S.C.C. Court File No. 33900

IN THE SUPREME COURT OF CANADA (ON APPEAL FROM THE COURT OF APPEAL FOR THE PROVINCE OF ONTARIO)

BETWEEN:

RICHARD C. BREEDEN, RICHARD C. BREEDEN & CO.: GORDON A. PARIS: JAMES R. THOMPSON, RICHARD D. BURT, GRAHAM W. SAVAGE and RAYMOND G.H. SElTZ

Appellants (Appellants)

- and -

CONRAD BLACK Respondent (Respondent)

AND BETWEEN:

RICHARD C. BREEDEN, RICHARD C. BREEDEN & CO., GORDON A. PARIS, JAMES R. THOMPSONl RICHARD D. BURT, GRAHAM W. SAVAGE and RAYMOND G.H. SElTZ Appellants (Appellants)

- and -

CONRAD BLACK Respondent (Respondent)

FACTUM OF THE RESPONDENT, CONRAD BLACK

(Pursuant to s. 40 of the Supreme Court Act, R.S.C. 1985, c. S-26 as am. 1990, c. 8 and Rule 36 and 42 of the Rules of the Supreme Court of Canada) AND BETWEEN:

RICHARD C. BREEDEN, RICHARD C. BREEDEN & CO., GORDON A. PARIS, JAMES R. THOMPSON, RICHARD D. BURT, GRAHAM W. SAVAGE and RAYMOND G.H. SElTZ Appellants (Appellants)

- and -

CONRAD BLACK Respondent (Respondent)

AND BETWEEN:

RICHARD C. BREEDEN, RICHARD C. BREEDEN & CO.: GORDON A. PARIS. JAMES R. THOMPSON: RICHARD D. BURT: GRAHAM W. SAVAGE and RAYMOND G.H. SElTZ Appellants (Appellants)

- and -

CONRAD BLACK Respondent (Respondent)

AND BETWEEN

RICHARD C. BREEDEN, RICHARD C. BREEDEN & CO.! GORDON A. PARIS, GRAHAM W. SAVAGE, RAYMOND G.H. SElTZ and PAUL B. HEALY Appellants (Appellants)

- and -

CONRAD BLACK Respondent (Respondent) AND BETWEEN:

RICHARD C. BREEDEN, RICHARD C. BREEDEN & CO., GORDON A. PARIS, JAMES R. THOMPSON, RICHARD D. BURT, GRAHAM W. SAVAGE, RAYMOND G.H. SEITZ, SHMUEL MEITAR and HENRY A. KlSSlNGER Appellants (Appellants)

- and -

CONRAD BLACK Respondent (Respondent)

LERNERS LLP GOWLING LAFLEUR HENDERSON LLP Barristers & Solicitors Barristers & Solicitors 130 Adelaide Street West 160 Elgin Street Suite 2400 Suite 2600 Toronto, ON M5H 3P5 Ottawa, ON K1P 1C3

Earl A. Cherniak, Q.C. (LSUC #09113C) Henry S. Brown, Q.C. Kirk F. Stevens (LSUC#: 27515P) Lisa C. Munro (LSUC# 36006R) Tel: 61 3.786.0139 Tel: 416.867.3076 Fax: 61 3.563-9869 Fax: 416.867.9192 [email protected]

Solicitors for the Respondent, Agent for Counsel for the Respondent Conrad Black

TO: THE REGISTRAR Supreme Court of Canada 301 Wellington Street Ottawa, ON KIA OJ1 AND TO:

BLAKE, CASSELS & GRAYDON LLP BLAKE, CASSELS & GRAYDON LLP 199 Bay Street 45 O'Connor Street Commerce Court, Suite 2800 World Exchange Plaza, Suite 2000 Toronto, ON M5L 1A9 Ottawa, ON KIP 1A4

Paul Schabas LSUC#26355A Nancy Brooks LSUC#37690H Tel: 416.863.4274 Tel: 61 3.788.2218 Email: [email protected] Fax: 613.788.2247 Email: [email protected] Ryder Gilliland LSUC#45662C Tel: 416.863.5849 Ottawa Agents for the Appellants Email: [email protected]

Erin Hoult LSUC#54002C Tel: 416.863.4011 Email: [email protected] Fax: 41 6.863.2653

Solicitors for the Appellants, Richard C. Breeden and Richard C. Breeden & Co.

AND TO:

BENNETT JONES LLP BLAKE, CASSELS & GRAYDON LLP One First Canadian Place 45 O'Connor Street 100 King Street West, Suite 3400 World Exchange Plaza, Suite 2000 Toronto, ON M5X 1A4 Ottawa, ON KIP 1A4

Robert W. Staley LSUC#27115J Nancy Brooks LSUC#37690H Tel: 416.777.4857 Tel: 61 3.788.2218 Email: [email protected] Fax: 61 3.788.2247 Email: [email protected] Julia E, Schatz LSUC#37412V Tel: 416.777.4665 Ottawa Agents for the Appellants Email: [email protected]

Solicitors for the Appellants, Gordon A. Paris, James R. Thompson, Richard D. Burt, Graham W. Savage, Raymond G.H. Seitz, Paul B. Healy, Shmuel Meitar and Henry A. Kissinger TABLE OF CONTENTS

PART I .STATEMENT OF FACTS ...... I

A . Overview ...... I

B . The connection between the subject matter of Black's claim and Ontario ...... 2

1. Black's connections to Ontario ...... 2

2 . Black exercised control over International from Ontario ...... 3

3 . The defamatory statements ...... 5

4 . Other litigation in the U.S. and Canada ...... 7

(a) U.S. criminal proceedings against Black ...... 7

(b) Civil litigation in the U.S. and Canada ...... 8

(c) The defendants' freshly minted estoppel issue ...... 9

(d) The defendants' connections to Ontario in civil proceedings ...... 10

C . Reasons of the courts below ...... 12

PART II .STATEMENT OF ISSUES ...... 13

PART Ill - STATEMENT OF ARGUMENT ...... 13 ... A . Jur~sd~ct~on...... 13

1. Black's position on jurisdiction simplicifer ...... 13

2 . The "real and substantial connection'' test ...... 14

(a) Service ex juris rules and the "real and substantial connection" test ...... 14

(b) The basis of a "real and substantial connection1'in this case ...... 15

(c) The relevant connections in the "real and substantial connection" test ...... 16

(d) The defendants' agenda .replacement of the "real and substantial connection" test with a "personal subjection" test ...... 18

(e) The defendants' approach conflates jurisdiction simpliciter and forum non conveniens ...... 21

3 . The "real and substantial connection" test and defamation ...... 22 . . (a) Black's pos~t~on...... 22

(b) The defendants' position deconstructed ...... 23 (c) The focus of defamation law is still the plaintiffs reputation. not the defendant's conduct ...... 25

(d) Ordinarily. the place of publication is the locus delicti ...... 26

(e) The defendants' criticism of the Canadian approach is unjustified ...... 29

(f) The supposed spectre of unlimited liability ...... 30

(g) Considerations of comity do not support the defendants' position ...... 31

(h) The "targeting" test is satisfied on these facts ...... 33

(i) The Canadian approach to "targeting" ...... 34

B . Forum non conveniens ...... 35

1 . Location of the majority of the parties ...... 36

2 . Location of key witnesses and evidence ...... 37

3 . Avoidance of multiplicity of proceedings ...... 37

4 . The applicable law ...... 38

5 . Loss of juridical advantage ...... 38

6 . Enforceability of an Ontario judgment ...... 39

7 . Conclusion on forum non conveniens ...... 40

PART IV . SUBMISSIONS ON COSTS ...... 40

PART V .ORDER SOUGHT ...... 40

PART VI - TABLE OF AUTHORITIES ...... 41

PART VII - STATUTES AND REGULATIONS ...... 44 PART I - STATEMENT OF FACTS

A. Overview

1. If the respondent, Conrad Black, were a "libel tourist", he would have brought these defamation actions in the United Kingdom, a jurisdiction so roundly condemned by the appellants ("defendants") as a "plaintiff friendly" forum, where Black has connections. Justice Belobaba, the motion judge, and a unanimous Court of Appeal (Doherty, Juriansz, and Karakatsanis JJ.A.) correctly appreciated that Ontario may properly assume jurisdiction over the defendants, who are former directors, officers, and advisors of Hollinger International Inc. ("International"), on the basis that they knew or ought to have known that Black's reputation is more substantially connected to Ontario than any other place in the world and that the highly inflammatory charges that they posted on International's web site in the United States were certain to be widely published in Ontario. Those statements charged Black with having run International, while he controlled it, as a "corporate kleptocracy" and having "looted it" of "hundreds of millions'' of dollars.

2. The issue upon which this court granted leave to appeal is the proper application of the "real and substantial connection" test for the assumption of jurisdiction in trans- border defamation cases. Black's position is that the test is satisfied when: a) there is substantial publication in the jurisdiction; b) the plaintiff has a substantial reputation to protect in the jurisdiction; and, c) the defendant is in a position to reasonably foresee substantial publication in the jurisdiction and to know of the plaintiff's substantial reputation there. Such a test is consistent with the "real and substantial connection" test, its emphasis on foreseeability of harm, the principles of order and fairness that inform it, and the balance that Canadian defamation law strikes between freedom of expression and protection of reputation. The defendants' proposed test is more consistent with the "personal subjection" approach to jurisdiction in American law which places more emphasis on the liberty interests of defendants than does Canadian law. Their approach is also inconsistent with settled Canadian defamation law. 3. The defendants also contend that the motion judge erred in declining to exercise his discretion to stay these actions on the basis of forum non conveniens and that the Court of Appeal should have set aside his decision as unreasonable. As the Court of Appeal found, the motion judge carefully weighed all the appropriate factors and came to a reasonable decision. There is no basis for review.

4. Contrary to the assertions in the defendants' factum (whose specific paragraph numbers will be denoted in the text of this factum as, e.g., "DF 7 57, this case is not about the following matters, as the courts below correctly held:

It is not about the defendants' disclosure obligations under U.S. securities law and the governance of International, an American company. As the motion judge noted, the defendants surely could have fulfilled those obligations without the excessive and inflammatory statements which are the subject of this libel action.'

It is not about whether Black committed specific wrongs, which are the subject of other litigation in several jurisdictions, including ontario.'

It is not about Black's present status under U.S. criminal law.

It is not about the fact that Black gave up his Canadian citi~enshi~.~

B. The connection between the subject matter of Black's claim and Ontario

1. Black's connections to Ontario

5. Black grew up in Ontario, was schooled in Toronto, and lived primarily in Ontario until he was 45 years old. He still maintains his family home in Toronto. Most of his close family members, including all three of his children, live in ~ntario.~He founded The National Post, owned Saturday Night magazine, is an officer of the Order of Canada, and is a member of the Canadian Business Hall of Fame and Canadian Press Hall of ~ame.~He has been a director of Brascan Corporation, Canadian Imperial Bank of Commerce, and CanWest Global Communications Corp. Five books, all by Toronto-

' Appellants Record (herelnafter A R ) Vol I p 12 pp 15-16 Superior Court of Justlce Reasons of Belobaba J dated March 31 2009 (herelnafter Mot~onReasons') 7 40 7 56 A R VOI I p 12 Mot~onReasons 740 A R VOI I p 12 Motion Reasons rn 37-39 A R VOI I p 8 pp 11-12 Motion Reasons rn 23 36 A R Vol XIX pp 189-190 Aff~davltof Alana Black sworn July 29 2008 (here~nafter Alana Black Affldavlt ) rn 68 70 5 A R Vol I p 8 pp 11-12 Motlon Reasons rn 23 36 A R Vol XIX pp 189-190 Alana Black Affldavlt rn 68 70 area authors, have been written about him. He has frequently appeared on the cover of Macleans magazine. Tens of thousands of Canadian articles about him can be found on "~oo~le".~

6. In 2001, Black reluctantly gave up his Canadian citizenship to become a member of the United Kingdom's House of Lords. He waged a very public and legal battle, albeit unsuccessfully, with the then Prime Minister of Canada over whether he could retain his Canadian citizenship while accepting the peerage.7 Black would often travel to Canada and the U.S. Black's corporate airplane logs show that he flew more often to Ontario than to any other single jurisdiction after he gave up his Canadian citizen~hi~.~

7. As the motion judge found, Black's

...ties to Ontario (and Canada) are long-standing and, as I have already noted, beyond dispute. I accept the evidence submitted by counsel for the plaintiff, that Mr. Black has not received the same level of attention in any other jurisdiction that he has received in Canada, and in particular, Ontario. If the allegedly defamatory statements damaged his repufation anywhere: they certainly did so in 0ntario.' [~rn~hasisadded.]

8. The Court of Appeal agreed with that finding.'"

2. Black exercised control over International from Ontario.

9. Until January, 2004, Black was the Chairman of International. When Black commenced these libel actions in Ontario, he was also the Chairman, CEO, a director, and the controlling shareholder of The Ravelston Corporation ("Ravelston"), an Ontario corporation that controlled International through Hollinger Inc., of which Black was also Chairman and CEO. A wholly-owned subsidiary of Ravelston provided advisory: consultative, procurement: and administrative services to International, including

h R Vol I pp 11-12 Mot~onReasons 77 36-37 A R Vol XIX p 190 pp 192-195 pp 197-198 p 213 Alana Black Aff~dav~t7 69 7 71 fin 77-83 87 90 Append~xD A R Vol XXll p 95 Aff~dav~tof Stanley W L Freedman sworn October 14 2008 (heremafter Freedman Aff~dav~t')7 15 7 A R Vol I p 12 Mot~onReasons 7 37 A R Vol XIX p 191 Alana Black Aff~dav~t7 72 Black v Chret~enet a1 [2000] 0 J No 784 (ON S C J ) Black v Chretien et a1 [2001] 0 J No 1853 ONCA 8 A R Vol I pp 11-12 Mot~onReasons 77 36-37 A R Vol XX pp 157-158 Reply Aff~davitof Jim McDonough sworn September 15 2008 77 11-12 9 A R Vol I p 12 Mot~onReasons 7 38 '% R Vol I p 53 Appeal Reasons 7 43 strategic advice, planning, and financial services. These corporations conducted day- to-day operations together as "the Hollinger Group" from premises at 10 Toronto Street, Toronto, ~ntario."

10. Black's legal troubles began in May 2003, when a minority shareholder of International questioned the legitimacy of certain "non-compete:' and "management service" payments to Black or companies he owned or controlled. In June, 2003, the board of directors of International, including Black, created a Special Committee to conduct an independent investigation into the al~e~ations.'~

11. The defendants Gordon Paris, Raymond Seitz, and Graham Savage were appointed to the Special Committee, which retained the defendants Breeden and Breeden & Co. to advise it. The "Report of the Investigation of the Special Committee of the Board of Directors of Hollinger International Inc." ("the Special Committee Report"), dated August 30, 2004, contains many of the statements at issue in these defamation actions.13

12. The statements were all published at various times in 2004 and 2005. The ten defendants were all either directors, officers, or advisors of International. A core group of five defendants - Richard Breeden, Richard Breeden & Co., Gordon Paris, Graham

Savage and Raymond Seitz - are defendants in all six actions. James R. Thompson and Richard D. Burt are defendants in the first four actions. The fifth action is against the core group of five, plus Paul Healy (a corporate vice-president), and the sixth action is against the core group of five, plus James Thompson, Richard Burt, Shmuel Meitar and Henry Kissinger. Savage resides in Ontario. Meitar resides in Israel. The remaining eight defendants reside in various jurisdictions in the United states.14

*. A R Vol I p 5 pp 11-12 Motlon Reasons 7 4 7 36 A R Vol XIX p 182 Alana Black Affldav~t 7 47 A R Vol XXll pp 93-94 pp 177-182 Freedman Aff~davlt7 6 Exhlb~tB Corporate chart contained In the lnternat~onalSpeclal Committee Report dated August 31 2004 A R Vol XVlll pp 12-27 Affldav~t of Jlm McDonough sworn May 7 2008 (hereinafter McDonough Affldavlt ) Exhibit 96 Statement of Claim 04-CV-263436CM2 Holllnger lnternat~onalInc v Hollinger Inc et a1 (Ont S C J ) '2 A R Vol I p 5 Motlon Reasons 7 6 '3 A R VOI IV pp 43-45 McDonough Affldavlt 77 36-40 A R Vol XIX pp 168-170 Alana Black Affldav~t77 17-19 '' A R Vol I p 6 p 14 Motlon Reasons 7 11-15 7 50 13. As the motion judge observed, the individual defendants are all sophisticated and knowledgeable. They include a former Chairman of the U.S. Securities and Exchange Commission, a former Governor of Illinois, two former U.S. Ambassadors and a former U.S. Secretary of State. The motion judge inferred that "[it] is inconceivable that the defendants would not have known about some of Black's many connections to Toronto and Ontario or that he had established a significant reputation in this jurisdiction, especially since one of their colleagues, Mr. Savage, actually lived in this province".'5 [Emphasis added.]

3. The defamatory statements

14. The statements at issue were all posted, as alleged in the Statements of Claim: by the defendants' authorization, made either maliciously or with reckless indifference as to their truth, on International's web site andlor were the subject of International's press releases. They were re-published, as the defendants knew or ought to have known they would be, by media widely distributed in Ontario, including The Globe and Mail: The Toronto Star: and The National ~osf.'~In general, Black and certain of his business associates were said to be guilty of "conduct including paying unauthorized, unjustified, or unwarranted amounts" to themselves in the form of consideration for non- compete agreements given to purchasers of International's U.S. community newspapers that were not properly approved by International's Board of Directors. The statements also included assertions that International's "books and records were altered", and that Black had "diverted and usurped assets and opportunities" and "engaged in a pattern of racketeering activities".17

'5 A R.. Vol. I. pp 14-15. Motion Reasons. 77 50-51 '".R . Vol XIX. pp. 174-176. and Vol. XX. pp 16-20. Alana Black Aff~dav~t.r[fi 33-35 and Exhib~t6. Pages of The Globe and Mail. National Post and Toronto Star " A.R . VOI. I. pp 145-146. pp. 175-177. p. 190. Amended Statement of Cla~m.04-CV-263720CMl. Schedules "H". "U". and "AA": A.R . Vol I. pp. 208-212, Further Amended Statement of Claim. 04-CV- 265298CMl. Schedules "A" and "B": A.R . Vol. II. pp. 59-62. pp. 65-67. pp. 91-93. Amended Statement of Cla~m.04-CV-265299CM2: Schedules "G". "H". "J". "U"; A.R.. Vol. II. pp. 122-123. Amended Statement of Claim. 04-CV-270773CM1. Schedule "A": A.R.. Vol. II, pp. 140-150. Amended Statement of Claim. 05- CV-285535PD2. Schedule "A" 15. The most inflammatory statements were contained in the Special Committee Report, signed by Paris, Savage, Seitz, and Breeden. These statements included the following:

(a) "Hollinger was systematically manipulated and used by its controlling shareholders for their sole benefit, and in a manner that violated every concept of fiduciary duty. Not once or twice, but on dozens of occasions Hollinger was victimized by its controlling shareholders as they transferred to themselves and their affiliates more than $400 million in the last seven years. . . ";

(b) Black and his associate David Radler "made it their business to line their pockets at the expense of Hollinger almost every day in almost every way they could devise. The Special Committee knows of few parallels to Black and Radler's brand of self-righteous and aggressive looting of Hollinger to the exclusion of all other concerns or interests, and irrespective of whether their actions were remotely fair to shareholders";

(c) "...one scheme after another was devised to siphon away Hollinger's opportunities, its cash flow and a share of its balance sheet";

(d) the company was a "corporate kleptocracy" when Black was its CEO:

(e) "...[O]ne must ...note the myriad of schemes, fiduciary abuses and fraudulent acts that were used to transfer essentially the entire earnings output of Hollinger..."; and

(f) "Hollinger wasn't a company where isolated improper and abusive acts took place. Rather, Hollinger was a company where abusive practices were inextricably linked to every major development or action ... At Hollinger, Black as both CEO and controlling shareholder ...created an entity in which ethical corruption was a defining characteristic of the leadership team...".I8 [Emphasis added]

16. The Special Committee Report was posted, in its entirety, on International's web site.lg These statements were then re-published numerous times on the web sites of The Globe and Mail, The Toronto Star, and The National ~ost.~~

'8 A R . Vol II. pp. 181-187. p 195. Amended Statement of Claim. 04-CV-276761CM2. Schedule "I". pp 1-5, p 24 " A.R..Vol. ll. pp 181-216. Amended Statement of Cla~m.04-CV-276761CM2. Schedule ,.I" '' A.R . VOI II. pp 47-65. pp. 81-86. pp 92-97. pp. 100-104. pp. 111-1 12. Amended Statement of Claim. 04-CV-276761CM2. Schedules "Il-V" - "11-Z". "11-FF". "11-GG". II-JJ". "11-KK". "11-MM". "11-NN". and "11-RR" 17. The bottom of the International press releases and the Special Committee's Report contained contact information for Canadian, British and American media.21

18. Black pleads that the defendants knew or ought to have known that he was well known in Ontario and that Ontario newspapers would re-publish statements about him. Although his libel actions initially claimed damages for injury to his world-wide reputation, he later restricted his claims to damage to his reputation in ~ntario.'~

4. Other litigation in the U.S. and Canada

(a) U.S. criminal proceedings against Black

19. After the release of the Special Committee Report, numerous civil and criminal proceedings ensued. In November 2005, thirteen criminal charges against Black were laid in the U.S. In July 2007, a Chicago jury acquitted Black on nine counts and convicted him on four - three counts of mail fraud and one count of obstruction of justice. The jury found that he had defrauded International of just over U.S.$6 million in unauthorized non-compete payments. He was sentenced to six-and-a-half years in prison. In March 2008, he began serving his sentence in a low-security federal correctional facility in Florida. However, an appeal to the U.S. Supreme Court resulted in the vacating of his convictions on two of the fraud charges. The prosecution elected not to re-try him on these charges. Presently, Black is residing in Florida on bail as he awaits a re-sentencing hearing in June 201 1 and the outcome of a further application to the U.S. Supreme Court for cerfiorari to review his remaining convictions on one count of fraud and one count of obstruction of justice.23

2 3 A.R.,Vol I. pp. 190-191, Amended Statement of Claim. 04-CV-263720CM1. Schedule "Mu.A R . Vol I. pp 208-212, Further Amended Statement of Cla~m.04-CV-265298CMl. Schedules "A" and "B", A R Vol II. pp. 122-123. Amended Statement of Cla~m.04-CV-270773CM1. Schedule "A". A R..Vol II. pp 1- 48. Amended Statement of Clalm. 04-CV-265299CM2: A R . Vol II. pp 140-150. Amended Statement of Cla~m.05-CV-285535PD2. Schedule "A'; " A R . Vol I, pp 190-191. Amended Statement of Cla~m.04-CV-263720CMl. Schedule "M".A R..Vol. I. pp 208-212. Further Amended Statement of Claim. 04-CV-265298CM1, Schedules "A" and "B". A R.. Vol II. pp 122-123. Amended Statement of Cla~m.04-CV-270773CM1, Schedule "A". A.R.. Vol II. pp 22-48, Amended Statement of Claim. 04-CV-265299CM2. A.R..Vol. II. pp 129-137. Amended Statement of Claim. 05-CV-285535PD2 23 A.R.; Vol. I, pp. 5-6. Motion Reasons, 77 6-9 20. Thus, despite the defendants' statements of widespread and persuasive fraud involving hundreds of millions of dollars, today Black stands convicted of a single count of fraud totalling less than $600,000 with respect to one transaction and one count of obstruction of justice (arising from his moving boxes from the 10 Toronto Street office to his Toronto home).24

21. Because Black is no longer a citizen of Canada, the outcome of the certiorari application to the U.S. Supreme Court will be relevant to the determination of whether he is "inadmissible" to return to Canada. If his convictions stand, he may return to Canada nonetheless if, upon applying to the Minister of Immigration, he is granted a temporary resident permit.25 If the two remaining convictions are reversed, he will be eligible to return to Canada.

(b) Civil litigation in the U.S. and Canada

22. Numerous civil and regulatory proceedings with respect to Black's business affairs have been brought in the United States, Ontario, Saskatchewan, and Quebec. The business dispute is trans-national and not confined to the United States. Six proceedings were commenced in Ontario, five of which remain extant. As well, there are various other claims for contribution and indemnity in Ontario arising out of actions in Ontario, Saskatchewan, Quebec and Illinois. 26

2hR VOI XV pp 2-81 see esp pp 57-60 McDonough Affldavlt Exh~b~t77 Thlrd Superseding lndlctrnent In Unlted States v Black et a1 A R Vol XV p 83 McDonough Aff~dav~tExh~b~t 78 Order of the Un~tedStates Dlstrlct Court Northern D~strlctof llllno~s Eastern Dlvts~on dated July 13 2007 In United States v Black et a1 A R Vol XXlV pp 144-154 Further Supplementary Aff~dav~tof J~rn McDonough sworn November 17 2008 (herelnafter McDonough Further Supplementary Aff~dav~t) Exh~b~tA Dec~s~onof the Unlted States Court of Appeals Seventh Circuit dated June 25 2008 In Unlted States v Black et a1 530 F 3d 596 (7th Clr 2008) A R Vol XXlV p 156 McDonough Further Supplementary Aff~dav~tExhlblt B Order of the Un~tedStates Court of Appeals Seventh C~rcu~tdated August 13 2008 In Unlted States v Black et a1 deny~ngBlack's pet~t~onfor an en banc rehear~ng Respondents Record (herelnafter R R ) Vol Ill tab 15 p 125 Decislon of the Supreme Court of the Un~tedStates dated May 18 2009 In Black et a1 v Unlted States 129 S Ct 2379 grant~ngpet~tlon for wr~tof certiorar~ R R Vol Ill tab 16 p 126-128 Dec~s~onof the Supreme Court of the Un~tedStates dated June 24 2010 In v Black et a1 v United States 561 U S (2010) vacatlng judgment of Court of Appeals Dec~s~onof the Unlted States Court of Appeals Unlted States v Black et a1 October 29 2010 No 05-CR 727 (7" Clr ) 25 lmmlgratlon and Refugee Protect~onAct S C 2001 c 27 ss 3 and 24 25 R R Vol I tab 4 pp 83-84 Statement of Cla~m 04-CV-028649 Steven Drover et a1 v Argus Corporation et a1 7 69 R R Vol I tab 3 pp 21-27 pp 31-34 pp 36-37 Notice of Appl~cat~on04-CL- 5441 Catalyst Fund General Partner I Inc v Holl~ngerInc 77 1 and 12 15 to 19 28 29 R R Vol I tab 23. The Ontario proceedings raise essentially the same issues as International's action against Black in Illinois (see Appendix "A" of the Appellants' fact~m).~~Litigation in the United States was commenced in Delaware and Illinois. The Illinois action was stayed pending the outcome of the criminal proceedings against lack.^' An Ontario class action now has been settled.29

(c) The defendants' freshly minted estoppel issue

24. The defendants assert (for the first time in these actions) that a decision of Farley J. of the Ontario Superior Court (in yet another Ontario proceeding that is no longer extant) precludes Black from asserting that the Illinois action will not dispose of the defendants' as yet unpleaded defence of justification in these Ontario libel actions (see DF 77 7, 19, 23, 23, 74-76, and Appendix "A"). That decision arose from a motion brought by Ravelston, not Black, for an anti-suit injunction restraining International from bringing or maintaining any claim relating to the management of the Hollinger-related corporations in any jurisdiction outside Ontario. lnternational brought a cross-motion for a temporary stay of Ravelston's counterclaim in an Ontario replevin action brought by International, pending the resolution of International's Illinois action against Ravelston, Black, and others. Farley J. dismissed the anti-suit injunction and granted International's motion for a stay on the basis that there was overlap in the two proceedings regarding allegations of impropriety in respect of management services provided to International by, and fees paid to, Ravelston and Black.

5 pp 181-184 Statement of Allegattons In the Matter of the Securities Act and Holllnger Inc et a1 7 18 R R Vol Ill tab 13 p 103 Statement of Cla~m07-CL-6954 Hollinger Inc v Conrad M Black et a1 fifi 17 to 19 R R Vol I tab 6 pp 228-233 Amended Statement of Cla~m05-CL-5822 Holllnger Inc et a1 v The Ravelston Corporation Limited 19 to 35 R R Vol II tab 9A pp 107-123 Not~ceof Act~on 05- CL-6220 Argus Corporation Limited et a1 v Peter Y Atkinson et a/, R R Vol II tab 9B pp 126-146 Not~ceof Act~on06-CL-6259 Conrad M Black et a1 v Argus Corporation Limited et a1 R R Vol II tab 9C pp 148- 161 Not~ceof Act~on 06-CL-6260 Argus Corporat~onLimited et a1 v Moffatt Management Inc et a1 R R Vol II tab 9D pp 164-174, Statement of Cla~m07-CL-7334 F David Radler et a1 v Conrad M Black et a1 R R Vol II tab 9E pp 176-186 Statement of Claim CV-08-00007549-00CL Moffatt Management Inc et a1 v Sun-Times Media Group Inc et a1 R R Vol Ill tab 10 pp 1-55 Not~ceof Act~on06-CL-6261 Hollinger Inc et a1 v The Ravelston Corporation eta1 '' A R VOI Vlll pp 25-236 McDonough Aff~dav~tExh~b~t 45 Second Amended Compla~ntf~led In lll~no~s on October 29 2004 25 A R Vol I p 5 Motton Reasons 7 8 A R Vol I p 44 Appeal Reasons 7 15 29 A R Vol XVI pp 124-193 McDonough Aff~dav~tExh~btt 88 St~pulat~onand Agreement of Settlement of U S and CanadIan Class Act~ons 25. Significantly, Farley J. found that Ravelston had not indicated any injustice to it or loss of juridical advantage if a stay were granted on a temporary basis. That is not so in this case, which the defendants concede (DF fi 84).30

26. More importantly, no other court in any other jurisdiction will be deciding whether the statements that underlie these actions are defamatory or whether they are justified on the basis that they are true or fair comment. No other court will be determining whether lnternational was a "corporate kleptocracy" while run by Black or whether "ethical corruption was a defining characteristic of the leadership team" or whether Black made it his business to "line [his] pockets at the expense of [International] almost every day in almost every way [he] could devise". In the action brought against Black by lnternational in Illinois, the claims are limited to specific, quantifiable impugned transactions and fees3'

27. While the defendants argued in the courts below that the Illinois action will determine the truth of their defamatory statements, the first time they have asserted that Farley J.'s decision gives rise to issue estoppel is in the appeal to this court

(d) The defendants' connections to Ontario in civil proceedings

28. The defendants overstate their assertion that they have no connection to Ontario (DF 7 61 (ii)).

29. The defendants directed International's activities wherever they occurred, including Ontario, where lnternational commenced litigation. lnternational brought an unsuccessful action for a Mareva injunction against Black to seize his assets worldwide and take advantage of the more favourable pre-judgment execution law in ~ntario.~' lnternational also brought a replevin action in Ontario, in which it sought the return of certain accounting and computer records located in Ontario which it claimed were

33 A R Vol XVlll p 11 1 McDonough Aff~dav~tExh~b~t 102 Reasons of Justice Farley dated August 11 2004 In Holl~ngerlnternat~onal Inc v Holllnger Inc et a1 and The Ravelston Corporation et a1 v Holllnger lnternat~onalInc et a1 7 5 Appellants factum 7 84 3 ' A R Vol Vlll p 43 McDonough Affldavlt Exh~b~t45 Second Amended Compla~ntflled In llllnols on October 29 2004 F~gure2 A R Vol I p 12 pp 15-16 Motlon Reasons 740 7 56 32 R R Vol Ill tab 12 pp 70-96 Sun-T~mesMedla Group Inc [formerly International] v Conrad M Black 06-CL-6678 necessary to enable it to file audited financial statements with the U.S. Securities and Exchange Commission. International maintained business premises and employed staff at 10 Toronto

30. In March, 2005, only a few weeks after Black had issued the last of these libel claims: Breeden, the former chair of the U.S. Securities and Exchange Commission, came to Ontario personally to meet with the Ontario Securities Commission to persuade it to reject Black's attempt to privatize Hollinger Inc., a Canadian corporation. On March 23! 2005 a Globe and Mail article reporting on Breeden's visit began as follows:

Richard Breeden took a flight to Toronto two weeks ago to lecture the Ontario Securities Commission about its inaction against Conrad Black.

The article quoted Breeden as saying:

This is 100-per-cent Conrad's attempt to sneak back into control of the U.S. company." ..."Why the Canadian regulators would use any of their discretion under the law to assist Conrad in his schemes truly is beyond me.34

Although OSC staff recommended that the privatization bid be allowed to proceed, the OSC rejected it shortly after Breeden's visit.35

31. Further, Paris, Savage, Seitz, Burt, Kissinger, Meitar, and Thompson have been sued in Ontario, personally, on matters relating to their positions as directors and officers of International, and submitted their rights to the Ontario courts when these matters were settled and court orders were obtained. Some of those proceedings

33 A R VOI XXll pp 177-182 Freedman Aff~dav~tExhlb~t B Corporate chart conta~ned In the lnternatlonal Spec~alComm~ttee Report dated August 31 2004 A R Vol XVlll pp 15-24 McDonough Aff~dav~tExh~ b~t 96 Statemen t of Clalm 04-CV-263436CM2, Hollinger lnternatlonal Inc v Hollinger Inc et a1 (Ont S C J ) 34 A R VOI XXlll pp 28-29 Freedman Aff~dav~tExh~b~t H Globe & Mall art~cledated March 23 2005 Breeden gave OSC a push In Black case" 3% R Vol XXlll pp 30-31 Freedman Aff~dav~tExh~b~t I Holl~nger Inc Press Release dated March 28 2005 involved claims made by and against Ontario-based ''Directors and Officers" liability

C. Reasons of the courts below

32. The Court of Appeal, like the motion judge, held that Black has asserted claims within the meaning of Rule 17.02 (g) of the Rules of Civil ~rocedure,~'which authorizes service of process out of the jurisdiction for a "tort committed in Ontario", because libel, whose essence is publication, occurs where the defamatory statement is read38 Accordingly, on the basis of its own authority in Van Breda v. Village Resorts, (presently before this court)39 the Court of Appeal held that the defendants bore the burden of rebutting a presumption that there is a "real and substantial connection" between Black's claims for defamation and ~ntario.~'Both courts also found that Black had raised a proper claim for damages sustained in ~ntario.~'However, the Court of Appeal noted that Van Breda holds that Rule 17.02 (h): which authorizes service out of the jurisdiction where a claim is for "damages sustained in Ontario", does not give rise to the same presumption. Thus: if a plaintiff serves a statement of claim on a defendant outside of Ontario on the sole basis of Rule 17.02 (h): it is the plaintiff who bears the burden of showing that hislher claim has a "real and substantial connection" to

33. The Court of Appeal found that the defendants had failed to rebut the presumption because there was significant publication in The material was not only posted on a web site that was accessible in Ontario, but was re-published in

3% R VoI I tab 4 pp 70-175 Statement of Clarrn 04-CV-028649 Steven Drover et a1 v Argus Corporation et a1 (Ont S C J) A R Vol XVI p 125 p 130 p 9 p 142 pp 146-148 McDonough Aff~dav~tExh~b~t 88 St~pulat~onand Agreement of Settlement of U S and CanadIan Class Act~ons p 2 and 7 (rec~tals)and 9 14 15 26 28 R R Vol II tab 8B pp 17-30 Not~ceof Appl~cat~on05-CV- 289537PD2 Hollinger Inc v American Home Assurance Company et a1 R R Vol II tab 8D pp 42-71 Not~ceof Appl~cat~on05-CV-289479PD1 Chubb Insurance Company of Canada v The Ravelston Corporation et a1 R R Vol II tab 8E pp 73-105 Not~ceof Appl~cat~on05-CV-289530PD3 American Home Assurance Company v The Ravelston Corporation et a1 37 R RO 1990 Reg 194 38 A R Vol I p 50 p 52 Appeal Reasons 7 32 7 39-40 " Van Breda v V~llageResorts Limited 2010 ONCA 84 [Van Breda] " A R Vol I p 53 Appeal Reasons 7 42 4' A R Vol I pp 11-12 Mot~onReason 7 35 7 38 A R Vol I pp 55-56 Appeal Reasons 7748-51 42 A R Vol I pp 55-56 Appeal Reasons 7 49 43 A R Vol I p 56 Appeal Reasons 7 50 The Globe and Mail, The Toronto Star, and The National Post and on the web sites of those newspapers.44 Further, as the motion judge held and the Court of Appeal agreed, it was reasonably foreseeable to the defendants that there would be substantial republication in Ontario. The Court of Appeal also held that, even though no Canadian authority supports the "targeting" test used in the United States, for which the defendants advocate, there was evidence that the defendants had "targeted" 0ntario4j

34. Both courts also found that there was a real and substantial connection between Black's claim for damages to his reputation and Ontario. They noted that he lived here for many years and has continuing connections to Ontario, including connections to the most members of his immediate family and friends.46

35. The facts relating to the issue of forum non conveniens are set out at paragraphs 103-117 below in connection with the motion judge's treatment of the relevant factors.

PART II - STATEMENT OF ISSUES

36. There are two issues on this appeal:

(a) Did the courts below properly assume jurisdiction?

(b) Was the motion judge's discretionary decision that Ontario is the most convenient forum reasonable and deserving of deference?

Black submits that the answer to both questions is "yes"

PART Ill - STATEMENT OF ARGUMENT

A. Jurisdiction

1. Black's position on jurisdiction simpliciter

37. In the context of trans-border defamation cases, the "real and substantial connection" test requires:

44 A R..Vol. Ill. pp. 47-65. Amended Statement of Claim, 04-CV-276761CM2. Schedules "11-V" - "ll-Z" 45 A.R . Vol. I. p. 52. Appeal Reasons, 38-39 '9R.. Vol I. pp. 11-12. Motion Reasons. 7 36. 7 38. 62; A R., Vol. I. p. 53. Appeal Reasons. 7 43 (a) substantial publication of the defamatory words in the jurisdiction;

(b) that the plaintiff is damaged because he has a substantial reputation to protect in the jurisdiction; and,

(c) that both (a) and (b) are reasonably foreseeable to the defendant. 38. The courts below applied the above test, which comports with the principles of order and fairness developed by this court.

2. The "real and substantial connection" test

(a) Service ex juris rules and the "real and substantial connection" test 39. In Morguard v. De avoy ye,^' this court held that order and fairness require a "real and substantial connection" between the forum and the plaintiff's claim or the defendant before a court may exercise jurisdiction. Later, in Hunt v. T&N PLC, this court held that order and fairness are constitutional imperatives. In Hunt, LaForest J. observed that no test can ever be precisely defined and rigidly applied to determine what is a "real and substantial connection" and that the principles of order and fairness can only be developed incrementally. The "traditional rules" pursuant to which courts assumed or declined jurisdiction were, he stated, "a good place to start."48

40. Provincial and territorial rules of court govern when service outside of the jurisdiction is appropriate. In Ontario, Rule 17.02 of the Rules of Civil procedure4' serves this function. There is no constitutional challenge to Rule 17.02 or any of its components in this case. It must, therefore, be assumed that Rule 17.02 comports with the constitutional requirements of order and fairness.

41. A "good place to start" a structured analysis of whether the "real and substantial connection" test is met in any given case is to analyze whether the recognized legal elements of the plaintiff's claim fall into one of the enumerated categories in Rule 17.02. Van 6redaso holds that satisfaction of some, but not all, of the enumerated categories gives rise to a rebuttable presumption that there is a "real and substantial connection."

07 Morguard Investments Ltd. v. De Savoye. [I 9901 3 S.C.R. 1077. 1102-09 [Morguard] " Hunt V. T&N PLC. [I9931 4 S.C.R 289. 325-326 49 R.R 0 1990. Reg 194 The court looked to the adoption of presumptions in the Courf Jurisdiction and Proceedings Transfer Act, which has been adopted by three provinces. Very recently, the Court of Appeal for Newfoundland and Labrador held in Fewer v. Ellis that satisfaction of the provisions of that province's analogue to Rule 17.02 is a good indication of a "real and substantial connection". Regardless of whether it is more appropriate to apply "rebuttable presumptions" or treat service ex juris provisions as "indicia", they are a "good starting point".

42. LeBel J. for this court in Spar Aerospace Ltd. v. American Mobile Satellite Corp. compared the Quebec analogue of Rule 17.02 to the "real and substantial connection" test in Morguard:

Looking at the wording of art. 3148 itself, it is arguable that the notion of a "real and substantial connection" is already subsumed under the provisions of art. 3148(3), given that each of the grounds listed (fault, injurious act, damage, contract) seems to be an example of a "real and substantial connection" between the province of Quebec and the action. Indeed, I am doubtful that a plaintiff who succeeds in proving one of the four grounds for jurisdiction would not be considered to have satisfied the "real and substantial connection'' criterion, at least for the purposes of jurisdiction simpliciter.51

(b) The basis of a "real and substantial connection" in this case

43. Black asserts that the defendants committed a tort in Ontario within the meaning of Rule 17.02 (g).52 Except for Savage, none of the defendants are ordinarily resident in Ontario or have consented or attorned to the jurisdiction in these actions. Black has never taken the position that the defendants other than Savage are "necessary and proper parties" within the meaning of Rule 17.02(0) because Savage resides in Ontario. Consequently, it is common ground that this is not a case of "presence based jurisdiction" or "consent jurisdiction" but, rather, a case of "assumed" j~risdiction.~~

5"an Breda supra at 77 71 -77 i' " Spar Aerospace Ltd v American Mob~leSatellite Corp 2002 SCC 78 [2002] 4 S C R 205 at rj 56 Spar Aerospace] Van Breda supra at 7 76 "R R 0 1990 Reg 194 "~anet Walker Castel & Walker Canadian Confl~ct of Laws 6Ih ed looseleaf (Markham ON Buttetworths 2005) at 11-1 44. In this case, the Court of Appeal, following its previous decision in Van ~reda~~ held that, once the applicability of Rule 17.02(g) is established, there is a rebuttable presumption of a "real and substantial connection" between Ontario and the cause of action. It also held that Rule 17.02(h) ("damages sustained in Ontario") also applies to this case. Van Breda holds that the sustaining of damage inside the jurisdiction does not give rise to the presumption. However, Van Breda also holds that, in certain circumstances, a plaintiff can establish a real and substantial connection to Ontario on the sole basis that damage was sustained in the jurisdiction.

45. The defendants' assert (DF 77 36-37) that the only sense in which a tort was committed in Ontario was that the defamatory statements "were read there, i.e., that Black was allegedly damaged in Ontario." Pointing to Van Breda, they then say that the occurrence of damage in Ontario does not give rise to a presumption in favour of a "real and substantial connection." It is submitted below at paragraphs 63-65 that the defendants conflate injury and damage and that this is a case about a tort committed in Ontario.

46. However, at this juncture, it is only submitted that the outcome of this case in the courts below did not turn on the presumption. The motion judge rendered his decision before the Court of Appeal released Van Breda. The Court of Appeal gave no weight to the presumption in its analysis.

(c) The relevant connections in the "real and substantial connection" test

47. The "connections" in the "real and substantial connection" test are the connections between the forum and

(a) the plaintiff's case (i.e., the cause of action or claim); and,

(b) the parties, primarily the defendants. 48. The inquiry does not primarily focus on the plaintiff's connections to the forum except insofar as those connections relate to the plaintiff's claim. The fact that the

50 A R Vol I pp 46-47 p 50 pp 55-56 Appeal Reasons 77 22-23 32 49 Van Breda supra 7 72 plaintiff is not a resident in the forum may weaken the argument for assumed forum insofar as it is solely based on damages sustained in the forum. However, as the Court of Appeal in Van Breda and in this case noted, it is not necessary for the plaintiff to be a resident to assert a claim in the forum.55

49. In Morguard, LaForest J. held that order and fairness require a real and substantial connection between the forum and the parties or the subject matter of the proceeding before a court can assume juri~diction.~~By "parties", Morguard primarily meant "defendants". The first two Muscutt factors are: a) the connection between the forum and the plaintiff's claim; b) the connection between the forum and the defendant. Obviously, the presence of the plaintiff in the forum does not, by itself, justify haling the defendant into the forum. Therefore, what plaintiffs must demonstrate to justify assumed jurisdiction is a connection, not between themselves and the forum, but, rather, between the alleged wrongs done to them by the defendant (i.e., their cases) and the forum.57

50. In Morguard, which deals with the enforcement of foreign judgments, LaForest J. also speaks of the connections between the jurisdiction and the "wrong" or the ..~rongdoing".~~Ultimately: the "real and substantial connection'' test asks whether it is appropriate for the court to grant a remedy on the assumption that the plaintiff will be able to establish hislher cause of action. Thus, the legal characterization of the plaintiff's claim is critical at the jurisdiction simpliciter stage5' The approach is broad and aimed at determining the pith and substance of the claim in its legal sense, not its merits.

51. In Spar Aerospace, this court held that the Quebec Superior Court correctly assumed jurisdiction in a case where the plaintiff was a corporation headquartered in

XI 09 A R . Vol. I. p 54. Appeal Reasons. 7 45: Van Breda. supra. at 7 137 56 Morguard, supra. pp 1 102-1 109 " Muscuff V. Courcelles (2002) 60 O.R. (3d) 20 (C.A.)at fl 75-1 00 [Muscutt] " Morguard, supra. at pp 1103-1 105; Precious Metal Capital Corp. v Smith (2008). 92 O.R. (3d) 701 C.A.)at r[ 57 [Precious Metal] is Precious Metal supra at 7 9 lncorporafed Broadcasfers itd. v CanWesf Global Comrnun~cafions Corp. (2003). 63 O.R. (3d) 431 (C A ) at 7 57 Ontario and the defendants were all American corporations. The plaintiff claimed economic loss in excess of $800,000, alleging that the defendants had damaged the component of a satellite that the plaintiff had manufactured by sending signals from a ground station in Virginia that caused the satellite to go into overdrive. The "real and substantial connection" to Quebec resulted from the fact that the component was made at the plaintiff's manufacturing facility in Quebec, which gave rise to a claim of $50,000 for the loss of that facility's reputation, which, on the evidence, was independent of the plaintiff's national reputation. Although this was not a defamation claim, this court recognized in Spar Aerospace that a plaintiff's reputation may be damaged in a jurisdiction in which it is not a resident and that this connection is sufficient to ground the assumption of jurisdiction. Indeed, jurisdiction under article 3148(3) of the Quebec Civil Code was based solely on damage within Quebec and not on an injurious act having been committed in ~uebec.~'

52. Consequently, the defendants' focus on Black's decision to leave Ontario is misplaced. Even more irrelevant is their focus on his decision, made under protest, to give up his Canadian citizenship. As La Forest J, held, the "real and substantial connection" test protects both plaintiffs and defendants in a world where "...where people are constantly moving... ".61 [Emphasis added.] As the courts below appreciated, the fact that individuals may leave a jurisdiction hardly means they abandon their personal and economic interests and reputations there.

(d) The defendants' agenda - replacement of the "real and substantial connection" test with a "personal subjection" test

53. In both Canada and the United States, constitutional imperatives require limits on jurisdiction. However, the constitutional imperatives in each country are different6'

54. As Sharpe J.A. observed in Muscutt, the "real and substantial connection" test is broader than the approach that focuses on the question of whether the defendant's

E"par ~eros~ace.supra, at 77 26-43 5 ' Morguard. supra. at pp.1 108-1 109 " Hunt v. T&N PLC. supra, p. 328: Morguard. supra, at p. 1109. Muscutt, supra. at r[fi 72-74: G Watson and F. Au. Constitutional Lim~tson Service Ex Juris, Unanswered Questions from Morguard (2000). 23 Adv Q 167. 198-21 1 conduct should lead to the conclusion that helshe has "subjected himlherself to the jurisdiction." American courts have adopted this "personal subjection" approach because Fourteenth Amendment (Due Process) requires that defendants have "minimum contacts'' with the jurisdiction before their liberty interests can be infringed by haling them into the court of a sister sovereign state. Consequently, under U.S. law, jurisdiction cannot be assumed on the basis that it was foreseeable that, for example, a product would arrive and cause injury in the Under the American "personal subjection" approach, there must be something in addition to foreseeability

55. The American "personal subjection" approach is to be contrasted with the case in which this court first referred to "real and substantial connection'' as the basis for assumed jurisdiction: Moran v. Pyle. There, Dickson J. held that:

Applying this test to a case of careless manufacture, the following rule can be formulated: where a foreign defendant carelessly manufactures a product in a foreign jurisdiction which enters into the normal channels of trade and he knows or ought to know both that as a result of his carelessness a consumer may well be injured and it is reasonably foreseeable that the product would be used or consumed where the plaintiff used or consumed it, then the forum in which the plaintiff suffered damage is entitled to exercise judicial jurisdiction over that foreign defendant.64

56. The defendants challenge (DF 77 53-56) the application of foreseeability to trans- border libel cases and argue that the analysis should "look at the ties between the forum and each defendant and the claim and the forum as a whole...". They propose (DF 71 57-60) that, instead of foreseeability, this court should adopt an American "targeting" approach in which the court only assumes jurisdiction if the defendant has "manifest[ed] an intent" to target readers in the forum: Young v. New Haven ~dvocate.~~[Emphasis added.] That "targeting" test was developed by the United States Supreme Court in

" Muscutt. supra. at 57-71: Joost Blom. Comment, (1991) 70 Can Bar Rev. 733. 741-742. World- Wide Volkswagen Corp. et a/. v. Woodson District Judge of Creek County, Oklahoma ef al.. 444 U S 286. L Ed. 2d 490 (1980). 291-292, 295-297 54 Moran v. Pyle National (Canada) Ltd.. [I 9751 1 S.C R. 393. 409 Moran 55 Young v. New Haven Advocate et al. . 31 5 F. 3d 256, 263-264 (4P Clr.. 2002) [Young v. New Haven] Calder v. ~0ne.s~~within a constitutional framework that, as stated above, requires a "personal subjection" approach.

57. Thus, the provenance of the "targeting" test is an analytical framework that gives liberty primacy over foreseeability of harm. By contrast, the "real and substantial connection" test places a higher value on the avoidance of foreseeable harm, as is consistent with its emphasis on "order and fairness". This court should only adopt the "targeting" test if it is convinced that defamation is not amenable to the "real and substantial connection" analysis applicable to trans-border civil wrongs in general

58. The defendants suggest (DF 7 56) that Sharpe J.A. in Van Breda eschews a focus on foreseeability of harm. However, Van Breda explicitly reiterates Muscutt's rejection of the "personal subjection test". Sharpe J. A. stated:

I see no reason to depart from what we said in Muscutt, at paras. 54-74, in rejecting the argument that assumed jurisdiction should focus solely or primarily upon the nature and extent of the defendant's contacts with the jurisdiction. We concluded, at para. 74, that "[wlhile the defendant's contact with the jurisdiction is an important factor, it is not a necessary factor". A personal subjection test based exclusively on the defendant's contacts would be unduly restrictive, would fail to pay adequate heed to the interests of the injured plaintiff, would be inconsistent with a substantial body of case law reviewed in Muscutt, at paras. 63-74, and would be contrary to the Supreme Court of Canada's emphasis on the need for flexibility. It would also be inconsistent with CJPTA, s. 3(e), which confers jurisdiction if "there is a real and substantial connection between the [forum] and the facts on which the proceedings against that person is based."67

Muscutt held that foreseeability is not enough in a case where the scope of activity of a foreign business, such as a restaurant, is confined to the foreign jurisdiction, but it also held that foreseeability of harm justifies the assumption of jurisdiction where its activities are not so confined.68

55 Calder v. Jones. 465 U.S.783. 789-791 (1984) 57 Van Breda, supra, at 7 86: Court Jurisdiction and Proceedings Transfer Act, Un~forrnLaw Conference of Canada ["CJPTA"], s.3(e) " Muscuff, supra. at 7 83 59. As this court has repeatedly observed, the "real and substantial connection" test is flexible and is not intended to be a mere mechanical counting of connecting factors, or the lack thereof.69 Its application is always a matter of judgment; there is no self- applying black letter or bright line test7' Nevertheless, the test is objective. Insofar as the focus is on the defendant, it must be on what is reasonably foreseeable to a reasonable defendant in the general circumstances of the case, not on the actual expectations of the particular defendant in the particular circumstances.

60. The defendants (DF 7 38) note that the motion judge stated that the appellants "may not have expected as being probable or likely that they would have caused injury in ~ntario."~'However, in the very next sentence of his reasons, the motion judge found that the defendants ought reasonably to have foreseen that their defamatory words would be re-published in Ontario and cause Black cause injury in Ontario. The Court of Appeal agreed7'

61. In any event, as submitted below at paragraphs 94-98, and as the Court of Appeal held. the facts of this case would meet the "targeting" test.

(e) The defendants' approach conflates jurisdiction simpliciter and forum non conveniens

62. This court in Spar Aerospace and Tolofson v. ense en^^ and the Court of Appeal for Ontario in Muscuff and Van Breda hold that the issue of assumed jurisdiction is anterior to, and distinct from, the issue of forum non conveniens. Spar Aerospace rejected the contention that the court should adopt the stringent jurisdictional test under the 1968 Brussels Convention on jurisdiction and fhe enforcement of judgments in civil and commercial maffers because the convention lacks the counterweight of the forum non conveniens doctrine, which restrains overreaching. The "real and substantial connection" test thus remains a broad test, aimed at ensuring that the case before the domestic forum falls into a cafegory of case in which it is appropriate to assume

59 Van Breda supra at 77 43-44 73 Van Breda supra at 7 68 " A R VOI I p 15 Mot~onReasons 55 '' A R Vol I p 57 pp 60-61 Appeal Reasons 7 55 7 66 73 Spar v Aerospace supra Tolofson v Jensen [I 9941 3 S C R 1022 1049 jurisdiction and grant a remedy. This is consistent with the fact that assumed jurisdiction is a question of law that is reviewable on a standard of correctness, whereas forum non conveniens is a discretionary exercise reviewable on an unreasonableness

63. Because jurisdiction is distinct from forum non conveniens, the court does not consider whether another forum might have a more "real and substantial connection" to the Several fora may have a real and substantial connection to the plaintiffs claim and to the defendants.

64. The defendants urge the court to take a "holistic view" of the entire case and determine whether its essence lies in Ontario or the U.S. (DF fi 40-42). However, the jurisdictional simpliciter analysis is not the place to weigh the connections between the facts of the action to Ontario against the connections between the facts to the United States, as the defendants do. Similarly, Black's present circumstances, the supposed unfairness in requiring the defendants to travel to Ontario, and whether more re- publication occurred outside of Ontario than within Ontario are not relevant to jurisdiction simpliciter (see DF fi 61).

3. The "real and substantial connection" test and defamation

(a) Black's position

65. In trans-border defamation cases, the "real and substantial connection'' test requires that: the words constituting the alleged libel have had substantial publication in the forum; the plaintiff has a substantial reputation to protect in the forum; and, the defendant is in a position to reasonably foresee that his or her conduct will cause such substantial publication and damage in the forum.

66. The courts below applied this test. They did so by first looking at whether there was evidence that a tort had been committed in Ontario. They found that publication of

70 Spar Aerospace, supra. at 7 57: 7 61; 1968 Brussels Convention on jurisdiction and the enforcement of judgments in civ~land commercial matters. September 27. 1968. Offic~al Journal of the European Communit~es.Not~ce No. 98/C 27/01. Muscutt. supra. at 42-43; Van Breda, supra. at 77 48-49. 81- 82 75 Van Breda. supra. at 7 82: Muscutt. supra, at 7 44 the allegedly libelous statements occurred in Ontario and, applying well-established principles of tort and defamation law, concluded that the defendants had committed an injurious act (i.e. completed the tort) in ~ntario.~~That gave rise to a rebuttable presumption of a real and substantial connection to Ontario. The defendants could rebut the presumption by showing that publication in Ontario was not significant.77 They failed to do so because the evidence of substantial publication, including republication, was not contested." The courts below also assessed whether Black had a substantial reputation in Ontario to be damaged, an issue upon which he bore the burden of proof. The evidence that Black had a substantial reputation in Ontario was Then, the courts considered whether the defendants could reasonably foresee whether their statements would receive substantial publication (including republication) in Ontario and whether those statements would damage a substantial reputation in 0ntario8' On the facts, the answer to the foreseeability question was obvious.

(b) The defendants' position deconstructed

67. The defendants' say (DF fin 36-37) that "the only sense in which a tort was committed in Ontario was that the statements were downloaded and read there; i.e., that Black was allegedly damaged in Ontario.'' They thus conflate publication and damage. On their analysis, the court need not look at the elements of the tort and damage separately in order to determine whether there has been a substantial wrong committed by the defendants that is connected to Ontario and whether the damage flowing from that wrong is substantially connected to Ontario.

68. Instead, the defendants say that the court should focus on "the facts on which the proceeding against [them] is based" (DF 7 36). Then they assert that "presumptions are undesirable when inconsistent with a real and substantial connection" (DF 7 37). With respect: it is difficult to understand what this means, since a rebuttable presumption is a tool that assists in determining whether a "real and substantial connection1'exists. The

7E A R Vol I p 11 Mot~onReasons fi 35 A R Vol I p 50 Appeal Reasons fi 33 7 7 A R Vol I p 53 Appeal Reasons fi 42 78 A R Vol I p 6 Mot~onReasons fi 14 A R Vol I p 50 Appeal Reasons fi 33-34 79 A R VOI I p 12 Mot~onReasons fi 38 A R Vol I p 50 Appeal Reasons fi 33 R VoI I pp 13-15 Mot~onReasonsfi42-53 A R Vol I pp 56-57 Appeal Reasons753 defendants also assert that, since the only basis for asserting that a tort was committed in Ontario is that damage was sustained there, there should be no presumption of a "real and substantial connection" in trans-border libel cases (DF 7 37).

69. Then, while acknowledging that the elements of libel include the act of making a defamatory statement and the act of publication (or dissemination), the defendants assert that these elements are relevant only to damages. They maintain that the "more relevant" substance of a libel case is the "conduct giving rise" to the defendants' statements and the circumstances in which the statements were made (DF 7 41). Presumably, "conduct" refers to their conduct of International's affairs in relation to Black's conduct. The defendants also say that the most important aspect of a libel trial are the defences, most notably the defence of justification - i.e.: the truth of the statements (DF 7 52).

70. The defendants' test would look at "the ties, or lack of ties, between the forum and each defendant and between the claim and the forum as a whole, rather than focusing on what was purportedly 'foreseeable' to each defendant" (DF 7 56). Further, their test is a "targeting" test; it must be shown that the defendants "manifested an intent to target and focus on" readers in the jurisdiction (DF 7 59). This allows for "consideration of the expectations of speakers and publishers", which is that the law of the jurisdiction where they created the statements and posted them will apply (DF 77 59 and 54). The defendants say that the targeting test is needed to avoid the threat of unlimited liability arising from the ability of people everywhere in the world to download and read material on the internet.

71. In essence, the defendants assert that the following factors in themselves are insufficient for Ontario's courts to assume jurisdiction: a) commission of the tort of defamation (i.e., publication) in Ontario; b) damage to reputation in Ontario; c) reasonable foreseeability of damage to reputation in Ontario. The defendants may be right that each of these factors alone should not be sufficient to ground jurisdiction. However, it is unreasonable to assert that the court should not assume jurisdiction when all three factors are present, as they are in this case. (c) The focus of defamation law is still the plaintiffs reputation, not the defendant's conduct

72. The defendants' suggest, quoting indirectly from an 1887 text, that the law of defamation perhaps ''went wrong from the beginning". The direct quotation, found in the reasons of Gleeson C.J. in the High Court of Australia in Dow Jones & Company Inc. v. Gutnick is instructive:

Perhaps: as Pollock said in 1887, the law went "wrong from the beginning in making the damage and not the insult the cause of action" for slander but it is now too late to deny that damage by publication is the focus of the law. "It is the publication, not the composition of a libel, which is the actionable wrong."8'

73. In Hill v. Church of ~cientology,~'this court rejected the proposition that the law of defamation "went wrong from the beginning". Hill holds that the protection of the reputation of the individual is as essential as freedom of speech in a civilized society and that the law of defamation, including the presumption of falsity, is tied to Charfer values.83 The right to safeguard reputation is protected by the Quebec Charfer and the Civil Hill rejected the contention that a plaintiff in a libel case that pertains to matters of public interest must prove malice, as the U.S. Supreme Court required of plaintiffs in New York Times v. ~ullivan.~~Recently, in Grant v. Torstar, this court recognized the defence of responsible communication on matters of public interest. However, in summarizing the law of libel, Grant v. Torstar makes it clear that, once proof of the defamatory statements is made, the defendant must still establish justification, privilege, fair comment, and responsible communication on matters of public interest. In Canada, the reputation of the plaintiff, not the conduct of the defendant, is still the most substantial aspect of a defamation claim. It is still of utmost importance that defamed people have the opportunity of vindicating their reputations

8 ' Dow Jones & Company Inc. v. Gufnick; [2002]HCA 56 at 7 25,per Gleeson C.J. quoting Pollock. The Law of Torts (1 887) [Dow Jones] a2 Hill v. Church of Scientology of Toronto. [I 9951 2 S.C R 1130 [Hill v. Church of Scientology]: Bou Malhab v. Diffusion Metromedia CMR inc.. 201 1 SCC 9 at 7 18 [Bou Malhab] 83 Grant v. Torsfar Corp . 2009 SCC 61 at rn 28-37.fin 95-98 84 Bou Malhab. supra. at 7 18 New York Times Co v. Sullivan. 376 U S 254.269-271 (1964) before the members of the community in which those reputations have been damaged.86

(d) Ordinarily, the place of publication is the locus delicti.

74. The defendants rightly note that "place of acting" or "place of harm theories" are too rigid and mechanical and that courts, including this court in Moran v. Pyle, have eschewed them for that reason. However, the cases show a trend to expanding the assumption of jurisdiction where a defendant should foresee that its wrongful conduct may cause harm in another country. For example, in Distillers Co. (Biochemicals) Lfd. v. Thompson, the Privy Council held that the locus of the wrong in a case where a pharmaceutical manufacturer in the United Kingdom was sued in Australia for failure to warn, was not the place where the drug (thalidomide) was manufactured (the U.K.) but, rather, where the failure to warn (which is a negligent omission to publish) occurred (Australia). It should be noted that the locus of the injury in a case such as Distillers is not necessarily the place where the plaintiff sustains the greatest quantum of damage. Plaintiffs in such cases may, after the failure to warn has done its injury, move to another country before they can reasonably know that the damage has been done. Distillers was an influential precedent in Dickson J's reasons in Moran v. ~~le.~'

75. The defendants erroneously conflate publication and damage. Both the common law and Quebec civil law distinguish between legal injury and the damage flowing therefrom.88 As stated above, in Spar Aerospace: in the context of Quebec civil law, this court made a distinction between damage to reputation (in the sense of injury) and the quantum of damage to reputation, holding that jurisdiction was properly assumed by the Quebec court because the injury occurred there. It is for this reason that Ontario Rule 17.02 makes a distinction between "torts committed in Ontario" (17.02(g)) and "damages sustained in Ontario" (17.02 (h)). For the purposes of Rule 17.02 (g), a tort is completed when the legal injury occurs.

Hill v Church of Scientology. supra. at 77 107-146. 7 166 8 7 Distillers Co. (B~ochemicals)Ltd. v. Thompson. [I 9711 A C 458 at 469 (P C ). Moran. supra. at pp 406- 41 0 88 Co-operative Fire & Cas. Co. v. Saindon. [I9761 1 S.C R. 735.742: Spar Aerospace. supra. at 37, 749 76. When the tort is defamation, the legal injury occurs upon publication - i.e.,when a third person reads the defamatory statement. The effect of the injury (i.e., the damages) may extend long after the injury occurs and in many places other than the one where publication occurredB9 However, it is the publication which lies at the "heart" of a libel action.g0

77. In Dow Jones & Company Inc. v. Gutnick, the High Court of Australia unanimously held that the State of Victoria appropriately assumed jurisdiction in a case where one of its residents, who had extensive business interests in the United States and spent much time there, was defamed by material posted on the defendants' web site in New Jersey. The bulk of downloading occurred in the United States, although there were subscribers to the web site in Victoria. The plaintiff confined his claim for damages to his loss of reputation in Victoria. For four of the seven judges who sat on the case, Gleeson C.J. stated:

Reference to decisions such as Jackson v. Spittall, Distillers Co. (Biochemicals) Lfd v Thompson and Voth v Manildra Flour Mills Pty Lfd. show that locating the place of commission of a tort is not always easy. Attempts to apply a single rule of location (such as a rule that intentional torts are committed where the tortfeasor acts, or that torts are committed in the place where the last event necessary to make the actor liable has taken place) have proved unsatisfactory if only because the rules pay insufficient regard to the different kinds of tortious claims that may be made. Especially is that so in cases of omission. In the end the question is "where in substance did this cause of action arise"]? In cases, like trespass or negligence, where some quality of the defendant's conduct is critical, it will usually be very important to look to where the defendant acted, not to where the consequences of the conduct were felt.

In defamation, the same considerations that require rejection of locating the tort by reference only to the publisher's conduct, lead to the conclusion that, ordinarily, defamation is to be located at the place where the damage to reputation occurs. Ordinarily that will be where the material which is alleged to be defamatory is available in comprehensible form assuming, of course, fhat the person defamed has in fhat place a reputation which is

" Paulsson v Cooper. 201 1 ONCA 150 at 7 29 [Paulsson v. Cooper] 90 Raymond E Brown. The Law of Defamation in Canada, 2nd ed. (1999) at 7.2-7.8. 10.11-10 14 and 16 5-16 7: A R . Vol. I. p 11. Motion Reasons. 7 35; A.R.. Vol. I. p. 50. Appeal Reasons, fi 33: Jenner v. Sun Oil Co. Limited et al.. [I9521 1 O.R. 240 (H.C.) at 249-251: Paulsson v. Cooper. 201 1 ONCA at 7 25- 28. rev'g [2009] 0.J No 3121 (S.C.) thereby damaged. It is only when the material is in comprehensible form that the damage to reputation is done and it is damage to reputation which is the principal focus of defamation, not any quality of the defendant's conduct. In the case of material on the World Wide Web, it is not available in comprehensible form until downloaded on to the computer of a person who has used a web browser to pull the material from the web server. It is where that person downloads the material that the damage to reputation may be done. Ordinaril then, that will be the place where the tort of defamation is committed.4; [Emphasis added.]

78. Although Australia has not developed (at least not yet) a general "real and substantial connection" test, the approach in Gufnick is very similar to that applied by the Court of Appeal in this case. Presumptively, the place where the libel occurs is the place of publication. However, there may be extraordinary circumstances where the ordinary rule should not apply. One of those extraordinary circumstances, to which Gleeson C.J, expressly alluded, is where the plaintiff has no reputation in the jurisdiction to protect

79. The defendants' criticism of Gufnick as a "libel tourism" case (DF 7 67) is misplaced. While publication of the defamatory material was far greater in the United States: there were 1,700 subscribers in Australia where the plaintiff resided. It may be presumed that the good opinion of family, friends! and the people in their community is an important consideration when plaintiffs with trans-border reputations seek vindication in a place to which they have a particular connection

80. Cases may arise where a plaintiff with a global reputation sues in the jurisdiction for a libel that has received substantial publication there, but the plaintiffs reputation has no particular connection to the forum. Such cases (e.g. Berezovsky v. ~ichaels~')may deserve the "libel tourism" label. At some point, the court may be required to consider whether the plaintiffs reputation must have a strong and particular nexus to the jurisdiction. On the other hand, future experience may teach that such cases are more appropriately addressed at the forum non conveniens stage, because their facts are likely to point to the jurisdiction where they can be most fairly tried. However, the point

9' Dow Jones supra. at 43-44 32 Berezovsky v M~chaelsand Ors. [2000]2 All E R 986 (H L) does not need to be decided here because Black's reputation does have a strong and particular connection to the forum.

81. The defendants' contention that the substance of a defamation action lies where the facts related to their defences are located, and, in particular, the defence of justification, is geared only to the particular facts of this case. It is easy to imagine a case where an American posts a defamatory statement on a web site about the conduct of a Canadian public official in Rwanda. In that situation, Rwanda, not the U.S., would have the most substantial connection to the justification defence. As stated above, the question of jurisdiction simpliciter is a question of law. Thus the issue here must be approached at a level of generality that applies to all trans-border defamation cases. There is no authority for focusing the "real and substantial connection" test on the possible defences, rather than the claim.

82. The only feature of this case which distinguishes it from Gutnick is that Black does not reside in Ontario at present. However, as submitted above, the "real and substantial connection" test focuses on the ties between the jurisdiction and the plaintiff's case, not on the ties to the plaintiff himself or herself.

(e) The defendants' criticism of the Canadian approach is unjustified.

83. The approach of the Court of Appeal in the case at bar is both structured and flexible. The structure to start the inquiry is provided by the rules for service out of the jurisdiction and the law of defamation. The flexibility is provided by the recognition that the starting point may not be the end point if publication in the jurisdiction is insignificant, or if the plaintiff has no reputation there to protect. The defendants' contention that the approach is too rigid is misplaced. The defendants aptly characterize their approach as "holistic" (DF 7 41), but "unstructured" may be even more apt.

84. The defendants complain that the present Canadian jurisdictional test in trans- border defamation cases is so "minimal that it may as well not exist" (DF 7 43). Yet, they acknowledge the existence of cases where jurisdiction was held not to exist, albeit dismissing their significance with the comment that the connection in those cases to the domestic jurisdiction was ''so fleeting as to be irrelevant" (DF 7 43). Are the defendants seeking a test that denies jurisdiction where the connection is more than "fleeting" and not irre~evant?'~The defendants' criticism of the English jurisprudence does not apply to the Canadian approach.

85. Canadian courts have recognized the need to bar the door to true "libel tourists" where publication in the jurisdiction is minimal and where there is little evidence of impact on the plaintiffs reputation: see e.g., Bangoura v. Washington Posf; Olde v. Capifal Publishing Lfd. ~artnership.'~Some cases, possibly including Les Editions Ecosociefe Inc. v. Banro Corporation (presently before this court) may have found jurisdiction to exist where publication andlor reputation in the jurisdiction is not substantial. That problem can be remedied by a direction that the analysis only starts with consideration of the rules for service ex juris and the proposition that the libel occurs where it is published.

86. The Canadian approach to the assumption of jurisdiction in libel cases has been viewed as a more balanced than either the present approaches in the United Kingdom or the U.S. The "real and substantial connection" test and its focus on whether harm to the claimant in the forum was reasonably foreseeable discourages forum shopping while still affording adequate protection to reputation.95

(f) The supposed spectre of unlimited liability

87. Stressing the ubiquity and speed of the internet, the defendants raise the spectre of potential world-wide unlimited liability for statements posted on web sites and urge that the primary concern of the law should be freedom of expression and the expectation of defendants that their conduct will be governed by the law of the place where they act. However, as scholars and courts have recognized, this ubiquity and speed intensifies the harmful effects of defamatory activity as well as the exchange of

'"eals v. Saldanha. [2003] 3 S.C R. 416. 2003 SCC 72 at 7 32 " Bangoura v. Washington Post (2005). 258 D L R (4th) 341 at 7 23 (Ont. C.A.). Olde v. Capital Publ~shingLtd. Partnership. [I9961 0. J. No. 2777 (S C ). aff'd [I9981 O.J. No. 237, 7 13 (C.A.) '"ichard Garnett and Megan Richardson. ,,Libel Tourism or Just Redress? Reconciling the (English) R~ghtto Regulation with the (American) Right to Free Speech in Cross-Border Libel Cases" (2009) 5:3 J. Private Int'l L 471. 483-5 information and opinion that enhances human flourishing.96 The internet still involves "people in real space in one jurisdiction communicating in real space in other j~risdictions."~~Even if there is debate as to whether the internet's speed and ubiquity renders it qualitatively different from other communications technologies, any cogent jurisdictional test must apply to all modes of technology, such as newspapers, books, magazines, radio, satellite radio and te~evision.~~In Gutnick, Kirby J., who, unlike his colleagues in the High Court of Australia, did see the internet as being qualitatively different from other communications technologies, nevertheless warned that the "spectre of 'global' liability should not be exaggerated."99

88. Moreover, internet technology is constantly evolving. Thus, to meet the

Ir 100 requirements of order and fairness, any test must be "technologically neutral .

89. Order and fairness require that when people use modern communications technology, they should be aware that their words have the potential to do harm in other jurisdictions and that those jurisdictions may strike a different, but still reasonable, balance between free speech and protection of reputation. As Callinan J. stated in Gutnick, persons "can hardly expect to be absolved from compliance with the laws of those countries. The fact that publication might occur everywhere does not mean that it occurs n~where."'~'

(g) Considerations of comity do not support the defendants' position 90. The defendants argue (DF 7 49) that jurisdiction is improper because any judgment Black obtains in Ontario would not be enforceable in the United States. That assertion is debatable because not all jurisdictions in the United States have rules that block the enforcement of all foreign judgments as being inconsistent with U.S. First Amendment principles. Indeed, as the academic articles adduced by the defendants

36 Bamck Gold Corp. v. Lopehandia. 2004 CanLll 12938. 71 0 R (3d) 416 (ON C.A.)per Bla~rJ.A. at 77 28-34 97 Michael Saadat. Jurisdiction and the Internet after Gutnick and Yahoo'. [2005] JILT 2 at 1 2 1 lbid 99 Dow Jones supra per K~rbyJ at 7 165 see also Gleeson C J at 77 18-24 ' 3C M~chaelA Gelst Is There a There There7 Toward Greater Certa~ntyfor Internet Jur1sdlct1on7 (2001) 16 Berk Tech L J 1345 at 1359 .n. " Dow Jones supra per Call~nanJ at r/ 186 show, there are serious concerns in the United States about overreaction to libel tourism in ~n~1and.l'~However, even assuming that Black could not enforce a judgment in the United States, he could enforce a judgment against Savage, an Ontario resident. More importantly, as the courts below recognized, Black has a legitimate interest even in a judgment he cannot enforce - the vindication of his reputation.lo3

91. The defendants (DF 7 49) also question whether jurisdiction should exist because of concerns over enforcing foreign defamation judgments in Canada for fear of restricting the free speech of Canadians. They point out that if the court recognizes a "real and substantial" connection in this case, comity will oblige it to enforce a foreign judgment against a Canadian in similar circumstances. The response to this concern is that Canadian courts should enforce such a judgment if the foreign court properly took jurisdiction and the defamation law applied by the foreign jurisdiction is generally consistent with the policies and values of Canadian defamation law. Canadian courts should generally enforce a U.S, judgment in circumstances mirroring the facts of this case.

92. The defendants say that the "threat of having to defend" a libel action in Canada should not chill American discussion about individuals with foreign ties (DF 7 49). This is difficult to understand. To borrow the observation of Kirby J. in Gutnick, all of the defendants in this case (except Savage) may "choose simply to ignore the proceedings" and resist enforcement of a judgment in the United States "if that judgment was secured by the application of laws, the enforcement of which would be regarded as unconstitutional or otherwise offensive to [its] different legal culture."'04

' 32 See e g Andrew Kle~nSome Thoughts on Llbel Tour~sm(201 0) 38 Pepp L R 101 131 (Defendants Book of Authorltles (here~nafter D B A ) Vol IV Tab 89 p 201) Robert McFarland Please do not Publish this Article ~n England A Jur~sd~ct~onalResponse to Llbel Tour~sm(201 0) 79 MISS L J 61 7 p 15 (D B A Vol Ill Tab 91 p 218) Doug Rendelman Collecf~nga Llbel Tour~sfsDefamabon Judgment (2010 67 Wash & Lee L Rev 467 485 (D B A Vol IV tab 95 p 33) Davld Partlett The Lebel Tourist and the Ugly Amer~can Free Speech ~n an Era of Modern Global Commun~cat~ons(2009) 47 U Lou~sv~lleL Rev 629 658 (D B A Vol IV tab 94 pp 10-1 1) '"A R Vol I pp 19-20 Mot~onReasons 775-78 A R Vol I pp 62-63 Appeal Reasons 7 73 ' 36 Dow Jones supra per Klrby J at 7 165 (h) The U.S. "targeting" test is satisfied on these facts.

93. Even if this court were to adopt the American "targeting" test, there is sufficient evidence upon which to infer a manifest intent on the defendants' part to target readers in Ontario. This evidence did not consist of the "meagre" contact information for media in Canada and the United Kingdom, although that evidence is significant because it demonstrates the defendants' knowledge that Black has a significant reputation in those countries and that the media is very interested in his affairs. The other evidence is the defamatory words themselves. They were not simply aimed at meeting securities law disclosure obligations. Allegations against Black of "corruption" "stealing every day in every way," "looting" "self righteous[ness]", and running a ''corporate kleptocracy" manifest an intent to target readers in jurisdictions with an interest in Black's personal affairs. As the courts below appreciated, it was inconceivable that the defendants did not know where Black had a substantial reputation. This is not a case like Young v. New Haven ~dvocate"~in which the allegedly defamatory article was aimed at Connecticut readers because it was about a Connecticut issue, the treatment of Connecticut prisoners being housed in a Virginia prison. The plaintiff, a Virginia prison warden, had no reputation to protect in Connecticut. Black does have a substantial reputation to protect in Ontario, even though he does not live there. It should be noted that the U.S. "personal subjection" approach does not require the plaintiff to have ties to the j~risdiction.'~~

94. The targeting test, like "reasonable foreseeability", is objective; it focuses on the defendant's "manifest intent", not hislher subjective intent. Thus, knowledge that the defendant knew hislher words would reach readers in the target jurisdiction may be implied. Otherwise defendants could plead wilful blindness to the natural and probable consequences of their conduct.lo7 In this case, the defendants attempt to do exactly that by asserting that the responsibility for the dissemination of their defamatory statements lies with the newspapers that re-published them. As the motion judge noted, however, Brown, The Law of Defamation, states that "Ljlurisdiction may be

' C5 Young v. New Haven. supra. pp. 263-264 3 36 Calder v. Jones, supra. p. 783, p. 788 exercised where. .. republication is the natural and probable consequence of the posting ,, 108 elsewhere .

95. Thus, the targeting test is met when the defendants intentionally "target" the plaintiff and have actual or constructive knowledge, that their defamatory words will reach the jurisdiction. On the facts of this case, the test is met, as the Court of Appeal held.log

(i) The Canadian approach to "targeting"

96. However, a focus on foreseeability is preferable to a focus on manifest intent and constructive knowledge. The Ontario Court of Appeal's recent decision in Paulsson v. Cooper demonstrates this. In that case, the defendants did not know the plaintiff lived in Ontario. The defamatory words were in an academic journal article that attacked the plaintiff's scholarship in a book he had published. The journal made its way through normal distribution channels into university and public libraries in a number of jurisdictions, including Ontario. The Court of Appeal held that it did not matter whether the defendant knew where the plaintiff resided or would suffer damage. The "target'! community in that case was an academic community, not a geographical community. Requiring a showing that the defendant intended to target readers in a specific geographical jurisdiction makes no sense - why should a plaintiff be unable to seek vindication because the defendant does not know where the plaintiff lives and where his reputation may be damaged?

97. The motion judge and the Court of Appeal in this case, and the Court of Appeal in Paulsson v. Cooper, all adopted the following statement of the law by Nordheimer J. in Barrick Gold Corp. v. Blanchard & Co.:

[Tlhe rationale enunciated by Dickson J. [in Moran v. Pyle] has equal application here. If a person issues a statement and places that statement in a normal distribution channel designed for media attention and

'" M~chaelA Gelst Is There a There There7 Toward Greater Certainty for Internet Jur1sdictlon7 (2001) 16 Berk Tech L J 1345at p 1402 ' 38 A R Vol I p 14 Mot~onReasons fi 47 Raymond E Brown The Law of Defamat~on~n Canada 2d ed (1999) at 17 08 A R Vol I, pp 48-49 Appeal Reasons fi 29 ' 39 A R Vol I p 52 Appeal Reasons fi 39 publication, a person ought to assume the burden of defending those statements, wherever they may damage the reputation of the target of those statements and thereby cause the target harm, as long as that harm occurred in a place that the originator of the statements ought reasonably to have had in his, her or its contemplation when the statements were issues. [Emphasis added]' lo

That formulation of the "targeting" test is consistent with the "real and substantial connection" test. It does also not assist the defendants in this case.

B. Forum non conveniens

98. Proceedings are only to be stayed when there is a clearly more appropriate forum for the resolution of the dispute. A stay is a discretionary order. 11 1 Accordingly, the decision of the motion judge is entitled to deference. The defendants have failed to show that the courts below reached an unreasonable result. They seek simply to re- argue this issue. They cite no example of this court overturning a discretionary decision about the appropriate forum.

99. Having started proceedings in a forum having a real and substantial connection to the dispute, the plaintiff's choice of forum is entitled to be respected and is not to be easily displaced. Before the plaintiff's choice is displaced, the court must find that another single specific forum is more appropriate.'12 In particular, once jurisdiction has been established, the plaintiff is entitled to claim the juridical advantages of the chosen

100. To determine the most appropriate forum, the doctrine of forum non conveniens weighs the factual connections to competing jurisdictions and also considers whether a stay would deprive the plaintiff of a legitimate juridical advantage. No one factor is

'" Bamck Gold Corp v Blanchard & Co [2003] 0 J No 5817 (S C J ) fi 44 A R Vol I p 58 Appeal Reasons fi 57 Paulsson v Cooper supra at 7 34 A R Vol I pp 13-14 Mot~onReasons 7 46 11 1 Amchem Products Inc v B C (Workers Compensation Board) [I9931 1 S C R 897 919-921 [Amchem Products] Teck Comlnco Metals Ltd v Lloyd's Underwriters 2009 SCC I I [2009] 1 S C R 321 at rn 37-8 [Teck Comlnco Metals Ltd ] BNP Paribas (Canada) v BCE Inc 2007 ONCA 559 at fi 4 [ BNP Paribas'] Preclous Metal supra at fi 29 Spar Aerospace supra at fi 22 Young v Tyco lnternatlonal of Canada Ltd 2008 ONCA 709 at rn 23-39 [Young v Tyco] -32 Paulsson v Cooper supra at fifi 51 -52 "3 Amchem Products supra pp 920-921 determinative and, importantly, the relative weight to be given each factor in a particular case is in the discretion of the motion judge1l4

101. For the reasons briefly reviewed below, the decisions of the courts below that Ontario is the most appropriate forum and neither New York nor Illinois is a more appropriate forum than Ontario are reasonable. That is sufficient to dispose of this issue.

1. Location of the majority of the parties

102. Five of the defendants constitute a core group named in all six actions: Breeden, Richard Breeden & Co., Paris, Savage and Seitz. Apart from Savage, who resides in Ontario, these defendants are scattered throughout the United States. Breeden and Breeden & Co. reside in Connecticut, Paris resides in New York and Seitz resides in New Hampshire. The remaining defendants reside in Illinois (Thompson), the District of Columbia (Burt), New York (Healy), Connecticut (Kissinger) and Israel (Meitar). Regardless of the forum in which these actions are heard, most of the parties will have to travel. The defendants allege that this factor favours New York, even while alleging that other factors favour Illinois (contrast DF fin 77 and 80). However, the courts below rightly accepted that there is little significant difference for the defendants, as a group, between having to travel to New York and having to travel to 0ntario.'15

103. As noted above, there is a reasonable likelihood that Black would be allowed to enter Ontario for the purposes of this litigation. However, if Black must testify by video link from outside Ontario, this circumstance may well prejudice him in the eyes of an Ontario jury, not the defendants. Experienced trial judges have observed that the advantages to a cross-examiner of a witness in the flesh as opposed to a witness on a video screen may be overstated, even non-existent.'16 The defendants' contention of significant prejudice to them if the trial occurs in Ontario is unwarranted.

'4 BNP Par~bassupra at 7 32 Eastern Power Ltd v Azlenda Comunale Energla and Amblente (1999) 178 DLR (4th) 409 at 17-20 (Ont CA) Muscuft supra 41 ''5 7 A R Vol I p 22 Mot~onReasons 7 88 A R Vol I p 64 Appeal Reasons 7 81 "5 Polansk~v Conde Nasf Publ~cat~onsLtd [2005] UKHL 10 at 13-14 per Lord N~cholls 2. Location of key witnesses and evidence

104. The motion judge found that the key witnesses and the bulk of the documentary evidence are currently located in the U.S. However, he correctly found that "computer technology has diminished the importance of the physical location of the documentary

I1 117 evidence, as well as the need to transport truckloads of paper to trial .

105. The defendants argue that Rule 45 of the Federal Rules of Civil Procedure makes a U.S. state the most appropriate forum. However, as noted by the courts below, there is no evidence of how that rule would operate. In addition, it is far from clear how much of the evidence will actually need to be compelled, rather than voluntarily produced by the parties, across borders.'18

106. Evidence of the defamation, including publication and damage to Black's reputation, will be based in Ontario.

3. Avoidance of multiplicity of proceedings

107. Any defence of justification in this defamation case does not turn on whether Black violated his fiduciary duty to International in relation to specific transactions. Rather, as the motion judge observed, the defendants will be required to justify their statements that Black "looted" International, ran a "corporate kleptocracy", and stole "hundreds of millions of The determination of the specific allegations in some, any, or all of the extant proceedings in both Canada (primarily Ontario) and the United States may or may not resolve the issues raised by the defendants' yet to be delivered plea of justification.

108. The motion judge was right to give no weight to the defendants' emphasis on Black's present status as a "convicted felon". On forum non conveniens motions, judges must be cautious about prejudging the merits.lZ0

"7 A R Vol I p 22 Mot~onReasons rn 89-91 A R Vol I pp 64-65 Appeal Reasons rn 81 -83 115 A R Vol I p 22 Mot~onReasons r[ 91 A R Vol I p 64 Appeal Reasons r[ 82 '13 A R Vol I pp 23-24 Mot~onReasons r[ 95 98 A R Vol I p 65 Appeal Reasons r[ 84 123 Young v Tyco supra r[ 6 r[ 45 109. The defendants' emphasis on the 2004 decision of Farley J. is misplaced and their issue estoppel argument is untimely (DF 74-76). That decision only addressed whether a specific claim should be temporarily stayed. Farley J. simply did not opine on the most appropriate forum for resolving the truth of the defendants' defamatory statements. Further, Farley J. was not weighing any loss of juridical advantage to Black, which is a key consideration here. Finally, the defendants' argument that the decision of Farley J. raises issue estoppel is being raised in this court for the first time: which is inappropriate.

110. Black has undertaken to sue only in Ontario, which avoids the prospect of a multiplicity of proceedings in the future on the specific issue of defamation and damage to his reputation.12'

11 1. There will be a multiplicity of other proceedings no matter where the libel actions are tried, and these issues are already before the Ontario courts as well as courts in the United States. This court has recently acknowledged that there will be cases where proceedings are not stayed and multiple proceedings will result.122

4. The applicable law

112. This court has established the lex loci delicfi as the general choice of law rule for tort claims. However, as submitted above, the /ex loci delicfi for libel in common law courts outside the United States is the place of publication. As the motion judge noted, U.S. corporate and securities law will not be central to the simple factual issues of whether Black "stole every day in every way 11 . 123

5. Loss of juridical advantage

113. Black will enjoy a juridical advantage if the actions are tried in Ontario. The advantage is the application of Ontario law. There is no suggestion that a U.S. court would apply anything other than U.S. law to the claim.

"' A R..Vol I. p. 25. Motion Reasons. 7 105: A.R.. Vol I. p. 65. Appeal Reasons, 7 84 '" Teck Cominco Metals Ltd.. supra. at rn 24-30: A.R.. Vol I. p 65. Appeal Reasons. 7 84 'i3 A.R . Vol I. p. 23. Mot~onReasons. rn 92-94 114. As set out above, there are still major differences in the way that Canada and the United States balance the competing values of freedom of expression and protection of reputation. American defamation law is not inherently superior to Canadian defamation law. It must be open to democratic countries to strike the balance between free speech and reputation in different ways.

115. The ongoing development of the law of defamation in Canada, in particular by this court, does not erode the advantage to Black under Ontario law. Under U.S. law, Black would be required to prove actual malice. As Cory J. noted in Hill: the actual malice rule can shift trials away from the defence of truth because defendants can assert that they acted negligently. Canadian law not only affords Black a legitimate juridical advantage, but also a more meaningful opportunity to vindicate his reputation in a proceeding in which the truth has a greater chance of coming to light.

116. Having sued in a jurisdiction with a real and substantial connection to the dispute, Black should not be deprived of this juridical advantage unless the other factors conclusively favour another forum. As the courts below found: they do not.

117. The defendants assert (DF 7 85) that allowing these actions to proceed confers an illegitimate juridical advantage on Black because, under Canadian corporate law, he would not be permitted to sue an inspector or other person involved in a court-ordered investigation. The defendants fail to point out that it is the court that determines whether the inspector's report is to be published. It is inconceivable that a Canadian court would permit the publication of material comparable to what the defendants posted on International's website. Moreover, the defendants did not make this argument in the Court of ~ppeal.'*~

6. Enforceability of an Ontario judgment

118. For the reasons stated above, the American position on enforceability should have no bearing on a Canadian court's analysis.

'2"anada Business Corporations Act. R.S C. 1985, c. 44. ss 229-237 7. Conclusion on forum non conveniens

119. The courts below did not err in finding Ontario to be the most appropriate forum for this dispute. When weighed! the relevant factors, particularly legitimate juridical advantage, point to Ontario.

PART IV - SUBMISSIONS ON COSTS

120. There is no reason why costs should not follow the event

PART V - ORDER SOUGHT

121. The respondent. Conrad Black, asks that this appeal be dismissed with costs

ALL OF WHICH IS RESPECTFULLY SUBMITTED this 2""ay of March. 201 1

Lisa C. Munro Lerners LLP, Solicitors for the Respondent, Conrad Black

-41

PART Vl OF AUTHORITIES TABLE

NO'S. NO. PARA. TAB

(Workers Compensation Board), Products B.C. Inc. Amchem v.

[1993] 98, S.C.R 897 99 1

Washington (2005), Bangoura Post 258 D.L.R.

v.

(Ont. C.A.) (4th) 85 341

Corp. [2003] Co., Barrick Gold Blanchard and v.

(S.C.J.) O.J. 5817 97 No.

Corp. Lopehandia, Gold 12938, Barrick 2004 CanLII

v.

(C.A.) (3d) O.R. 416 87 71

[2003] Saldanha, 416, 3 S.C.R. 84 2003 SCC Beals 72 v.

Berezovsky [2000] Ors, (H.L) Michaels and 80 986 2 All E.R. v.

[2000] al, (ON S.C.J.) Chr#tien O.J. 784 Black No. et

v.

[2001] (ONCA) al., aff'd. Black Chr#tien O.J. No. et 6 1853 v.

(Canada) Inc., 98, BNP Paribas BCE 2007 ONCA 100 559 v.

Diffusion 9. Bou Malhab M•trom•dia CMR 73 inc. 2011 SCC 9 v.

Jones, 56, (1984) Calder U.S. 783 93 465 v.

Co-operative Saindon, [1976] Fire Cas. Co. & S.C.R. 11, 75 1 735 v.

(Biochemicals) Thompson, Distillers Co. Ltd.

v.

(P.C.) [1971] A.C. 458 74

Company Gutnick, [2002] 72, 87, 89, Dow Jones & Inc. 77, HCA 92 56 v.

Comunale Eastern Power Ltd Azienda

v

Energia (1999) (Ont. C.A.) (4th) andAmbiente 178 409 DLR 100

Corp., SCC 15. Grant Torstar 2009 61 73 v.

Scientology of Toronto, [1995] 16. Church of Hill 73 S.C.R. 1 !30 2 v.

[1993] T&NPLC, S.C.R. Hunt 39, 4 17. 53 289 v. TAB NO. PARA. NO'S.

18, Incorporafed Broadcasters Ltd. v. Canwest Global Communications Corp. (2003), 63 0.R. (3d) 431 (C.A.)...... 50

19. Jenner v. Sun Oil Co. Limited et al., [I9521 1 0.R. 240 (H.C.)...... 76

20. Moran v. Pyle National (Canada) Lfd., [I9751 1 S.C.R. 393 ...... 55, 74

2 1. Morguard Investments Ltd. v. De Savoye, [I9901 3 S.C.R. 1077 ...... 39) 49! 50, 52, 53

22. Muscutt v. Courcelles (2002) 60 O.R. (3d) 20 (C.A.)...... 49, 53: 54, 58, 62: 63: 100

23. New York Times Co. v. Sullivan, 376 U.S. 254 (1964) ...... 73

24. Olde v. Capital Publishing Ltd. Partnership, [I9961 0.J. No. 2777 (S.C.),aff'd [I9981 0.J. No. 237 (C.A.)...... 85

25. Paulsson v. Cooper [2009] O.J. No. 3121; rev'g. 201 1 ONCA 150...... 76, 97, 99

26. Polanski v. Conde Nasf Publications Ltd.: [2005] UKHL 10 ...... 103

27. Precious Metal Capital Corp. v. Smith (2008), 92 O.R. (3d) 701 (C.A.)...... 50, 98

28. Spar Aerospace Ltd. v. American Mobile Satellite Corp., 2002 SCC 78, [2002] 4 S.C.R. 205 ...... 42, 51, 62, 75, 98

29. Teck Cominco Metals Ltd. v. Lloyd's Underwriters, 2009 SCC 11, [2009] 1 S.C.R. 321 ...... 98, II I

30. Tolofson v. Jensen [I9941 3 S.C.R. 1022 ...... 62

3 1. Van Breda v. Village Resorts Limited, 2010 ONCA 84 (CanLII) ...... 32, 41, 42, 44, 48: 58, 59, 62: 63

32. World- Wide Volkswagen Corp. et al. v. Woodson District Judge of Creek County, Oklahoma, ef al. , 444 U.S. 286, L. Ed. 2d 490 (1980) ...... 54

33. Young v. New Haven Advocate et al., 31 5 F.3d 256 (4thCir. 2002) ...... 56, 93

34. Young v. Tyco International of Canada Lfd., 2008 ONCA 709 (CanLII) ...... 98, 108 TAB NO. PARA. NO'S.

OTHER SOURCES:

35. Joost Blom, Comment, (1991) 70 Can Bar Rev. 733 ...... 54

36. Raymond E. Brown, The Law of Defamation in Canada, 2nd ed. (1 999) ...... 76, 94

37. Michael A. Geist, Is There a There There? Toward Greater Certainty for lnternet Jurisdiction? (2001), 16 Berk. Tech. L.J. 1345 ...... 88, 94

38. Richard Garnett and Megan Richardson, "Libel Tourism or Just Redress? Reconciling the (English) Right to Regulation with the (American) Right to Free Speech in Cross-Border Libel Cases" (2009) 5:3 J. Private Int'l L 471 ...... 86

39. Michael Saadat, Jurisdiction and the lnternet affer Gutnick and Yahoo!: [2005] JILT 2 ......

40. Janet Walker, Castel & Walker, Canadian Conflict of Laws, 6thed., looseleaf (Markham ON: Buttetworths, 2005) ......

4 1. G. Watson and F. Au, Constitutional Limits on Service Ex Juris, Unanswered Questions from Morguard (2000), 23 Adv. Q. 167 ...... 53

42. Courf Jurisdiction and Proceedings Transfer Act, Uniform Law Conference of Canada ["CJPTA"], s.3(e) ...... 58

43, 1968 Brussels Convention on jurisdiction and the enforcement of judgments in civil and commercial matters, September 27, 1968, Official Journal of the European Communities, Notice No. 98/C 27/01 ...... 62 PART VII - STATUTES AND REGULATIONS

Canada Business Corporations Act (R.S., 1985, c. C-44)

PART XIX

INVESTIGATION

Investigation

229. (1) A security holder or the Director may apply, ex parte or on such notice as the court may require, to a court having jurisdiction in the place where the corporation has its registered office for an order directing an investigation to be made of the corporation and any of its affiliated corporations.

Grounds

(2) If, on an application under subsection (I), it appears to the court that

(a) the business of the corporation or any of its affiliates is or has been carried on with intent to defraud any person,

(b) the business or affairs of the corporation or any of its affiliates are or have been carried on or conducted, or the powers of the directors are or have been exercised in a manner that is oppressive or unfairly prejudicial to or that unfairly disregards the interests of a security holder,

(c) the corporation or any of its affiliates was formed for a fraudulent or unlawful purpose or is to be dissolved for a fraudulent or unlawful purpose, or

(d) persons concerned with the formation, business or affairs of the corporation or any of its affiliates have in connection therewith acted fraudulently or dishonestly, the court may order an investigation to be made of the corporation and any of its affiliated corporations.

Notice to Director

(3) A security holder who makes an application under subsection (1) shall give the Director reasonable notice thereof and the Director is entitled to appear and be heard in person or by counsel.

No security for costs

(4) An applicant under this section is not required to give security for costs

Hearings in camera

(5) An ex parte application under this section shall be heard in camera. Consent to publish proceedings required

(6) No person may publish anything relating to ex parte proceedings under this section except with the authorization of the court or the written consent of the corporation being investigated.

R.S., 1985, c. C-44, s. 229; 2001, c. 14, ss. 113(F), 135(E)

Powers of court

230. (1) In connection with an investigation under this Part, the court may make any order it thinks fit including, without limiting the generality of the foregoing,

(a) an order to investigate;

(b) an order appointing an inspector, who may be the Director, fixing the remuneration of an inspector, and replacing an inspector;

(c) an order determining the notice to be given to any interested person, or dispensing with notice to any person;

(d) an order authorizing an inspector to enter any premises in which the court is satisfied there might be relevant information, and to examine any thing and make copies of any document or record found on the premises;

(e) an order requiring any person to produce documents or records to the inspector;

(f) an order authorizing an inspector to conduct a hearing, administer oaths, and examine any person on oath, and prescribing rules for the conduct of the hearing;

(g) an order requiring any person to attend a hearing conducted by an inspector and to give evidence on oath;

(h) an order giving directions to an inspector or any interested person on any matter arising in the investigation;

(i) an order requiring an inspector to make an interim or final report to the court;

(j) an order determining whether a report of an inspector should be published and, if so, ordering the Director to publish the report in whole or in part or to send copies to any person the court designates;

(k) an order requiring an inspector to discontinue an investigation; and

(I) an order requiring the corporation to pay the costs of the investigation. Copy of report

(2) An inspector shall send to the Director a copy of every report made by the inspector under this Part.

Power of inspector

231. (1) An inspector under this Part has the powers set out in the order appointing him.

Exchange of information

(2) In addition to the powers set out in the order appointing him, an inspector appointed to investigate a corporation may furnish to, or exchange information and otherwise cooperate with, any public official in Canada or elsewhere who is authorized to exercise investigatory powers and who is investigating, in respect of the corporation, any allegation of improper conduct that is the same as or similar to the conduct described in subsection 229(2).

Court order

(3) An inspector shall on request produce to an interested person a copy of any order made under subsection 230(1).

Hearing in camera

232. (1) Any interested person may apply to the court for an order that a hearing conducted by an inspector under this Part be heard in camera and for directions on any matter arising in the investigation.

Right to counsel

(2) A person whose conduct is being investigated or who is being examined at a hearing conducted by an inspector under this Part has a right to be represented by counsel.

Criminating statements

233. No person is excused from attending and giving evidence and producing documents and records to an inspector under this Part by reason only that the evidence tends to criminate that person or subject that person to any proceeding or penalty, but no such evidence shall be used or is receivable against that person in any proceeding thereafter instituted against that person under an Act of Parliament, other than a prosecution under section 132 of the Criminal Code for perjury in giving the evidence or a prosecution under section 136 of the Criminal Code in respect of the evidence. R.S., 1985, c. C-44, s. 233; R.S., 1985, c. 27 (1st Supp.), s. 187

Absolute privilege (defamation)

234. Any oral or written statement or report made by an inspector or any other person in an investigation under this Part has absolute privilege.

Information respecting ownership and control

235. (1) If the Director is satisfied that, for the purposes of Part XI, XIII or XVII, or for the purposes of enforcing any regulation made under section 174, there is reason to inquire into the ownership or control of a security of a corporation or any of its affiliates, the Director may require any person that the Director reasonably believes has or has had an interest in the security or acts or has acted on behalf of a person with such an interest to report to him or her or to any person the Director designates

(a) information that such person has or can reasonably be expected to obtain as to present and past interests in the security; and

(b) the names and addresses of the persons so interested and of any person who acts or has acted in relation to the security on behalf of the persons so interested.

Constructive interest in securities

(2) For the purposes of subsection (I): a person is deemed to have an interest in a security if

(a) the person has a right to vote or to acquire or dispose of the security or any interest therein:

(b) the person's consent is necessary for the exercise of the rights or privileges of any other person interested in the security; or

(c) any other person interested in the security can be required or is accustomed to exercise rights or privileges attached to the security in accordance with the person's instructions.

Publication

(3) The Director shall publish in a publication generally available to the public the particulars of information obtained by the Director under this section, if the particulars

(a) are required to be disclosed by this Act or the regulations; and

(b) have not previously been so disclosed Offence

(4) A person who fails to comply with this section is guilty of an offence and liable on summary conviction to a fine not exceeding five thousand dollars or to imprisonment for a term not exceeding six months or to both.

Officers, etc., of bodies corporate

(5) Where a body corporate commits an offence under subsection (4), any director or officer of the body corporate who knowingly authorized, permitted or acquiesced in the commission of the offence is a party to and guilty of the offence and is liable on summary conviction to a fine not exceeding five thousand dollars or to imprisonment for a term not exceeding six months or to both, whether or not the body corporate has been prosecuted or convicted.

R.S., 1985: C. C-44, S. 235; 2001, C. 14, SS. 114, 135(E)

Solicitor-client privilege

236. Nothing in this Part shall be construed as affecting solicitor-client privilege

R.S., 1985, C. C-44, S. 236; 2001, C. 14, S. 135(E)

Inquiries

237. The Director may make inquiries of any person relating to compliance with this Act.

PARTIE XIX

ENQUETES

229. (1) Tout detenteur de valeurs mobilieres ou le directeur peut demander au tribunal du ressort du siege social de la societe, ex parte ou apres avoir donne I'avis que celui-ci peut exiger, d'ordonner la tenue d'une enquete sur la societe et sur toute societe du meme groupe.

Motifs

(2) Le tribunal peut ordonner la tenue de I'enquete demandee conformement au paragraphe (I), s'il lui parait etabli, selon le cas : a) que la societe ou des societes de son groupe exercent ou ont exerce leurs activites commerciales avec une intention de fraude: b) que la societe ou toute autre societe de son groupe, soit par la faqon dont elle conduit ou a conduit ses activites commerciales ou ses affaires internes, soit par la faqon dont ses administrateurs exercent ou ont exerce leurs pouvoirs, abuse des droits des detenteurs de valeurs mobilieres ou se montre injuste a leur egard en leur portant prejudice ou en ne tenant pas compte de leurs interets; c) que la constitution ou la dissolution soit de la societe soit des societes de son groupe repond a un but frauduleux ou illegal; d) que des personnes ont commis des actes frauduleux ou malhonnetes en participant a la constitution soit de la societe soit de societes du meme groupe, ou dans la conduite de leurs activites commerciales ou de leurs affaires internes.

Avis au directeur

(3) Le detenteur de valeurs mobilieres qui presente une demande conformement au paragraphe (1) doit en donner, dans un delai raisonnable, avis au directeur; celui-ci peut comparaitre en personne ou par ministere d'avocat.

Pas de cautionnement pour frais

(4) La personne qui intente une action en vertu du present article n'est pas tenue de fournir de cautionnement pour les frais.

Audiences a huis clos

(5) La demande ex parte, faite en vertu du present article, est entendue a huis clos

Publication interdite, sauf autorisation prealable

(6) Toute publication, relative aux procedures ex parte intentees en vertu du present article, est interdite sauf autorisation du tribunal ou consentement ecrit de la societe faisant I'objet de I'enquete.

L.R. (1985), ch. C-44, art. 229; 2001, ch. 14, art. 113(F) et 135(A).

Pouvoirs du tribunal

230. (1) Dans le cadre de I'enquete prevue a la presente partie, le tribunal peut rendre toute ordonnance qu'il estime pertinente en vue, notamment : a) de proceder a I'enquete; b) de nommer un inspecteur, qui peut etre le directeur, de fixer sa remuneration et de le remplacer; c) de decider s'il y a lieu de donner avis aux interesses ou a toute autre personne; d) d'autoriser I'inspecteur a visiter les lieux oh, selon le tribunal, il peut puiser des renseignements pertinents, ainsi qu'a examiner toute chose et prendre copie de tout document ou livre qu'il y trouve; e) de requerir la production a I'inspecteur de documents ou de livres; f) d'autoriser I'inspecteur a tenir une audition, a faire preter serment et a interroger sous serment, ainsi que de preciser les regles regissant I'audition; g) de citer toute personne a I'audition tenue par I'inspecteur, pour y deposer sous serment: h) de donner des instructions a I'inspecteur ou a tout interesse sur toute question relevant de I'enquete; i) de demander a I'inspecteur de faire au tribunal un rapport provisoire ou definitif; j) de statuer sur I'opportunite de la publication du rapport de I'inspecteur et, dans ['affirmative, de demander au directeur de le publier integralement ou en partie ou d'en envoyer copie a toute personne designee par le tribunal; k) d'arreter I'enquete;

I) d'enjoindre a la societe de payer les frais de I'enquete.

Copie du rapport

(2) L'inspecteur doit envoyer au directeur une copie de tout rapport qu'il etablit en vertu de la presente partie.

1974-75-76, ch. 33, art. 223; 1978-79, ch. 9: art. 1 et 72.

Pouvoirs de I'inspecteur

231. (1) L'inspecteur vise par la presente partie a les pouvoirs precises dans son ordonnance de nomination.

change de renseignements

(2) Outre les pouvoirs precises dans son ordonnance de nomination, I'inspecteur nomme pour enqueter sur une societe peut fournir aux fonctionnaires canadiens ou etrangers ou echanger des renseignements et collaborer de toute autre maniere avec eux, s'ils sont investis de pouvoirs d'enquete et qu'ils menent, sur la societe, une enquete a propos de toute allegation faisant etat d'une conduite reprehensible analogue a celles visees au paragraphe 229(2).

Ordonnance du tribunal

(3) L'inspecteur doit, sur demande, remettre a tout interesse copie de toute ordonnance rendue en vertu du paragraphe 230(1).

-51

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Presomption

(2) Pour I'application du paragraphe (I), est reputee detenir un droit sur une valeur mobiliere la personne, selon le cas : a) qui a droit de vote ou le droit de negocier cette valeur ou tout droit sur celle-ci; b) dont le consentement est necessaire a I'exercice des droits ou privileges de toute autre personne detenant un droit sur cette valeur; c) qui donne des instructions selon lesquelles d'autres personnes detenant un droit sur cette valeur peuvent etre obligees ou ont I'habitude d'exercer les droits ou privileges dont elle est assortie.

Publication

(3) Le directeur doit publier dans une publication accessible au grand public les renseignements qu'il a obtenus en vertu du present article lorsque les conditions suivantes sont reunies : a) la presente loi ou les reglements I'exigent; b) ils ne I'ont pas ete precedemment.

Infraction

(4) La personne qui contrevient au present article commet une infraction et encourt, sur declaration de culpabilite par procedure sommaire, une amende maximale de cinq mille dollars et un emprisonnement maximal de six mois, ou I'une de ces peines.

Personnes morales et leurs dirigeants, etc.

(5) En cas de perpetration par une personne morale d'une infraction visee au paragraphe (4), ceux de ses administrateurs ou dirigeants qui y ont sciemment donne leur autorisation, leur permission ou leur acquiescement sont consideres comme des coauteurs de I'infraction et encourent, sur declaration de culpabilite par procedure sommaire, une amende maximale de cinq mille dollars et un emprisonnement maximal de six mois, ou I'une de ces peines, que la personne morale ait ete ou non poursuivie ou declaree coupable.

L.R. (1985), ch. C-44, art. 235; 2001, ch. 14, art. 114 et 135(A).

Secret

236. La presente partie n'a pas pour effet de porter atteinte au secret professionnel de I'avocat. L.R. (1985), ch. C-44, art. 236; 2001, ch. 14, art. 135(A).

237. Le directeur peut, a I'egard de toute personne, proceder a toute enquete dans le cadre de I'application de la presente loi.

1974-75-76, ch. 33, art. 230; 1978-79, ch. 9, art. 1. Courts of Justice Act R.R.O. 1990, REGULATION 194

RULES OF CIVIL PROCEDURE

SERVICE OUTSIDE ONTARIO WITHOUT LEAVE

17.02 A party to a proceeding may, without a court order, be served outside Ontario with an originating process or notice of a reference where the proceeding against the party consists of a claim or claims,

Tort Committed in Ontario

(g) in respect of a tort committed in Ontario; Damage Sustained in Ontario

(h) in respect of damage sustained in Ontario arising from a tort, breach of contract: breach of fiduciary duty or breach of confidence, wherever committed;

SIGNIFICATION EN DEHORS DE L'ONTARIO SANS AUTORISATION DU TRIBUNAL

17.02 L'acte introductif d'instance ou I'avis d'un renvoi peut etre signifie sans I'autorisation du tribunal a une partie se trouvant en dehors de I'Ontario si la ou les demandes contre cette partie, selon le cas :

Delit commis en Ontario

g) se rapportent a un delit commis en Ontario; Prejudice subi en Ontario

h) se rapportent a un prejudice subi en Ontario et qui decoule d'un delit, d'une inexecution de contrat, d'un manquement a I'obligation de fiduciaire ou d'un abus de confiance, quel que soit I'endroit ou ils ont eu lieu; Immigration and Refugee Act, S.C. 2001, c. 27, ss. 3 and 24

Objectives - immigration

3. (1) The objectives of this Act with respect to immigration are

(a) to permit Canada to pursue the maximum social, cultural and economic benefits of immigration;

(b) to enrich and strengthen the social and cultural fabric of Canadian society, while respecting the federal, bilingual and multicultural character of Canada;

(b.1) to support and assist the development of minority official languages communities in Canada;

(c) to support the development of a strong and prosperous Canadian economy, in which the benefits of immigration are shared across all regions of Canada;

(d) to see that families are reunited in Canada;

(e) to promote the successful integration of permanent residents into Canada, while recognizing that integration involves mutual obligations for new immigrants and Canadian society;

(f) to support, by means of consistent standards and prompt processing, the attainment of immigration goals established by the Government of Canada in consultation with the provinces;

(g) to facilitate the entry of visitors, students and temporary workers for purposes such as trade, commerce: tourism, international understanding and cultural, educational and scientific activities:

(h) to protect the health and safety of Canadians and to maintain the security of Canadian society;

(i) to promote international justice and security by fostering respect for human rights and by denying access to Canadian territory to persons who are criminals or security risks; and

(j) to work in cooperation with the provinces to secure better recognition of the foreign credentials of permanent residents and their more rapid integration into society.

Objectives - refugees

(2) The objectives of this Act with respect to refugees are

(a) to recognize that the refugee program is in the first instance about saving lives and offering protection to the displaced and persecuted; (b) to fulfil Canada's international legal obligations with respect to refugees and affirm Canada's commitment to international efforts to provide assistance to those in need of resettlement;

(c) to grant, as a fundamental expression of Canada's humanitarian ideals, fair consideration to those who come to Canada claiming persecution;

(d) to offer safe haven to persons with a well-founded fear of persecution based on race, religion, nationality, political opinion or membership in a particular social group, as well as those at risk of torture or cruel and unusual treatment or punishment;

(e) to establish fair and efficient procedures that will maintain the integrity of the Canadian refugee protection system, while upholding Canada's respect for the human rights and fundamental freedoms of all human beings;

(f) to support the self-sufficiency and the social and economic well-being of refugees by facilitating reunification with their family members in Canada;

(g) to protect the health and safety of Canadians and to maintain the security of Canadian society; and

(h) to promote international justice and security by denying access to Canadian territory to persons, including refugee claimants, who are security risks or serious criminals.

Application

(3) This Act is to be construed and applied in a manner that

(a) furthers the domestic and international interests of Canada;

(b) promotes accountability and transparency by enhancing public awareness of immigration and refugee programs;

(c) facilitates cooperation between the Government of Canada, provincial governments, foreign states, international organizations and non-governmental organizations;

(d) ensures that decisions taken under this Act are consistent with the Canadian Charter of Rights and Freedoms, including its principles of equality and freedom from discrimination and of the equality of English and French as the official languages of Canada;

(e) supports the commitment of the Government of Canada to enhance the vitality of the English and French linguistic minority communities in Canada; and

(f) complies with international human rights instruments to which Canada is signatory.

24. (1) A foreign national who, in the opinion of an officer, is inadmissible or does not meet the requirements of this Act becomes a temporary resident if an officer is of the opinion that it is justified in the circumstances and issues a temporary resident permit, which may be cancelled at any time.

Exception

(2) A foreign national referred to in subsection (1) to whom an officer issues a temporary resident permit outside Canada does not become a temporary resident until they have been examined upon arrival in Canada.

Instructions of Minister

(3) In applying subsection (I), the officer shall act in accordance with any instructions that the Minister may make.

Restriction

(4) A foreign national whose claim for refugee protection has been rejected or determined to be withdrawn or abandoned by the Refugee Protection Division or the Refugee Appeal Division may not request a temporary resident permit if less than 12 months have passed since their claim was last rejected or determined to be withdrawn or abandoned.

Humanitarian and compassionate considerations - request of foreign national

Objet en matiere d'immigration

3. (1) En matiere d'immigration, la presente loi a pour objet : a) de permettre au Canada de retirer de I'immigration le maximum d'avantages sociaux, culturels et economiques; b) d'enrichir et de renforcer le tissu social et culture1 du Canada dans le respect de son caractere federal, bilingue et multiculturel; b.1) de favoriser le developpement des collectivites de langues officielles minoritaires au Canada; c) de favoriser le developpement economique et la prosperite du Canada et de faire en sorte que toutes les regions puissent beneficier des avantages economiques decoulant de I'immigration; d) de veiller a la reunification des familles au Canada; e) de promouvoir I'integration des residents permanents au Canada, compte tenu du fait que cette integration suppose des obligations pour les nouveaux arrivants et pour la societe canadienne; f) d'atteindre, par la prise de normes uniformes et I'application d'un traitement efficace, les objectifs fixes pour I'immigration par le gouvernement federal apres consultation des provinces; g) de faciliter I'entree des visiteurs, etudiants et travailleurs temporaires qui viennent au Canada dans le cadre d'activites commerciales, touristiques, culturelles, educatives, scientifiques ou autres, ou pour favoriser la bonne entente a I'echelle internationale; h) de proteger la sante des Canadiens et de garantir leur securite; i) de promouvoir, a I'echelle internationale, la justice et la securite par le respect des droits de la personne et I'interdiction de territoire aux personnes qui sont des criminels ou constituent un danger pour la securite; j) de veiller, de concert avec les provinces, a aider les residents permanents a mieux faire reconnaitre leurs titres de competence et a s'integrer plus rapidement a la societe.

Objet relatif aux refugies

(2) S'agissant des refugies: la presente loi a pour objet : a) de reconnaitre que le programme pour les refugies vise avant tout a sauver des vies et a proteger les personnes de la persecution; b) de remplir les obligations en droit international du Canada relatives aux refugies et aux personnes deplacees et d'affirmer la volonte du Canada de participer aux efforts de la communaute internationale pour venir en aide aux personnes qui doivent se reinstaller: c) de faire beneficier ceux qui fuient la persecution d'une procedure equitable refletant les ideaux humanitaires du Canada: d) d'offrir I'asile a ceux qui craignent avec raison d'etre persecutes du fait de leur race, leur religion, leur nationalite, leurs opinions politiques, leur appartenance a un groupe social en particulier, ainsi qu'a ceux qui risquent la torture ou des traitements ou peines cruels et inusites; e) de mettre en place une procedure equitable et efficace qui soit respectueuse, d'une part, de I'integrite du processus canadien d'asile et, d'autre part, des droits et des libertes fondamentales reconnus a tout etre humain; f) d'encourager I'autonomie et le bien-etre socioeconomique des refugies en facilitant la reunification de leurs familles au Canada: g) de proteger la sante des Canadiens et de garantir leur securite; h) de promouvoir, a I'echelle internationale, la securite et la justice par I'interdiction du territoire aux personnes et demandeurs d'asile qui sont de grands criminels ou constituent un danger pour la securite. Interpretation et mise en oeuvre

(3) L'interpretation et la mise en oeuvre de la presente loi doivent avoir pour effet : a) de promouvoir les interets du Canada sur les plans interieur et international; b) d'encourager la responsabilisation et la transparence par une meilleure connaissance des programmes d'immigration et de ceux pour les refugies; c) de faciliter la cooperation entre le gouvernement federal, les gouvernements provinciaux, les tats etrangers, les organisations internationales et les organismes non gouvernementaux; d) d'assurer que les decisions prises en vertu de la presente loi sont conformes a la Charte canadienne des droits et libertes: notamment en ce qui touche les principes, d'une part, d'egalite et de protection contre la discrimination et, d'autre part, d'egalite du fran~aiset de I'anglais a titre de langues officielles du Canada; e) de soutenir I'engagement du gouvernement du Canada a favoriser I'epanouissement des minorites francophones et anglophones du Canada; f) de se conformer aux instruments internationaux portant sur les droits de I'homme dont le Canada est signataire.

24. (1) Devient resident temporaire I'etranger, dont I'agent estime qu'il est interdit de territoire ou ne se conforme pas a la presente loi, a qui il delivre, s'il estime que les circonstances le justifient, un permis de sejour temporaire - titre revocable en tout temps.

Cas particulier

(2) L'etranger vise au paragraphe (1) a qui I'agent delivre hors du Canada un permis de sejour temporaire ne devient resident temporaire qu'apres s'etre soumis au contr8le a son arrivee au Canada.

Instructions

(3) L'agent est tenu de se conformer aux instructions que le ministre peut donner pour I'application du paragraphe (1).

Reserve

(4) L'etranger dont la Section de la protection des refugies ou la Section d'appel des refugies a rejete la demande d'asile ou dont elle a prononce le desistement ou le retrait de la demande ne peut demander de permis de sejour temporaire que si douze mois se sont ecoules depuis le dernier rejet de la demande d'asile ou le dernier prononce du desistement ou du retrait de celle-ci. 2001, ch. 27, art. 24; 2010, ch. 8, art. 3.

Sejour pour motif d'ordre humanitaire a la demande de I'etranger S.C.C. No.: 33900

THE SUPREME COURT OF CANADA (ON APPEAL FROM THE COURT OF APPEAL FOR THE PROVINCE OF ONTARIO)

BETWEEN:

RICHARD C. BREEDEN, RICHARD C. BREEDEN & CO., GORDON A. PARIS, JAMES R. THOMPSON, RICHARD D. BURT, GRAHAM W. SAVAGE and RAYMOND G.H. SElTZ

Appellants (Appellants)

- and -

CONRAD BLACK

Respondent (Respondent)

FACTUM OF THE RESPONDENT, CONRAD BLACK

LERNERS LLP Barristers & Solicitors 130 Adelaide Street West, Suite 2400 Toronto, ON M5H 3P5

Earl A. Cherniak, Q.C. (LSUC #09113C) Kirk F. Stevens (LSUC#: 2751 5P) Lisa C. Munro (LSUC# 36006R)

Tel: 416.601.2350 Fax: 41 6.867.2402

Solicitors for the Respondent, Conrad Black

JOG 1703062 1