Canada: Records Management @ Gowlings, February 16, 2012 - Volume 3, Number 2

Legal Technology


Animal Welfare International Inc. v. W3 International Media Ltd.  2011 BCSC 299.

Application by the plaintiff to settle the terms and conditions that should attach to the production of documents pursuant to an Order of the Court and to compel the defendant to produce certain documents.  The parties had carried on business under a profit sharing agreement until the agreement was terminated by the plaintiff.  By previous Order of the Court the defendant was to deliver to the plaintiff two customer databases for two separate websites.  The defendant argued that there were privacy concerns relating to production of the databases since the databases contained confidential client information such as credit card numbers, addresses, etc., and as such information contained in the databases should be redacted.

The Court held that the privacy concerns were satisfied by ordering the principals of the plaintiff to sign confidentiality agreements and as such ordered the defendant to turn over the databases.  Further, the Court ordered that the defendant was to produce to the plaintiff any data relating to a report prepared that disclosed sales, profits and costs for a material period of the agreement.  The Court ruled and affirmed that electronic data is a document for purposes of production.  Accordingly, any of the data underlying the report that was stored electronically was to be produced along with any supporting paper documents.

Naaco Materials Handling Group, Inc. v. Lilly Co., No. 11-2415 AV, 2011 WL 5986649 (W.D. Tenn. Nov. 16, 2011).

Motion by the plaintiff to prevent further spoliation by the defendant.  In the main action, the plaintiff claimed damages for economic and competitive injury in relation to an alleged unauthorized and improper access to the plaintiff's secure dealer website.  The plaintiff manufactured and sold lift trucks and aftermarket parts.  The defendant was a dealer of the plaintiff's product.  Through the plaintiff's secure website, authorized dealers could access proprietary information, including information for servicing lift trucks, such as maintenance manuals, diagnostics, and pricing information.  By contract, dealers were required to keep confidential the contents of the website.  The defendant was terminated as a dealer, and sold its computers to another dealer.  One of the defendant's employees went to work for the other dealer and the plaintiff issued the employee new access information for the website.  The plaintiff alleged that, despite this, the defendant continued to access its website.  The defendant admitted unauthorized access but denied claims that it obtained trade secrets or infringed plaintiff's copyright by such access.  The defendant's counsel instructed the defendant's President to take various steps to preserving electronic data in light of ongoing litigation.  These instructions were forwarded to several senior employees within the company.

Three to four months later, a similar notice was sent to all of the defendant's employees.

Forensic examinations of the defendant's computers were conducted to identify which computers had accessed the secure website.  Hard drives of identified computers were preserved.  However, as a witness testifying on behalf of the company, the defendant's President had testified that the defendant did nothing at several key times to preserve evidence of access to the website.  In particular, it took no steps towards preservation when the defendant's access information was initially cancelled upon termination of the dealer agreement, when it was served with the plaintiff's complaint, nor when it received a "document hold" letter from the plaintiff.  The plaintiff argued that any evidence lost was at the very core of its claim, and that having been denied the opportunity to fully support its claim, it had been prejudiced by the failure to preserve evidence. In response, the defendant insisted that spoliation was not proven and that the plaintiff's own server logs were the best evidence of access to the website.

The court found that the defendant had failed to meet its obligation to provide a proper and prepared witness on behalf of the corporation. The defendant had a duty to produce a knowledgeable person as to each topic to the deposition and to adequately prepare the deponent.  The defendant's President could not identify who had learned of the access information, nor could he indicate what portions of the website had been accessed.  He should have spoken with each of the employees who admittedly accessed the website and examined each of the computers identified as having been used to access the website.  Re-examination was ordered with costs to the defendant.

With respect to spoliation, the defendant's duty to preserve arose upon the anticipation of litigation triggered only when it received the plaintiff's complaint.  The fact that the defendant knew of its employees' access prior to that time was not reason enough for the defendant to anticipate litigation.  In this regard, the Court noted, the plaintiff had not sent any pre-litigation or cease-and-desist letters prior to launching its complaint.  The defendant's preservation and collection efforts were insufficient in the circumstances in that the defendant failed to issue a written company-wide litigation hold in a timely fashion, and failed to take additional steps to prevent emails from being deleted, to prevent data from being overwritten, or to identify and preserve backup tapes.  In terms of collection, three months had elapsed from the time of the complaint before the defendant began searching for evidence of access.  Collection efforts were improperly left to employees to complete on their own with no managerial oversight, follow-up, or documentation of collection procedures.  Proper technicians were not retained to assist with these efforts.

The defendant's conduct with respect to preservation and collection of evidence constituted negligence at a minimum.  In determining whether sanctions were appropriate, the Court concerned itself less with whether relevant documents were in fact lost given that the plaintiff was only seeking costs associated with the forensic examinations.  Instead, the Court focused on the defendant's conduct in the circumstances. The lack of evidence as to spoliation was primarily the product of the defendant's failure to take steps toward preservation of electronic data, as was the need for forensic examinations.  Costs of the forensic examinations were awarded to the plaintiff.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Events from this Firm
8 Nov 2016, Seminar, Ottawa, Canada

The prospect of an internal investigation raises many thorny issues. This presentation will canvass some of the potential triggering events, and discuss how to structure an investigation, retain forensic assistance and manage the inevitable ethical issues that will arise.

22 Nov 2016, Seminar, Ottawa, Canada

From the boardroom to the shop floor, effective organizations recognize the value of having a diverse workplace. This presentation will explore effective strategies to promote diversity, defeat bias and encourage a broader community outlook.

7 Dec 2016, Seminar, Ottawa, Canada

Staying local but going global presents its challenges. Gowling WLG lawyers offer an international roundtable on doing business in the U.K., France, Germany, China and Russia. This three-hour session will videoconference in lawyers from around the world to discuss business and intellectual property hurdles.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.