Date: 20030103
Docket: T-1967-01
Neutral citation: 2003 FCT 1
BETWEEN:
RONALD G. MAHEU
Applicant
- and -
IMS HEALTH CANADA and
THE PRIVACY COMMISSIONER OF CANADA
Respondents
REASONS FOR ORDER
LEMIEUX J.:
A. INTRODUCTION
[1] Ronald Maheu (the "applicant") appeals Prothonotary Hargrave's May 14, 2002 order requiring him, pursuant to paragraph 416(1)(g) of the Federal Court Rules (the "Rules"), to post security for costs in the amount of $12,000. He also invokes his impecuniosity under Rule 417 which he said was raised but not decided by the Prothonotary.
[2] Paragraph 416(1)(g) and Rule 417 of the Rules read:
| 416. (1) Where, on the motion of a defendant, it appears to the Court that
...
(g) there is reason to believe that the action is frivolous and vexatious and the plaintiff would have insufficient assets in Canada available to pay the costs of the defendant, if ordered to do so, or
. . .
the Court may order the plaintiff to give security for the defendant's costs.
417. The Court may refuse to order that security for costs be given under any of paragraphs 416(1)(a) to (g) if a plaintiff demonstrates impecuniosity and the Court is of the opinion that the case has merit. [emphasis mine]
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416. (1) Lorsque, par suite d'une requête du défendeur, il paraît évident à la Cour que l'une des situations visées aux alinéas a) à h) existe, elle peut ordonner au demandeur de fournir le cautionnement pour les dépens qui pourraient être adjugés au défendeur :
...
g) il y a lieu de croire que l'action est frivole ou vexatoire et que le demandeur ne détient pas au Canada des actifs suffisants pour payer les dépens s'il lui est ordonné de le faire;
417. La Cour peut refuser d'ordonner la fourniture d'un cautionnement pour les dépens dans les situations visées aux alinéas 416(1)a) à g) si le demandeur fait la preuve de son indigence et si elle est convaincue du bien-fondé de la cause. [je souligne]
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[3] Prothonotary Hargrave's order reads, in part, as follows:
1. This application shall proceed. However, while it does not meet the test for striking out for several reasons, including in that it is not plain, obvious and beyond doubt that it is in fact an abusive proceeding, or a frivolous or vexatious proceeding, which will not succeed, it appears that there is reason to believe it is frivolous and vexatious, being a lower test standard. Thus the Respondent is entitled to security for costs from the Applicant, an undischarged bankrupt. [emphasis mine]
[4] Prothonotary Hargrave also provided written reasons which will be referred to.
[5] At the hearing before Prothonotary Hargrave, the Privacy Commissioner of Canada (the "Privacy Commissioner") intervened to make argument on the new federal legislation, the Personal Information Protection and Electronic Documents Act, ch. 5, S.C. 2000 (the "Act"), which underpins the proceeding launched by Mr. Maheu. He also made extensive submissions to this court arguing Prothonotary Hargrave had erred in interpreting the new statute.
B. BACKGROUND
[6] On November 2, 2001, the applicant, pursuant to section 14 of the Act, applied to the Court for review of a September 21, 2001 report by the Privacy Commissioner who determined drug prescription information - whether in the form of an individual prescription or in the form of patterns discerned from a number of prescriptions - was not "personal information about the physician" for the purposes of the Act.
[7] The Privacy Commissioner's September 21, 2001 report arose out of a complaint made to him by Mr. Maheu, who is also President of Pharma Communications Group Inc. ("Pharma Communications"). He complained that IMS Health Canada's ("IMS") information gathering practices breached the Act. IMS was notified of the complaint by the Privacy Commissioner. IMS is in the business of collecting and analysing prescription data and statistical information related to health care issues which it then uses to develop data bases and other forms of information management for its clients in government and industry. It is acknowledged Pharma Communications is in the same business as IMS.
[8] Mr. Maheu stated IMS purchased a number of items of information from Canadian pharmacies taken off prescriptions without the knowledge or consent of the prescribing doctor. This information is said to include store number, drug identification number, drug name, drug strength, manufacturer, selling price, new or refill, reasons for use, reasons for no substitution order, prescriber's first and last name, phone number, patient gender and date of birth.
[9] In contrast, Mr. Maheu says in his affidavit in support of his application, Pharma Communications derives its data directly from the prescribing physician which it uses with the doctor's knowledge and consent.
[10] After conducting an investigation, the Privacy Commissioner concluded the information IMS collects and discloses is not personal information about physicians and therefore not subject to the protections of the Act. The complaint was dismissed as not well-founded. The Privacy Commissioner added:
I consider knowledge of this finding to be in the public interest and will therefore make it public.
[11] Mr. Maheu then applied to this Court, pursuant to section 14 of the Act, for a review of the Privacy Commissioner's decision.
C. THE PROTHONOTARY'S REASONS
[12] Prothonotary Hargrave was seized with a motion launched by IMS seeking alternative remedies: first, to strike, as an abuse of process, Mr. Maheu's application for review or, in the alternative, an order requiring him to post security under Rule 416(1)(g). IMS argued Mr. Maheu's application was brought for an improper purpose, namely, he was attempting to abuse this court's process by using the review procedures of the Act to advance his and his company's commercial interests and not to protect the collection, use or disclosure of personal information, which is the Act's purpose.
[13] Prothonotary Hargrave found Pharma Communications and IMS to be competitors - both in the business of selling information to producers of prescription drugs based on prescriptions written by doctors. Mr. Maheu never disputed this fact.
[14] He framed the motion before him and held as follows:
[2] The crux of this application, as viewed by the Respondent, is that the Applicant is abusing the process of the Federal Court by seeking what is ostensibly a review under the Personal Information Protection and Electronic Documents Act, ... of the actions of IMS in collecting and disclosing information but which, according to IMS, is "a thinly veiled attempt to pursue Pharma Communication's commercial interests". IMS submits that the Application ought to be struck out as an abuse of process of the Federal Court: I would not go so far as to strike out the proceedings, however it is an abuse attracting security for costs in favour of the Respondent, pursuant to Rule 416(1)(g). [emphasis mine]
[15] He noted the Federal Court proceeding was not the only litigation between the parties and referred to an action between them in the Ontario courts (a commercial dispute stemming from a licencing agreement under which IMS provided data to Pharma Communications) and to an injunction issued against Mr. Maheu prohibiting him from making mailings to doctors in Quebec. The Prothonotary said this Ontario litigation "has an indirect bearing on this Federal Court litigation for it supports the contention of IMS that "at the root of the Federal Court litigation is a commercial matter". After examining IMS' material, he found the Federal Court proceeding "has the earmarks of a commercial dispute", however, noting, "there are apparently no decided cases determining whether the scope and purpose of the Act might possibly extend to such a dispute" [emphasis mine].
[16] He expressed his view of the Act and IMS' position:
[8] Turning to the Act, section 3 provides in part that the purpose of the Act is "...to establish ... rules to govern the collection, use and disclosure of personal information...". The Act establishes a code for the protection of personal information, that is information about an identifiable individual (exclusive of name and other identifying information). It sets out the rules under which private organizations must operate when they collect, use or disclose personal information in the context of commercial activities. Here IMS makes two points: first, the Applicant is not himself a health care provider; second, IMS does not collect information about Mr. Maheu. Rather, IMS contends that Mr. Maheu is using the Act to gain a competitive advantage for his company and that, in itself, is said to constitute an abuse of the Court. [emphasis mine]
[17] He declined to strike out Mr. Maheu's application stating:
[14] In the present instance the scope of the Act has not yet been determined. While it would appear to be an abuse, or vexatious or frivolous, to use the Act to obtain a competitive business advantage, in the absence of decided cases bearing on the scope of the Act, I am not about to strike out the present pleading for two reasons... . [emphasis mine]
[18] Relying on the Federal Court of Appeal's decision in David Bull Laboratories (Canada) Inc. v. Pharmacia Inc., [1995] 1 F.C. 588, he ruled judicial review applications should only be summarily dismissed where the application is "so clearly improper as to be bereft of any possibility of success and then only in exceptional circumstances". As for his second reason, also relying on Federal Court jurisprudence, he held serious issues of law should not be decided on summary motion unless clearly futile.
[19] Turning to the alternative remedy of requiring the applicant to post security, Prothonotary Hargrave stressed the words of paragraph 416(1)(g) of the Rules "where ... , it appears to the Court ... there is reason to believe that the action is frivolous and vexatious" and stated these words imported a lower standard than the plain and obvious test needed to strike out an action.
[20] Relying on a number of cases in the bankruptcy field where Canadian courts did not permit the Bankruptcy and Insolvency Act to be used for an improper or collateral purpose, he wrote:
[19] In the present instance, the material appears to indicate that there is reason to believe that the proceeding is frivolous and vexatious in the sense that is not fair and honest to use the process of the Court in order to extend the Act for what is very arguably an improper purpose, that of obtaining a commercial advantage. [emphasis mine]
[21] He was of the opinion from a plain reading of Rule 416(1)(g) IMS need not show the applicant's application was in fact frivolous and vexatious.
[22] He considered and found comfort in the Ontario rule on security for costs which is framed in similar language. The Prothonotary stated "the only substantial difference is that, in Ontario, there must be "good reason" not merely "reason to believe that the action is frivolous and vexatious". He consisdered the case of Hallum v. Canadian Memorial Chiropractic College (1989), 70 O.R. (2d) 119, where Justice Doherty found a defendant, in seeking security for costs "... only had to show that it appeared there was good reason to believe that the action was frivolous or vexatious. It was not required to show that the action was in fact frivolous" [emphasis mine].
[23] The Prothonotary concluded:
[22] In the present instance, it objectively appears that there is reason to believe that the Applicant is using the Act for a collateral and improper purpose, rather than for the purpose set out in section 3 of the Act. As I have indicated the Act is designed to regulate the collection, use and disclosure of personal information generated in commercial activities. Here the Applicant's own personal information is not at issue in any way.
[23] In the present instance IMS has succeeded in establishing reason to believe that the Application is frivolous and vexatious, a lower standard than that required to strike out a pleading, but a clearly sufficient standard from which to apply for security for costs. [emphasis mine]
D. THE ARGUMENTS
(1) The applicant
[24] Counsel for the appellant/applicant argued the Prothonotary was clearly wrong in four ways. First, he misapprehended the facts when he found, by launching his application for review of the Privacy Commissioner's decision, Mr. Maheu was seeking a commercial advantage. He states the heart of the dispute between the parties is whether IMS' manner of collecting information from physicians complies with the Act. He is simply seeking an interpretation of the Act and, if successful, one of the remedies prescribed by Parliament including an order from this Court that IMS must change its practices. This is a public remedy which cannot be characterized as a commercial advantage and this is particularly so when it is recognized the Act applies to the private sector and prescribes rules governing commercial activity in collecting, using and disclosing personal information.
[25] Second, the Prothonotary was wrong when he concluded Mr. Maheu's purpose was a collateral one. His purpose, he argues, was simply to seek a determination whether IMS' practices were in compliance with the Act. He does not deny having a commercial interest in the application. The Act should be available to a person who has a commercial interest in the use or abuse of personal information and also should be capable of application against a party who has a commercial interest in the use or abuse of personal information.
[26] Third, the Prothonotary was wrong in principle and took into account an irrelevant consideration when he found, because the application was not about Mr. Maheu's own personal information, this fact was somehow material to his conclusion the application was for an improper purpose. The appellant/applicant argues the Act does not require a complainant before the Commissioner to confine his/her complaint to matters involving his/her personal information.
[27] Fourth, the application was not an abuse of process. The Prothonotary declined to strike the application as abusive but ordered security for costs on a lower standard. This, counsel for the appellant/applicant argues is an error in principle because it cannot logically be that an application is not abusive but at the same time appear to be abusive. Further, he argued the Prothonotary was wrong to hold the failure of IMS on its motion to strike did not foreclose an application of Rule 416(1)(g) for the reason that it would "virtually never come into play in the context of an action for the action would be struck first". The Prothonotary went wrong because abuse of process is but one species of a frivolous and vexatious proceeding leaving lots of room for the application of the Rule in other circumstances.
(2) The respondent IMS
[28] Counsel for IMS counters by arguing, on a proper reading of Rule 416(1)(g), its burden before the Prothonotary was not to show the application was in fact frivolous or vexatious but only that it appeared there was reason to believe it was.
[29] There is no basis for interfering with the Prothonotary's ruling, it is argued, as the applicant has failed to discharge its burden under the Aqua-Gem test. There was ample evidence upon which the Prothonotary could conclude, as a fact, the application was one of the means by which Mr. Maheu and his company Pharma Communications have sought to gain a commercial advantage over IMS, in particular, by publicly attacking IMS' business practices. Furthermore, there was ample evidence to support the contention the applicant's purpose in bringing the application was to pursue the commercial interests of his company, a purpose which is incompatible with the purpose of the Act. Counsel for IMS points out the applicant himself admits IMS does not collect, use or disclose his personal information and he has never denied his commercial interest in the application.
[30] IMS submits Hargrave P. did not err in taking into account the fact the applicant's own personal information was not at issue in the application as the basis for concluding it appeared there was reason to believe the application had been brought for an improper purpose.
[31] Counsel for IMS states he agreed before the Prothonotary with the position taken by the Privacy Commissioner to the effect a complaint under the Act need not pertain to personal information of the complainant. However, he argues the fact Mr. Maheu's own information was not at issue in the application is clearly relevant in determining the purpose for which he has brought the application. He states that fact, when coupled with the other facts contained in the affidavits filed by IMS, clearly supports the conclusion the Prothonotary reached with respect to the applicant's purpose.
[32] Finally, he argues the Prothonotary's decision is a discretionary one which is entitled to some deference and I should not interfere even if I held a different view.
(3) The Privacy Commissioner
[33] Counsel for the Privacy Commissioner appeared before the Court to assist it in the proper interpretation of the Act, this being the first case where this Court would have an opportunity to interpret that statute.
[34] He focussed on paragraph 22 of the Prothonotary's reason where it is said:
It objectively appears that there is reason to believe that the applicant is using the Act for a collateral and improper purpose rather than the purpose set out in section 3 of the Act.
In reaching this conclusion, he stated that Hargrave P. relied on the fact the applicant's own personal information was not at issue in any way. Mr. Maheu was not a health provider, i.e. a physician, and IMS did not collect information about him personally. The Privacy Commissioner's concern was, by making this comment, the Prothonotary was ruling on the right of an applicant to bring an application to this Court (or indeed before the Privacy Commissioner).
[35] He explained the scheme of the Act in terms of both substance and procedure. In terms of procedure, he pointed to Division II of the Act, dealing with remedies, which provides for the filing of complaints, an investigation by the Privacy Commissioner, a report and an application to this Court for a hearing by a complainant, if dissatisfied with the report. In particular, subsection 11(1) provides "an individual may file with the Commissioner a written complaint against an organization for contravening a provision of Division I or for not following a recommendation set out in Schedule I".
[36] Subsection 14(1) of the Act provides "a complainant may, after receiving the Commissioner's report, apply to the Court for a hearing in respect of any matter in respect of which a complaint was made or that is referred to in the Commissioner's report" and in certain clauses of Schedule I or in certain clauses in that Schedule as modified or clarified by Division I.
[37] I note the Privacy Commissioner is not required to prepare a report if he/she is satisfied "the complaint is trivial, frivolous or vexatious or is made in bad faith". The Privacy Commissioner prepared a report in this case. [emphasis mine].
[38] Counsel for the Privacy Commissioner stressed that under section 11 of the Act, an individual may file a complaint concerning an organization's information practices, regardless of whether that organization collects, uses or discloses personal information relating to the individual's complaint.
[39] This is evident, he argued, by a consideration of sections 11 to 14 of the Act and in particular, sections 11 and 14 where he argues there is nothing requiring, as a pre-condition to a complaint or court review, a complainant's allegations relate to his or her own personal information, nor is there any reason to read such limitation into the Act emphasizing if Parliament wished to restrict the right to file a complaint to those individuals that are directly affected by the allegations of breaches of the Act, it would have expressly set out such limitations as it did under section 18.1 of the Federal Court Act limiting applications for judicial review to anyone directly affected.
[40] His view is there is nothing in the Act which would prohibit an individual representing a business from filing a complaint alleging a breach of the Act by a competing business and states, as a result, the very fact an individual alleges a competitor has engaged in information practices which contravene the Act cannot be used, on its own, to justify a finding the complainant "is using the Act for a collateral or improper purpose".
[41] In oral argument, counsel for the Privacy Commissioner amplified his written arguments. He stressed the difference between the federal Privacy Act and this Act. The federal Privacy Act is limited to accessing an individual's personal information in the hands of the Federal Government. In contrast, the Act under examination sets the rules for governing the collection, use and disclosure of personal information in the federal private sector carrying out commercial activities.
[42] He examined the Schedule to the Act and said it contains principles set out in the National Standard of Canada entitled Model Code for the Protection of Personal Information (CAN/CSA-Q830-96) when it is collected and used by private organizations in the federal private sector. These principles include (1) responsibility for personal information under its control and accountability for compliance with stated principles; (2) identification of the purposes for which the information is collected; (3) the knowledge and consent of the individual is required for the collection, use or disclosure of personal information, except where inappropriate; (4) the collection of personal information is limited to that which is necessary for the purposes identified by the organization with a corollary the information shall be collected by fair and lawful means; (5) personal information shall not be used or disclosed for purposes other than those for which it was collected except with the consent of the individual or as required by law; (6) personal information shall be accurate, complete and up-to-date as is necessary for the purposes for which it is to be used; (7) personal information shall be protected by security safeguards appropriate to the sensitivity of the information; and (8) individual access upon request, i.e. an individual is to be informed of the existence, use and disclosure of his or her personal information and shall be given access to that information.
[43] Counsel points out this Schedule model code, subject to the exceptions contained in sections 7 to 9 of the Act, goes well beyond disclosing information about individuals because, except as related to paragraph 4.9 of the Schedule, all other provisions of the model code deal with systems and methods and are not concerned about specific information.
[44] He looks at the remedial provisions of the Act which he argues are not limited to access to personal information. Rather, they are broad public law remedies whose purpose is to achieve compliance with the regulatory features of the Act.
[45] He concludes by saying commercial advantage or private interest is irrelevant. To hold otherwise would unduly limit standing under the Act to trigger complaints and following the Privacy Commissioner's report, appeals to this Court.
E. ANALYSIS
(1) Standard of Review
[46] The standard of review is well-known and is set out in Canada v. Aqua-Gem Investments Ltd., [1993] 2 F.C. 425, where Justice MacGuigan stated:
[95] Discretionary orders of prothonotaries ought not to be disturbed on appeal to a judge unless:
(a) they are clearly wrong, in the sense that the exercise of discretion by the prothonotary was based upon a wrong principle or upon a misapprehension of the facts, or
(b) they raise questions vital to the final issue of the case.
Where such discretionary orders are clearly wrong in that the prothonotary has fallen into error of law (a concept in which I include a discretion based upon a wrong principle or upon a misapprehension of the facts), or where they raise questions vital to the final issue of the case, a judge ought to exercise his own discretion de novo. [emphasis mine]
[47] It is clear Prothonotary Hargrave's decision to require the applicant to post security for costs is a discretionary decision and that it is not vital to the final issue of the case, that is, vital to the result of the case (see note 15 in Aqua-Gem, supra). If I had evidence the order for security for costs would stop Mr. Maheu in his tracks, i.e. force him to abandon his application before this Court, that result would have disposed of the application and would have required me to review the matter de novo (see John Wink Ltd. v. Sico Inc. (1987), 57 O.R. (2d) 705 (H.C.J.)). In the circumstances, in order for the applicant to succeed, I must find that the Prothonotary, in reaching his decision, was clearly wrong in the sense used by Justice MacGuigan that is, wrong in principle or on the facts.
(2) Discussion
[48] At this juncture, I make a number of points. First, Mr. Maheu did not contest IMS' assertion he had insufficient assets in Canada available to pay its costs if ordered to do so which is the second prong of the test under paragraph 416(1)(g) of the Rules. Accordingly, this appeal only concerns the first prong of that paragraph, namely, whether it appears to the Court that there is reason to believe that the application is frivolous and vexatious.
[49] Second, Mr. Maheu did not lead any evidence as to his impecuniosity under Rule 417, which is his burden (see Fortyn v. Canada, [2000] 4 F.C. 184 (T.D.)). As a result, Mr. Maheu fails under Rule 417.
[50] Having reached these conclusions, the only remaining issue before me is whether Prothonotary Hargrave erred in his determination of the first prong of Rule 416(1)(g).
[51] As I see it under the Aqua-Gem test, a prothonotary may err in law by exercising his/her discretion on a wrong principle, misinterpreting the enabling provision or by misapprehending the facts.
[52] Exercising a discretion on a wrong principle may arise if "reliance ... has been placed upon considerations irrelevant or extraneous to the statutory purpose" (see [1982] 2 S.C.R. 2">Maple Lodge Farms Ltd. v. Canada, [1982] 2 S.C.R. 2). A misapprehension of the facts may arise when a prothonotary forgets, ignores or misconceives the evidence in a way that affects the decision (see Housen v. 2002 SCC 33">Nikolaisen, 2002 SCC 33).
[53] I agree with Prothonotary Hargrave that the words "it appears to the Court that ... there is reason to believe that the action is frivolous and vexatious" is a lower and different standard than that required to strike out a pleading.
[54] The real question is how low of a standard of proof do the words "there is reason to believe" set. The Prothonotary did not discuss this point. I am of the view the standard of proof expressed in paragraph 416(1)(g) is no different than the standard of proof contained in the expression "reasonable grounds to believe" which Parliament has used on several occasions and which the Federal Court of Appeal in Chiau v. Canada (Minister of Citizenship and Immigration), [2001] 2 F.C. 297, has held is a standard of proof that "while falling short of a balance of probabilities nonetheless connotes a bona fide belief in a serious possibility based on credible evidence." [emphasis mine]
[55] I am of the view this standard finds support in the French text of Rule 416(1)(g) "il paraît évident à la Cour ..." and accords with the purpose of the Rule as expressed by the Ontario Court of Appeal in Schmidt et al v. Toronto-Dominion Bank, [1995] 24 O.R. (3d) 1, interpreting the Ontario Rule.
[56] The Ontario Court of Appeal in Schmidt, supra said this:
The words "good reason to believe" qualify the words "frivolous and vexatious" and indicate a finding short of an actual determination that the appeal is frivolous and vexatious. A judge hearing a motion for security for costs may reach the tentative conclusion that an appeal appears to be so devoid of merit as to give "good reason to believe that the appeal is frivolous and vexatious" without being satisfied that the appeal is actually totally devoid of merit. This latter, more definitive finding will, as indicated above, usually require a full hearing of the merits of the appeal. In our opinion, rule 61.06(1)(a) was not intended to, and does not, require that a judge hearing a motion engage in a full inquiry into the merits of the appeal, or that the judge reach a definitive conclusion as to the merits of the appeal.
The interpretation favoured by Carthy J.A. is also consistent with the purpose underlying the rule. Rule 61.06(1)(a) endeavours to provide a respondent with some protection should the appeal ultimately fail, without denying the appellant an opportunity to pursue the appeal. Since an order under rule 61.06(1)(a) does not determine the appeal, an interpretation of the rule which requires that the respondent demonstrate something short of an actual absence of merit appropriately balances the respective interests of the respondent and the appellant.
In holding that rule 61.06(1)(a) requires only a finding that there is good reason to believe that the appeal is frivolous and vexatious and not an actual finding that it is frivolous and vexatious, we should not be taken as disagreeing with Justice Finlayson's delineation of the factors which are relevant to that assessment. The apparent merits of the appeal, the presence or absence of an oblique motive for the launching of the appeal, and the appellant's conduct in the prosecution of the appeal will be relevant to a determination of whether there appears to be good reason to believe that the appeal is frivolous and vexatious. No doubt, in specific cases, other factors will also be relevant. [emphasis mine]
[57] With respect to the learned Prothonotary, I am of the view he erred in law by misinterpreting the Act when he came to the conclusion there was reason to believe Mr. Maheu's application fo review was for an improper purpose - an attempt to obtain a commercial advantage over IMS.
[58] His finding may also have been affected by a misapprehension of who was the complainant before the Privacy Commissioner. The complainant was not Pharma Communications as stated in the Prothonotary's reasons. The Privacy Commissioner makes it clear in his September 21, 2002 report the complainant was an individual, Ronald Maheu, who "has a right to apply to the Federal Court, Trial Division for a hearing..." following a determination his complaint was not well founded.
[59] I subscribe to the view of the counsel for the applicant and the counsel for the Privacy Commissioner as to the perspective of the Act. In this respect, it matters not, as the Prothonotary held, Mr. Maheu's personal information was not at stake in the complaint he made to the Privacy Commissioner. That consideration was irrelevant.
[60] The scheme of the Act is to establish a code of conduct - a set of rules - applicable to organizations that collect, use or disclose personal information in the course of commercial activities. It is a public law regulatory statute providing for the means of enforcement through complaints, the Privacy Commissioner's investigation, report and an appeal by the complainant as of the right to this Court which may make orders in the nature of public law remedies.
[61] In this perspective, with respect, the learned Prothonotary erred in concluding the application before this Court by Mr. Maheu was for an improper purpose, that of gaining a competitive advantage over IMS.
[62] Simply put, in my view, Mr. Maheu is seeking from this Court, as he has a right to do, a determination whether IMS's practices comply with the law in terms of relevant collection gathering techniques involving personal information (see in particular paragraph 4.3.5 of the Schedule to the Act).
[63] It matters not that Mr. Maheu is President of Pharma Communications, a competitor of IMS. Disqualifying a competitor from access to the Act's enforcement mechanisms was not in Parliament's contemplation having regard to the fact that it is competitors engaged in commercial activities who, along with persons whose personal information is being collected, are primarily affected by its rules. Standing between competitors is well recognized in federal regulatory statutes and here, any abuse can be checked by the Privacy Commissioner not making a report if he views the complaint "trivial, frivolous or vexatious or if made in bad faith".
[64] Exercising de novo the discretion provided for in paragraph 416(1)(g) of the Rules on the basis of the evidence before the Prothonotary, I conclude IMS is not entitled to security for costs from Mr. Maheu in respect of the application before this Court.
[65] IMS's material does not disclose the application before this Court was brought for a purpose other than the assertion by Mr. Maheu of legitimate rights. This makes inapplicable the bankruptcy cases relied upon by IMS.
[66] It is clear the Ontario litigation and the injunction have nothing to do with the question of whether IMS is compliant with the Act. Mr. Maheu's letter of February 18, 2002 to the marketing manager of a pharmaceutical company was in response to a concern that person had expressed to him. The approach to Alberta's Privacy Commissioner was a written submission on what shape the regulatory statute in Alberta should look like. Lastly, the approach to Quebec physicians was an invitation to them to opt out of certain arrangements following legislation by the Quebec National Assembly.
[67] Adopting the test set out in Chiau, supra - a bona fide belief in a serious possibility (that Mr. Maheu's application was vexatious and frivolous constituting an abuse of process because made for an improper purpose) based on credible evidence, I am not satisfied IMS has made out a case for security for costs pursuant to paragraph 416(1)(g) of the Rules.
[68] For these reasons, the appeal from Prothonotary Hargrave's May 14, 2002 order is allowed with costs.
(signed)François Lemieux
Judge
OTTAWA, Ontario
January 3, 2003
FEDERAL COURT OF CANADA
TRIAL DIVISION
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: T-1967-01
STYLE OF CAUSE : RONALD G. MAHEU and
IMS HEALTH CANADA and
THE PRIVACY COMMISSIONER OF CANADA
PLACE OF HEARING : Toronto, Ontario
DATE OF HEARING : June 17, 2002
REASONS FOR ORDER : THE HONOURABLE MR. JUSTICE LEMIEUX
DATED : January 3, 2003
APPEARANCES:
Mr. Paul Bigioni FOR THE APPLICANT
Mr. T. Murray Rankin FOR THE RESPONDENT
(IMS HEALTH CANADA)
Mr. Dougald Brown FOR THE RESPONDENT (THE PRIVACY COMMISSIONER OF CANADA)
SOLICITORS OF RECORD:
Mr. Paul Bigioni FOR THE APPLICANT
Markham, Ontario
Mr. T. Murray Rankin FOR THE RESPONDENT
Arvay Finlay (IMS HEALTH CANADA)
Victoria, British Columbia
Mr. Dougald Brown FOR THE RESPONDENT
Nelligan O'Brien Payne (THE PRIVACY
Ottawa, Ontario COMMISSIONER OF CANADA)
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