DEFENDANTS RESPONDING FACTUM TO CERTIFICATION MOTION

Transcription

1 BE T W E E N : Court File No. CV OOCP ONTARIO SUPERIOR COURT OF JUSTICE SAMUEL BERG and DANIEL PACHIS - an d - Plaintiffs CANADIAN HOCKEY LEAGUE, ONTARIO MAJOR JUNIOR HOCKEY LEAGUE, ONTARIO HOCKEY LEAGUE, WESTERN HOCKEY LEAGUE, QUEBEC MAJOR JUNIOR HOCKEY LEAGUE INC., WINDSOR SPITFIRES INC., LONDON KNIGHTS HOCKEY INC., BARRIE COLTS JUNIOR HOCKEY LTD., BELLEVILLE SPORTS AND ENTERTAINMENT CORP., ERIE HOCKEY CLUB LIMITED, JAW HOCKEY ENTERPRISES LP, GUELPH STORM LIMITED, KINGSTON FRONTENACS HOCKEY LTD., KINGSTON FRONTENACS HOCKEY CLUB, ONTARIO INC., MISSISSAUGA STEELHEADS HOCKEY CLUB INC., NIAGARA ICEDOGS HOCKEY CLUB INC., BRAMPTON BATTALION HOCKEY CLUB LTD., NORTH BAY BATTALION HOCKEY CLUB LTD, GENERALS HOCKEY INC., OTTAWA 67'S LIMITED PARTNERSHIP, THE OWEN SOUND ATTACK INC., PETERBOROUGH PETES LIMITEDy, COMPUWARE SPORTS CORPORATION, IMS HOCKEY CORP., SAGINAW HOCKEY CLUB, L.L.C., ONTARIO INC c.o.b. as SARNIA STING, 211 SSHC CANADA ULC o/a SARNIA STING HOCKEY CLUB, SOO GREYHOUNDS INC., McCRIMMON HOLDINGS, LTD. and MANITOBA LTD., A PARTNERSHIP c o b as BRANDON WHEAT KINGS., ONTARIO INC., REXALL SPORTS CORP., EHT, INC., KAMLOOPS BLAZERS HOCKEY CLUB, INC., KELOWNA ROCKETS HOCKEY ENTERPRISES LTD., HURRICANES HOCKEY LIMITED PARTNERSHIP, PRINCE ALBERT RAIDERS HOCKEY CLUB INC., BRODSKY WEST HOLDINGS LTD., REBELS SPORTS LTD., QUEEN CITY SPORTS & ENTERTAINMENT GROUP LTD., SASKATOON BLADES HOCKEY CLUB LTD., VANCOUVER JUNIOR HOCKEY LIMITED PARTNERSHIP, CANADA INC., CLUB DE HOCKEY JUNIOR MAJEUR DE BAIE-COMEAU INC., CLUB DE HOCKEY DRUMMOND INC., CAPE BRETON MAJOR JUNIOR HOCKEY CLUB LIMITED, LES OLYMPIQUES DE GATINEAU INC., HALIFAX MOOSEHEADS HOCKEY CLUB INC., CLUB HOCKEY LES REMPARTS DE QUEBEC INC., LE CLUB DE HOCKEY JUNIOR ARMADA INC., MONCTON WILDCATS HOCKEY CLUB LIMITED, LE CLUB DE HOCKEY L'OCEANIC DE RIMOUSKI INC., LES HUSKIES DE ROUYN- NORANDA INC., CANADA INC. c.o.b. as CHARLOTTETOWN ISLANDERS, LES TIGRES DE VICTORIAVILLE (1991) INC., SAINT JOHN MAJOR JUNIOR HOCKEY CLUB LIMITED, CLUB DE HOCKEY SHAWINIGAN INC., CLUB DE HOCKEY JUNIOR MAJEUR VAL D'OR INC., WEST COAST HOCKEY ENTERPRISES LTD., MEDICINE HAT TIGERS HOCKEY CLUB LTD., PORTLAND WINTER HAWKS, INC., BRETT SPORTS & ENTERTAINMENT, INC., THUNDERBIRD HOCKEY ENTERPRISES, LLC, TOP SHELF ENTERTAINMENT, INC., SWIFT CURRENT TIER 1 FRANCHISE INC., CANADA INC., LEWISTON MAINEIACS HOCKEY CLUB, INC., KITCHENER RANGER JR A HOCKEY CLUB, KITCHENER RANGERS JR "A" HOCKEY CLUB, SUDBURY WOLVES HOCKEY CLUB LTD., GROUPE SAGS 7-96 INC., MOOSE JAW TIER ONE HOCKEY INC. DBA MOOSE JAW WARRIORS, KOOTENAY ICE HOCKEY CLUB LTD., LETHBRIDGE HURRICANES HOCKEY CLUB, and LE TITAN ACADIE BATHURST (2013) INC./THE ACADIE BATHURST TITAN (2013) INC. Proceeding under the Class Proceedings Act, 1992, S.O. 1992, C.6 Defendants DEFENDANTS RESPONDING FACTUM TO CERTIFICATION MOTION

2 TORYS LLP 79 Wellington St. W, 30th floor Box 270, TD South Tower Toronto, ON M5K 1N2 Fax: Patricia D.S. Jackson (LSUC #: 18466S) Tel: Crawford Smith (LSUC #: S) Tel: Lisa Talbot (LSUC #: 44672I) Tel: Irfan Kara (LSUC #: 65945J) Tel: Lawyers for the Defendants TO: CHARNEY LAWYERS 151 Bloor St. West, Suite 602 Toronto, ON M5S 1P7 Fax: Theodore P. Charney Tel: GOLDBLATT PARTNERS LLP 20 Dundas Street West, Suite 1100 Toronto, ON M5G 2G8 Fax: Steven Barrett James K. McDonald Joshua Mandryk Tel: SUTTS, STROSBERG LLP Goyeau Street Windsor, ON N9A 6V4 Fax: William V. Sasso Tel: Lawyers for the Plaintiffs

3 TABLE OF CONTENTS PART I OVERVIEW... 1 PART II - FACTS... 5 A. Major Junior Hockey: the CHL and the OHL... 6 (i) The CHL... 6 (ii) The OHL... 7 B. Other Amateur Hockey in Canada and the United States... 9 (i) Junior hockey... 9 (ii) Minor hockey (iii) Hockey academies (iv) The National Collegiate Athletic Association (NCAA) C. The Role of an OHL Player is Not Unique D. The Standard Player Agreement (i) Player development (ii) League approvals (iii) Trade clause (iv) Education benefits (v) OHL Scholarship (vi) Specific player commitments E. In Loco Parentis: Billets, Character Development, and Well-Being F. The OHL Team Finances G. The Proposed Representative Plaintiffs Have Conflicts with the Class (i) Samuel Berg (ii) Daniel Pachis H. U.S. Courts Would Not Enforce the Judgment of a Canadian Court in this Case (i) The law is unsettled for determining whether amateur athletes are employees The law is unsettled under the FLSA There is no direct precedent or analogous authority to determine the employment status of OHL players under Michigan State law There is no direct precedent or analogous authority to determine the employment status of OHL players under Pennsylvania State law (ii) The representative plaintiffs lack standing under U.S. law (iii) FLSA requires plaintiffs to opt-in to collective actions PART III ISSUES AND THE LAW A. Conflicts within the Class are Insurmountable and Embodied by the Proposed Representative Plaintiffs s. 5(1)(e)... 48

4 B. A Class Proceeding in Ontario is not the Preferable Procedure for Claims Against U.S. Teams s. 5(1)(d) (i) The defendants are not barred from raising a preferable procedure argument (ii) An Ontario class proceeding is not preferable to resolve U.S. claims (iii) Considerations of efficiency and proportionality mean that a U.S. class proceeding is preferable to a class action in Ontario C. Numerous Causes of Action are Redundant and Add Unnecessary Complexity (i) Negligence (ii) Breach of Honest Performance (iii) Unjust Enrichment (iv) Waiver of Tort D. The Proposed Class Period is Flawed PART IV ORDER REQUESTED CERTIFICATE SCHEDULE A SCHEDULE B

5 PART I OVERVIEW 1. The plaintiffs seek to certify an action to determine if young athletes who play major junior hockey in Ontario, Pennsylvania and Michigan in the Ontario Hockey League (OHL) are employees. In a 150-page factum replete with misstatements of the evidence, 1 the plaintiffs address multiple causes of action and numerous proposed common issues. Yet, the essence of the claim they seek to certify is simple: are these young athletes employees? 2. This is a novel case. Although courts have considered the distinction between employees, independent contractors, and interns, they have done so where there is no doubt that work is involved. Here, should this action be certified, the threshold issue for trial would be whether an amateur athlete is, first and foremost, a worker at all. No Canadian court has ever considered this issue. 3. Just as the plaintiffs add unnecessary complexity to their claim, their factum also unnecessarily belabors the various aspects of control in the relationship between an athlete and his coach and his team. In so doing, the plaintiffs not only improperly wade into the merits, but they also miss the point. The defendants do not dispute that most of these aspects of control are common to a hockey player s experience in the OHL. They do not deny that hockey players must attend practices, arrive at a designated time for games, follow their coaches' directions, adhere to team rules, and the like. These elements of control are not unique to athletes who play hockey in the OHL; they are common features of competitive amateur sport. Whether these elements of control transform athletes (not only hockey players in OHL, but hockey players at all competitive levels and athletes across the spectrum of amateur sport) into employees would be for the trial judge to decide should this action be certified. 4. However, this action should not be certified for the following reasons. 1 See Appendix A for a sampling of the most striking examples.

6 First, certification should be denied because there is an insurmountable conflict within the proposed class. That conflict is embodied by the proposed representative plaintiffs, who do not represent the interests of all members of the proposed class. 6. Both proposed representative plaintiffs are former players whose interests, by their own admissions, are restricted to obtaining wages. 2 They ignore or minimize the range of benefits that players receive while playing in the OHL: hockey development programs, educational benefits (including tutoring and tuition payments), housing and supervision from billet families, health care, mental health support, character development programs, equipment, and post-secondary scholarships. Like other former players, they have already had their opportunity to play in the OHL and they have already had their chance to use the benefits offered to players. Their only interest now is in obtaining retroactive wage payments. 7. For current and future 3 players and their parents, however, safeguarding the benefits provided by the teams is very important. The young athletes who play hockey on the 20 teams of the OHL range in age from 16 to 20. Many are drafted when they are only 16 years old. Many are living away from home for the first time. Most still attend school. The teams provide housing and supervision. They make sure the players go to school, do their homework, receive tutoring if necessary, eat well, manage stress, receive medical care, and learn life lessons in a caring environment. They act in loco parentis. Current and future players and their parents have an interest in safeguarding this relationship and the benefits that flow from it. 8. The OHL teams also cover all costs that would otherwise be borne by parents, for example, registration fees, travel and lodging costs for away games, food bills, off-season training, medical insurance, equipment and education costs. The OHL teams spend tens of 2 Cross Examination of Samuel Berg, January 16, 2017 at , Defendants Brief of Transcripts and Answers to Undertakings, Tab 2 [ Berg Cross ]; Cross Examination of Daniel Pachis, January 17, 2017 at , Defendants Brief of Transcripts and Answers to Undertakings, Tab 3 [ Pachis Cross ]. 3 The plaintiffs propose a class definition with no specified end-date. The defendants submit that should this action be certified, the end date should be the date of the court s certification order. However, in the event the action is certified as proposed by the plaintiffs, then the action would indeed affect the interests of future players.

7 - 3 - thousands each year on player development, approximately $46,000 annually on each player. 4 Current and future players and their parents have an interest in maintaining these benefits. 9. Also, each player is eligible for the OHL Scholarship Program, which covers the cost of post-secondary tuition and expenses for up to four years at an institution of the player's choosing after he finishes playing for the OHL. To date, the OHL has more than $30 million in contingent liability for scholarships earned by current and former players but not yet used. 5 Current and future players, as well as those former players who have yet to use the full extent of their OHL Scholarship, have an important interest in safeguarding the OHL Scholarship Program. 10. Certification jeopardizes all of these benefits that are so important to current and future players and their parents. That is because, if this case is certified, a $30 million contingent liability would immediately crystallize. 6 That contingent liability, coupled with the $30 million and growing contingent liability for scholarships earned but not yet used, and the ongoing costs of the benefits provided to players, is beyond the ability of most of the defendants to fund. With finite resources, most of the teams would have to reduce or eliminate the various benefits described above to address the contingent liability that would crystallize upon certification or to cease operations, which would reduce the pool of available hockey opportunities for young athletes. These statements are not threats of reprisal as the plaintiffs suggest. 7 Rather, they respond to misrepresentations that the proposed plaintiffs distributed to potential class members, and simply reflect the fiscal reality of major junior hockey in Canada. 4 Affidavit of David E. Branch, sworn December 23, 2015, at para. 213, Defendants Responding Certification Motion Record, Vol. I, Tab 1, p. 1 [ Branch Affidavit (December 2015) ]; Affidavit of Denise Burke, sworn November 14, 2015 at para. 17, Defendants Responding Certification Motion Record, Vol. II, Tab 2, p. 305 [ Burke Affidavit ]. 5 Branch Affidavit (December 2015) at para This estimate is based upon the wage rates applicable in each jurisdiction, and assumes a 40 hour work week, a 22 player roster, a seven month season, over 2.85 seasons. 7 Plaintiffs Certification Factum at para. 127.

8 Certification, then, would give rise to a conflict between current, future and former players. Current and future players have an interest in safeguarding their hockey opportunities and the range of benefits they receive while playing in the OHL, benefits that that are entirely dependent on the financial viability of the teams and that would be jeopardized by certification of this action. Former players, like the proposed representative plaintiffs, have a fundamentally different and conflicting interest. They have nothing to lose by seeking retroactive wages. This conflict cannot be resolved by creating sub-classes. Current players would get the short-end of any outcome while former players would only stand to benefit. 12. Second, a class action in Ontario is not the preferable procedure to resolve the claims against U.S. teams located in Michigan and in Pennsylvania. The evidence is that a U.S. court would likely decline to enforce a class action judgment from this court in respect of the U.S. teams, because of the following factors. (a) (b) The plaintiffs do not ask this court to apply U.S. federal and state wage and hour law to junior hockey players, but rather to make such law at first instance. There is no dispute that U.S. claims are governed by U.S. wage and hour legislation despite a choice of law clause in the Standard Players Agreement (SPA). However, no U.S. court has ever held that an employment relationship exists between any amateur sports team and its players, and the tests for determining whether an individual is an employee and, if so, what activities constitute covered employment under U.S. law are unsettled. U.S. courts are unlikely to enforce new law made in Canada in respect of U.S. wage and hour legislation. Actions under the federal Fair Labor Standards Act (FLSA) cannot be pursued as class actions. Unlike class actions at the state level or those under Rule 23 of the U.S. Federal Rules of Civil Procedure, which allow plaintiffs to opt out of a proceeding, the FLSA requires plaintiffs to opt-in affirmatively to a collective action. Individual claimants must agree expressly in writing to participate and to

9 - 5 - be bound by the statutory right of action. 8 This court should not permit the plaintiffs to do indirectly what cannot be done directly in a U.S. court. (c) The plaintiffs lack standing individually or on behalf of a class to assert claims against all but the teams for which they played. Under the FLSA, the representative plaintiffs lack standing to bring a collective action against two of the three teams because a plaintiff must have a cause of action against each individual defendant In the alternative, should this court be inclined to certify this action, it should limit the causes of action pleaded. The plaintiffs have pleaded multiple causes of action that are redundant and introduce nothing but unnecessary complexity to the proceedings. In this case, these causes of action negligence, breach of honest performance, unjust enrichment, and waiver of tort are entirely dependent on whether the players are found to be employees, whether under contract or by statute. They do not yield any benefit to the plaintiffs that is not already secured by succeeding with the primary employment claim, and should not be certified. 14. Finally, should this action be certified, the plaintiff s class periods are flawed. First, the end-date for inclusion in the class should be the date of the court s certification decision. The plaintiffs seek certification of an open-ended class, which is improper and would deny class members their statutory right to opt out. Second, the plaintiffs in the U.S. claims are subject to a three year limitation period for claims under the FLSA or under state law. PART II - FACTS 15. Junior hockey is amateur ice hockey for players between the ages of 16 and Canadian junior hockey consists of several tiers based on the quality or level of play. In Ontario, 8 Expert Report of David Dunn, sworn December 18, 2015 at 3, 51-53, Defendants Responding Certification Motion Record, Vol. III, Tab 10, p. 524 [ Dunn Report ]. 9 Berger v. National Collegiate Athletic Association, 843 F.3d 285 at 289 (7th Cir. 2016), Defendants Book of Authorities, Tab 38 [Berger]; Dunn Report at 9, Branch Affidavit (December 2015) at para. 19.

10 - 6 - these include Major Junior, Junior A, Junior B and Junior C. The CHL and its three Leagues govern Major Junior, the highest tier. 11 The other tiers are governed by the provincial sports bodies that oversee amateur hockey. Only the Major Junior tier provides resources, standards, educational support, and scholarships to players. 12 However, most hockey players make the same level of commitment regardless of the tier in which they play. 13 A. Major Junior Hockey: the CHL and the OHL (i) The CHL 16. The CHL oversees Major Junior hockey in Canada. It is administered as a development program and is the top level of amateur hockey in Canada for players between the ages of 16 and Each year, approximately 1300 young male athletes play hockey with the 60 teams of the CHL. The teams 52 Canadian and 8 American span three leagues: the OHL, the Western Hockey League (WHL) and the Quebec Major Junior Hockey League (QMJHL) The CHL was founded in 1975 and is a not-for-profit corporation. 16 It has long been recognized as the premier amateur development experience for competitive hockey players. Many amateur hockey players join the CHL because they want to maximize their chances to play in the National Hockey League. 17 The CHL provides more players to the NHL and Canadian Interuniversity Sport (CIS) than any other league in the world; 18 approximately 55% of current 11 Branch Affidavit (December 2015) at paras Branch Affidavit (December 2015) at para Supplementary Affidavit of David E. Branch, sworn September 23, 2016 at paras. 6-7, Defendants Responding Certification Motion Record, Vol. I, Tab 1, p. 1 [ Branch Affidavit (September 2016) ]. 14 Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at paras Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para. 21.

11 - 7 - NHL players played in the CHL at some time, while roughly 64% of CIS hockey players in the CHL Despite this success, only a minority of CHL players ever play in the NHL. In recognition of this, an important element of the CHL s development program is to provide a sound base for alternate career experience, including through a focused and supported education program. The details of the OHL s education program is described below. 19. The CHL partners with Hockey Canada, which is the national governing body for amateur hockey in Canada. Hockey Canada oversees the management of hockey programs, from entry-level to top-level teams and competitions, across the country. 20 All U.S.-based teams and players belong to USA Hockey, which is the American equivalent to Hockey Canada. 21 Hockey Canada recognizes the CHL as an amateur league. 22 (ii) The OHL 20. The OHL is a non-profit corporation organized under the laws of Ontario, 23 with teams in Ontario, Michigan, and Pennsylvania. The OHL offers a multi-faceted development program for amateur hockey players aged 16 to 20, providing competitive amateur hockey players with highlevel opportunities in hockey, education, and character development The league s primary objective is to help players develop their hockey skills, further their education, and preserve future opportunities outside of hockey. Many hockey players join the OHL when they are only 16 years old. For that reason, the OHL supervises, disciplines, and 19 Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Affidavit of Ron Robison, Ex. H, Defendants Responding Certification Motion Record, Vol. IV, Tab 11-H, p Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para. 156

12 - 8 - supports players in a way that corresponds to their individual needs, abilities, and stages of life. The OHL commits to provide a range of supports to both the players and to their parents, 25 described in more detail below. 22. Twenty teams comprise the OHL: seventeen in Ontario, two in Michigan and one in Pennsylvania. 26 Since , the OHL has divided its teams into two Conferences, with two geographically-based Divisions in each to ease the distances teams must travel. 27 Players are drafted from Ontario and from a large part of the United States including Michigan, Pennsylvania, New York, Arkansas, Florida, Illinois, Iowa, Louisiana, Missouri, Ohio, South Carolina, Virginia, Wisconsin, Alabama, Delaware, Georgia, Indiana, Kentucky, Maryland, Mississippi, New Jersey, North Carolina, Tennessee, and West Virginia The plaintiffs state at paragraph 146 of their factum that the vast majority of the current and former players on [the U.S. teams] are Ontarians who return home at the end of each season, and when their OHL careers come to an end. The plaintiffs cite for this proposition a memorandum attached to the affidavit of Brendan O Grady, which Justice Hall ordered was not to be relied upon for the truth of its contents. 29 By way of endorsement dated December 12, 2016, this court ordered that the evidentiary rulings made by Justice Hall in this regard would 25 Branch Affidavit (December 2015) at paras ; Affidavit of Kelly Mercer, sworn November 19, 2015 at paras. 10, 11, 17, 29, Defendants Responding Certification Motion Record, Vol. II, Tab 6 at p. 463 [ Mercer Affidavit ]; Affidavit of Jane Carrick, sworn December 17, 2015 at paras , Defendants Responding Certification Motion Record, Vol. II, Tab 7, p. 490 [ Carrick Affidavit ]. 26 Branch Affidavit (December 2015) at para The East Division of the Eastern Conference includes the Hamilton Bulldogs, Kingston Frontenacs, Oshawa Generals, Ottawa 67 s and Peterborough Petes. The Central Division in the Eastern Conference includes the Barrie Colts, Mississauga Steelheads, Niagara IceDogs, North Bay Battalion and Sudbury Wolves. The Midwest Division of the Western Conference includes the Erie Otters, Guelph Storm, Kitchener Rangers, London Knights and Owen Sound Attack. The West Division of the Western Conference includes the Flint Firebirds, Saginaw Spirit, Sarnia Sting, Sault Ste. Marie Greyhounds and Windsor Spitfires. Branch Affidavit (December 2015) at paras Branch Affidavit (December 2015) at para Walter v. Western Hockey League, 2016 ABQB 588 at paras

13 - 9 - apply in the Ontario action. 30 Even more egregious, the memorandum does not remotely support the proposition for which the plaintiffs cite it. The memorandum simply refers to the citizenship of players. It says nothing about where players reside not the province, state or country prior to joining the OHL. Nor does it say anything about where players intend to reside after they finish playing with the OHL. 24. The regular season runs six months, from late September to late March. Teams compete in a partial inter-conference schedule format to accommodate education demands and to minimize travel. In a 68-game regular season schedule, teams play approximately one third of their games against Division opponents and over two thirds of their games played against teams in their Conference. 31 The CHL schedule culminates in the Memorial Cup championship tournament, where the three League champions and a host-team play in a round-robin tournament to determine the national champion. 32 B. Other Amateur Hockey in Canada and the United States 25. Two things are apparent upon an examination of amateur hockey in Canada and the United States: (a) (b) (i) the common features relied upon by the plaintiffs are common in amateur hockey at other levels, and indeed, in amateur competitive sport; and the benefits put at risk by this action are not offered by other hockey alternatives, which highlights the importance of these benefits to current and future players, and the implications to these players of their loss. Junior hockey 26. After Major Junior, the next tier of junior hockey is Junior A, which is governed by the Canadian Junior Hockey League. Hockey Canada regulates the CJHL, which oversees Endorsement December 12, Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para. 11.

14 constituent leagues across the country. Players are provided with most equipment, and the teams pay travel costs. There is no scholarship or tuition reimbursement program. Some, but not all, players, pay to play in the CJHL. 33 Fees vary per team, but now range between $4,000 and $8,000 per player, per year The next tiers of amateur hockey are Junior B and C, which operate as extensions of local minor hockey leagues under the auspices of Hockey Canada, but without a national governing body. Junior B and C leagues operate on a pay-to-play model. Fees range from $1,000 to $1,500 per player, per year, and players are responsible for paying the costs of travel and accommodation for out-of-town games. Players purchase their own equipment, except for sweaters, socks, and pants Other junior hockey leagues operate outside the purview of the CHL, CJHL, or Hockey Canada. For example, in Toronto, the Greater Metro Junior A Hockey League is a pay-to-play league was created in The GMHL charges an annual fee of approximately $6000 per player and does not offer a scholarship program. Out-of-town players pay to be billeted with local families. The GMHL provides some but not all player equipment In the U.S., the United States Hockey League includes Tier I, the top level of American Junior Hockey. The USHL consist of teams in the central and midwestern U.S. The USHL does not charge players to pay, and teams provide players with equipment and pay travel costs. The USHL does not, however, offer a scholarship program. Tier II is the next level of Junior Hockey in the U.S., and is represented by the North American Hockey League. The NAHL has no scholarship program, and all player expenses, including room and board, are paid by the player Berg Cross at Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para. 78.

15 Many of the leagues referred to above, whether in Canada or in the U.S., charge admission to games and attract spectators. 38 Junior and minor hockey teams also obtain corporate sponsorship. 39 (ii) Minor hockey 31. Minor hockey is the level below Junior Hockey. Minor hockey players are classified and organized by age in leagues. Hockey Canada sets the rules, and local hockey associations administer the players and leagues for their respective regions. 40 Minor hockey is divided by skill level into competitive and non-competitive. Players move from recreation (or house league) to competitive hockey, where players travel outside their hometowns for competitions. 41 A competitive minor league team holds tryouts, and selection is based on skill level and fit. Players chosen to compete experience a higher level of on-ice competition and coaching than in a recreational league To play minor hockey, players must generally pay registration and team fees, some of which are as high as $8,000 per player. In addition to paying a registration fee, parents and players must pay for equipment ($4,000 per player or up to $8,000 if the player is a goalie); meals; off-season training; personal trainers (with ice-time, this can range between $200 and $250 per hour); additional tournament fees; travel to games; and accommodation for out-of-town 38 Branch Affidavit (December 2015) at para Branch Supplementary Affidavit (September 23, 2016) at paras and Exhibit C. 40 Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para. 82.

16 games. 43 Players receive no education benefits or scholarship. 44 Increasingly, minor hockey coaches are paid, and some minor hockey teams charge admission to games. 45 (iii) Hockey academies 33. Hockey academies are privately-owned specialized sports schools that cater mainly to high-school aged children. Hockey is their primary focus. They promise to make students better hockey players by providing additional ice time and private instruction. 46 Premier Elite Athletes Collegiate (PEAC), formerly located in Downsview, Ontario, was one such academy. Tuition can range from $35,000 to $50,000, and does not include the costs of equipment, sticks, skates, school uniforms, textbooks, travel, and incidentals. 47 Players divide their day between traditional classes, on-ice hockey practices (approximately 90 minutes daily), hockey games, and sportspecific fitness training (approximately 60 minutes daily). 48 Many boys also play on the academy s hockey team and commit to that team s practice and game schedule. 49 (iv) The National Collegiate Athletic Association (NCAA) 34. An alternative to playing hockey with the CHL is to play college-level hockey in the United States for the National Collegiate Athletic Association (NCAA). Although NCAA Division I schools provide athletic scholarships, Division III schools do not. NCAA scholarships 43 Branch Affidavit (December 2015) at paras. 85, 92; see Carrick Affidavit at para. 5. Ms. Carrick is the mother of four current or former players with the OHL and estimates she spent approximately $12,000 per year, per son, to play minor league hockey before they reached the OHL. 44 Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at paras. 88, 89-93; Berg Cross at , ; Cross Examination of Daniel Pachis, January 17, 2017 at 254, Defendants Brief of Transcripts and Answers to Undertakings, Tab 3 [ Pachis Cross ]. 46 Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Berg Cross at Branch Affidavit (December 2015) at para. 95; See Berg Cross at Sam Berg attended PEAC and played hockey for the Academy when he was in grade 10. While Sam played hockey with PEAC, the team travelled to cities in Canada and the United States to play against other minor league hockey teams, other hockey academies, and some junior hockey teams.

17 range from partial to full coverage of tuition and fees, room and board, and course-related books, for one or more years. However, NCAA scholarships are not guaranteed, and can be reduced or withdrawn depending on performance. Coaches decide who receives a scholarship, how much, and whether it will be renewed. Scholarships range from partial to full coverage based on grant and financial aid, and the financial status of a player s family can be considered with respect to determining the quantum of a scholarship. A player can pay more on an NCAA athletic scholarship than he may pay to attend a Canadian university without a scholarship CHL players are not eligible to play in the NCAA. In 1980, the NCAA deemed CHL teams to be professional for the purposes of NCAA eligibility. The NCAA did so to compete with the CHL to attract talented hockey players. By designating CHL players as professional, the NCAA hopes to dissuade players from playing with the CHL. The NCAA also hopes to create more opportunities for American players. 51 The CHL does not accept the NCAA s designation of CHL players as professional, and the designation remains a point of dispute between the two. 52 C. The Role of an OHL Player is Not Unique 36. The characteristics that the plaintiffs assert create common issues appropriate for a class proceeding are the same in other levels of amateur hockey at the Junior and Minor levels, in hockey academies, and at the collegiate levels, including at the NCAA and CIS. They are not unique to the OHL. As the representative plaintiffs have conceded, hockey players at all levels of amateur competitive play make the same commitments as the players in the OHL. There are team tryouts; Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at paras For example, Sam Berg was only invited to play for a hockey academy after he had attended a practice and performed to a certain level. Berg Cross at Competitive minor hockey teams also hold tryouts, and players are selected depending on skill level and fit. See Branch Affidavit (December 2015) at para. 82.

18 Players must attend all scheduled practices and games; 54 Players must be mentally and physically ready to play, which requires training and commitment to their team; 55 Coaches determine who will play, in what position, how often, and for what duration; 56 Players have specific roles, and better players tend to get more ice time. 57 Players generally wear a jacket and tie to games starting at the midget level; 58 Out-of-town players are billeted; For example, as Daniel Pachis admitted, while playing minor hockey with the Whitby Wildcats, he would adhere to the team s practice, game and tournament schedule. Sam Berg admitted that he was required to attend scheduled games, practices and training sessions while playing Junior A hockey; Pachis Cross at 85-87; Berg Cross at See also Branch Affidavit (September 2016) at paras. 17, For example, Sam Berg agreed that while playing with the OJHL, he took his performance seriously, trained hard and worked hard. He trained on his own, in addition to the set team practice and training schedule; Berg Cross at , Discipline is involved at all levels of junior hockey. Hockey, by its very nature is a competitive team sport and players at all levels of hockey have a desire to work hard, train hard and improve their skills and strength. June A, B and C teams have large teams of staff, scouts, trainers, therapists and coaches similar to the OHL. See Branch Affidavit (September 2016) at paras. 7, Daniel Pachis agreed that his minor hockey coach with the Whitby Wildcats set the lineup for each game and decided who would play the power play and penalty kill. Sam Berg agreed that his coaches in Buffalo and Hamilton, while playing Junior A hockey, would set the lineup for each game and decided who would play the power play and penalty kill; Pachis Cross at 90-93; Berg Cross at Daniel Pachis conceded that players in minor hockey and Junior A hockey do not receive equal ice time and coaches decide which players participate in specific game scenarios. Sam Berg agreed that this occurred when he played Junior B hockey; Pachis Cross at ; Berg Cross at Both Sam Berg and Daniel Pachis conceded that they wore a jacket and tie for games while playing Junior A hockey; Pachis Cross at 252; Berg Cross at See also Branch Affidavit (September 2016) at para Daniel Pachis agreed that several of his teammates while with the Whitby Fury, a Junior A team, were billeted by the OJHL; Pachis Cross at Several Junior A, B and C teams also have billet coordinators for out-of-town players. See Branch Affidavit (September 2016) at para. 18.

19 Games may be hundreds of kilometers apart, requiring players and teams to stay overnight; 60 Players may be traded at the Junior A level, even across provincial boundaries and hockey associations; 61 Players at the Junior A level practice or play six times per week, just as they do in Major Junior; 62 and Not every Junior player is in school or has a part-time job The plaintiffs argue that OHL teams have certain characteristics that make playing for an OHL team different. They suggest the OHL teams are unique for charging admission to games, paying coaches, having sponsors, and attracting media coverage. They are not. Many of these elements are also present at other minor and junior levels of hockey. 64 For example, the Milton Icehawks, a Junior A team, has team sponsors, season ticket holders, billet families, media coverage, community events, scouts, trainers and a team of experienced coaches. Its games are streamed on the internet. 65 The Elmira Sugar Kings, a Junior B team, charge admission for 60 Both Sam Berg and Daniel Pachis conceded that while playing minor hockey, their teams would travel to play tournament games and be required to stay overnight at his own expense; Pachis Cross at ; Berg Cross at Sam Berg was traded from the Buffalo Junior Sabres to the Hamilton Red Wings while playing Junior A hockey in the OJHL. Daniel Pachis was also traded while playing Junior A hockey in the OJHL; Berg Cross at ; Pachis Cross at For example, Daniel Pachis conceded that while playing Junior A hockey, he attended three or four practices per week, in addition to two or three games per week; Pachis Cross at 226, Daniel Pachis had graduated from high school and was not enrolled in any academic institutions when he played for the OJHL; Branch Affidavit (December 2015) at para. 102; Pachis Cross at Branch Affidavit (September 2016) at paras , and Exhibit C for numerous screenshots from websites of Junior A, B and C teams that illustrate the substantial similarities between CHL teams and lower level junior hockey teams: charging admission, corporate sponsorship, use of player images, promotional and community involvement, billeting, media broadcasting, paid coaching, office-staff, press coverage, and sales of concessions and team memorabilia. 65 Branch Affidavit (September 2016), Exhibit C at pp

20 games, has extensive corporate sponsors (such as RBC, Food Basics, McDonalds and PetValu), and participates in several community events with players, parents and staff. 66 The Wallaceburg Lakers, a Junior C team, charge admission for games, sell season ticket packages, attract media coverage, sell team merchandise to fans, and has extensive corporate sponsors (such as BMO and Subway) There are two differences between the various junior and minor hockey leagues in Canada. Neither has anything to do with the obligations and commitments of the players. (a) (b) The first is skill. CHL athletes are the most skilled hockey players in their age group. The second is the range of benefits afforded players. Outside the CHL, most hockey programs require parents to pay a significant amount of money for their children to play hockey, whether in the form of registration fees, tournament fees, equipment, travel, meals, education, and more. No organization or league offers the same benefits and educational package as the CHL. There are no alternatives to the level of support, supervision, and commitment to character development as the CHL. 68 D. The Standard Player Agreement 39. The CHL regards itself as the world s premier development hockey league. 69 Player development and the quality of player experience are priorities for each team in the OHL and the other two Leagues. The Leagues prioritize the interests and the needs of their players above all else. Their philosophy is Players First Branch Affidavit (September 2016), Exhibit C at pp Branch Affidavit (September 2016), Exhibit C at pp Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para. 16.

21 These sentiments are expressed by the provisions contained in the Standard Player Agreement (SPA), an agreement that each player (along with his parents) enters into with his team. The SPA expresses the mutual commitments of the team and the player, and reflects the mutual understanding that the player is an amateur athlete in need of supports not provided to professional athletes. 71 The SPA states expressly that players are not employees and the SPA does not create an employment relationship. 72 There is nothing unusual about players signing with a team. It happens at all levels of junior minor hockey. 73 (i) Player development 41. Under the SPA, a team commits to provide a player with a multi-faceted development program that focuses on hockey training, education, and character development. The team promises to provide a premier hockey development opportunity in a safe and healthy environment, as well as an education development program with the support necessary for the player to maintain the educational opportunities of his choosing. 74 The team commits to ensuring the player s safety and well-being, and to protect his interests in a carefully supervised environment In exchange, the player commits to play exclusively for the team and to meet certain expectations (the same expectations that any organized sports team would have). 76 He agrees to maintain certain minimum standards of health and fitness, to participate in league or team sponsored events, and to adhere to specific conduct on and off the ice. The player agrees to abide 71 Branch Affidavit (December 2015) at para Section 1.(b): It is expressly acknowledged and agreed by the parties involved that the Player is an amateur athlete who is encouraged to continue the Player s education while also being schooled and trained in the game of hockey. The parties agree that this Agreement is not a contract of employment between the Club and the Player and nothing in this Agreement shall constitute the parties as employer/employee, or as agents, partners, or co-ventures of each other. 73 Pachis Cross at Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para. 157.

22 by team rules regarding curfew; the use of tobacco, drugs and alcohol; school attendance; and community service and training, all of which help teams to ensure the player s safety and wellbeing. 77 These commitments allow the teams to follow through with the player to provide him with multi-faceted development opportunities and with his parents to meet expectations with respect to the care of their son. 78 Again, there is nothing unusual about these commitments in the world of competitive amateur hockey. 43. The leagues and teams assume responsibility for supervising and taking care of the players. All parents must sign the SPA along with their son, regardless of their son s age. 79 Parental involvement in negotiations and parental agreement is necessary because the team makes a commitment to both the player and his parents. The parents participate as a party to the agreement. 80 Additionally, in most cases, the parents and the player are represented by agents and/or obtain legal advice before signing the SPA. 81 (ii) League approvals 44. The OHL approves and registers all SPAs, which allows the League to make sure teams provide players with the required level of benefits and support. This consistency also keeps a competitive balance across the OHL. Teams may offer different levels of benefits and support to their players, depending on a combination of team capacity and individual need, only after certain League minimums are met Additionally, OHL approval ensures that teams do not offer impermissible benefits to players in an attempt to influence unduly a player s decisions to play with a particular team. An impermissible benefit is tied less to a player s development and more to a monetary reward (or 77 Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para. 162.

23 other incentive) for deciding to play with the team. For example, a team is not allowed to offer cash or any other incentive bonus to players for their performance The OHL believes that maintaining competitive balance within the League fosters the best development opportunities for players because an even playing field provides excellent opportunities for all players on all teams. Players have the greatest chance of furthering their development if they are challenged but can keep up against their opponents. Maintaining minimum operating standards helps the League to achieve this goal. 84 (iii) Trade clause 47. Under the SPA, players accept that they may be traded to another team. However, players and their parents may negotiate the terms of this trade clause 85 and the League exercises its discretion to approve all trades by considering and protecting the interests of the player. 48. Players in high school cannot be traded without their consent, and the OHL ensures that teams honour these clauses. 86 The OHL also does not permit trades during the Christmas period of any hockey season. 87 A player who is traded does not forfeit any part of the OHL Scholarship he has earned and nothing about a trade affects a player's entitlement to his scholarship or other benefits in his SPA. 88 As set out above, trades also happen at the Junior A level and below. 83 Branch Affidavit (December 2015) at para Teams may provide small gifts, such as gift cards, for Christmas or Holidays but nothing more. 84 Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para. 169.

24 (iv) Education benefits 49. The OHL endeavors to provide each player with the skills required to be successful in life after hockey. 89 Education is a key part of that equation. 50. The OHL is committed to providing every player with support to ensure their academic success. Although most players join the OHL hoping to play hockey in the NHL, few will realize that dream. In fact, only 30% of OHL players sign a contract with the NHL. Because most players will not play professional hockey, the teams do their best to make sure that players progress in their education to allow for future educational and career opportunities Each OHL team covers all education costs of current players, including tuition (including university or college level courses), books, tutoring costs, and in some cases, private school fees. 91 The OHL has a Manager of Education Services, who works with each team s academic advisor to help teams implement League-wide education standards. 92 All teams must provide players with access to academic advisors all year round, including during the off-season and summer. 93 Teams must have an Academic Policy which meets minimum League-wide education standards The academic advisor acts as a liaison between the team, the players and their parents, and the academic institutions players attend, whether high schools or post-secondary institutions. The academic advisor helps to monitor the academic progress and behavior of players 89 Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at paras. 58, In the OHL, academic advisors are required to have a university degree and to have experience providing academic counselling services to student athletes. Academic advisors are all professional educators and have working knowledge of the high school curriculum. Many are trained guidance counsellors or teachers. 93 Branch Affidavit (December 2015) at paras. 61, Branch Affidavit (December 2015) at para 139.

25 throughout the season, and gives the information to the team's general manager and the players' parents as soon as is practical. 95 This information helps the teams to monitor the academic progress of players, and to intervene if a player is not reaching his maximum academic potential. 96 Academic advisors also provide counselling and guidance support, including career and academic counselling The OHL takes pride in the academic achievements of players, and encourages their active participation in academics during the hockey season. Teams pay the costs associated with hiring qualified tutors to help students during the academic year to help them complete the academic year. 98 All players are expected to attend high school until graduation and fully participate in educational programs, if enrolled. Upon graduation, players are encouraged to take post-secondary courses. 99 Players must graduate from high school in a timely manner and must take at least one course per semester failure to do so may result in disciplinary action by the team or the OHL. 100 These requirements are waived very rarely, and only with parental support and consent. Teams must report academic results to the OHL office. 101 In , the high school graduate rate among OHL players was 99.7%. 102 This graduation rate stands in stark contrast to the national average in Canada, which is 82% Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para The OHL will discipline a player regardless of skill level. For example, players may not play in a regularly scheduled OHL game because of problems they are having at school. Fortunately, because of the League's emphasis on education this rarely, if ever, occurs. 97 Branch Affidavit (December 2015) at para. 147; Burke Affidavit at para Branch Affidavit (December 2015) at paras. 137, Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at paras Branch Affidavit (December 2015) at para Branch Affidavit (December 2015) at para. 26.