JOHN PAUL INGARRA, KYLE PINNELL, PAUL TANTALO and 5046013 ONTARIO INC. v DYE & DURHAM LIMITED, OMERS INFRASTRUCTURE MANAGEMENT INC., and DOPROCESS LP

Ingarra v. Dye & Durham Limited
Court (s) Database
Federal Court Decisions
Date
2023-07-31
Neutral citation
2023 FC 1046
File numbers
T-855-22
Notes
A correction was made on February the 16th, 2024.
Decision Content
Date: 20230731
Docket: T-855-22
Citation: 2023 FC 1046
Montréal, Quebec, July 31, 2023
PRESENT: Mr. Justice Gascon
PROPOSED CLASS PROCEEDING
BETWEEN:
JOHN PAUL INGARRA, KYLE PINNELL, PAUL TANTALO, and 5046013 ONTARIO INC.
Plaintiffs
and
DYE & DURHAM LIMITED, OMERS INFRASTRUCTURE MANAGEMENT INC., and DOPROCESS LP
Defendants
ORDER AND REASONS
I. Overview
[1] The Defendants, Dye & Durham Limited [Dye & Durham] and DoProcess LP [DoProcess], seek an order removing Cartel & Bui LLP as counsel of record to the Plaintiffs, Mr. John Paul Ingarra, Mr. Kyle Pinnell, Mr. Paul Tantalo, and 5046013 Ontario Inc. This motion arises in the context of a proposed class action brought by the Plaintiffs, in which they allege that Dye & Durham and DoProcess engaged in a conspiracy to increase the price of real estate conveyancing software through Dye & Durham’s acquisition of DoProcess from OMERS Infrastructure Management Inc. [OMERS Infrastructure] — who also appears as Defendant in this matter. According to the Plaintiffs, this transaction would have breached section 45 of the Competition Act, RSC 1985, c C-34 [Act] on illegal agreements between competitors, as well as sections 21 and 22 of the Criminal Code, RSC 1985, c C-46 [Criminal Code]. Pursuant to section 36 of the Act, the Plaintiffs claim damages resulting from the alleged breach, estimated to be in the amount of $200 million for the class members.
[2] In their motion, Dye & Durham and DoProcess submit that Mr. Calvin Goldman, the Plaintiffs’ former counsel of record, would have received confidential information regarding their businesses in the course of previous retainers Mr. Goldman had for a predecessor company of Dye & Durham, OneMove Technologies Inc. [OneMove]. Because Mr. Goldman worked on the statement of claim in this proposed class proceeding [Statement of Claim] with the Plaintiffs’ current counsel of record, Messrs. Nicholas Cartel and Glenn Brandys from Cartel & Bui, Cartel & Bui would now be “tainted” and would therefore need to be removed as counsel of record to prevent a potential misuse of Dye & Durham’s and DoProcess’ confidential information.
[3] This motion raises two issues: 1) was Mr. Goldman in a conflict of interest when he advised the Plaintiffs and worked with Cartel & Bui on the Statement of Claim? 2) if so, should Cartel & Bui and Messrs. Cartel and Brandys be removed as counsel of record to the Plaintiffs because of their relationship with Mr. Goldman?
[4] For the reasons that follow, the motion to remove Cartel & Bui as counsel of record will be dismissed. Further to my review of the evidence and the applicable case law, I am not persuaded that confidential information relevant to the matter at hand was imparted to Mr. Goldman in the context of his previous retainers, nor that it was passed upon Cartel & Bui. Cartel & Bui can therefore continue to act as counsel of record to the Plaintiffs in this matter.
II. Background
A. The parties
[5] Dye & Durham provides cloud-based software and technology solutions for legal and business professionals. Dye & Durham Corporation is Dye & Durham’s key operating subsidiary.
[6] OneMove provided web-based real estate transaction platforms. Among others, OneMove operated the real estate conveyancing software platform branded “eConveyanceTM” [eConveyance]. eConveyance is a cloud-based software application that simplifies the process of buying, selling, and financing residential real estate transactions by connecting all of the participants in the property transfer process. In 2016, OneMove amalgamated with Dye & Durham Corporation. As a result, Dye & Durham, through Dye & Durham Corporation, now operates eConveyance. OneMove’s former Chief Executive Officer [CEO], Mr. Matthew Proud, is now CEO of Dye & Durham.
[7] DoProcess was a limited partnership that operated a suite of products related to real estate conveyancing and title searching, including the real estate conveyancing software called “Conveyancer,” subsequently rebranded as “Unity.” When it was owned by OMERS Infrastructure, DoProcess was an affiliated entity of Teranet Inc. [Teranet], which runs the electronic title registration system for the province of Ontario.
[8] In December 2020, Dye & Durham acquired DoProcess from OMERS Infrastructure. In June 2022, DoProcess was subsequently dissolved. All its properties were distributed to entities that were then amalgamated with Dye & Durham Corporation.
[9] Cartel & Bui is a law firm based in Toronto, Ontario. Mr. Cartel and Mr. Brandys work as lawyers at that firm. Mr. Goldman is a lawyer who established his own firm, The Law Office of Calvin Goldman, in 2020. Before he started his own firm, Mr. Goldman was Chair of the Competition, Antitrust and Foreign Investment Group at Goodmans LLP in Toronto. He was a partner at Goodmans from 2014 to September 2020. Mr. Goldman’s law firm shares office space with Cartel & Bui, but the two firms are independent from one another.
B. The factual context
[10] At the time the proposed class action was commenced in late April 2022, the Plaintiffs’ counsel of record were Messrs. Cartel and Brandys of Cartel & Bui and Mr. Goldman of The Law Office of Calvin Goldman.
[11] In June 2022, Dye & Durham and DoProcess communicated their concerns about Mr. Goldman’s alleged conflicts of interest because of his past involvement — when he was a partner at Goodmans — in competition law matters involving Dye & Durham’s predecessor OneMove. Following these exchanges between the parties, Mr. Goldman and his firm withdrew as counsel of record to the Plaintiffs, but Cartel & Bui did not. When he ceased acting in this matter, Mr. Goldman was clear that that he did not acknowledge that he was or had been in any form of conflict of interest.
[12] Dye & Durham and DoProcess allege that, in two specific instances, Mr. Goldman obtained confidential information from Dye & Durham’s predecessor OneMove, as follows.
(1) The 2014 retainer
[13] In 2014, Mr. Proud — in his capacity as CEO of OneMove at the time — communicated with Mr. Goldman and other lawyers at Goodmans to seek advice about a potential abuse of dominance complaint under section 79 of the Act. An abuse of dominant position occurs when a dominant firm or a dominant group of firms engages in a practice of anti-competitive acts, with the result that competition has been, is, or is likely to be prevented or lessened substantially in a market. Mr. Proud was of the view that the conduct of DoProcess prevented the expansion of the eConveyance software into Ontario.
[14] In the context of that retainer, Mr. Proud purportedly provided Mr. Goldman with confidential and commercially sensitive information about OneMove’s business and products, including:
a description of OneMove’s eConveyance product, the functionality of conveyancing software generally, and how OneMove’s products compared to those offered by DoProcess and Teranet;
Mr. Proud and OneMove’s views on the importance of integrating conveyancing software with title insurance offerings;
a description of OneMove’s market share, and planned expansion into Ontario; and
a description of OneMove’s allegations surrounding DoProcess and Teranet’s anti-competitive conduct.
[15] According to Mr. Proud’s affidavit evidence and his cross-examination, all of this information was provided verbally to Mr. Goldman during a single telephone conversation. No documents were handed out to Mr. Goldman at the time.
[16] Despite the fact that they had initially accepted to act for OneMove and stated they had no legal conflicts, Mr. Goldman and Goodmans subsequently advised OneMove that they were withdrawing from that retainer due to business conflicts.
[17] In his affidavit, Mr. Goldman testified that he had “no recollection of that [2014] consultation, or of Mr. Proud.”
(2) The 2016 abuse of dominance complaint
[18] In 2015, Mr. Goldman and Goodmans started to act for an entity named Information Services Corporation [ISC] in relation to ISC’s subsequent investment in OneMove. ISC is not related to Dye & Durham.
[19] In 2016, Mr. Goldman and Goodmans advised ISC again and worked with OneMove in submitting an abuse of dominance complaint — the very complaint discussed by Mr. Proud with Mr. Goldman in the context of the 2014 retainer — against DoProcess. At the time, ISC and OneMove agreed to the terms of a joint defence agreement [JDA].
[20] Dye & Durham and DoProcess submit that, in the context of those mandates for ISC, Mr. Goldman received significant confidential information about OneMove’s business and its views on the conveyancing software industry and competitors. Because Mr. Goldman received a copy of the complaint submitted to the Competition Bureau [Bureau], Dye & Durham and DoProcess submit that Mr. Goldman obtained confidential information about OneMove’s business and perspectives on the industry, including:
a description of OneMove’s eConveyance application and the functionality of conveyancing software generally;
OneMove’s views of the competitive importance of integrating software seamlessly with title insurers and land registry operators, such as Teranet;
OneMove’s views of the key providers of conveyancing software, their products and market positions, including OneMove’s views of DoProcess and its Conveyancer application;
allegations regarding DoProcess and Teranet’s alleged anti-competitive practices, which were preventing OneMove’s expansion into Ontario;
a description of pricing models of the conveyancing software offered by OneMove and DoProcess; and
OneMove’s views as to what market conditions would facilitate a more meaningfully competitive market.
[21] I pause to underline that, on that retainer, Mr. Goldman was not acting for OneMove with respect to ISC’s investment or to the contemplated abuse of dominance complaint to the Bureau. Mr. Goldman was instead solely acting for ISC. Mr. Goldman indeed submits that neither he nor any other colleague of his at Goodmans acted for Mr. Proud or OneMove with respect to the abuse of dominance complaint to the Bureau. He further points out that the JDA specifically provided that no lawyer-client relationship with the other party’s counsel would be created, and that the agreement could not be used to seek to disqualify counsel on the basis of information being shared.
[22] In his affidavit, Mr. Goldman affirmed that no confidential information was imparted to him in his capacity as counsel to ISC in the context of this 2016 abuse of dominance complaint. Mr. Goldman was not cross-examined on his affidavit.
[23] In their respective affidavits and on cross-examination, Messrs. Cartel and Brandys both stated that they did not receive any confidential information regarding Dye & Durham or DoProcess from Mr. Goldman. They further indicated that the Statement of Claim was drafted and the proposed class action was commenced on the sole basis of publicly available information.
C. The relevant statutory framework
[24] The relevant legislative provisions are found in the Act and the Criminal Code. They read as follows.
(1) The Act
Recovery of damages
Recouvrement de dommages-intérêts
36 (1) Any person who has suffered loss or damage as a result of
36 (1) Toute personne qui a subi une perte ou des dommages par suite :
(a) conduct that is contrary to any provision of Part VI, or
a) soit d’un comportement allant à l’encontre d’une disposition de la partie VI;
(b) the failure of any person to comply with an order of the Tribunal or another court under this Act,
b) soit du défaut d’une personne d’obtempérer à une ordonnance rendue par le Tribunal ou un autre tribunal en vertu de la présente loi,
may, in any court of competent jurisdiction, sue for and recover from the person who engaged in the conduct or failed to comply with the order an amount equal to the loss or damage proved to have been suffered by him, together with any additional amount that the court may allow not exceeding the full cost to him of any investigation in connection with the matter and of proceedings under this section.
peut, devant tout tribunal compétent, réclamer et recouvrer de la personne qui a eu un tel comportement ou n’a pas obtempéré à l’ordonnance une somme égale au montant de la perte ou des dommages qu’elle est reconnue avoir subis, ainsi que toute somme supplémentaire que le tribunal peut fixer et qui n’excède pas le coût total, pour elle, de toute enquête relativement à l’affaire et des procédures engagées en vertu du présent article.
…
[…]
Conspiracies, agreements or arrangements between competitors
Complot, accord ou arrangement entre concurrents
45 (1) Every person commits an offence who, with a competitor of that person with respect to a product, conspires, agrees or arranges
45 (1) Commet une infraction quiconque, avec une personne qui est son concurrent à l’égard d’un produit, complote ou conclut un accord ou un arrangement :
(a) to fix, maintain, increase or control the price for the supply of the product;
a) soit pour fixer, maintenir, augmenter ou contrôler le prix de la fourniture du produit;
(b) to allocate sales, territories, customers or markets for the production or supply of the product; or
b) soit pour attribuer des ventes, des territoires, des clients ou des marchés pour la production ou la fourniture du produit;
(c) to fix, maintain, control, prevent, lessen or eliminate the production or supply of the product.
c) soit pour fixer, maintenir, contrôler, empêcher, réduire ou éliminer la production ou la fourniture du produit.
…
[…]
Definitions
Définitions
(8) The following definitions apply in this section.
(8) Les définitions qui suivent s’appliquent au présent article.
competitor includes a person who it is reasonable to believe would be likely to compete with respect to a product in the absence of a conspiracy, agreement or arrangement to do anything referred to in paragraphs (1)(a) to (c). (concurrent)
concurrent S’entend notamment de toute personne qui, en toute raison, ferait vraisemblablement concurrence à une autre personne à l’égard d’un produit en l’absence d’un complot, d’un accord ou d’un arrangement visant à faire l’une des choses prévues aux alinéas (1)a) à c). (competitor)
price includes any discount, rebate, allowance, price concession or other advantage in relation to the supply of a product. (prix)
prix S’entend notamment de tout escompte, rabais, remise, concession de prix ou autre avantage relatif à la fourniture du produit. (price)
…
[…]
Prohibition if abuse of dominant position
Ordonnance d’interdiction : abus de position dominante
79 (1) If, on application by the Commissioner or a person granted leave under section 103.1, the Tribunal finds that
79 (1) Lorsque, à la suite d’une demande du commissaire ou d’une personne à qui a été accordée en vertu de l’article 103.1 la permission de présenter une demande, il conclut à l’existence de la situation suivante :
(a) one or more persons substantially or completely control, throughout Canada or any area thereof, a class or species of business,
a) une ou plusieurs personnes contrôlent sensiblement ou complètement une catégorie ou espèce d’entreprises à la grandeur du Canada ou d’une de ses régions;
(b) that person or those persons have engaged in or are engaging in a practice of anti-competitive acts, and
b) cette personne ou ces personnes se livrent ou se sont livrées à une pratique d’agissements anti-concurrentiels;
(c) the practice has had, is having or is likely to have the effect of preventing or lessening competition substantially in a market,
c) la pratique a, a eu ou aura vraisemblablement pour effet d’empêcher ou de diminuer sensiblement la concurrence dans un marché,
the Tribunal may make an order prohibiting all or any of those persons from engaging in that practice.
le Tribunal peut rendre une ordonnance interdisant à ces personnes ou à l’une ou l’autre d’entre elles de se livrer à une telle pratique.
(2) The Criminal Code
Parties to offence
Participants à une infraction
21 (1) Every one is a party to an offence who
21 (1) Participent à une infraction :
(a) actually commits it;
a) quiconque la commet réellement;
(b) does or omits to do anything for the purpose of aiding any person to commit it; or
b) quiconque accomplit ou omet d’accomplir quelque chose en vue d’aider quelqu’un à la commettre;
(c) abets any person in committing it.
c) quiconque encourage quelqu’un à la commettre.
Common intention
Intention commune
(2) Where two or more persons form an intention in common to carry out an unlawful purpose and to assist each other therein and any one of them, in carrying out the common purpose, commits an offence, each of them who knew or ought to have known that the commission of the offence would be a probable consequence of carrying out the common purpose is a party to that offence.
(2) Quand deux ou plusieurs personnes forment ensemble le projet de poursuivre une fin illégale et de s’y entraider et que l’une d’entre elles commet une infraction en réalisant cette fin commune, chacune d’elles qui savait ou devait savoir que la réalisation de l’intention commune aurait pour conséquence probable la perpétration de l’infraction, participe à cette infraction.
Person counselling offence
Personne qui conseille à une autre de commettre une infraction
22 (1) Where a person counsels another person to be a party to an offence and that other person is afterwards a party to that offence, the person who counselled is a party to that offence, notwithstanding that the offence was committed in a way different from that which was counselled.
22 (1) Lorsqu’une personne conseille à une autre personne de participer à une infraction et que cette dernière y participe subséquemment, la personne qui a conseillé participe à cette infraction, même si l’infraction a été commise d’une manière différente de celle qui avait été conseillée.
Idem
Idem
(2) Every one who counsels another person to be a party to an offence is a party to every offence that the other commits in consequence of the counselling that the person who counselled knew or ought to have known was likely to be committed in consequence of the counselling.
(2) Quiconque conseille à une autre personne de participer à une infraction participe à chaque infraction que l’autre commet en conséquence du conseil et qui, d’après ce que savait ou aurait dû savoir celui qui a conseillé, était susceptible d’être commise en conséquence du conseil.
Definition of counsel
Définitions de conseiller et de conseil
(3) For the purposes of this Act, counsel includes procure, solicit or incite.
(3) Pour l’application de la présente loi, conseiller s’entend d’amener et d’inciter, et conseil s’entend de l’encouragement visant à amener ou à inciter.
III. Analysis
A. Mr. Goldman’s alleged conflict of interest
[25] The first issue to be determined is whether Mr. Goldman was in a conflict of interest when he advised the Plaintiffs and worked with Cartel & Bui on the Statement of Claim, due to his previous retainers involving OneMove.
(1) The legal test
[26] The test to assess whether a conflict of interest arises from a lawyer’s possession of confidential information has been established by the Supreme Court of Canada in MacDonald Estate v Martin, [1990] 3 SCR 1235 [Martin] at page 1260 and Canadian National Railway Co v McKercher LLP, 2013 SCC 39 [McKercher] at paragraph 24. In those decisions, the Supreme Court of Canada laid out a two-part approach to assessing conflicts over the potential misuse of confidential information:
1)Did the lawyer receive confidential information attributable to a solicitor and client relationship relevant to the matter at hand?
2)Is there a risk that it will be used to the prejudice of the client?
[27] In MediaTube Corp v Bell Canada, 2014 FC 237 [MediaTube] at paragraphs 27 and 28, the Court summarized how the Martin test applies. In the first part of the test, the moving party bears the onus of establishing that confidential information relevant to the matter at hand was shared with the lawyer in the previous relationship. This can be met in two ways: 1) the moving party may adduce evidence that confidential information was in fact imparted to the lawyer during the solicitor-client relationship; or 2) the moving party may demonstrate that the lawyer’s new retainer is “sufficiently related” to the matters covered in the prior relationship. If the latter option is satisfied, a rebuttable presumption arises that the law firm possesses confidential information which raises a risk of prejudice (Martin at pp 1260–1262; MediaTube at para 27). The test of whether the confidential information is relevant to the matter at hand requires the moving party to demonstrate that the confidential information or a portion of it received in the first retainer would likely be part of the factual context directly informing the lawyer’s advice to the new client.
[28] Conversely, a defendant can rebut the inference that confidential information has been shared in two ways: 1) by demonstrating that no confidential information was actually shared; or 2) by demonstrating that the information is not “sufficiently related” or relevant to the matter on which the lawyer seeks to act (GCT Canada Limited Partnership v Vancouver Fraser Port Authority, 2019 FC 1147 [GCT] at para 82).
[29] In Celanese Canada Inc v Murray Demolition Corp, 2006 SCC 36, the Supreme Court of Canada commented on its previous Martin decision and said the following at paragraph 42: “it is important to note that Sopinka J. [who authored the Martin reasons] imposed no onus on the moving party to adduce any further evidence as to the nature of the confidential information beyond that which was needed to establish that the receiving lawyer had obtained confidential information attributable to a solicitor and client relationship which was relevant to the matter at hand.” Accordingly, the moving party is only required to demonstrate that matters are “sufficiently related” in order to benefit from the presumption of receipt of relevant confidential information by the lawyer.
[30] The second part of the Martin test deals with the risk that confidential information will be used to the prejudice of the former client (MediaTube at para 28). If the lawyer’s new retainer is found to be “sufficiently related” to the matters on which the lawyer worked for a former client, and the rebuttable presumption arises, the courts should then “infer that confidential information was imparted unless the [lawyer] satisfies the court that no information was imparted which could be relevant” (Martin at p 1260). This presumption can only be rebutted by the defendant if there is sufficient evidence to demonstrate that no relevant confidential information was effectively disclosed as a result of the prior relationship. But this is not an easy burden to discharge, as Sopinka J. emphasized in Martin: “[n]ot only must the court’s degree of satisfaction be such that it would withstand the scrutiny of the reasonably informed member of the public that no such information passed, but the burden must be discharged without revealing the specifics of the privileged communication” (Martin at p 1260).
[31] Having said that, I underline that Martin expressly recognizes that there may be cases where a party can satisfy “the court that no information was imparted which could be relevant” to the underlying dispute (Martin at p 1260).
[32] I pause to point out that the two-part Martin test is anchored in an overriding policy principle which has to inform and guide the courts in answering whether or not a disqualifying conflict of interest arises in any particular case: the test must be such that “the public represented by the reasonably informed person would be satisfied that no use of confidential information would occur” (Martin at pp 1259–1260). Stated differently, the test is whether a reasonably informed member of the public “would conclude that counsel’s removal is necessary for the proper administration of justice” (Kaiser (Re), 2011 ONCA 713 [Kaiser] at para 21).
[33] The Martin decision also establishes a presumption that, where relevant confidential information is imparted in the context of a solicitor-client relationship, the information received by the “tainted” lawyer would be shared within the law firm that acquired it.
[34] The framework developed in Martin is not limited to solicitor-client relationships. It extends to information provided by other parties involved or associated with the firm’s client. Accordingly, if confidential information is “attributable to a solicitor-client relationship,” the Martin test applies (GCT at paras 36–39, 44).
[35] The Martin test was recently used by the Court in McLean v Suhr, 2018 FC 1000 [McLean]. In that case, the Court echoed the words of the Supreme Court of Canada in Martin and reiterated the importance, when considering conflicts of interest, to strike an appropriate balance between “the need to maintain a high standard for the legal profession and integrity of the judicial system, the right of litigant to choice of counsel, and the desirability for reasonable mobility in the legal profession” (McLean at para 28; see also Martin at p 1243).
[36] Indeed, it is fair to say that Canadian courts have taken a cautious approach and exercised a high level of restraint before interfering with a party’s choice of counsel and exercising their discretion to remove counsel (Kaiser at para 21; Salager v Dye & Durham Corporation, 2017 BCSC 470 [Salager] at para 56). In other words, the courts will not issue orders removing counsel lightly.
[37] In the end, the determination of whether a conflict of interests exists is largely a factual inquiry, and the courts must examine each case on its own merits (GCT at para 34). In the present case, and for the reasons that follow, I find that Dye & Durham and DoProcess have not discharged their burden on the first part of the Martin test. In my view, they fail the test on the two fronts identified in MediaTube. First, I am not persuaded that, on a balance of probabilities, confidential information was provided to Mr. Goldman as part of the 2014 retainer or the 2016 abuse of dominance complaint. Second, the matters on which Mr. Goldman worked as part of the previous retainers are not “sufficiently related” to the matter now at issue in this proposed class action to justify the removal of Plaintiffs’ counsel (GCT at para 82). In light of these findings, there is no need to determine whether, under the second part of the Martin test, there is a risk that relevant confidential information obtained in the 2014 retainer and the 2016 abuse of dominance complaint will be used to the prejudice of Dye & Durham and DoProcess.
(2) There is no clear and compelling evidence that confidential information was in fact imparted to Mr. Goldman
[38] Dye & Durham and DoProcess argue that Mr. Goldman had access to confidential information relevant to the present proposed class action as a result of his prior solicitor-client relationship with Dye & Durham’s corporate predecessor OneMove and the other ISC mandates he was part of. Dye & Durham and DoProcess submit that, since OneMove provided Mr. Goldman its own views about its business and products and about the implications of DoProcess’ anti-competitive conduct for the broader conveyancing software market place and its competitiveness, this is confidential information capable of being used in some tangible manner now that Dye & Durham (as the successor to OneMove) is being sued on the theory that its acquisition of DoProcess is an illegal, anti-competitive conspiracy.
[39] Cartel & Bui respond that the information Mr. Proud mentions in his evidence is not confidential and is available in the public domain. In addition, they claim that Dye & Durham and DoProcess have failed to give any indication other than a general reference to alleged confidential information that Mr. Goldman would have received.
[40] I agree with Cartel & Bui that the moving parties have failed to demonstrate that confidential information was imparted to Mr. Goldman as part of the 2014 retainer or 2016 abuse of dominance complaint.
[41] Dye & Durham and DoProcess acknowledge that the confidentiality of the information claimed to be misused is relevant (GCT at para 46; Chapters Inc v Davies, Ward & Beck LLP, [2001] OJ No 206 (CA) [Chapters] at paras 31–32, 34–35), and that it is their burden to establish this, on the usual standard of balance of probabilities. Without revealing the information itself, Dye & Durham and DoProcess have to provide an outline of the nature of the information such that the Court is in a position to assess whether it is confidential and whether it is relevant to the new matter (Chapters at paras 29–30).
[42] I am not convinced that, based on the evidence before me, confidential information has been provided to Mr. Goldman as part of the 2014 retainer or the 2016 abuse of dominance complaint, nor that such confidential information was effectively relayed to Cartel & Bui. In other words, I find no realistic possibility of relevant confidential information having been acquired by Mr. Goldman about Dye & Durham or DoProcess that can be used to the prejudice of Dye & Durham and DoProcess in the proposed class action. There are three reasons for that.
(a) There is no evidence of “confidential” information
[43] First, I am unable to conclude that the information identified by Mr. Proud in his affidavit is more likely than not to be confidential information. Regarding the 2014 retainer, Dye & Durham and DoProcess claim that Mr. Goldman obtained confidential information raised in the Statement of Claim relating to market positions in the conveyancing software industry, the preferential integration of Teranet software with Dye & Durham software, the difficulty of firms switching conveyancing software, and market conditions. More specifically, Mr. Proud identified the following information, allegedly relayed to Mr. Goldman in a single telephone conversation: a description of OneMove’s eConveyance product, the functionality of conveyancing software generally, and how OneMove’s products compare to those offered by DoProcess and Teranet; OneMove’s views on the importance of integrating conveyancing software with title insurance offerings; a description of OneMove’s market share, and planned expansion into Ontario; and a description of OneMove’s allegations surrounding DoProcess and Teranet’s anti-competitive conduct. This also included information on potential points of differentiation between OneMove’s and DoProcess’ products and relative market positions.
[44] Turning to the 2016 abuse of dominance complaint, Mr. Proud identified the following information, allegedly emanating from the abuse of dominance complaint submitted to the Bureau: a description of OneMove’s eConveyance application and the functionality of conveyancing software generally; OneMove’s views of the competitive importance of integrating software seamlessly with title insurers and land registry operators, such as Teranet; OneMove’s views of the key providers of conveyancing software, their products and market positions, including OneMove’s views of DoProcess and its Conveyancer application; statements regarding DoProcess’ and Teranet’s alleged anti-competitive practices, which were preventing OneMove’s expansion into Ontario; a description of pricing models of the conveyancing software offered by OneMove and DoProcess; and OneMove’s views as to what market conditions would facilitate a more meaningfully competitive market.
[45] Dye & Durham and DoProcess maintain that the Statement of Claim uses information from all of the categories that Mr. Proud asserts he shared with Mr. Goldman in the previous retainers.
[46] In my view, the lists of information provided by Mr. Proud are not sufficient to establish the confidentiality of the information claimed to have been disclosed to Mr. Goldman. The descriptions of the information remain very generic, with no specific documents or categories of documents identified. In fact, Mr. Proud acknowledged that no documents were provided to Mr. Goldman as part of the 2014 retainer. Moreover, the evidence adduced by Messrs. Cartel and Brandys in their respective affidavits and on cross-examination indicated that the alleged confidential information described by Mr. Proud is publicly available from multiple public sources and common knowledge of practitioners in the field. In addition, by its very nature, information on topics such as products, market conditions, competitors’ activities and conduct, integration of businesses, or market positions of players in an industry is typically not confidential when it is not clear that it encompasses strategic or financial information.
[47] The current situation is quite different from the specific information found to be confidential in GCT, where well-identified reports, papers, presentations to the board, and board minutes were singled out by the plaintiffs (GCT at para 46). In that case, the Court found those descriptions sufficient to reflect the confidential nature of the information in issue. Here, however, the generic descriptions made by Mr. Proud do not allow me to conclude that confidential information was necessarily involved and imparted to Mr. Goldman as part of the 2014 retainer or 2016 abuse of dominance complaint.
[48] In addition, the evidence establishing that Cartel & Bui only used publicly available information to prepare the Statement of Claim has not been contradicted. Messrs. Cartel and Brandys affirmed in their affidavits that they obtained information from public sources to prepare the Statement of Claim, and they provided detailed references to specific evidence emanating notably from Exhibits 2 and 3 to Mr. Proud’s affidavit containing Dye & Durham’s July 13, 2020 Prospectus [Prospectus] and July 30, 2021 Annual Information Form [AIF]. The Prospectus discussed the conveyancing software services offered in the industry, eConveyance, growth prospects in the conveyancing software sector, and the competitive strengths of Dye & Durham, while the AIF provided information on the industry context and the risks to Dye & Durham’s business and the industry in general. These documents contain numerous references regarding the public nature of the information on the functionality of conveyancing software, marketing activities, the real estate conveyancing software platforms, and client integration. When information allegedly misused is found to be public, it tips the scales in favour of the responding party who argues that the information is not confidential (Chingee v Canada (Attorney General), 2019 FC 532 [Chingee] at para 49).
(b) There is no detail on the alleged “confidential” information
[49] Second, the evidence referred to by Dye & Durham and DoProcess contains no detail on the alleged confidential information. It is true that the moving parties had the right not to explain the details of their relationship with Mr. Goldman and the claimed confidential information. But, they still had to show that relevant confidential information was effectively imparted to Mr. Goldman. The descriptions of alleged confidential information must be sufficient to allow the Court to determine the nature of the confidential information at issue in the motion (GCT at para 47). Unlike the situation in GCT, I do not find that the description of the alleged confidential information made by Dye & Durham and DoProcess is sufficient to meet the test set out in the case law (GCT at para 48).
[50] In GCT and Chapters, on which Dye & Durham and DoProcess relied in their submissions, the moving parties seeking removal of counsel provided the description of particular documents containing confidential information, such as material presented to the company’s board of directors, the board minutes, expert reports, financial statements, and information on future strategies concerning specific matters. The nature of the information was easily identified without the need to actually reveal the confidential information itself, as the nature of the documents was a sufficient indicator of the degree of confidentiality of the information they contained (GCT at paras 46–47; Chapters at para 6). In GCT for example, the Court found that the description of the documents provided by the moving party described the information “with sufficient detail to support the conclusion that it is confidential and relevant” (GCT at para 48).
[51] However, this is not the case here. Dye & Durham and DoProcess cannot claim that the present case is similar to GCT and Chapters because, in those two precedents, the Court had knowledge of specific documents exchanged, from which it could infer the confidential nature of the information they contained. In the case at bar, the Court is left with general categories of information that, by definition, could include both confidential and non-confidential information. There is no evidence and no detail allowing me to conclude that, on a balance of probabilities, information allegedly conferred on Mr. Goldman in these categories was confidential. There is “insufficient specific information before the Court to find that whatever information was provided at those times is confidential or sufficiently related” (Chingee at para 50).
[52] Dye & Durham and DoProcess rely on paragraph 32 of the Chapters case to argue that the categories of information they provided are sufficient. But that paragraph is actually a summary that the court was able to provide based on more specific information submitted by the moving party. Here, however, Dye & Durham and DoProcess provided only the level of information that the court summarized in Chapters, without first providing the specific information to the Court as required. Therefore, they fall far short of identifying the nature of the information, as did the moving parties in Chapter — and in GCT. The possibility that Mr. Goldman obtained confidential information is only theoretical, and not realistic, due to the lack of clear and compelling evidence to that effect (Chapters at para 30).
[53] In other words, Dye & Durham and DoProcess did not provide clear reasons demonstrating that the possibility that Mr. Goldman obtained relevant confidential information is more than theoretical.
[54] Moreover, Mr. Proud failed to draw a link between the alleged confidential information and the Statement of Claim to which Mr. Goldman contributed. In his evidence, Mr. Proud did not indicate which allegations of the Statement of Claim reflected confidential information allegedly imparted to Mr. Goldman. He did not describe, with any granularity, the confidential information and documents that he claims were provided to Mr. Goldman. The Court is therefore left to speculate as to how the alleged confidential information could have found its way in the Statement of Claim.
(c) There is no evidence of “confidential” information shared with Cartel & Bui
[55] Third, there is no clear and convincing evidence establishing that confidential information was relayed to Cartel & Bui or that any confidential information was shared between Mr. Goldman and Cartel & Bui. Mr. Proud indeed acknowledged that he does not know whether Mr. Goldman shared confidential information with Cartel & Bui or not. Conversely, the affidavits of Messrs. Cartel and Brandys state that no confidential information was shared and that Mr. Goldman had no role in the research, investigation, and drafting of the Statement of Claim. Furthermore, the presumption established in the Martin decision regarding the “tainted lawyer,” as discussed