IN THE SUPREME COURT OF BRITISH COLUMBIA  
Citation:  
Williams v. Audible Inc.,  
022 BCSC 834  
2
Date: 20220518  
Docket: S1810561  
Registry: Vancouver  
Between:  
And  
John Williams  
Plaintiff  
Audible Inc., Apple, Inc., Apple Canada Inc.,  
Amazon.com, Inc. and Amazon.com.ca, Inc.  
Defendants  
Brought under the Class Proceedings Act, R.S.B.C. 1996, c. 50  
Before: The Honourable Madam Justice Horsman  
Reasons for Judgment  
Counsel for the Plaintiff:  
Counsel for Apple Inc.:  
Counsel for Audible Inc.:  
D. Klein  
M. Good  
C. Hannouche  
A. Klein  
C. Woodin  
E. Davis  
E. Schiff  
R. Hughes  
M. Sampson  
A. Goodman  
R. Eghan  
Place and Date of Hearing:  
Place and Date of Judgment:  
Vancouver, B.C.  
February 2225, 2022  
Vancouver, B.C.  
May 18, 2022  
Williams v. Audible Inc.  
Page 2  
Table of Contents  
INTRODUCTION ....................................................................................................... 4  
FACTUAL BACKGROUND....................................................................................... 5  
The exclusivity provisions in the AppleAudible agreements................................. 5  
The deletion of the Exclusivity Provisions .............................................................. 7  
The procedural history............................................................................................ 8  
The notice of civil claim and certification application material............................. 9  
The amended notice of civil claim and further evidence on certification ........... 11  
The further amended notice of civil claim.......................................................... 12  
SUMMARY OF THE APPLICATIONS..................................................................... 12  
AUDIBLE’S STAY APPLICATION.......................................................................... 15  
The Amazon Stay Decision .................................................................................. 16  
Discussion............................................................................................................ 18  
THE DEFENDANTS’ SUMMARY JUDGMENT APPLICATION.............................. 19  
The test for summary judgment............................................................................ 19  
The defendants’ application for summary judgment on the merits ....................... 20  
The claim for damages under s. 36 of the Competition Act .............................. 21  
The parties’ positions .................................................................................... 22  
The evidentiary issues................................................................................... 24  
Legal principles.......................................................................................... 24  
Discussion ................................................................................................. 26  
The Pecman Affidavit #1............................................................................ 27  
The Pecman Affidavit #2............................................................................ 30  
The Westermann Affidavit ......................................................................... 30  
Section 45 of the Competition Act................................................................. 31  
Legislative evolution and history................................................................ 33  
Scope of s. 45 of the Competition Act........................................................ 35  
Should the plaintiff’s claim for damages under s. 36 of the Competition Act be  
summarily dismissed?................................................................................... 37  
Summary of conclusion on the summary judgment application on the merits42  
The defendants’ application for summary judgment on the limitation defence ..... 42  
THE PLAINTIFF’S CERTIFICATION APPLICATION ............................................. 44  
Certification requirements..................................................................................... 44  
Williams v. Audible Inc.  
Page 3  
Discussion ........................................................................................................ 45  
The common issues and preferability requirements............................................. 46  
The plaintiff’s proposed common issues and revisions to the common issues..... 48  
Discussion............................................................................................................ 50  
Williams v. Audible Inc.  
Page 4  
INTRODUCTION  
[
1]  
There are three applications before the Court.  
[
2]  
First, the plaintiff applies for certification of this action as a class proceeding  
pursuant to the Class Proceedings Act, R.S.B.C. 1996, c. 50 [CPA]. The action is  
focused on exclusivity provisions in an agreement between the defendants Audible  
Inc. (“Audible”) and Apple Inc. (“Apple”) relating to the distribution and sale of digital  
downloadable audiobooks in Canada. The plaintiff alleges that the defendants’  
conduct in agreeing to the exclusivity provisions violates the Competition Act, R.S.C.  
1
985, c. C-34 [Competition Act] and the Business Practices and Consumer  
Protection Act, S.B.C. 2004, c. 2 [Consumer Act], and constitutes the tort of civil  
conspiracy. The plaintiff seeks to certify this action as a class action brought on  
behalf of persons in Canada who purchased digital downloadable audiobooks from  
the iTunes store or the Audible website between March 12, 2010 and January 15,  
2
017.  
[
3]  
Second, Apple applies for summary judgment dismissing all claims against it  
pursuant to Rule 9-6 of the Supreme Court Civil Rules, B.C. Reg. 168/2009 [SCCR],  
and Audible seeks summary judgment dismissing the Consumer Act claims. The  
defendants say that the undisputed evidence confirms that the agreement in issue in  
this case was not unambiguously harmful to competition, which is fatal to all of the  
causes of action advanced by the plaintiff. Alternatively, the defendants say that if  
summary judgment is not granted dismissing the entire action, then at minimum, any  
claims should be limited to audiobook purchases made no later than two years  
before the notice of civil claim was filed.  
[
4]  
Third, the defendant Audible applies to extend the terms of a consent stay of  
proceedings under s. 15 of the Arbitration Act, R.S.B.C. 1996, c. 55 [Arbitration Act].  
The consent stay does not currently extend to relief sought by the plaintiff under the  
Consumer Actwhich the parties agree may be pursued in court despite an  
 
Williams v. Audible Inc.  
Page 5  
arbitration clause in the contract between the plaintiff and Audible. Audible joins with  
Apple in the summary judgment application as it relates to the Consumer Act claims.  
[
5]  
FACTUAL BACKGROUND  
6] The factual background underpinning this action is relatively straightforward.  
By consent, these three applications were heard at the same time.  
[
The procedural history and legal issues are more complex.  
The exclusivity provisions in the AppleAudible agreements  
[
7]  
Audible is an audiobook publisher. Like other audiobook publishers, it  
purchases licenses to recordings from major book publishers. Audible developed  
proprietary software to digitize audiobooks for online distribution. Beginning in 1997,  
customers could purchase Audible products for download directly from Audible’s  
website.  
[
8]  
Apple is a multinational technology company that designs, develops, and sells  
consumer electronics, software, and online services. Apple operates a variety of  
online marketplaces for the sale of digital products and services, including the  
iTunes Store. Apple’s iTunes Store allows customers to purchase and download  
media, including audiobooks. The iTunes stored was launched in April 2003.  
[
9]  
On May 14, 2003, Audible and Apple entered into a Digital Download Sales  
Agreement which permitted Apple to sell Audible audiobooks on iTunes. On  
September 17, 2003, the parties replaced their prior agreement with a second Digital  
Download Sales Agreement (the “2003 Agreement”), which covered a range of  
matters related to Apple’s supply and distribution of Audible audiobooks. The 2003  
Agreement contained exclusivity provisions that imposed the following restrictions:  
a) Audible could not authorize or otherwise permit any commercially branded  
internet-based digital download/streaming distribution service primarily  
 
 
Williams v. Audible Inc.  
Page 6  
directed to music, other than Apple, to integrate Audible Content (as  
defined in the 2003 Agreement) into its service for commercial sale;  
b) Apple was to source all English audiobooks it wished to market on the  
iTunes store from Audible if Audible held the rights to the audiobooks. If  
Audible did not hold the rights, then Apple had to give Audible 90 days to  
acquire the rights.  
[
10] On July 27, 2006, Apple and Audible replaced the 2003 Agreement with a  
Global Master Agreement (the “2006 Agreement”).  
[
11] The focus of the proposed class action is the exclusivity provisions in Clause  
.8 of the 2006 Agreement, which were revised somewhat from the 2003  
4
Agreement. The entire text of Clause 4.8(a) and (b) is contained in Appendix A to  
this judgment. In summary form, Clause 4.8(a) and (b) provided:  
4
.8(a) Audible was prohibited from integrating its content with any internet-based  
store or distribution service that used digital downloading or streaming—  
other than Appleunless the store or distribution service did not include a  
digital music or music/video downloads store or offering. Audible was  
permitted to include links, displays, and web banners at any other sites,  
excluding sites that offer digital music or music/video downloads, provided  
that the purchase transaction, checkout, and invoicing was conducted on  
Audible.com as a separate transaction from purchases of any digital  
music or music/video downloads (the “Restrictions on Audible”); and,  
4
.8(b) Subject to limited exceptions, Apple was required to source audiobooks  
exclusively from Audible, unless Audible did not have the rights, in which  
case Audible had 150 days to acquire the rights (the “Restrictions on  
Apple”).  
(Collectively, the “Exclusivity Provisions”)  
Williams v. Audible Inc.  
Page 7  
[
12] Under the 2006 Agreement, Audible was allowed to continue engaging in  
direct sales of audiobooks from its website. In this sense, Apple and Audible  
operated at the same level in the production/distribution chain, and were competitors  
in the sale of downloadable audiobooks. The plaintiff’s claim under s. 45 of the  
Competition Act is dependent on the characterization of the arrangement between  
Apple and Audible as a horizontal agreement between competitors to limit  
competition.  
[
13] Amazon was not a party to the 2003 Agreement or the 2006 Agreement.  
Audible and Amazon entered into a Co-Branding, Marketing and Distribution  
Agreement, dated January 30, 2000 (the “Co-Branding Agreement), pursuant to  
which Amazon advertised Audible content on Amazon’s website. Audible was  
acquired by Amazon in 2008. This acquisition did not create any agreements related  
to the sale of audiobooks between Apple and Amazon.  
[
14] The 2006 Agreement between Apple and Audible was to continue until  
September 30, 2010, with automatic one-year renewal periods. On July 1, 2010,  
Audible and Apple amended the 2006 Agreement to extend it to December 31,  
2
011, after which either party could terminate the 2006 Agreement for any reason  
with 60 days’ notice.  
The deletion of the Exclusivity Provisions  
15] The Exclusivity Provisions were deleted from the 2006 Agreement, effective  
[
January 15, 2017. The deletion followed the initiation of inquiries by European  
competition regulators into the Exclusivity Provisions. The plaintiff has put into  
evidence the following three press releases to show the concern of European  
regulators regarding the impact of the Exclusivity Provisions on competition in the  
audiobook market:  
(1)  
A press release issued by the Bundeskartellamt, the German antitrust  
regulator, on November 16, 2015. The press release indicated that the  
Bundeskartellamt had initiated administrative proceedings against Apple  
 
Williams v. Audible Inc.  
and Audible following a complaint by the German Publishers and  
Page 8  
Booksellers Association that objected to various practices used by  
Audible, “including its exclusive supply of audiobooks to Apple’s iTunes  
Store”;  
(
2)  
3)  
A press release issued by the Bundeskartellamt on January 19, 2017,  
announcing that the regulator had closed its administrative proceedings  
against Audible and Apple following the deletion of the Exclusivity  
Provisions;  
(
A press release issued by the European Commission welcoming the  
decision by Apple and Audible to delete the Exclusivity Provisions, a  
step that was expected to “improve competition in downloadable  
audiobook distribution in Europe.”  
[
16] As I understand the plaintiff’s position, he says that these press releases are  
of primary relevance to the limitation defence that the defendants advance. The  
plaintiff pleads that the defendants’ unlawful conduct was not discoverable until  
January 2017, when the defendants publicly announced the deletion of the  
Exclusivity Provisions, and European competition regulators announced the  
conclusion of their investigations.  
The procedural history  
[
17] The plaintiff’s theory of his case has changed over time. The notice of civil  
claim was amended both shortly before the date for the original hearing of the  
certification application in February 2020, and shortly before the hearing of the  
present applications. In the course of his submissions at the hearing, the plaintiff  
further narrowed his claim. The plaintiff’s evolving theory of his case has created  
some difficulties, including in relation to the evidence he relies on in support of  
certification. The defendants say that the evidentiary difficulties are, in themselves, a  
reason to refuse certification.  
 
Williams v. Audible Inc.  
Page 9  
[
18] In order to understand some of the arguments advanced by the parties on  
these applications, it is necessary to review the procedural history.  
The notice of civil claim and certification application material  
[
19] The plaintiff filed his original notice of civil claim on September 27, 2018. The  
notice of civil claim alleges that in 2003, Apple and Audible entered into an exclusive  
agreement for the provision of audiobooks. Pursuant to this agreement, Audible  
became the sole supplier of audiobooks to the Apple iTunes Store, and was  
forbidden from supplying audiobooks to any online platform for digital sale other than  
the iTunes store. The plaintiff further alleged that after Amazon acquired Audible in  
2
008, Amazon, Audible, and Apple entered into an agreement not to compete in the  
production, distribution, and sale of audiobooks, which permitted the defendants to  
charge an unlawful premium for audiobooks sold through the iTunes Store, and the  
Audible and Amazon websites.  
[
20] The plaintiff sought, and continues to seek, to recover the allegedly unlawful  
premium—or “Overcharge”, as it is termed in the notice of civil claim—on behalf of  
class members. In his notice of civil claim, the plaintiff pleads the following causes of  
action:  
a) Damages under s. 36 of the Competition Act as a remedy for the  
defendants’ alleged breach of s. 45 of that Act;  
b) General damages for the tort of civil conspiracy;  
c) Restitution of the Overcharge, or alternatively disgorgement of benefits, on  
the ground of unjust enrichment; and  
d) Remedies under s. 172 of the Consumer Act in relation to the defendants’  
alleged violation of ss. 8 and 9 of that Act through their unfair and  
unconscionable business practices.  
 
Williams v. Audible Inc.  
Page 10  
[
21] The plaintiff filed his certification application on May 30, 2019. The orders  
sought by the plaintiff included orders certifying the action as a class proceeding,  
and defining the class as all persons in Canada who purchased digital audiobooks  
from the Amazon or Audible websites or Apple’s iTunes Store between October 16,  
2
003 and the date of certification.  
[
22] In support of his certification application, the plaintiff served, among other  
affidavits, the Affidavit No. 1 of Dr. Roger Ware sworn April 12, 2019 (“Ware Affidavit  
1”). Dr. Ware is an expert economist. He was asked to opine on whether it would  
#
be possible to assess common economic harm to class members caused by the  
defendants’ wrongful conduct, to quantify that harm on an aggregate basis, and to  
quantify the economic gain to the defendants. For the purpose of his analysis,  
Dr. Ware was asked to assume that the exclusive agreement was between Audible,  
Amazon, and Apple, and that it covered worldwide sales from the three platforms.  
[
23] Apple and Audible filed their responses to civil claim on October 2, 2019. The  
defendants plead that the agreements between Apple and Audible were in the  
nature of dual distribution agreements, which are typically pro-competitive. The  
defendants plead that the agreements were not “hard core” or “naked” cartel  
agreements captured by the criminal prohibition in s. 45 of the Competition Act. The  
defendants deny that Amazon was a party to the distribution agreements. Audible  
additionally pleads that the plaintiff’s claims should be stayed as a result of a binding  
arbitration clause in the contracts between Audible and its customers.  
[
24] Apple and Audible subsequently filed material in response to the certification  
application: Apple on November 29, 2019 and Audible on December 4, 2019. The  
defendants’ evidence included copies of the 2003 Agreement and the 2006  
Agreement. The defendants also tendered evidence to establish that there is no  
agreement between Apple and Amazon with respect to audiobooks, and that the  
only agreement between Amazon and Audible relating to audiobooks was not  
exclusive during the class period. The defendants’ affidavit included the expert