Federal Court of Appeal Reins in Privacy Tort Class Actions

In 2015, the Federal Court certified a class action against the Federal Government after envelopes sent to participants in the Marihuana Medical Access Program disclosed the name of the program. The Federal Court permitted claims that this incident exposed participants’ personal information (i.e., participation in the program) to proceed on the basis of the torts of intrusion upon seclusion and publicity given to private life, as well as breach of contract, negligence and breach of confidence.

In a recent ruling, the Federal Court of Appeal (FCA) overturned the certification of all claims except negligence and breach of confidence.¹ Importantly, the FCA held that the plaintiff had not pleaded facts sufficient to support the intrusion upon seclusion and publicity given to private life torts that were only recently imported from American jurisprudence into the common law of some provinces. Although based on procedural requirements for pleadings, the Court’s decision may restrain the scope or number of privacy class actions in the future.

Where privacy breaches result from administrative errors such as the all-too-common incident of misdirected mailings of invoices or account statements, the FCA's decision supports the view that corporate defendants should not be drawn into lengthy and expensive privacy tort litigation unless plaintiffs present facts from the outset that support all the elements of these claims for invasion of privacy.

What You Need To Know

• Extreme facts do not make widely-applicable law. The decision affirms that torts designed to remedy harms caused by intentional invasions of privacy cannot automatically be applied to accidental or administrative errors. This may provide a useful tool to stem the tide of class actions against businesses that are based on torts developed to cure harms committed by individuals in much more personal contexts.
• It may be worth challenging certification of privacy class actions. Novel claims, or novel applications of existing causes of action, can be successfully challenged at the certification stage if the facts alleged do not support the legal allegations. Not every court will simply allow plaintiffs to amend insufficient claims a number of times until they find a cause of action that "sticks."
• Actual harm continues to be a matter for trial. Although the question of whether any class member has suffered any compensable harm continues to be a significant concern for businesses facing privacy litigation, the Court did not require that facts supporting actual damages or a causal link between the breach and the damages claimed be pleaded at the outset of a case. The Court accepted that a general pleading of the nature of damages claimed was sufficient at the certification stage.

Intrusion Upon Seclusion

In 2012, the Ontario Court of Appeal recognized a tort of intrusion upon seclusion, in the context of the repeated viewing of financial information about a perceived romantic rival. Since then, plaintiffs (or perhaps more accurately, class action plaintiff counsel) have attempted to use that tort to seek damages against organizations (businesses, government, hospitals, etc.) following unintentional privacy breaches. The FCA looked closely at the elements of the tort articulated by the Ontario court, and emphasized that intrusion upon seclusion is an intentional tort, requiring intentional conduct, or, at a minimum, an awareness by defendants that their actions are wrong. Although this requirement could, in certain circumstances, be satisfied by a defendant who has acted recklessly, the decision appears to exclude accidental conduct from the scope of this tort, even if it rises to the level of negligence.

Publicity Given to Private Life

The Federal Court first certified the publicity given to private life claim in the medical marijuana case before it had been adopted by any Canadian court. Although an Ontario court has since recognized the tort in the context of the non-consensual distribution of intimate images of a woman by a former romantic partner (see our bulletin on the Doe v. D. case here), the FCA's decision assists in narrowing the application of that tort to privacy incidents that arise more frequently in the organizational context. In particular, the Court found that communication to a small group of people is not sufficient to support this cause of action. Rather, the Court held that communication to the "public at large" requires the publication of private facts on a "much broader scale than what took place here," such as the distribution of handbills, the publication in a newspaper or a radio broadcast (while the Court did not turn its mind to the internet, it is reasonable to think that could also qualify). It therefore concluded that the allegation that family, neighbours or mail carriers may have viewed the information on the envelopes did not meet the "publication" requirement, and therefore does not disclose a cause of action.

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¹ http://decisions.fca-caf.gc.ca/fca-caf/decisions/en/item/145582/index.do