The Supreme Court of Canada has granted leave to appeal from Equustek Solutions Inc. v. Google
Inc., a decision that affirmed a global restraining
order against Google Inc. (Google) and Google Canada Corporation
(Google Canada), despite neither entity being physically located in
Canada or being a party to the main action.
In the main action, the plaintiff manufacturer of computer
networking devices claimed that the defendants had stolen trade
secrets and used these secrets to develop their own products
online. The defendants initially carried on business in B.C., but
eventually marketed their products through a variety of websites,
ignoring various court orders to stop doing business online.
While Google was not a party to the main action, the
defendants' websites were listed on its search engine. Google
initially complied with the plaintiffs' request to remove
specific web pages (or URLs) from searches originating from Canada
(through Google.ca), but it was unwilling to categorically block
the defendants' websites appearing in any search results, done
from any Google website, from any location in the world.
The plaintiffs subsequently sought an injunction against Google
preventing them from including the defendants' websites in its
B.C. SUPREME COURT
In Equustek Solutions Inc. v.
Jack, the B.C. Supreme Court ordered Google Inc. and
Google Canada to remove all of a company's websites from its
search results. Although Google is incorporated in Delaware and
operates out of California, the chambers judge of the B.C. Supreme
Court determined it had territorial competence over Google, noting
that Google carried on business in B.C. The chambers judge applied
the standard test for granting an injunction to Google, a third
party, ruling that Google would not be inconvenienced to a large
degree if an injunction were granted, while the plaintiffs had
suffered irreparable harm from the defendants' conduct, which
Google had inadvertently facilitated.
The B.C. Court of Appeal dismissed Google and Google
Canada's appeal from the order of the B.C. Supreme Court. As
discussed in our June 2015 Blakes Bulletin: Still Can't Search This: B.C. Court of
Appeal Affirms Global Restraining Order Against
Google, the Court of Appeal noted that the B.C.
Supreme Court's territorial jurisdiction over the underlying
subject matter of the dispute was sufficient to provide it with
competence over the injunction application, a potentially
significant expansion of the courts' power over non-resident,
non-parties. The Court of Appeal also agreed with the B.C. Supreme
Court's decision that B.C. courts had jurisdiction over Google
itself, noting that Google carried business in B.C. through its
advertising, search and proprietary information activities.
Since the lower court had jurisdiction over Google in this case,
the Court of Appeal held that there was no bar to granting an
injunction on the basis that the court's order may impact
activities in other jurisdictions. However, the Court of Appeal
agreed with the intervenor Canadian Civil Liberties
Association's submission that B.C. courts must not grant orders
with extra-territorial effects that have a realistic possibility of
offending another state's core values on freedom of expression.
On the facts of this case, though, the Court of Appeal held there
was nothing impacting foreign freedom of speech or lawful
On further appeal, the Supreme Court of Canada will have the
opportunity to clarify a number of important issues arising from
these decisions, including the test courts are to apply for
injunctions directed against non-parties (especially non-resident
parties) and how courts are to factor comity concerns in to orders
that will have an impact on the fundamental values of other
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