SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE: CV-14-10552-CL
DATE: 20140624

RE: Ceridian Canada Ltd. and Pendylum Inc. / Moving Parties

AND:

Farida Azeezodeen / Responding Party

BEFORE: Justice E. P. Belobaba

COUNSEL: David E. Lederman and Ryan Cookson / for the Moving Parties

Farida Azeezodeen, self-represented / Responding Party

HEARD: June 20 and 24, 2014

decision on Contempt of court motion

[1] This is a motion to find the defendant in contempt of court under Rule 60.11(1) of the Rules of Civil Procedure.

[2] After her employment was terminated for refusing to undergo a background check, the defendant embarked on an email campaign with her former employer that culminated in threats and conduct akin to extortion. The defendant told the plaintiffs that if they didn’t settle with her and pay a significant sum of money by a certain date, she would issue a long and detailed press release disclosing the plaintiffs’ confidential business methods and disparaging their business reputation.

[3] On the Friday before the threatened Monday press release, the plaintiffs sought and obtained a five-day ex parte injunction prohibiting the defendant from publishing the press release. The plaintiff did not comply with the court order and proceeded to carry out her threat. The press release was issued and the plaintiffs’ confidential information was widely disclosed over the Internet by numerous news outlets.

[4] For the reasons that follow, I am satisfied beyond a reasonable doubt that the defendant, Farida Azeezodeen breached the court order in question and is in contempt of court. I will schedule the sentencing hearing after discussion with the parties.

Background

[5] The plaintiffs’ affidavit evidence provides the following factual background.

[6] Ceridian provides payroll and related human resource services to corporate customers throughout North America. Ceridian uses confidential and competitively sensitive business methods in providing these services to its customers. As well as dealing directly with its corporate customers, Ceridian also enters into agreements with third party companies that, in turn, enter into independent contractual agreements with other individuals or entities to assist in the delivery of services to Ceridian’s customers.

[7] Ceridian employees and independent contractors are provided access to confidential information relating to Ceridian customers and the employees of those customers including payroll data, social insurance and social security numbers, benefit data, employee addresses and names, tax and source deduction information and various other human resource and employee related information. In order to secure and protect Ceridian’s own confidential information and the confidential information of its customers and the employees of its customers, Ceridian imposes on its contractors strict confidentiality obligations.

[8] Ceridian entered into agreements with Pendylum pursuant to which the latter undertook to assist Ceridian in servicing Ceridian customers. The most recent agreement contained several confidentiality provisions and required Pendylum to impose the same strict confidentiality obligations on its subcontractors.

[9] In July 2013, Pendylum entered into an agreement with the defendant who undertook to assist Pendylum in providing services to Ceridian customers. The defendant agreed not to use or disclose or authorize any person to use or disclose any “Confidential Information” either during the term of her contractual relationship with Pendylum or afterwards. Under the agreement, “Confidential Information” included information about the plaintiffs’ customers or their employees and any information about the plaintiffs’ business methods or operations.

[10] In the performance of her duties, the defendant had access to confidential information about Ceridian customers and the employees of those customers. The plaintiff was also given information about the plaintiffs’ business methods. The plaintiffs say that most, if not all, of the information provided to the defendant in the course of her training and duties, constitutes “Confidential Information” as defined in the Pendylum agreement and in the defendant’s agreement. The defendant was strictly prohibited from using or disclosing any of this information to any third party.

[11] In October 2013, Ceridian discovered that a number of the subcontractors working for Pendylum had not received background checks as required under Pendylum’s agreement with Ceridian. The Pendylum subcontractors were asked to submit to a background check. All of them complied with this request, except the defendant. Accordingly, on October 13, 2013, the defendant’s agreement was terminated by Pendylum and the defendant was no longer authorized to use or possess any of the confidential information that came into her knowledge or possession in the course of working for Pendylum.

[12] In November 2013, the defendant sent a letter to Ceridian in which she made numerous defamatory statements about the plaintiffs’ business practices and operations, which she threatened to make public. The defendant advised Ceridian that unless she was paid the sum of $23.2 million, she would make public confidential information relating to Ceridian, Pendylum and their customers. On January 6, 2014, the defendant again wrote to Ceridian threatening to “go public” with numerous allegations about Ceridian and Pendylum. The defendant now offered not to publicize the allegations in exchange for a “settlement” of $500,000.

[13] On April 24, 2014, Ceridian received another letter from the defendant in which she made another threat that she intended to circulate a “press release” to “every press agency and HR and payroll agency across Canada and the U.S.” and that she would do so on May 12, 2014. The “press release” the defendant threatened to publish contained confidential information regarding Ceridian and Pendylum’s business methods. It also made various defamatory statements regarding the business dealings of Ceridian and Pendylum, including their dealing with the independent contractors. On May 8, 2014, the defendant wrote again to Ceridian repeating her threat that she would widely disclose her “press release” on May 12, 2014.

[14] In response to the defendant’s threats, on May 9, 2014, the plaintiffs brought an ex parte motion before me for an interim and interlocutory injunction and an Anton Piller order. I did not grant the Anton Piller order. However, I did grant a five-day interim injunction to prohibit the publication of the threatened press release. I did so because, as I noted in my hand-written Endorsement, there was “great risk of irreparable harm if the defendant issued the threatened press release.” I proceeded without notice to the defendant because of the very real risk that the defendant, if given notice, would simply issue the hugely damaging press release before the hearing date.

[15] The court Order that I issued on May 9 provided, among other things, that the defendant or anyone acting on her behalf and anyone having knowledge of the court Order shall not publish or otherwise disclose any of the statements made in her “press release” document to anyone. It also required the defendant to provide the plaintiffs with a list of all persons and entities to whom she has communicated confidential information. The Order stated that it would expire on May 14, 2014, unless renewed. In my endorsement on the back of the motion record, I made clear that the defendant “should attend on May 14, 2014 and make any submissions she deems appropriate.”

[16] The plaintiffs’ process server tried to serve the defendant personally with the court Order on Friday evening, May 9 but no one answered the door. He left the package at the front door.

[17] On Saturday, May 10 at 12:39 p.m., Mr. Lederman, counsel to the plaintiffs, sent a copy of the court Order to the defendant by e-mail. The defendant was also provided with copies of the May 9 Endorsement, motion record and factum. The May 10 email advised the defendant that an injunction had been issued against her and that she may attend court to speak to the injunction on May 14, 2014.

[18] On May 10 at 12:42 p.m., the defendant responded to Mr. Lederman’s email of 12:39 p.m. with the following:

It is too late. I never received any replies or packages in 8 months. The press release is already paid for and submitted. 8 months...no reply...they never cared.

[19] In a series of e-mail exchanges that followed on Saturday May 10 and Sunday May 11, Mr. Lederman informed the defendant several times that she was prohibited by a court order from disclosing her press release, that she was required to provide the plaintiffs with the identities of third parties to whom she has disclosed confidential information, and that failure to do so would be a breach of the court Order.

[20] In an e-mail on May 10 at 1:02pm, Mr. Lederman said this:

Pursuant to the terms of the attached Order, you and anyone acting on your behalf have been prohibited from publishing or disclosing any of the statements in the press release. You will be held in contempt of Court if you do not abide by the terms of this Order. I suggest you speak with a lawyer who can explain the ramifications to you should you choose to ignore the attached Order of the Court.

[21] The defendant’s response made clear that she did not intend to comply with the court Order. The defendant said this in her e-mail on May 10 at 1:20 p.m.:

[I] have never received a reply or package in 8 months. They had two weeks to give me a court order but issued it after the press release was submitted. There is no breach of confidentiality when we tell the world what someone did to us. Your job now is to prove libel or defamation. You have advised me after the fact of a court order. When you are in court on Wednesday… advise the judge that the order has no effect…he cannot violate my right to free speech.

[22] Mr. Lederman continued to urge the defendant to comply with the court Order and provide the plaintiffs with a list of the persons to whom she had disclosed confidential information. In his e-mail of May 10 at 4:36 p.m. he said this:

While you may have paid for and submitted the press release, it is not too late to stop it. If the press release is published or otherwise disclosed, you will be in breach of paragraph 7 of the Court Order. Paragraph 5 of the Court Order requires you to disclose a list of all persons and entities to whom you have communicated any Confidential Information of our clients. Confidential Information includes any information or knowledge relating to our clients’ businesses. Accordingly, please immediately provide a list of all these people, including any press agency you have engaged to issue the press release. If you do not provide this information forthwith, you will be in breach of the Court Order. I suggest you bring the Court Order to the attention of whichever press agency you have engaged.

[23] Mr. Lederman also offered to take steps to stop the defendant’s press release from being disclosed if he was provided with the names of the individuals and news agencies to whom she had distributed the release:

With respect to the press release, there is no question that the press release can be stopped. If you fail to take such steps you will be in breach of the Order, so please take immediate steps to do so. Even if this poses some practical difficulty for you, or if you are unclear as to how you can stop it, we will gladly take the steps necessary to stop its release as soon as we receive the details as to the individuals and news outlets to whom you have distributed the release. Again, this disclosure is required pursuant to the terms of the Court Order, so failure to provide such information is also a breach of the Order.

[24] The defendant did not comply with the plaintiffs’ requests for information. Instead, in a reply e-mail on Sunday May 11 at 11:21 a.m., the defendant demanded a settlement:

[T]ell your clients that if they want me to go out of my damn way on Monday to prevent release after I’ve already paid for it…and there's no guarantee it can be stopped...they should settle. I have settled with companies before.

Settle now and I will try… no guarantees. Don't settle and I will face all consequences.

[25] After a series of further exchanges, on Sunday Mr. Lederman sent the following e-mail to the defendant:

We conclude from your response that you are refusing to comply with the terms of the Order which require you to provide us immediately with the names of the parties and media outlets to whom you have distributed the press release.

[26] On the morning of Tuesday May 13, Ceridian discovered that the defendant’s proposed “press release” had been published on the “Accesswire” news website. Shortly thereafter, Ceridian became aware of dozens of other websites that had published the press release. The press release contained confidential information about the plaintiffs’ business methods and software applications. Ceridian’s public relations team also learned that the defendant had been promoting the press release through her Twitter and Facebook accounts.

[27] Ceridian sent a copy of the court Order to the various media outlets asking them to immediately remove all copies, references, links or other communications relating to the press release. Most of them complied immediately.

[28] On May 14, counsel for the plaintiffs re-attended before me to request a continuation of the court Order. The defendant had been advised both by the court in its Endorsement and in the Lederman emails that she should attend court on that date, but she chose not to do so. I extended the Order, pending the further order of any judge of this court.

[29] On May 15, the defendant advised Mr. Lederman that she would be filing a motion on May 20. I agreed to convene a case conference to schedule the plaintiffs’ proposed motion for contempt and to assist with any motion that the defendant intended to bring. I was also, frankly, hoping that the parties’ face to face meeting might result in a settlement of some kind that would preclude the need for any further proceedings. The case conference was held on May 20. I discussed scheduling matters, encouraged the parties to engage in a candid discussion and then left the meeting. I was later advised that no settlement had been reached and the plaintiffs’ contempt motion would be proceeding.

[30] I note that the plaintiffs served their Motion for Contempt of Court by email. They did so for two reasons: one, the defendant explicitly authorized service by email in one of her email exchanges with Mr. Lederman on May 11; and two, my Order of May 14 also authorized service by email. The service of these motion materials is therefore valid under Rule 60.11(2).

The applicable law

[31] To find a defendant in contempt of court, the court must be satisfied that: (1) the court Order stated clearly and unequivocally what should and should not be done; (2) the party who disobeyed the Order did so deliberately and willfully; and (3) because contempt is a quasi-criminal finding, contempt must be established beyond a reasonable doubt.[^1]

[32] The alleged contemnor must have knowledge of the nature and terms of the court order, but once having knowledge, must obey the order “in both letter and spirit with every diligence”.[^2] A person subject to an order cannot escape a finding of contempt by “finessing” the interpretation of an order or by “hid[ing] behind a restrictive and literal interpretation to circumvent the order and make a mockery of it and of the administration of justice.”[^3]

[33] Most people readily understand that the power of the Court to enforce its orders by way of contempt proceedings is integral to the rule of law and the administration of justice. Once an order has been obtained, it is imperative that it be obeyed, that the public understand it must be obeyed, and that judges have the will and the ability to ensure compliance.[^4] As Cumming J. noted:

It is integral to a free and democratic society like Canada that citizens act pursuant to and under the rule of law. Court orders in force must be respected and followed. The deliberate failure to obey a court order strikes at the very heart of the administration of justice ...[^5]

[34] The proper route for challenging a court order is by appeal or by another proceeding before the courts, not by ignoring its terms. As Justice Blair noted in Surgeoner: “No society which believes in a system of even-handed justice can permit its members to ignore, disobey, or defy its laws and its court orders at their whim because in their own particular view it is right to do so.”[^6]

Analysis

[35] The evidence presented by the plaintiffs was compelling. I was curious as to what Ms. Azeezodeen would say in her defence. Despite my earlier directions to the contrary, the defendant spent almost an hour on the witness-stand reading a prepared statement containing a wide-ranging array of (mainly misguided) legal submissions about how the rules of civil procedure were flouted,[^7] how she was wrongfully terminated, why the “confidential information” was not confidential and why this court should not have issued the May 9th Order.

[36] I reminded the defendant that it is no defence to a motion for contempt to argue that the order is improper and should not have been granted. As the case law makes clear, a court order stands, and commands respect in all its aspects, until it is reversed on appeal or an equally effective order is secured that it need not be obeyed.[^8] I urged the defendant to present evidence that was germane to the contempt of court motion, namely the clarity of the court Order, whether the Order was breached, whether the breach was intentional and whether the plaintiffs have proven contempt of court beyond a reasonable doubt. The defendant proceeded to do so.

[37] The defendant did not suggest that she had no knowledge of the court Order. She conceded that she had full knowledge of the Order by early Saturday afternoon, May 10, when she received Mr. Lederman’s email and attachments at 12:39 p.m.

[38] The defendant did not argue that the court Order was unclear or that she was in any way confused by the language in the Order; nor did she try to argue that any of her actions were anything other than deliberate and intentional.

[39] The thrust of her evidence was as follows:

(i) That she forwarded the press release to the appropriate agency on Saturday morning May 10 at 11:50 a.m. almost an hour before she knew about the court

Order from Mr. Lederman’s email, sent at 12:39 p.m. By then, she says, it was “too late” to do anything. She says she was not obliged to “retract” the press release and thus made no effort to do so. She submits that she is not in breach of para. 7 of the Order.

(ii) That her only obligation under para. 5 of the Order was to provide the plaintiffs with a list of the persons and entities “to whom she has communicated the Confidential Information” and that the use of the past tense “has communicated” means people or entities that received the Confidential Information before May 9, the date of the Order (she says this information was provided) and does not include people or entities who received the Confidential Information after the May 9 Order was issued (such as the 43 news outlets that received the press release.) She is therefore not in breach of para. 5 of the Order.

[40] I reject these rationalizations on a number of grounds.

[41] I start by describing what I think actually happened. I suspect that the defendant knew about the Order either Friday night or Saturday morning when she opened the package that the process server had left at her front door on Friday evening. I suspect that the defendant then made the decision not to wait until her threatened deadline of Monday May 12 to “issue the press release” but to do so on Saturday morning while she could still plausibly deny any knowledge of the Order and before she received any emails about the Order from plaintiffs’ counsel. I suspect this is exactly what happened but on the evidence before me I am not able to make this finding and I decline to do so. Putting my suspicions aside, I now turn to findings that can be made on the evidence.

[42] I do not accept the defendant’s statement that she issued the press release at 11:50 a.m. and thereafter it was “too late” and that nothing could be done. Nor do I accept her evidence that she could not make the necessary arrangements to stop the press release because it was “the weekend.” Even if the press agency was unmanned during the weekend (hard to believe on a common sense level) the defendant could still have sent a “cancelling instruction” that would have been acted upon on Monday morning; or she could have stopped the press release anytime on Monday, May 12. (Remember, the news outlets did not publish the press release until Tuesday, May 13.) Instead, despite the numerous pleas and offers of assistance from plaintiffs’ counsel, the defendant did nothing. She took no steps to stop the press release from being posted on the Internet, despite the clear language in para. 7 of the court Order that neither the defendant nor anyone acting on her behalf and having knowledge of the Order shall publish or otherwise disclose any of the statements in the press release.[^9]

[43] The May 9 court Order did not expire on May 9. It was clear from para. 8 that the Order was in effect for five days until May 14, 2014 (and longer if renewed). Thus, it is no answer to say that once the $99 press agency fee was paid at 11:50 a.m. on May 10 and the press release process was activated, that the defendant could lawfully sit back and do nothing. The court Order makes clear that the Order is ongoing, at least until May 14, and that over these five days the defendant is under a continuing obligation not to publish or disclose the contents of the press release. Having full knowledge of the court Order by the early afternoon of May 10, the defendant was required to take whatever steps were reasonable to ensure that the contents of the press release would not be published or disclosed. She made no effort to cancel the press release; she made no effort to forward a copy of the court Order to the press agency, not even on Monday, the day before the press release was posted. She made no effort whatsoever and in doing so, I find that she breached both the letter and spirit of para. 7 of the court Order.

[44] Recall also that in an email to the plaintiffs on Sunday May 11, the defendant herself stated that she could try to stop the press release but would only do so if the plaintiffs agreed to pay a settlement:

[T]ell your clients that if they want me to go out of my damn way on Monday to prevent release after I’ve already paid for it…and there's no guarantee it can be stopped...they should settle. I have settled with companies before.

Settle now and I will try… no guarantees. Don't settle and I will face all consequences.

[45] The case law is clear. Once a person has knowledge of a court Order, she must obey the order “in both letter and spirit with every diligence”.[^10] I repeat: “with every diligence.” The defendant failed to comply with both the letter and the spirit of the court Order and rather than exerting “every diligence” she did absolutely nothing.

[46] I find that the defendant knowingly and wilfully breached para. 7 of the court Order and on the evidence before me did so beyond a reasonable doubt.

[47] As for the second rationalization – that the obligation to provide a list of recipients under para. 5 of the court Order was limited to persons and entities who had received the Confidential Information before the May 9 Order – this is a rationalization that defies both common sense and the plain meaning of the May 9 Order. As already noted, the May 9 Order did not expire at the end of the day. It was clear from para. 8 that the Order was in effect for at least five days until May 14, 2014. In other words, it was clear to the defendant that the obligation to provide the required list of persons or entities to whom the defendant “has communicated the Confidential Information” was an obligation that did not end on Friday May 9 but continued over the weekend and the five-day duration of the court Order. To suggest otherwise is to flout the long-standing proposition of law that has already been discussed:

A person subject to an order cannot escape a finding of contempt by “finessing” the interpretation of an order or by “hid[ing] behind a restrictive and literal interpretation to circumvent the order and make a mockery of it and of the administration of justice.”[^11]

[48] I do not believe that even the defendant believed that her only obligation was to provide a list of names regarding communications that were made before the May 9 Order. She is an otherwise intelligent and articulate individual. She would have no difficulty understanding both the language of the Order and its overall intent. And I have no difficulty finding on the evidence before me that the defendant breached para. 5 of the Order.

[49] In sum, I find that the defendant knowingly and wilfully breached paras. 5 and 7 of the court Order. I find the defendant Farida Azeezodeen in contempt of court and I do so beyond a reasonable doubt.

Belobaba J.

Date: June 24, 2014

[^1]: Prescott-Russell Services for Children and Adults v. G.(N.) (2006), 2006 81792 (ON CA), 82 O.R. (3d) 686, at para. 27 (C.A.); Law Society of Upper Canada v. Fingold, 2012 ONSC 2850, at para. 29.

[^2]: Sure Track Courier Ltd. v. Kaisersingh, 2011 ONSC 4810, at paras. 53-54.

[^3]: Sweda Farms Ltd. v. Ontario Egg Producers, 2011 ONSC 3650, at para. 21.

[^4]: Ibid., at para. 18; Mercedes-Benz Financial v. Kovacevic (2009), 2009 9423 (ON SC), 308 D.L.R. (4th) 562, at para. 5.

[^5]: Sussex Group Ltd. v. 3933938 Canada Ltd., [2003] O.T.C. 664 (Sup. Ct.), at para. 47.

[^6]: Surgeoner v. Surgeoner (1992), 6 C.P.C. (3d) 318, at para. 5 (Ont. Gen. Div.)

[^7]: For example, the defendant was fixated on the requirement that the May 9 court Order had to be personally served and because it was only served by email on May 10, it was “not effective.” Rule 60.11(2) prescribes that the Motion for a Contempt Order requires personal service unless the court has authorized otherwise (which, by the way, is what happened here: supra, para. 30) but says nothing about court Orders. It is of course preferred that court Orders be personally served but if not, what matters is when the defendant became fully aware and knowledgeable of the Order: recall the discussion above at para. 32.

[^8]: Sussex Group, supra, note 5, at para. 55

[^9]: As it turned out, plaintiffs’ counsel eventually contacted most or all of the news outlets and provided them with a copy of the court Order. The news outlets readily complied and removed the press release from their web-sites. Had the defendant chosen to comply with the court Order, she could have done this over the weekend and for sure on Monday May 12 but did not do so.

[^10]: Sure Track, supra, note 2, at paras. 53-54.

[^11]: Sweda Farms, supra, note 3, at para. 21.