Canada: Canada's Federal Court Awards Damages Against A Foreign Website For Breach Of Privacy Laws

Last Updated: March 1 2017
Article by Anastasia Semenova and Wendy J. Wagner

Most Read Contributor in Canada, October 2018

In a recent decision, A.T. v Globe24h.com, 2017 FC 114, Canada's Federal Court asserted jurisdiction over a foreign-based website that republished Canadian court and tribunal decisions from Canadian legal websites and allowed them to be indexed and rendered searchable on Google and other search engines.

The Court declared that the owner and operator of the website, based in Romania, contravened the provisions of the federal private sector privacy legislation (the Personal Information Protection and Electronic Documents Act - PIPEDA), by collecting, using and disclosing online personal information contained in publicly available legal decisions for inappropriate purposes, and without the consent of the individuals concerned. The owner and operator was further ordered to:

(1) remove all Canadian decisions containing personal information from the website and to take necessary steps to remove these decisions from search engine caches;

(2) refrain from further copying and republishing Canadian court and tribunal decisions in a manner that contravenes PIPEDA; and

(3) pay $5,000 in damages.

Background

Investigation of Complaints under PIPEDA by the Privacy Commissioner

PIPEDA governs the collection, use and disclosure of personal information in the course of commercial activities. PIPEDA defines "personal information" very broadly as any information about an identifiable individual. The cornerstone of PIPEDA and substantially similar provincial privacy laws is that personal information must be collected, used and disclosed only with the consent of the individuals concerned (subject to limited exceptions) and for purposes that a reasonable person would consider appropriate.

The Privacy Commissioner of Canada can investigate complaints under PIPEDA under section 12 of PIPEDA and may issue a report of findings at the conclusion of an investigation. Within a year of receiving the Commissioner's report or being advised that an investigation has been discontinued, a complainant may apply to the Federal Court for a de novo hearing in respect of any aspect of the complaint.

Application for a hearing before the Federal Court

In this case, an application for a de novo hearing was made under section 14 of PIPEDA. The applicant was a Canadian resident originally from Romania. The respondent, based in Romania, was the sole owner and operator of Globe24h.com ("Globe24h"), a website hosted on a Romanian-based server that republished public documents from a number of countries, including Canada.  

The Canadian court or tribunal decisions published on Canadian legal websites, such as the publicly available CanLII.org, were republished on the respondent's website, "Globe24h". Unlike the Canadian legal websites, Globe24h allowed third party search engines such as Google to index the decisions and make them available within search engine results for the individuals' names. The decisions contained personal information about the individuals or their families, revealing personal matters related to health, finances, employment, immigration status and family matters such as divorce and custody proceedings. When the affected individuals complained, the website's owner and operator sought payment in exchange for the timely removal of the results.  In response, 49 individuals filed complaints with the Privacy Commissioner and over 150 complaints were received by CanLII.org.

The applicant filed a complaint to the Privacy Commissioner on the basis that the website collected, used and disclosed his personal information in violation of PIPEDA. The applicant was concerned that his personal information appearing in a labour relations decision, made easily accessible to the public through search engines, would affect his future employment prospects. The Privacy Commissioner determined that the applicant's complaint was well-founded.

PIPEDA's  Extraterritorial Application to Foreign-based Organizations

The Federal Court of Canada has previously determined that PIPEDA will apply to a foreign-based organization where there is evidence of a sufficient connection between the organization's activities and Canada. The relevant connecting factors include:

  • the location of the target audience of the website;
  • the source of the content on the website;
  • the location of the website operator; and
  • the location of the host server.

In this case, the website operator and host server were located in Romania. However, the Court held that when an organization's activities take place exclusively through a website, the physical location of the website operator or host server is not determinative. In the Court's view, there were three key connecting factors to Canada as follows:

(1)  the content was of Canadian origin, consisting of Canadian legal decisions;

(2)  the website directly targeted Canadians by listing Canadian case law, and the majority of visitors were from Canada; and

(3)  the impact was felt by Canadians as evidenced by numerous complaints to the Privacy Commissioner and Canadian media reports.

The Court noted that Romanian authorities had cooperated with the Privacy Commissioner's investigation, and had taken action to curtail Globe24h's activities including by issuing a fine against it for contravening Romanian data protection laws. However, this fact did not prevent the Court from asserting jurisdiction over the matter, on the basis that the Court's findings would complement rather than offend any action that taken in a Romanian court. Although the Court expressed concerns about the enforceability of any order it issued against a party who was not physically present in Canada, the Court reasoned that the issuance of a corrective order in Canada could assist the applicant both in pursuing his remedies in Romania and in persuading the operators of search engines to de-index the pages carried by the respondent website.

An Organization's Purposes for Collecting, Using and Disclosing Personal Information must be "Appropriate"

The Court agreed with the Privacy Commissioner's findings that Globe24h.com's activities did not constitute an appropriate purpose for the collection, use and disclosure of personal information, within the meaning of section 5(3) of PIPEDA. The Court rejected the respondent's  argument that the intention behind the publication of the Canadian decisions was to inform the public on matters of public interest. Rather, the Court found that the website's primary purpose was to incentivize individuals to pay to have their personal information removed from the website. A secondary purpose was to generate advertising revenue by driving traffic to the website through the increased exposure of personal information in search engines. In the opinion of the Court, these purposes could not be considered as appropriate from the perspective of a reasonable person.

The "Journalistic Purposes" Exemption was Inapplicable

Section 4(2)(c) of PIPEDA contains an exemption which applies where the information is collected, used or disclosed exclusively for journalistic purposes. The court rejected the respondent's claim that the purpose of republication was journalistic in nature, on the basis that the website added no value to the original freely accessible publications by way of commentary, additional information or analysis. Instead, the website exploited the content by demanding payment for its removal.

The "Publicly Available Information" Exemption was Inapplicable

Section 7 of PIPEDA contains an exemption for certain specific categories of "publicly available information", one of which is personal information contained in court or tribunal documents. However, any republication of such information must relate directly to the original purpose for which the documents were published, i.e. to uphold the open court principle protecting the general right of the public to have access to court proceedings.  The Court agreed with the Privacy Commissioner that in this case, the exemption was unavailable to the respondent, since the website's purposes did not relate directly to the open court principle, but actually undermined the administration of justice by discouraging people from accessing the justice system.

Remedies Under Section 16 of PIPEDA

The Court opined that a declaration that Globe24h had contravened PIPEDA, combined with a corrective order, would allow the applicant and other complainants to submit a request to search engines to remove links to decisions on Globe24h.com from their search engine results. The Court further held that a broad corrective order was warranted in this case because the effects of Globe24h's actions were not confined to the applicant.

The Court also held that monetary damages of $5,000 were warranted based on the conduct of the owner and operator of the website, and for the purpose of vindication and deterrence of further privacy breaches. The Court characterized the breach as "egregious", based on its finding that the respondent had essentially made a business of exploiting the privacy of individuals for profit, and had acted in bad faith in failing to take responsibility and rectify the problem.

Conclusion

While the monetary damages awarded in this case were modest, the Court sent a clear signal that damages will be awarded where the privacy rights of Canadians are disregarded in the pursuit of profit, in a manner that is non-compliant with Canadian privacy laws. The Court has also reinforced that foreign-based organizations operating online and handling the personal information of Canadians will not be able to escape liability on the basis that the website operator and/or host are physically located outside of Canada.

Finally, the decision emphasizes that available exemptions under PIPEDA are limited and specific, and will be interpreted narrowly in order to afford maximum protection to individual privacy interests. Organizations must have legitimate purposes for the collection, use and disclosure of personal information, and even that information which is publicly available will be protected where its collection, use and disclosure is considered exploitive and inconsistent with the original purposes for which it was made available. 

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.

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