Category: Firm News

Alex Pettingill, Joyce Tam, and Natasha O’Toole, were successful on appeal in Subway Franchise Systems of Canada, Inc. v Canadian Broadcasting Corporation, 2021 ONCA 25
In its decision released on January 18, 2021, the Ontario Court of Appeal confirmed that the anti-SLAPP (Strategic Litigation Against Public Participation) provisions under s. 137.1 of the Courts of Justice Act (the “CJA”) can be used to dismiss negligence claims. Further, the Court held that a Trent University lab, retained by CBC to conduct testing in support of CBC’s investigative journalism, did not owe a duty of care to Subway, as there was insufficient proximity between the parties.

Background
CBC retained a Trent University lab to conduct DNA testing on chicken products from several fast food restaurants, including Subway. Trent conducted the testing and reported its results to CBC, which subsequently broadcast those results in a Marketplace episode and related digital media.

Subway sued CBC and Trent for $210 million. Subway claimed against Trent concurrently in defamation and negligence. With respect to Subway’s negligence claim, Subway alleged that: Trent knew that the testing was being conducted for the purpose of broadcasting conclusions about Subway’s products, advertising, brand, and business to a wide audience; Trent owed Subway a duty of care in carrying out testing of Subway products; and Trent breached that duty of care.

Trent’s Anti-SLAPP Motion
Trent moved to dismiss the negligence claim against it pursuant to s. 137.1 of the CJA on the basis that the claim arose from an expression relating to a matter of public interest and that the negligence claim did not have substantial merit because: (1) it did not meet the legal test for a tort claim to be brought concurrently with a defamation claim; and/or (2) Trent did not owe Subway a duty of care.

In denying Trent’s motion to dismiss Subway’s negligence claim, Justice Morgan found that the claim did not arise from an expression relating to a matter of public interest under s. 137.1(3), and therefore s. 137.1 was not engaged. Justice Morgan reasoned that negligence actions are aimed at conduct rather than speech, whereas he considered s. 137.1 to be aimed at “expressive torts”, like defamation. He focused his analysis on the “site of the negligence”, which he considered to be how Trent performed its testing and not the communication of the results. In his analysis under s. 137.1(4), Justice Morgan applied the standard applicable on a Rule 21 motion to strike. He held that the negligence claim had sufficient merit to proceed and the harm suffered by Subway outweighed the public interest in protecting Trent’s expression.

Trent’s Appeal
The primary issues on appeal were whether Subway’s negligence claim against Trent arose from an expression relating to a matter of public interest and whether Subway’s negligence claim had substantial merit. The Court of Appeal held in Trent’s favour on both issues. It set aside Justice Morgan’s order and replaced it with an order dismissing the negligence claim.

Section 137.1(3) Subway’s Negligence Claim against Trent Arose from an Expression Relating to a Matter of Public Interest
The Court of Appeal affirmed that the only threshold requirement to properly engage the dismissal mechanism under s. 137.1 is that the proceeding arises from an expression relating to a matter of public interest. Section 137.1 is not limited to defamation claims – any cause of action can meet the threshold requirement where “[t]he expression is causally connected to the claim; there is a nexus between them; the expression grounds the claim; and the claim targets the expression.” (para 41). It is not necessary for the expression to be the gravamen of the claim.

The Court held that Trent’s expression of or about its test results was integral to all aspects of Subway’s negligence claim and that the nature of the expression, being the chicken content of sandwiches sold by Subway and its competitors, is a matter of public interest. Therefore, Trent met the threshold burden of establishing that the negligence claim against it arose from an expression relating to a matter of public interest.

Section 137.1(4)(a) Subway’s Negligence Claim against Trent did not have Substantial Merit
The Court of Appeal confirmed that for a proceeding to have substantial merit within the meaning of s. 137.1(4)(a), it must have a “real prospect of success”.

Given that Subway’s negligence claim was for pure economic loss, Subway was required to show a duty of care in conformity with the principles recently set out by the Supreme Court of Canada in Livent (2017 SCC 63) and Maple Leaf (2020 SCC 35).

The Court of Appeal held that Subway’s negligence claim did not have a real prospect of success in establishing a relationship of proximity analogous to any established category of proximity. On a novel duty of care analysis, the facts did not show a close and direct relationship between Subway and Trent – they did not show any expectations, representations, undertakings, reliance, or statutory obligations. As such, there was no real prospect that Subway could establish proximity sufficient to ground a duty of care, and Subway’s negligence claim lacked substantial merit.

Key Takeaways

• Anti-SLAPP motions under s. 137.1 of the CJA are not limited to defamation claims. They can be used to resist any cause of action that arises from an expression related to a matter of public interest within the meaning of s. 137.1(3) of the CJA.
• An independent lab retained to conduct testing for use in investigative journalism does not owe a duty of care to the subjects of its testing unless the specific facts support a finding of proximity.

For more information on our Defamation Practice, or our work defending universities, please contact Alex Pettingill