Law Times

Page 12 January 20, 2014 Law Times • FOCUS Chitrakar v. Bell TV Decision lowers bar to PIPEDA damages BY MICHAEL McKIERNAN For Law Times A Federal Court of Canada decision has lowered the bar to privacy damages under the Personal Information Protection and Electronic Documents Act, according to some privacy lawyers. In Chitrakar v. Bell TV, Federal Court Justice Michael Phelan ordered Bell to pay a total of $20,000 in damages to a customer after finding the company acted with "reprehensible" disregard for his privacy rights. Prospective satellite television customer Rabi Chitrakar was unable to prove a direct loss resulting from Bell's breach, but Phelan still awarded him $10,000 in damages, plus another $10,000 in exemplary damages, to censure Bell. The court awarded an additional $1,000 to cover disbursements and costs for Chitrakar, who represented himself. "The fixing of damages for privacy rights' violations is a difficult matter absent evidence of direct loss. However, there is no reason to require that the violation be egregious before damages will be awarded. To do so would undermine the legislative intent of paragraph 16(c)  which provides that damages be awarded for privacy violations including but not limited to damages for humiliation," Phelan wrote in his Oct. 29 decision. "Privacy rights are being more broadly recognized as important rights in an era where information on an individual is so readily available even without consent. It is important that violations of those rights be recognized as properly compensable." "It's a signal that privacy rights will be taken very seriously now by the court, especially in this The decision fits a 'changing trend' that has seen judges become more willing to award damages for privacy breaches, says Eloïse Gratton. information age," says Catherine Lovrics, a privacy lawyer at Bereskin and Parr LLP. She says Phelan's rejection of the "egregiousness" standard is particularly significant because it runs counter to the prevailing Federal Court jurisprudence. In a 2010 decision that is one of the most cited on privacy damages, Randall v. Nubodys Fitness Centres, Federal Court Justice Richard Mosley declined to award damages to a man whose gym-going habits were shared with his employer despite a ruling from the Office of the Privacy Commissioner of Canada that his complaint was well-founded. In the decision, Mosley expressed his view that an award of damages under PIPEDA should "not be made lightly" and in fact "should only be made in the most egregious situations." "This decision appears to go against Randall v. Nubodys, which could signal a bit of a turning of the tides," says Lovrics. While Chitrakar also obtained a ruling from the privacy commissioner that his complaint was well-founded, Lovrics says she was struck by Phelan's statement in passing that this "is not a pre- 2014 ONTARIO LAWYER'S PHONE BOOK THE MOST COMPLETE DIRECTORY OF ONTARIO LAWYERS, LAW FIRMS, JUDGES AND COURTS With more than 1,400 pages of essential legal references, Ontario Lawyer's Phone Book is your best connection to legal services in Ontario. Subscribers can depend on the credibility, accuracy and currency of this directory year after year. More detail and a wider scope of legal contact information for Ontario than any other source: 27,000 lawyers listed 9,000 law firms and corporate offices listed December each year On subscription $74 One time purchase $77 L88804-626 Multiple copy discounts available Prices subject to change without notice, to applicable taxes and shipping & handling. Includes lists of: Federal and provincial judges Federal courts, including a section for federal government departments, boards and commissions Ontario courts and services, including a section for provincial government ministries, boards and commissions Small claims courts Miscellaneous services for lawyers Visit carswell.com or call 1.800.387.5164 for a 30-day no-risk evaluation Untitled-3 1 www.lawtimesnews.com 13-12-02 7:29 PM condition to the right for damage." Eloïse Gratton, of McMillan LLP's privacy law practice group, says Phelan's decision fits a "changing trend" that has seen judges become more willing to award damages for privacy breaches. "It used to be difficult but now it's less and less of an issue," she says. "There is a feeling that the [Office of the Privacy Commissioner] already has no enforcement powers, so if after a breach no damages are awarded, nobody is going to take it seriously. The courts are getting there slowly, and this is the first case at the federal level that shows the court has switched things a little bit." Barbara McIsaac, counsel at the Ottawa office of Borden Ladner Gervais LLP and co-author of The Law of Privacy in Canada, says Bell didn't help itself with its approach to Chitrakar's complaint throughout the process and notes a privacy breach need not inevitably lead to an award of damages. According to the court decision, the company performed a "hard pull" credit check that can potentially damage a person's credit score if it took place close in time to another one. This happened on the same day Chitrakar ordered his satellite service but before he had signed any agreement. After an unsatisfactory voice mail apology from a Bell customer service representative for failing to inform him that a credit check may be performed, the company sent Chitrakar on a "royal runaround" seeking a resolution to his complaint before he cancelled his service after six months. When it came to the privacy commissioner matter, Bell was unable to locate any relevant records concerning Chitrakar's case and when it reached the Federal Court, nobody appeared for the company, according to Phelan. "Bell's conduct in this matter is reprehensible in respect to Chitrakar's privacy rights. Not only did Bell violate those rights, it has shown no interest in compensation or apparently any interest in addressing the [customer service representative's] actions nor in following the privacy commissioner's remedial recommendations. Its failure to appear in this court is consistent with its disregard of Chitrakar's privacy rights," Phelan wrote before going on to note that Bell's size had played into the value of the award he made since "a small damages award would have little material impact." "It's clear he was concerned and annoyed that from his point of view, Bell seemed to ignore the court case," says McIsaac. "I think the message for companies is pretty straightforward that if you have a complaint, don't take it lightly. Investigate it seriously and work to remedy it as best you can because in those circumstances, the likelihood of a court awarding damages is significantly lessened." LT

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