Law Times

Law Times • January 26, 2015 Page 11 www.lawtimesnews.com Intrusion upon seclusion Ontario's privacy tort broadens its reach By Judy van rhiJn For Law Times s Ontario lawyers embrace the tort of intrusion upon seclu- sion, they're not only using it as a cause of action but are expanding on the concept and coming up with novel ap- plications for it. Christopher Du Vernet, who was counsel for the successful appellant in Jones v. Tsige, de- scribes himself as being like a proud parent. "It's growing up quite well, but there is still work to do in refining it," he says. He has observed many cases citing the tort are winding slow- ly through the courts. "A lot are settling, which is salutary," he says. "Institutions know that negative headlines will be damaging." In fact, in a sign that the tort is maturing, complainants are now suing institutions as well as individuals. In a decision in McIntosh v. Legal Aid Ontario this fall, the complainant sued Legal Aid Ontario as well as an employee involved with her ex-boyfriend who unlawfully accessed her file and used the contents to threaten her. After completing an investigation, LAO acknowledged there was a breach of the plaintiff 's privacy, provided a letter of apology, and settled the action against it. In the case against the in- dividual defendant, the court found she had accessed the plain- tiff 's LAO file for an improper purpose, constituting a breach of her privacy rights "sufficient to establish liability based upon the tort of intrusion upon seclusion. "The rogue employee is alive and well, and I think this will be the principal source of privacy litiga- tion," says Du Vernet. He believes the developing case law shows the wisdom of creating the tort as traditional legal tools fall away. "More traditional causes of action like breach of contract and breach of fiduciary duty are proving to be inadequate to the task. That's exactly what we ar- gued in court, and it's precisely the gap that the Court of Appeal identified. With breach of con- tract, you need to prove loss, and sometimes there is not a tradi- tional contractual relationship. Claims for breach of a fiduciary duty always fail. "The genius of the new tort is that it recognizes a new category of loss. It's not economic loss. It's an intangible thing." Du Vernet predicts the next wave of privacy litigation will see negligence claims directed at banks, hospitals, and other large institutions whose systems re- quire protection from snooping employees and external hack- ers. "After the Jones case and the Sony hacking, no one can say they are surprised that there might be malicious people attempting to in- filtrate their system," he says. But he says it's unfor- tunate that institutions such as banks haven't al- ready reacted to the new law. "They are still being named as defendants. We will need significantly higher awards for damag- es to make any impact on corporate practice. Only lawyers are reading the cases. Any press attention is ephemeral; it only lasts a day. Large awards will focus the attention of the large institutions." While the threshold for an invasion of privacy remains high, the awards so far have been modest. Jones put an upper limit on awards at $20,000. The issue also arose in McIn- tosh as the court awarded just $7,500 after finding the com- plainant more irritated than devastated by the breach. "The cost of rolling out the litigation is consumed by the award," says Du Vernet. He believes low awards act as an invitation to violators and a disincentive for plaintiffs to liti- gate. "For banks that make tens of millions of dollars in profits, awards under $10,000 validate the decision not to change. It's cheaper to pay than to improve their systems, which is the opposite effect from what the Court of Appeal intended." Du Vernet hopes the courts will revisit the damages issue. "It was actually never argued in Jones v. Tsige," he says. "No parties proposed a cap and it has always struck me as being very arbitrary. The Court of Appeal was worried that the f loodgates would open when it created a new tort, so they only opened the gates a crack. None of those concerns have come about. Until there are large awards and negative headlines, the large institutions won't change." One reaction to the low awards is the attempt to use a waiver of tort that allows the plaintiff to seek restitution of the profits gained instead of damages. Du Vernet be- lieves it could apply where someone has disclosed customer information. "They can get the money made from the custom- ers," he says, noting that so far such a scenario has only come up on a motion to strike with no actual decision so far. Another development is the use of the tort in class actions. Du Vernet believes their economies of scale will make them the future of privacy tort litigation. So far, the threshold for class action certification in privacy matters has been low. In Ontario, there are sev- eral privacy class actions in play, including one against the Bank of Nova Scotia for an employee's alleged theft of clients' personal information. Both the Peterborough Re- gional Health Centre and the Rouge Valley Health System are facing lawsuits for improp- er access to and use of patient information. There's also an Ontario version of the Can- ada-wide class action against Home Depot of Canada Inc. for the breach of debit and credit card information. The Federal Court has certi- fied a class action related to the loss of a hard drive containing personal information under the Canada student loan pro- gram. In or around May 2015, the court will hear an applica- tion against Health Canada on behalf of 40,000 medical mari- juana users who received a letter with the word "marihuana" on the outside envelope. The Supreme Court of Brit- ish Columbia has certified a class action against Facebook regarding alleged privacy vio- lations even though the B.C. courts have refused to adopt the tort of intrusion upon seclusion. Manitoba, Saskatchewan, and Newfoundland have similar statutory regimes, but in certi- fication proceedings in New- foundland in November 2014, the Newfoundland Supreme Court found that the tort might coexist along with the Privacy Act. It specifies that its provi- sions are in addition to other rights of action or remedies available outside of the act. Du Vernet continues to watch the evolution of the tort with interest. "The Jones case is an example of the tort system recognizing a need and filling a gap," says Du Vernet. "It shows the f lexibility of the tort system when the legislature, for whatever reason, doesn't re- spond." LT FOCUS Dimock Straon llp experience. results. 20 Queen W. 32nd fl, Toronto | 416.971.7202 | dimock.com We're proud to welcome Sangeetha Punniyamoorthy, Alan Macek and Geoff Mowa to the partnership With almost 30 years experience between them, Sangeetha, Alan and Geoff bring depth and insight to a wide range of intellectual property maers. Sangeetha has built a busy practice focusing on copyright and trademark litigation, Alan emphasizes electrical and computer-related technology while Geoff has developed a practice that includes maers involving the Patented Medicines (Notice of Compliance) Regulations. Welcome to the team. ree new partners bring depth to our team Untitled-3 1 2015-01-20 2:05 PM A 'The Jones case is an example of the tort system recognizing a need and filling a gap,' says Christopher Du Vernet.

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