Counsel for those behind the suit, however, suggested those arguments be put forward at a trial and not at the leave to appeal hearing that took place in a Toronto court.
The lawsuit at the centre of the arguments claims a devastating loss of cultural identity was suffered by Ontario victims of the so-called 60s Scoop.
It refers to a period of time between the 1960s and the 1980s when thousands of aboriginal children were taken from their homes and placed with non-native families by child welfare services.
"The issue is hugely important, there's no doubt about that, and we've never said these people haven't suffered," Department of Justice lawyer Owen Young said in an interview outside court. "But when you drill down to the basics, the question is:'Is that a legal problem for the courts or is it a social-political problem?'"
Young suggested the Ontario judge who certified the lawsuit this summer could have erred in his decision.
"We're dealing with the way it's presented to the court," he said of the lawsuit. "The legal tools to deal with this aren't very good."
But lawyers for the representative plaintiffs said a leave to appeal hearing wasn't the place for the government to be laying out its arguments on the merits of the case.
"This was a procedural motion for certification," lawyer Jeffery Wilson said outside court of the decision the government wanted to appeal.
"The best place to test the legitimacy of this action — that is the merits — is not at this point, when it's all based on hypothetical arguments and submissions. Rather, it should happen once and when a judge has the opportunity to see people, to hear the evidence.... Nothing is tested here."
The case has been working its way through the courts for over three years.
Plaintiffs asked for permission to put the case forward as a class action in February 2009, but the federal government successfully appealed certification of the proceedings, largely on a procedural point. A new hearing was then ordered in January this year. In July, the Ontario Superior Court of Justice certified the case after dismissing a Crown motion asking for the suit to be quashed.
All the legal delays have made the plaintiffs determined to see the case through, said Wilson.
"It's essential it go forward because their claim is about a lost generation of children, about children who lost their cultural identity and who as a result endured tremendous pain," he said.
That pain was still being felt by Marcia Brown Martel, the representative plaintiff in the lawsuit who grew emotional as she spoke of the toll the 60s Scoop had taken on her life.
The 50-year-old said she lost her distinct language, traditions and ties to her community after being taken from her aboriginal family and being adopted into a non-indigenous home.
"The negativity that came from that time period of being removed as a 60s Scoop child for myself, that affects me as a person in my community," she said.
The lawsuit has the potential to set a precedent, said Martel, if only the federal government would allow it to proceed.
"Canada as a government chooses to appeal a fact of history, to be able to say that they are not accountable for a historical wrong that has had a current and a very current effect to a nation of people," she said.
"Tradition, culture, children and language are the foundation of a nation. Once you remove one of those foundations, like a three legged stool, it's off balance."
None of the lawsuit's claims have been proven in court. The judge hearing the government's application for leave to appeal will deliver her decision at a later date.