Olasker ’77 said the initiative reflects Davies’ commitment to creating a more inclusive legal profession by removing barriers that stand in the way of students with exceptional promise.

“We count among our lawyers at Davies individuals who have overcome obstacles to achieve excellence in the profession, and we recognize that we have an opportunity to expand access to a legal education to students from equity-deserving groups,” she said.

“Our commitment to equity, diversity and inclusion is a core value of our firm, and the creation of the Davies Fellows Award is an impactful way for us to turn our values into action.”

Davies partner Chantelle Cseh ’10 shared her own personal story of overcoming challenges to complete her legal education, including financial hardship, losing her family home to fire and the serious illness of a parent. She said that Osgoode’s holistic admissions policy opened the door to opportunity when all others had closed.

“Some of those setbacks really impacted my ability to focus on my studies,” she recalled. “After everybody else rejected me, I remember getting the call that changed my life. Were it not for Osgoode’s support, I wouldn’t be standing here today.”

Osgoode Dean Mary Condon said the creation of the Davies Fellows Award is a transformative contribution to the law school’s No Barriers campaign, which aims to make Osgoode one of the most diverse and inclusive law schools in Canada.

“I am so grateful for the amazing support our Davies alumni have given to this initiative,” she said, “which will see generous alumni donations matched by Osgoode to help reduce systemic barriers to law school for students from all equity-deserving groups, who will in turn change the face of the legal profession.

“As the first Canadian law school to adopt a holistic admissions policy 15 years ago,” she added, “Osgoode has been a leader in making legal education more open, inclusive and diverse.”

Every year, the bursary will help support one first-year student in the law school’s juris doctor (JD) program, who has demonstrated financial need and exceptional promise.

The successful candidate’s personal and professional achievements will include overcoming obstacles related to financial means, racial, cultural, gender inequalities, mental health, and/or physical or learning challenges. The recipient will be known as a Davies Fellow.

The award is renewable for the student’s second and third years in the JD program, provided the student remains in good academic standing and continues to demonstrate financial need and exceptional promise.

Davies managing partner Sarbjit Basra ’94 said the firm hopes the Davies Fellows Award will make a real impact toward creating a more diverse and inclusive legal profession.

“We would not be the firm we are without the contribution of partners such as Chantelle and others,” he said. “Diversity makes us stronger and better.”

 

Prospective students discover the Osgoode advantage on Welcome Day

Photo of Associate Dean (Academic) Craig Scott
Associate Dean (Academic) Craig Scott

“Osgoode will give you the understanding and the tools to be leaders and changemakers in the legal profession, so that you can help shape what 21st century lawyering looks like.”

That was the message from Associate Dean (Academic) Craig Scott in his opening remarks to a group of more than 200 newly admitted students and their families at the law school’s annual Welcome Day event on Feb. 23, 2023.

In response to a student’s question about which law school to attend, Scott stated that all Canadian law schools offer a solid legal education, and the best law school is the one that “is best for you.” But he went on to say, “You won’t be surprised that I think that Osgoode is indeed the best. Why do I think that? Let me give you just some reasons.”

First, he noted, Osgoode offers both a broad and a deep legal education that gives students significant control over their curriculum choices. This, in turn, he argued, allows Osgoode graduates to build the kind of career they want in the legal profession – from representing clients who are survivors of domestic violence to solving complicated multi-party contractual disputes. “Our graduates are legal policy makers, peace negotiators, counsel academics or judges at provincial, national or international levels,” he said.

Second, he added, a recent survey of upper year students identified what they value most about their Osgoode experience: the wide variety of opportunities for hands-on learning in legal settings and the quality of its law professors. Osgoode offers the most extensive and innovative clinal programs in Canada, he noted.

Third, said Scott, Osgoode is a school that values community and a diversity of perspectives that comes from different sources of knowledge – from lived experience to a variety of intellectual philosophies.

Guests then moved to breakout sessions to get more information on Osgoode’s curriculum, student financial aid and career development. The evening ended with a mock first-year classroom session by Professors Trevor Farrow and Allan Hutchinson.

Osgoode typically admits about 280 students into the first year of its JD program. The law school has a holistic admissions policy that considers post-secondary achievement, LSAT scores, life experiences and achievements, written and oral communication skills and an individual’s record of overcoming challenges.  In its admissions policy, Osgoode puts a priority on opening doors to communities that are traditionally under-represented in the legal profession.

Osgoode event honours murdered and missing Indigenous women

Photo of four members of the Osgoode Indigenous Students' Association who organized Osgoode Red Dress Week in honour of murdered and missing Indigenous women.
Osgoode Indigenous Students’ Association members (L-R) Megan Delaronde, Hannah Johnson, Sage Hartmann and Annika Butler.

As JD students Megan Delaronde ’23 and Annika Butler ’23 wrote out the names and stories of missing and murdered Indigenous women and girls recently, one thing became painfully clear: the Canadian justice system has never solved the vast majority of cases.

Butler, the co-chair of the Osgoode Indigenous Students’ Association (OISA), Delaronde, OISA’s director of cultural and community relations, and 1L Representatives Sage Hartman and Hannah Johnson wrote out 300 of the stories for OISA’s RedDress Week Feb. 13-17, posting them throughout the main floor of the law school along with a number of red dresses”.  They selected the stories from thousands of cases chronicled in a database maintained by the Gatineau, Que.-based Native Women’s Association of Canada.

“There are stories that I have written out that will stick with me,” said Delaronde, a member of the Red Sky Métis Independent Nation in Thunder Bay, Ont.

She and Butler, a member of the Mattawa/North Bay Algonquin First Nation, pointed to examples like a nine-month-old baby girl who died in foster care – no charges were ever laid – or 20-year-old Cheyenne Fox of Toronto, whose three 911 calls just prior to her 2013 murder went unanswered.

“I think a lot of the time this problem stays abstract for people who aren’t Indigenous,” said Delaronde. “One of the things we were hoping to accomplish with our names wall was to show the vastness of this problem and for people to understand that these aren’t just names. Many of them were mothers and the vast majority of these cases have gone unsolved.”

Many of the postings on the wall did not carry a name. “A lot of the names of missing and murdered Indigenous women and girls (MMIWG) we don’t know,” said Butler, “but we still wanted to hold a place in our hearts for them.”

She noted that official statistics kept by police typically underestimate the number of missing and murdered Indigenous women in Canada compared with records kept by the Native Women’s Association and other Indigenous organizations and communities.

OISA’s RedDress Week this year was the most extensive in the club’s history. Inspired by Métis artist Jaime Black’s 2010 art installation, the REDress Project, RedDress events are typically held in May to raise awareness of missing and murdered Indigenous women. But because the academic year is usually over by May, Delaronde said OISA decided to schedule the event in February.

She said the timing seemed appropriate considering one of the latest reminders of the continuing tragedy: the recent murders of four Indigenous women in Winnipeg: Rebecca Contois, 24, Marcedes Myran, 26, Morgan Harris, 39, a mother of five children, and a fourth unidentified woman who has been named Mashkode Bizhiki’ikwe – Buffalo Woman.

“We wanted to ramp it up this year so we poured our hearts into it,” said Delaronde.

The group also organized a trivia night event that raised almost $1,000 for the Native Women’s Association of Canada.

Butler and Delaronde said that first-year reps Hartmann (Red River Métis) and Johnson (Secwepemc Nation) also played a key role in organizing the event, with support from OISA members Levi Marshall and Conner Koe, Osgoode’s student government and Osgoode’s Office of the Executive Officer.

They also commended Osgoode and York for the support they have provided to Indigenous students, especially York’s Centre for Indigenous Student Services and the “time and intention” Osgoode has put into hiring “top-tier” Indigenous professors.

In September, OISA organized a special event for Orange Shirt Day (also known as the National Day for Truth and Reconciliation), with guest speakers and Osgoode alumni Deliah Opekokew ‘77, the first First Nations lawyer to ever be admitted to the bar association in Ontario and in Saskatchewan, and Kimberly Murray ‘93, who serves as the federal government’s special interlocutor on unmarked graves at former residential schools. In March, it plans to organize a Moose Hide Campaign Day. The Moose Hide Campaign is nationwide movement of Indigenous and non-Indigenous Canadians from local communities, First Nations, governments, schools, colleges/universities, police forces and many other organizations committed to taking action to end violence against women and children.

Professor Allan Hutchinson sounds an alarm about corporate concentration in a recent Globe and Mail op-ed

As the Rogers-Shaw-Quebecor blockbuster deal stumbles to cross the completion line, many are still concerned about its effect on competition in the communications marketplace.  But, as we await the Minster’s possible, but unlikely veto, there is another perhaps larger issue lurking behind the competition headlines.

It is one of the great myths of the Canadian corporate and investing scene that shareholding is becoming more diffuse and, therefore, more Canadians now own more corporate stocks than ever before.  In other words, whatever the competition challenges among the largest corporations, there is a steady move to opening up corporate power to more openness and, as such, more competition for control.  Democracy seems to be on the march.

However, whatever the basic corporate ownership figures disclose on the surface, there is a reverse and contradictory process taking place beneath that surface.  Corporate power is as or more concentrated than ever before. Some of Canada’s leading families have consolidated and extended their hold over some the country’s mega-corporations.  And, most cannily, while perpetuating the belief that corporate power is being re-distributed.

This is nowhere better revealed than in the Rogers-Shaw-Quebecor debacle.  These media behemoths appear to be widely-held; many Canadians either personally or through mutual funds and pensions own large chunks of their shares.  The problem is that, contrary to common assumptions, there is no connection between the shares owned and the control exercised.  People remain on the outside looking in.

These families, often the offspring of their companies’ founders, have managed to retain a stranglehold on their companies by relying on a dual-class shareholding structure.  This is perfectly lawful in Canada.  While the vast majority of the companies’ non-voting shares are widely-held, a much smaller class of voting shares are monopolised by these billionaire families.

The Rogers family owns less than 30 per cent of the company’s equity, but controls 97.5 per cent of the voting stock.  The Shaw family has around 80 per cent of the voting control and much less of the stock.  And the Peladeau family (mainly through Pierre Péladeau) has almost 75% of the voting control of the company.

So, these three families dominate and control the communications infrastructure of Canada.  Their companies’ shares might be owned by many Canadians (who might well thereby get a distributed piece of the available economic pie), but they have very little or no control over the running of those companies.  The upshot of this is that a very a wealthy elite control and exercise corporate power in their own interests or, at best, in their own judgement of what is in the public interest.

And the communications sector is no outlier.  Only about 30% of Canadian corporations are widely held; the remaining 70 per cent are controlled by one or a number of related shareholders.  Once the complex schemes of inter-corporate holdings are factored in, around 80 per cent of all publicly-traded corporations in Canada are seen to be controlled by a handful of people; this compares with about 20 per cent in the United States.

Apart from the debilitating democratic impact of this corporate concentration on the Canadian polity generally, there are many drawbacks for the specifics of corporate governance.  The two leading ones are — that controlling shareholders will appoint their cronies to the board and that such indebted appointees will defer to their wishes; and that the inside group will benefit themselves in many ways (e.g., favourable loans, inflated salaries; dividend payments over retained earnings; etc.).

Although often viewed as a technical issue of corporate organisation, the use of dual-class shares enables a handful of families (and often one member of that family) to exert massive political and social influence through their corporate fiefdoms.  While such dual-class arrangements might be defensible in straight financial terms, they make a mockery of any claim that there is a vigorous and healthy ‘shareholder democracy’ at work.   

(Published in The Globe and Mail, Feb. 15, 2023)

 

 

Osgoode alumni, faculty and former deans celebrate the life of Professor R.J. Gray

Scores of Osgoode alumni, faculty and former deans gathered Feb. 11 to celebrate the life of former professor R.J. Gray, whose remarkable 42-year career at the law school had a positive impact on thousands of Canadian lawyers.

The guests of honour included his wife of 66 years, Kelley, his children and grandchildren (including two Osgoode graduates), and seven former deans – Harry Arthurs, John McCamus, John Evans, Jim MacPherson, Jinyan Li, John Evans and Lorne Sossin.

Current Dean Mary Condon paid tribute to R.J. Gray’s tremendous contribution to the Osgoode community as a teacher, a longtime associate dean and a passionate coach of the Osgoode Owls basketball team.

“He was a force of nature around the law school who was deeply connected to its history and its development into a leading location for legal education,” she said. “He approached everything he did with his characteristic warmth, humour and humanity.”

Condon quoted from a Kudo Board set up in R.J. Gray’s honour to highlight the enduring affection he inspired in many Osgoode students. For some, his influence was literally life-changing.

“He had a way of bringing out the best in students and helping them overcome any hurdles they may be facing,” said one of his former students. “In every person’s life, there are a few individuals who make a significant difference. R.J. was one of those people in my life,” said another Osgoode grad.

Other speakers paying tribute included his son Rob, a 1984 Osgoode grad, his daughter Trish, Professor Allan Hutchinson, who was on faculty with R.J. for many years, and three alumni, Gilbert Sharp ’72, Courtney Betty ’86 and Jeff Raphael ’95.

On his retirement in 2000, R.J. Gray’s enormous contribution to the law school was celebrated at a retirement party at Toronto’s Royal York Hotel that brought together more than 700 people. The event marked the creation of the R.J. Gray Award, which is presented annually to a student in financial need who demonstrates outstanding academic performance and participation in extracurricular activities.

His family has invited people wishing to honour R.J.’s memory to donate to the award fund and more than $15,000 has already been collected – an amount that will be matched by the law school.