Claiming Disgorgement Remedy

Question: Can a plaintiff in Ontario seek disgorgement when they suffered little or no loss but the defendant profited from the wrongdoing?

Answer: Denali Paralegal can help Ontario families and individuals understand when a disgorgement (restitutionary) claim may be available even if you cannot easily show a traditional damages loss, by focusing on the “profiting from wrong” theory of unjust enrichment, where the defendant’s gain was made possible by an underlying legal wrong and an ordinary damages remedy would be inadequate, as described in Pharmascience Inc. v. Novartis Pharmaceuticals Canada Inc., 2020 ONSC 6534.  This remedy is not meant to fully compensate for harm like damages, but to strip ill-gotten gains to deter wrongdoing.  If you think the other side benefited without corresponding deprivation, call (877) 414-4377 to discuss your next steps.

Add this website to Google Preferred Sources

What Can a Victim of Wrongdoing Claim In a Lawsuit If the Victim Was Without the Suffering of a Loss But the Wrongdoer Received a Benefit or Profit From the Wrongdoing?

When a Wrongdoer Benefits or Profits From a Wrongdoing, the Victim of the Wrongdoing May Claim Disgorgement of the Benefits or Profits From the Wrongdoer.

Understanding Disgorgement Remedy Principles Involving Restitution For Wrongdoings Resulting In Ill Gotten Gains

In some circumstances a wrongdoer may receive a benefit or profit arising from the wrongdoing while little, if any, loss or harm arises to the victim of the wrongdoing. Whereas the law generally forbid a person from suing unless a loss or harm has occurred per no harm, no foul principles, a valid lawsuit may involve claims for the illegitimate benefits or profits arising from the misconduct of the wrongdoer.

The Law

The availability of the remedy of disgorgement was well explained within the case of Pharmascience Inc. v. Novartis Pharmaceuticals Canada Inc., et al, 2020 ONSC 6534, wherein it was said:

Explained Principles

There may be circumstances where a person commits a criminal fraud or a civil fraud, among other wrongs, without causing harm or loss to the wronged person and yet benefits or profits arise in favour of the wrongdoer.  The law, applied by the courts, seeking to discourage and deter wrongful conduct, may order that the benefits or profits be disgorged from the wrongdoer and provided to the victim.  In this way the remedy of disgorgement ensures that the wrongdoer fails to benefit or profit from the wrongdoing and is, presumably, discouraged and deterred from engaging in wrongful conduct.

Summary Comment

Disgorgement is a form of restitution rather than compensation whereas disgorgement is applied in law as a matter of fairness rather than as a means for making whole the losses or harms of a victim.