Canada (Director of Investigation and Research) v. Thompson Corp., docket T-1630-98

Date: 19980819

Docket: T-1630-98

IN THE MATTER OF the Competition Act, R.S.C., c. C-34 (as amended)

AND IN THE MATTER OF an Inquiry under section 10 of the Competition Act to review the proposed transaction between Hollinger Inc. and Southam Inc. and Sun Media Corporation involving The Financial Post, The Hamilton Spectator, The Record (Kitchener-Waterloo), The Cambridge Reporter and The Daily Mercury (Guelph) newspaper pursuant to section 92 of the Competition Act, and

AND IN THE MATTER OF an Application by the Director of Investigation and Research, Competition Act, for the issuance of orders requiring that certain parties produce certain records and provide written return of information pursuant to paragraphs 11(1)(b), 11(1)(c) and subsection 11(2) of the Competition Act.

BETWEEN:

     The Director of Investigation and Research,

     Applicant,

     - and -

     The Thomson Corporation,

     Thomson Canada Limited, and

     Thomson Newspapers Co. Ltd.,

     Respondents.

     REASONS FOR ORDER

BLAIS J.

[1]      The applicant seeks a ruling from this Court to address the issue of whether respondents have standing to participate in the hearing of the Competition Act¹ (the "Act") section 11 ex parte application made by the Director of Investigation and Research.

BACKGROUND PROCEEDING

[2]      On August 13, 1998, Me Francine Matte, the Senior Deputy Director of Investigation and Research, Mergers Branch, in her capacity as Acting Director of Investigation and Research caused an inquiry to be commenced pursuant to section 10 of the Competition Act and has authorized the application herein for orders for records pursuant to paragraph 11(1)(b) and written return of information pursuant to paragraph 11(1)(c) of the Competition Act.

[3]      In connection with his review of the proposed merger transaction between Hollinger Inc., Southam Inc. and Media Corporation the Director of Investigation and Research made an application to the Court pursuant to the Competition Act, for an ex parte hearing to be held in camera on Friday, August 14, 1998 at 2:30 p.m. pursuant to Rules 29(2), 151(1), 358, 361, 362(2) and 364.

[4]      The motion filed sought an order pursuant to paragraphs 11(1)(b) and 11(1)(c) and subsection 11(2) of the Competition Act, directing that the respondents, Thomson Corporation, Thomson Canada Limited and Thomson Newspaper Co. Ltd., produce certain records and provide written return of information.

[5]      On August 14, 1998, an order was given by the Honourable Mr. Justice Hugessen:

Notice of this Motion is to be given by facsimile transmission to Mr. Doodey for the Respondents this afternoon. The Motion is to be returnable at 2:30 p.m. on Monday August 17, 1998 or at such later time as the court may fix, in Ottawa.

[6]      At the commencement of proceedings in Ottawa on Monday, August 17, 1998, counsel for the Director brought a preliminary motion seeking to exclude the respondents on the basis that section 11 of the Competition Act, provides for such application to be ex parte.

STATUTORY PROVISIONS

[7]      Order for oral examination, production or written return

11. (1) Where, on the ex parte application of the Director or the authorized representative of the Director, a judge of a superior or county court or of the Federal Court is satisfied by information on oath or solemn affirmation that an inquiry is being made under section 10 and that any person has or is likely to have information that is relevant to the inquiry, the judge may order that person to

(a) attend as specified in the order and be examined on oath or solemn affirmation by the Director or the authorized representative of the Director on any matter that is relevant to the inquiry before a person, in this section and sections 12 to 14 referred to as a "presiding officer", designated in the order;

(b) produce a record, or any other thing, specified in the order to the Director or the authorized representative of the Director within a time and at a place specified in the order; or

(c) make and deliver to the Director or the authorized representative of the Director, within a time specified in the order, a written return under oath or solemn affirmation showing in detail such information as is by the order required.

11(2) Records in possession of affiliate

(2) Where the person against whom an order is sought under paragraph (1)(b) in relation to an inquiry is a corporation and the judge to whom the application is made under subsection (1) is satisfied by information on oath or solemn affirmation that an affiliate of the corporation, whether the affiliate is located in Canada or outside Canada, has records that are relevant to the inquiry, the judge may order the corporation to produce the records.

     11(3) No person excused from complying with order

(3) No person shall be excused from complying with an order under subsection (1) or (2) on the ground that the testimony, record or other thing or return required of the person may tend to criminate the person or subject him to any proceeding or penalty, but no testimony given by an individual pursuant to an order made under paragraph (1)(a), or return made by an individual pursuant to an order made under paragraph (1)(c), shall be used or received against that individual in any criminal proceedings thereafter instituted against him, other than a prosecution under section 132 or 136 of the Criminal Code.

     11(4) Effect of order

(4) An order made under this section has effect anywhere in Canada.

     R.S., 1985, c. C-34, s. 11; R.S., 1985, c. 19 (2nd Supp.), s. 24.

PRESIDING OFFICER"S ORDER

[8]      After hearing submissions on the preliminary motion brought by counsel for the Director at the commencement of the hearing on August 17, 1998, for an order that the respondents be excluded from the hearing of the section 11 application, the Presiding Officer made the following order:

The preliminary motion by the applicant"s counsel is granted. The counsel for the respondents will be allowed to attend the in camera hearing but will not be allowed to make any representation at this stage.

Reasons to follows.

REASONS FOR ORDER

[9]      Upon being satisfied that respondents were notified of the applicant"s application made under section 11 of the Act as ordered by the Honourable Mr. Justice Hugessen on the 14^th day of August, 1998 and on the basis of the foregoing, I conclude that the Director established to my satisfaction that section 11 of the Competition Act, is clear as to the ex parte nature of the application referred to in the provisions.

[10]      It is further ordered that the motion record and all documents filed in connection with the application not form part of the public record until further order of this Court and that same documents shall be sealed.

[11]      It is further ordered that Thomson Corporation, Thomson Canada Limited and Thomson Newspapers Co. Ltd. do not disclose any of the materials or content of the hearing in connection with the application made by the Director.

                         Pierre Blais

                         Judge

OTTAWA, ONTARIO

August 21, 1998

__________________

¹      R.S.C., 1985, c. C-34, s. 1; R.S.C., 1985, c. 19 (2^nd Supp.), s. 19.