By Richard Stobbe

How far can Canadian courts reach when making orders that seek to control the conduct of foreign companies outside of Canada? This controversial question is still being decided, bit by bit, in both Canadian and US courts.  In our past posts we have written about a 2014 pre-trial temporary court order that required Google to de-index certain sites from Google’s worldwide search results, based on an underlying lawsuit that the plaintiff, Equustek, brought against the defendants back in 2011.  Google challenged the order requiring it to delist worldwide search results, and fought this order all the way up to the Supreme Court of Canada… where Google lost.

On July 24, 2017, approximately one month after the SCC decision, Google filed a complaint in US Federal Court, seeking an order that the injunction issued by the BC court is unlawful and unenforceable in the United States. That order was granted, first on a preliminary application on November 2, 2017 and then in a final ruling on December 14, 2017. With that US court decision in hand, Google came back to the BC court which had issued the original order, to vary the scope of that order.

On April 16, 2018, in Equustek Solutions Inc. v Jack, 2018 BCSC 610 (CanLII), the BC court again rejected Google’s requests. The BC court said that the US decision (which was in Google’s favour) did not establish that the injunction requires Google to violate American law. And without any significant change in circumstances, the court reasoned, there was no reason to change the original order.  As a result, the temporary order against Google – which has been in place since 2014 – remains in place, pending outcome of the trial.

The outcome of that trial will be closely watched. As I mentioned in my earlier article, there has been very little analysis of Equustek’s IP rights by any of the different levels of court. Since this entire case involved pre-trial remedies, the merits of the underlying allegations and the strength of Equustek’s IP rights have never been tested at trial. In order for the injunction to make sense, one must assume that the IP rights were valid. Even if they are valid, it is questionable whether Equustek’s rights are worldwide in nature since there was no evidence of any worldwide patent rights or international trademark portfolio.  We can only hope that the trial decision, and Google’s decision to appeal the latest BC court decision, will clarify these issues.

Calgary – 07:00 MDT