Owen J finds that it was costly for Justice to pursue its allegations of sham in the Cameco transfer-pricing litigation

Owen J made a lump sum award for legal fees of Osler borne by Cameco in its successful appeal of transfer-pricing adjustments for three of the years in dispute (2003, 2005 and 2006) of $10.25M, which represented about 35% of the Osler fees charged for those years. Factors mentioned by Owen J included:

• Settlement offers made by Cameco (one less than 30 days before trial, and one after trial) did not have any real bearing on his award given their “de minimis nature” (i.e., although Cameo offered “$32 million of additional taxable earnings in 2006 … no additional tax in any of the three years under appeal” was offered.
• The “volume of work was significantly increased by the Respondent’s reliance on sham, i.e., Cameco had “to address minute administrative details of how it and its subsidiaries carried on business.”
• He did “not accept the Respondent’s submission that it could not have anticipated the costs incurred by the Appellant given the Respondent’s vigorous pursuit of the allegation of sham.”

Neal Armstrong. Summary of Cameco Corporation v. The Queen, 2019 TCC 92 under Tax Court of Canada Rule 147(3).