Docket: A-174-16
Citation: 2016 FCA 204
Present: GLEASON
J.A.
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BETWEEN:
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THE TORONTO
REAL ESTATE BOARD
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Appellant
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and
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COMMISSIONER OF
COMPETITION
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Respondent
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REASONS
FOR ORDER
GLEASON J.A.
[1]
I have before me two motions. One motion is brought
by the appellant, the Toronto Real Estate Board [TREB], and seeks both a stay
of the order of the Competition Tribunal, pending the disposition of its appeal
of that order and an order expediting the appeal. The other motion is brought
by the Canadian Real Estate Association [CREA], and seeks an order allowing it
leave to intervene in the appeal on a limited basis to address issues that it
claims are of concern to it. For the reasons below, I have determined it
appropriate to grant both motions.
[2]
To place the issues in context, it is useful to begin
by briefly reviewing the nature of the proceedings before the Tribunal that
gave rise to the order under appeal.
[3]
TREB was the respondent in the proceedings
before the Tribunal. The proceedings stemmed from a complaint by the Commissioner
of Competition that certain of TREB’s practices related to its Multiple Listing
Service [MLS] system violated section 79 of the Competition Act, R.S.C.
1985, c. C-34. TREB is a not-for-profit corporation with approximately 46,000
members who act as real estate agents or brokers in the Greater Toronto Area
[GTA]. All TREB members are also members of CREA, the pan-Canadian association
that comprises approximately 110,000 real estate brokers and agents under the
umbrella of approximately 90 real estate boards and associations.
[4]
TREB offers services to its members, including,
most importantly, access to the TREB MLS System. To access the system, members
are contractually bound to comply with a set of rules. The system provides
access to a non-public database of current and up to two year old listings and to
archives of historical real estate listings for properties listed with a TREB
member (collectively termed the “TREB MLS database”).
The vast majority of properties listed in the GTA are listed with TREB members
and are thus included in the TREB MLS database.
[5]
The TREB MLS database contains extensive information
about the listed properties, including addresses, detailed descriptions, pictures,
details of the length of time the properties were on the market, the listing
and sale price and information about whether the property was sold or the
listing terminated, withdrawn, suspended or expired. Property owners provide much
of the information captured in the TREB MLS database to their realtors, who, in
turn, transmit it to TREB as part of the MLS system. Under the documentation
that is typically signed at the time of listing, property owners are asked to
confirm whether they consent to at least portions of the information about the
listing being uploaded to the internet. Such consent documentation may not have
been signed for many of the historical listings in the TREB MLS database.
[6]
Under the rules promulgated by TREB as part of its
MLS system, members are restricted with respect to what portions of the
information in the TREB MLS database they can place on their own password-protected
websites that are made available to members of the public following
registration. These rules prohibit members from copying the TREB MLS database
to create a database that is competitive with the TREB MLS database. The rules also
prohibit members from including on their own websites information about sold,
pending sold, withdrawn, expired, suspended or terminated listings, including
details of a property’s agreed-upon selling price or of the commission payable
to a TREB member representing the purchaser. Members can provide all information
about sold, pending sold, withdrawn, expired, suspended or terminated listings to
clients or prospective clients, 100 listings at a time, via hard copy or email.
[7]
TREB provides its members with access to the information
from its MLS database on active listings via electronic data feed, which may be
easily transferred by a member to its own website. However, the data feed does
not include information about sold, pending sold, withdrawn, expired, suspended
or terminated listings.
[8]
The Tribunal determined that the MLS rules that prohibit
TREB members from posting information to their own password-protected websites
about sold, withdrawn, expired, suspended or terminated listings, and about
details of pending sold listings (other than the sale price), constitute an
abuse of dominant position under section 79 of the Competition Act. In
the order under appeal, the Tribunal ordered TREB to include such data in its
data feed to members and, subject to certain limitations, to refrain from
prohibiting members from using such data on any device (including computers,
tablets or smartphones). Thus, under the order, TREB could no longer prohibit
members from posting information about sold, withdrawn, expired, suspended or
terminated listings, and about details of pending sold listings (other than the
sale price), to their own password-protected websites. The Tribunal also
ordered TREB to pay costs to the Commissioner of approximately $1.8 million.
[9]
The Tribunal gave TREB 60 days to comply with
its order. By Order dated July 27, 2016, I granted an interim stay of that
order, pending disposition of these motions, which were not ripe for
consideration before the date set by the Tribunal for compliance with its
order.
[10]
CREA owns the MLS and REALTOR trademarks, which
are featured on the TREB MLS database. Due to its interest in these trademarks
and to the potential effect of its ruling on CREA, the Tribunal granted CREA
intervener status in respect of certain issues.
[11]
Turning, first, to TREB’s motion for a stay and
an order expediting this appeal, the test applicable for the grant of a stay
such as the one sought by TREB is well-settled and requires TREB to establish three
things: first, that its pending appeal raises at least one serious issue;
second, that it would suffer irreparable harm if the stay were refused; and,
finally, that the balance of convenience favours granting the stay (RJR-MacDonald
Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311 at 347-349, 111
D.L.R. (4th) 385 [RJR-MacDonald]; Baier v. Alberta,
2006 SCC 38, [2006] 2 S.C.R. 311; Janssen Inc. v. AbbVie Corp., 2014 FCA
112 at paras. 12-17, 120 C.P.R. (4th) 385 [Janssen]; Glooscap
Heritage Society v. Minister of National Revenue, 2012 FCA 255 at para. 4,
224 A.C.W.S. (3d) 469 [Glooscap Heritage Society]). In a case such as
this, the threshold for establishing a serious issue is low; TREB need only
show that at least one of the issues it raises is not frivolous or vexatious (RJR-MacDonald
at 337-338; Janssen at para. 23; Glooscap Heritage Society at
para. 25; Canadian Waste Services Holdings Inc. v. Canada (Commissioner of
Competition), 2004 FCA 273 at para. 9, 133 A.C.W.S. (3d) 173).
[12]
Here, based on a review of the motion materials
and of TREB’s Amended Notice of Appeal, I am satisfied that TREB has met this
low threshold. More specifically, it has raised at least one serious issue with
respect to the possibility that the Tribunal’s order failed to take adequate
consideration of property owners’ privacy rights.
[13]
When analysing the privacy issue, the Tribunal focussed
largely on whether TREB’s motivation for raising property owners’ privacy
rights stemmed from a legitimate concern about those rights or was tainted by an
improper desire to maintain the dominant position of the majority of its
members, who do not rely on web-based services. TREB argues that in focussing
its inquiry on this issue, the Tribunal erred. Specifically, TREB raises as its
29th ground of appeal the following: the Tribunal erred in not
determining whether the data at issue constitute personal information as
contemplated by law, whether the dissemination of such data would engage
privacy legislation or other policy instruments, and whether privacy concerns
with respect to the data at issue represent legitimate business concerns (paraphrased
from the Amended Notice of Appeal, filed on July 8, 2016).
[14]
To date, the case law has not dealt in any great
degree with the interface between competition and privacy law, outside of the
context of disclosure orders for the purpose of investigations conducted by the
Competition Bureau. Recognizing that informational privacy can attract
constitutional protection (R. v. Tessling, 2004 SCC 67 at para. 24,
[2004] 3 S.C.R. 432) and that privacy laws have been held to be
quasi-constitutional in nature by the Supreme Court of Canada (UFCW, Local
410 v. Alberta (Information and Privacy Commissioner), 2013 SCC 62 at para.
19, [2013] 3 S.C.R. 733; H.J. Heinz Co. of Canada Ltd. v. Canada (Attorney
General), 2006 SCC 13 at para. 28, [2006] 1 S.C.R. 441; Lavigne v.
Canada (Commissioner of Official Languages), 2002 SCC 53 at para. 24, [2002]
2 S.C.R. 773), I cannot say that this ground of appeal does not raise a serious
issue as the Tribunal’s order might impact third parties’ privacy rights and
the relevance of such an impact on the Tribunal’s ability to issue an order
like the one under appeal is not frivolous.
[15]
Contrary to what the Commissioner submits, I
believe there to be a non-frivolous argument that the Tribunal did not fully
consider all the relevant potential impacts of its order on third party privacy
interests for at least two reasons. First, the Tribunal did not canvass whether
the order might impact the interests of those who sold or purchased properties
some time ago and did not sign consents to having their information disclosed
on the internet. Secondly, any consents signed more recently would have been signed
at a time when TREB members did not post the additional information on the
internet, in contrast to what would be enabled by the Tribunal’s order.
Therefore, the existing consents might not be broad enough to cover the posting
of the additional information that is allowed under the Tribunal’s order. Neither
point was considered by the Tribunal. Moreover, the fact that the information
in question is available in the land registry system is arguably not a complete
answer to third party privacy concerns as the Commissioner submits. Arguably,
there is such a qualitative difference between disclosure in the land registry
system versus disclosure on a realtor’s website so as to require an informed
consent to the latter for privacy purposes. Thus, the privacy issues raised by
this appeal cannot be said to be frivolous or vexatious and accordingly meet
the first branch of the test for issuance of the requested stay.
[16]
As for irreparable harm, I am satisfied that
TREB would suffer irreparable harm if the requested stay is not granted
because, as it and its affiant argues, there is a real possibility that it will
lose control over the data the order requires it to permit its members to post
on their websites once the data is posted. In short, TREB has established that
once the information is available on the internet, it probably can be copied
and there is simply no way to ensure that all copies would be retrieved if TREB
were successful in its appeal. This would render its appeal somewhat nugatory.
[17]
The balance of convenience favours the grant of
the requested stay, given the potential for interference with third party
privacy interests and the fact that the grant of the stay will effectively
continue the status quo. However, to minimize the detriment to the public
interest in having any violation of the Competition Act remedied as soon
as possible, this appeal should be expedited. Indeed, both parties concur that
this is appropriate. To ensure expedition, the parties and CREA shall file
within 15 days of the date of this order a proposed timetable for the
completion on an expedited basis of the various pre-hearing steps in this
appeal. In the event they are unable to agree on such a timetable, the
appellant shall make a motion in writing to settle the timetable within 15 days
of the date of this order.
[18]
Finally, I note that the Commissioner did not forcefully
argue in the alternative for compliance only with the costs portion of the
Tribunal’s order. Given the quantum of the costs award, the nature of the
issues engaged in this appeal and TREB’s not-for-profit nature, I believe it
appropriate that the stay extend to all parts of the Tribunal’s order.
[19]
Turning now to CREA’s motion for intervener
status, the test for intervention was set out in Rothmans, Benson &
Hedges Inc. v. Canada (Attorney General), [1990] 1 F.C. 74, 15 A.C.W.S.
(3d) 323 (T.D.), aff’d [1990] 1 F.C. 90, 103 N.R. 391 (C.A.), which was
recently affirmed, with some nuances, in Sport Maska Inc. v. Bauer Hockey
Corp., 2016 FCA 44, 480 N.R. 387. The Court will consider several factors in
deciding whether to allow an intervention; however, not all of the factors need
to be present for an intervention to be warranted, and the Court retains an
overarching discretion to allow an intervention when the interests of justice so
require. The factors listed in the case law for consideration are:
- whether the
proposed intervener is directly affected by the outcome;
- whether the case
raises a judiciable issue and engages the public interest (presumably when
the proposed intervener seeks public interest intervention status);
- whether there is
a lack of any other reasonable means to put the questions the intervener
seeks to raise before the Court;
- whether the
position of the intervener is adequately defended by one of the parties to
the case;
- whether the
interests of justice are better served by allowing the intervention; and
- whether the Court
can decide the case without the presence of the intervener.
[20]
Here, I agree with the Commissioner that the second,
third, and sixth of the foregoing factors are either absent or irrelevant.
However, the other three factors support allowing the intervention.
[21]
In terms of the first factor, it cannot be
contested that CREA is directly affected by the appeal and has more than a mere
jurisprudential interest in its outcome. As CREA notes, the Tribunal, itself,
in granting CREA intervener status, recognized that its order could well have a
direct impact on how CREA is required to deal with information like the data the
Tribunal ordered TREB to allow its members to post on their password-protected
websites as CREA makes similar information available to its members, subject to
similar conditions. As CREA argues, its interest in the appeal is highlighted and
impacted directly by one of TREB’s grounds of appeal alleging that the Tribunal
erred in limiting its order to TREB as opposed to other CREA members. In
addition, CREA has a direct interest in the appeal by virtue of its ownership
of implicated trademarks. CREA alleges that a lack of control over the MLS data
on the internet may well damage the value of its MLS trademark. Once again, the
Tribunal recognized this interest as sufficient to afford CREA intervener
status.
[22]
As for the fourth and fifth factors, CREA
possesses unique knowledge and a unique position as the voice of the real
estate industry in Canada that will be of benefit to the Court in deciding this
appeal. As it convincingly argues, many of its positions and evidence were
found useful by the Tribunal, and it is to be expected that its intervention
will similarly be of use to the Court. Further, CREA seeks leave to intervene
on limited issues tied to industry practice and its interest in its MLS
trademark and its own MLS database. Its participation will therefore not unduly
lengthen this process.
[23]
I therefore find that CREA should be granted
intervener status on the basis it seeks with the exception of being exempt from
costs. I believe it more appropriate to leave the issue of its responsibility
for costs to the panel hearing the appeal, particularly in light of the
Commissioner’s concern that CREA overstepped the bounds of its permitted
intervention before the Tribunal. Without agreeing that this occurred, the
ability to address any such concern in this proceeding through a costs award
should be maintained.
"Mary J.L. Gleason"
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