Canada: Performance Claims: Ontario Superior Court Orders Rogers To Pay $500,000 Administrative Monetary Penalty In "Chatr" Case

On February 21, 2014, the Ontario Superior Court of Justice (OSCJ) released its penalty decision in Commissioner of Competition v. Chatr Wireless Inc. and Rogers Communications Inc.1 Further to an application by the Commissioner of Competition (Commissioner), the OSCJ previously found that, in certain cities, Rogers/Chatr had failed to conduct adequate and proper testing prior to launching an ad campaign about having fewer dropped calls than new wireless carriers, contrary to the Competition Act (Act). The Commissioner sought an administrative monetary penalty (AMP) of $5-7 million, and a prohibition order not to engage in similar reviewable conduct for a period of 10 years. The Court ordered Rogers/Chatr to pay an AMP of $500,000 and denied the Commissioner's request for a prohibition order.


The Commissioner filed an application in November 2010 alleging that representations made by Rogers/Chatr (Chatr is a wireless brand owned by Rogers) about having fewer dropped calls than the new wireless carriers were materially false or misleading, and that Rogers/Chatr did not conduct "adequate and proper testing" of said representations, in contravention of sections 74.01(1)(a) and (b) of the Act. In the main decision released in August 2013,2 the OSCJ dismissed most of the Commissioner's application on the basis that Rogers/Chatr's representations were in fact true, and that Rogers/Chatr did conduct "adequate and proper testing" to substantiate its claims. However, the OSCJ found that, in certain cities, Rogers/Chatr had failed to conduct such adequate testing prior to making its claim. Although proper tests conducted after the launch of the ad campaign supported the "fewer dropper calls" claim, making the claim prior to valid testing was contrary to the Act. The penalty hearing was held to determine the appropriate sanction for having published the untested fewer dropped calls claims.


Section 74.1(3) of the Act precludes the imposition of an AMP if the liable party is able to establish that it exercised due diligence. The OSCJ found that Rogers/Chatr did not exercise due diligence because, despite policies outlining the requirement to conduct appropriate testing, there was a deliberate decision to rely on "technological facts" (including higher cell site density and indoor transmission systems) suggesting the superiority of its network in support of the impugned representations, rather than proper testing.

The Commissioner sought an AMP of $5-7 million.3 In rejecting that argument and deciding to order an AMP of $500,000, the Court distinguished this case from other precedents for the following reasons:

  • The Commissioner failed to prove that the fewer dropped calls claim was false and misleading;
  • Rogers/Chatr continued testing the fewer dropped calls claim after publicly making it; and
  • Rogers/Chatr's post-claim testing substantiated the fewer dropper calls claim.

The OSCJ considered the statutory factors listed in section 74.1(5) of the Act to determine the appropriate amount of AMP, including the following:

  • Effect on Competition: The Court found that competition was harmed, because the market was exposed to the risk that the representations would be false. However, the representations were, in fact, true. As such, the harm to competitors and the public was mitigated.
  • Respondent's Financial Position: The Court indicated that this is a significant relevant consideration for determining the AMP level, but did not consider Rogers' significant revenues as an aggravating factor because of the reputational risk associated with such a proceeding.
  • Respondent's History of Compliance: Rogers has never been found liable for misleading advertising under the Act before, but, in another matter, the British Columbia Court of Appeal upheld an injunction against Rogers precluding it from making reliability representations that it had not properly tested. This previous case was considered as an aggravating factor.

Ironically, in addition to the statutory factors, the OSCJ considered that, because this was a case where the untested performance claims were later substantiated, the reputational harm caused to Rogers/Chatr by comments made by the complainants was a mitigating factor.

The Commissioner also requested a prohibition order precluding Rogers from engaging in reviewable conduct in the future. The OSCJ declined to make a prohibition order, recognizing that Rogers/Chatr have suffered reputational harm and incurred significant costs as a result of the Commissioner's application.


Although this case is unique as the impugned representations were found to be true but untested in certain cities prior to publication, this is an important decision that will be relevant to future determinations regarding AMPs. Due to the large number of factors at play in determining the magnitude of an AMP or whether one should be ordered at all, it is difficult to predict outcomes with certainty. In light of the Commissioner's aggressive enforcement approach with respect to misleading advertising, it is important to consistently adhere to robust compliance programs and ensure that adequate and proper testing is conducted prior to making performance claims.


1 2014 ONSC 1146.

2 2013 ONSC 5315.

3 The maximum AMP is $10 million for first time offenders and $15 million for repeat offenders.

To view original article, please click here.

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.

Similar Articles
Relevancy Powered by MondaqAI
Bereskin & Parr LLP
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Bereskin & Parr LLP
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

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 or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq 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 of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions