Court File and Parties

COURT OF APPEAL FOR ONTARIO DATE: 20210707 DOCKET: M52604 (C68580)

Fairburn A.C.J.O. (Motions Judge)

BETWEEN

Wiseau Studio, LLC and Tommy Wiseau d.b.a. Wiseau-Films Plaintiffs/Defendants by Counterclaim (Appellants/Moving Parties)

and

Richard Harper, Fernando Forero McGrath, Martin Racicot d.b.a. Rockhaven Pictures, Room Full of Spoons Inc., Parktown Studios Inc. and Richard Stewart Towns Defendants/Plaintiffs by Counterclaim (Respondents/Responding Parties)

Counsel: Daniel Brinza, for the moving parties Meredith Bacal and Matthew Diskin, for the responding parties

Heard: July 7, 2021 by video conference

Endorsement

[1] This is a motion pursuant to s. 65.1(1) of the Supreme Court Act, R.S.C. 1985, c. S-26, seeking a stay of a decision of this court, which decision requires the moving parties to post security for costs of their appeal and the costs awarded from trial by no later than 4:00 p.m. today, “failing which the [responding parties] may move ex parte in writing before [that] panel for an order dismissing the appeal”: Wiseau Studio, LLC v. Harper, 2021 ONCA 396, at para. 10.

[2] The request for a temporary stay of this court’s panel decision is predicated on the moving parties’ efforts to obtain leave to appeal to the Supreme Court of Canada.

[3] For the following reasons, the moving parties’ motion to stay the panel decision is dismissed.

[4] First, there is no serious issue raised by the moving parties’ application for leave to appeal to the Supreme Court.

[5] The order of Thorburn J.A. required the posting of security for costs of the appeal and the costs awarded at trial: Wiseau Studio, LLC v. Harper, 2021 ONCA 31, at para. 41. That order was upheld by a panel of this court on June 2, 2021, with reasons released on June 7, 2021. As the panel noted, the Thorburn J.A. decision was a discretionary one based upon the record before her at that time. Moreover, the moving parties failed to justify why fresh evidence should be admitted on review. As such, according to the panel, at para. 7 of their reasons, the review turned on the fact that it was “reasonably open to [Thorburn J.A.] in the exercise of her discretion to make” the order she made, specifically as it related to security for costs of both the trial and appeal pursuant to r. 61.06(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194. I see no error in that approach.

[6] It is largely the facts that drove the final decision about the posting of costs in this case. Those facts are well documented in Thorburn J.A.’s decision, most notably at para. 10, and I will not repeat them here. Needless to say, as reflected in Thorburn J.A.’s review of the record below, there had been findings regarding the fact that the moving parties (normally resident outside of Ontario) had put up “roadblocks to scheduling at almost every attendance” and engaged in other improper acts that interfered with the efficient course of the litigation.

[7] For purposes of this motion, and the first question on the stay application pertaining to whether there is a “serious issue” to be dealt with, the moving parties have failed to demonstrate that there is an issue of public or national importance raised in the Notice of Application for Leave to Appeal to the Supreme Court of Canada that could possibly rise to the level of meeting the “stringent requirements” of s. 40(1) of the Supreme Court Act: Livent Inc. v. Deloitte & Touche, 2016 ONCA 395, 131 O.R. (3d) 784, at para. 7. This is particularly true given the completely discretionary nature of the original order in this case, as upheld by the panel on review. It is well settled that these types of discretionary orders are owed deference on review: Yaiguaje v. Chevron Corporation, 2017 ONCA 827, 138 O.R. (3d) 1, at para. 20. This is even more the case when discretionary orders, such as the one in dispute here, are heavily predicated on fact-finding.

[8] The second issue to be considered is whether the moving parties will suffer an irreparable harm if the stay is not imposed: Deloitte, at para. 4. They will not.

[9] Having reviewed the evidence on this motion, at its highest, there is a suggestion by the moving parties, as reflected in the affidavit of Tommy Wiseau, dated June 28, 2021, that he does not have sufficient funds, or access to sufficient funds, to meet the demands of this court’s order. I am not satisfied that this evidence reflects anything more than, as the responding parties put it, a request to “imagine” the irreparable harm that may flow. While there is discussion in Mr. Wiseau’s affidavit about the general financial implications of the COVID-19 pandemic in the United States and on the entertainment industry in particular, and a suggestion that it is “impossible for [Mr. Wiseau] to be able to obtain liquidity on a short notice”, there are no specifics given about why that is so. This is nothing more than a request to trust Mr. Wiseau. In light of the history of this matter, cogent evidence would be required to satisfy me that the security for costs required as a result of this court’s decision cannot be posted.

[10] In any event, even if the court was inclined to extend the trust requested, the responding parties have provided an in-writing undertaking that alleviates any harm that may flow to the moving parties pending resolution of the application for leave to appeal to the Supreme Court. That correspondence, dated July 4, 2021, is written by counsel to the responding parties, Matthew Diskin, and includes the following undertaking:

Further to your July 7 motion in the Wiseau matter, our clients and my firm undertakes that any funds recovered as relates to the cost awards and judgments in this matter will be held in trust, pending the leave to appeal motion to the Supreme Court of Canada. If leave is granted, and the order of the panel upholding security for costs of the appeal and judgment reversed, then such funds would remain in trust pending the hearing of the appeal of Justice Schabas’ judgment. If leave is not granted or if the proposed appeal is dismissed, then such funds would be released.

The point is that there is no need for a stay motion in view of the foregoing undertaking. My position is, and will be before the Court of Appeal on July 7, that the stay motion should be dismissed on various bases, but that to the extent there is any question, it is entirely resolved by the undertaking.

[11] Even if there could be harm flowing from dismissing this stay motion, the potential for harm has been significantly mitigated by the responding parties by way of this undertaking. In essence, any recovered funds will be held in trust pending the decision on the leave to appeal application before the Supreme Court of Canada. Of course, were the moving parties to be successful on that leave application, they could make a request of the Supreme Court of Canada to grant any necessary, interim remedies deemed necessary.

[12] Third, and finally, I will address whether the balance of convenience favours a stay: Deloitte, at para. 4.

[13] As reflected in Thorburn J.A.’s reasons, at para. 7, this litigation commenced with an ex parte injunction that restrained the release of the documentary that is at the heart of this dispute. Unbeknownst to the court that granted that injunction, at the same time that the ex parte motion was brought by the moving parties, the parties were negotiating about the documentary’s release.

[14] I pause to note that in a clearly different vein, but carrying the same element of surprise, during the hearing of this motion, the responding parties came to know for the first time, through a public website, that just yesterday the moving parties sued them in Federal Court. The responding parties have not yet seen the Statement of Claim because it has not yet been served on them. When asked about whether this was true, the moving parties’ counsel acknowledged that in fact this claim had been filed in court yesterday without any notice to the responding parties, suggesting that it was really nothing more than a “cheap insurance policy” to keep the moving parties’ options open going forward.

[15] It falls beyond the scope of the motion before me to comment upon that turn of events, other than to observe this behaviour appears somewhat consistent with many of the factual observations recounted by and made by Thorburn J.A. in her reasons.

[16] In any event, focusing on the balance of convenience here, I accept what Thorburn J.A. sets out in her reasons, at para. 34, that there is evidence that the responding parties will suffer prejudice if the order of this court to post security for costs is not granted (and therefore if it is stayed). That prejudice includes the fact that, as noted by multiple case management judges in the past and the trial judge, Mr. Wiseau seems to be engaging in “tactical attempt(s) … to delay and obstruct the release of Room Full of Spoons.”

[17] Conversely, I see no compelling evidence of harm to the moving parties, other than the fact that they may not be able to post the security for costs today. Of course, the panel hearing the review from Thorburn J.A.’s order gave them one month to do so. I am hearing this motion mere hours before the deadline.

[18] In all of these circumstances, including the responding parties’ written undertaking, the overarching consideration involving the interests of justice leads me to conclude that this motion to stay the panel decision of this court should be dismissed.

[19] If the moving parties do not comply with this court’s panel decision, and the responding parties decide to “move ex parte in writing before [the] panel for an order dismissing the appeal”, the responding parties must include these reasons and their undertaking as part of the record to be placed before the panel on that ex parte application.

Disposition

[20] The moving parties’ motion to stay the panel decision of this court is dismissed.

[21] Costs submissions will be heard in writing.

[22] The responding parties may provide written costs submissions of no more than two pages no later than July 9, 2021. The moving parties may respond with written costs submissions of no more than two pages no later than July 13, 2021.

“Fairburn A.C.J.O.”