Google attempted end run around Canadian courts fails, rules BC Judge in Equustek case

Yesterday, a judge of the British Columbia Supreme Court dismissed Google’s motion to vary or set aside the global injunction against it that had been affirmed by the Supreme Court of Canada. The injunction required Google delist websites that were being used to market a product that Equustek claimed was developed through theft of its trade secrets. Justice Smith in Equustek Solutions Inc. v. Jack, 2018 BCSC 610 held that Google was not able to show that the global delisting order made by against it violated its First Amendment rights in the U.S. or the core values of the U.S..

The ruling is significant as it affirms the long standing jurisdiction of Canadian courts to protect the integrity of their own processes through orders directed to parties over whom they have  personal jurisdiction, even if the orders cannot be enforced in the home venues of foreign businesses such as Google and large social media companies.

The case has a long history including an initial order made against Google by a BC Supreme Court judge, and unsuccessful appeals by Google to the BC Court of Appeal and the Supreme Court of Canada. See, Barry Sookman, Google v Equustek: worldwide de-indexing order against Google upheld by Supreme Court.

After losing the Supreme Court of Canada appeal, Google sued Equustek in California for an order declaring that the Canadian order was not enforceable against it in the U.S. A U.S. court, in a case not defended by Equustek, made that declaration holding that Google had protection from suit in the U.S. under the much controversial and embattled Communications Decency Act. See, Barry Sookman, US court thumbs its nose at Supreme Court of Canada: Google v Equustek.

Google’s argument to set aside the BC order was premised on changed circumstances since the injunction order had been originally granted, relying on “exception” language contained in the reasons issued by both the BC Court of Appeal and the Supreme Court as to when a variation order might be made.

Specifically, the reasons of the Court of Appeal stated:

I note, as well, that the order in this case is an interlocutory one, and one that can be varied by the court. In the unlikely event that any jurisdiction  finds the order offensive to its core values, an application could be made to the court to modify the order so as to avoid the problem.

The reasons of the Supreme Court contained the following statement:

If Google has evidence that complying with such an injunction would require it to violate the laws of another jurisdiction, including interfering with  freedom of expression, it is always free to apply to the British Columbia courts to vary the interlocutory order accordingly. To date, Google has made no such application.

Justice Smith rejected Google’s arguments that the Canadian order violated its First Amendment rights or the core values of the United States.

The U.S. decision does not establish that the injunction requires Google to violate American law. That would be the case if, for example, the Datalink Defendants obtained an order from a U.S. court requiring Google to link to their websites. But there is no suggestion that any U.S. law prohibits Google from de-indexing those websites, either in compliance with the injunction or for any other reason. Absent the injunction, Google would be free to choose whether to list those websites and the injunction restricts that choice, but injunctions frequently restrain conduct that would otherwise be prima facie lawful. A party being restricted in its ability to exercise certain rights is not the same thing as that party being required to violate the law. I interpret the words of Abella J. as being primarily limited to the latter situation.

But even if I am wrong in that, Google has not demonstrated that the injunction violates core American values. I assume rights guaranteed by the First Amendment can be regarded as core values, but Judge Davila expressly declined to rule on Google’s submissions that its First Amendment rights were violated by the injunction. Google argues the First Amendment was engaged because it drives the policy underlying both the statute and the decision. In my view, the decision of Judge Davila should not be interpreted to mean more than it actually says, particularly as Google’s application was unopposed and the Court did not have the benefit of any contrary arguments.

Importantly, the Court also held that the California court order did not prevent it from enforcing its own orders.

The effect of the U.S. order is that no action can be taken against Google to enforce the injunction in U.S. courts. That does not restrict the ability of this Court to protect the integrity of its own process through orders directed to parties over whom it has personal jurisdiction.

The decision is an important one that reinforces a Canadian court’s jurisdiction to uphold its own process.  Had the court ruled otherwise, it would have had even more international significance as it would have provided Google and other large U.S. social media companies with a road map as to how to evade orders of Canadian, and perhaps other, non-U.S. courts.

The saga involving Google’s attempts to evade providing assistance to Equustek may not be over yet. The trial of Equustek’s claim against the defendants is now underway. Should Equustek prevail, it could seek a similar order to enforce a permanent injunction.

This has not been a good two months for Google in the courts. Late last March, Google lost its fair use appeal in the Oracle v Google case with the unanimous U.S. Federal Circuit Court of Appeals ruling that there was “nothing fair” about Google taking oracle’s APIs “verbatim and using [them] for the same purpose and function as the original in a competing platform”. Last month a German appeals court found Google must take responsibility for the damages caused by its algorithmic generated search results finding it liable for violating an individual’s personality rights. Last week Google lost another “right to be forgotten” case in the UK in NT 1 & NT 2 v Google LLC [2018] EWHC 799 (QB) (13 April 2018).


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