Lawrence Veregin

This costs endorsement addresses the allocation of costs following a stay of proceedings due to the plaintiff’s failure to promptly disclose a settlement with certain defendants.

The court reviews the history of the Anton Piller Order, the Comeback Order, and the subsequent motions, ultimately awarding partial indemnity costs to the successful defendants, Marc Castillo and Castillo HR Consulting Inc., in the amount of $45,000.

The court declines to revisit costs already determined by a previous order and limits recovery to the portion of the motion related to the stay, excluding costs for the Anton Piller Order and preparation of a discovery plan.

The court considered a motion by Marc Castillo and Castillo HR Consulting Inc. to stay the action for abuse of process due to Peninsula Employment Services Ltd.'s failure to immediately disclose settlement agreements with three former co-defendants.

The court found that the delayed disclosure of these agreements, which required the settling defendants to cooperate with the plaintiff, fundamentally altered the adversarial landscape and violated the strict requirement for immediate disclosure.

As a result, the action was permanently stayed.

The court also addressed, in obiter, the obligations of the Independent Supervising Solicitor regarding the production and accessibility of electronic documents seized under an Anton Piller Order.

The plaintiff, Peninsula Employment Services Ltd., brought an ex parte motion for an Anton Piller order, an interim injunction to prevent copyright infringement, and a sealing order against former employees and their new company, Castillo HR Consulting Inc., and three corporate clients.

The plaintiff alleged unlawful access and removal of proprietary information, copyright infringement, and exploitation of trade secrets.

The court found a strong prima facie case, serious damage to the plaintiff, convincing evidence of incriminating documents in the defendants' possession, and a real possibility of destruction of evidence.

The court also found that the test for an interim injunction was met, including serious issue to be tried, irreparable harm, and balance of convenience favoring the plaintiff.

The motion for the Anton Piller order, interim injunction, and a limited sealing order was granted.

The defendants brought a motion for leave to add a counterclaim seeking a declaration dismissing the plaintiffs' claims in a 2013 intellectual property action.

The defendants argued the counterclaim was necessary to mitigate the costs of preparing for trial on all issues.

The court dismissed the motion, finding the proposed counterclaim was duplicative of the statement of defence, dependent on the main action, and brought with unexplained delay eight years into the litigation.

The plaintiff, claiming copyright in a movie, sought statutory damages against Internet Service Providers (ISPs) by way of a motion for their alleged failure to forward notices of suspected infringement to their subscribers under the notice-and-notice regime of the Copyright Act.

The Court held that, absent special circumstances intertwining the damages claim with a request for disclosure (which had already been settled), there is no legal basis to allow a standalone damages claim against non-party ISPs to proceed by motion.

The plaintiff must pursue damages by way of an action.

The motion was dismissed with costs.