Court File and Parties

COURT FILE NO.: CV-18-00607956-0000 DATE: 20201019 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: LI NIU, Plaintiff AND: YUAN CAO a.k.a. REBECCA CAO, Defendant

BEFORE: Justice Glustein COUNSEL: Gil Zvulony, for the plaintiff Ryder Gilliland, for the defendant

COSTS ENDORSEMENT

Nature of issue and overview

[1] By reasons for decision released on September 10, 2020 (the Reasons), I dismissed Cao’s[^1] anti-SLAPP motion and allowed Niu’s defamation claim to continue to trial.

[2] Counsel asked the court to address the issue of costs by written submissions, given s. 137.1(8) of the Courts of Justice Act, R.S.O. 1990, c. C. 43, which provides that if a judge does not dismiss a proceeding under s. 137.1, “the responding party is not entitled to costs on the motion, unless the judge determines that such an award is appropriate in the circumstances”.

[3] I received costs submissions from Niu on September 24, 2020, responding costs submissions from Cao on October 8, 2020, and reply costs submissions from Niu on October 15, 2020.

[4] Niu seeks partial indemnity costs of $61,000 (inclusive of HST and disbursements). Cao submits that no costs should be ordered because Niu has not rebutted the presumption under s. 137.1(8).

[5] For the reasons that follow, I find that no costs should be ordered against Cao. While the motion was not successful, there was a public interest in Cao’s expression, and, in any event, the anti-SLAPP motion was not frivolous nor brought for a strategic purpose. Consequently, Niu has not rebutted the statutory presumption under s. 137.1(8).

Applicable law

[6] I adopt the following principles as relevant to the court’s discretion to order costs under s. 137.1(8):

(i) “The mere fact that an anti-SLAPP challenge is dismissed and the defamation action is allowed to proceed to trial (the plaintiff having cleared the hurdles set out in s. 137.1 of the CJA) is not enough to justify a costs award under s. 137.1(8). Otherwise, the statutory presumption set out therein would be completely undermined”: Ferreira v. Da Costa, 2019 ONSC 2990, at para. 8;

(ii) “Nor is it sufficient to suggest … that the defendants’ alleged defamatory claims were particularly offensive … [since] the same can probably be said about every defamation suit brought by virtually every aggrieved plaintiff”: Ferreira, at para. 8;

(iii) “The 2010 Anti-SLAPP Advisory Panel Report that led to the enactment of s. 137.1 of the CJA noted that costs awards against unsuccessful defendants are intended to act as ‘costs sanctions against parties who bring frivolous motions for protection’”: Ferreira, at para. 9, citing Anti-SLAPP Advisory Panel Report to the Attorney General (Ontario: Ministry of the Attorney General, October 28, 2010), at para. 20;

(iv) The anti-SLAPP costs provisions “are designed to encourage defendants, who have been sued over expressions on matters of public interest, to bring s. 137.1 motions for an early dismissal of those claims. The costs provisions ease the financial burden and risk placed on the defendant who seeks an early termination of what it claims is a SLAPP”: Veneruzzo v. Storey, 2018 ONCA 688, 23 C.P.C. (8th) 352, at para. 38, citing Accruent LLC v. Mishimagi, 2016 ONSC 6924, at para. 4;

(v) Costs for anti-SLAPP motions should be ordered if the court finds that the defendant engaged in “frivolous motion practice to delay [the plaintiff’s] defamation claim”: Bent v. Platnick, 2020 SCC 23, at para. 179;

(vi) Frivolous conduct can be established if the court finds that the “lawsuit has none of the characteristics of a SLAPP, and the impugned expression is unrelated to a matter of public interest”. Costs against a defendant for an unsuccessful anti-SLAPP motion can be appropriate if the court finds that the anti-SLAPP motion is a “misuse of the litigation process” and “meritless”: Veneruzzo, at para. 39;

(vii) No case was put before the court on the present motion in which the court awarded costs to a plaintiff on an unsuccessful anti-SLAPP motion where the defendant was able to establish that the impugned expression related to a matter of public interest. To the contrary, numerous courts have held that s. 137.1(8) should be applied to order no costs when the impugned expression related to a matter of public interest. By way of example, Justice Belobaba held in Ferreira, at para. 11 (footnotes omitted):

Here, I found that the plaintiff’s actions had none of the characteristics of a SLAPP suit. However, I also found that the impugned expression (about the dangers of investing in syndicated mortgages) was related to a matter of public interest. It was only after completing the required analysis under the multi-step test set out in s. 137.1 of the CJA that I could conclude with some measure of confidence that the defendants’ anti-SLAPP motion should be dismissed and the plaintiffs’ defamation actions should continue on to trial.

(viii) Similarly, courts in Montour v. Beacon Publishing Inc., 2017 ONSC 6361; Thompson v. Cohodes, 2017 ONSC 2590; Hamlin v. Kavanagh, 2019 ONSC 6545; and Di Franco v. Bueckert, 2020 ONSC 2383, have all held that s. 137.1(8) should be applied to order no costs when the impugned expression related to a matter of public interest.

Analysis

[7] Niu submits that it is not settled law that a finding of public interest precludes an order of costs to a successful plaintiff when an anti-SLAPP motion is dismissed. Niu submits that the court in Veneruzzo was not limiting a finding of costs under s. 137.1(8) to the facts before it, i.e. the finding by the motion judge in that case that “the lawsuit has none of the characteristics of a SLAPP, and the impugned expression is unrelated to a matter of public interest”.

[8] Instead, Niu submits that the court can make an order against an unsuccessful defendant on an anti-SLAPP motion when it “considers just [to do so] in the circumstances”, relying on the Anti-SLAPP Advisory Panel Report, at para. 44.

[9] Niu relies on the Reasons in which I found that a trier of fact could reasonably conclude that (i) the impugned expression related to Niu; (ii) the statements were not only a complaint about the level of service Cao received from Niu; (iii) Cao knew that some of the statements she made were false at the time they were made; and (iv) the defences of justification, fair comment or qualified privilege might not apply.

[10] For the purposes of these costs reasons, I do not need to determine (i) whether a court can order costs against an unsuccessful defendant on an anti-SLAPP motion even if the court finds that the impugned expression relates to a matter of public interest (as submitted by Niu), or (ii) whether a finding that the impugned expression relates to a matter of public interest precludes a costs order under s. 137.1(8) (as submitted by Cao).

[11] On the facts of the present case, even if I accepted Niu’s position, I would still not order costs against Cao because I find that Cao’s motion was not frivolous, and as such, the presumptive rule in s. 137.1(8) should be followed.

[12] As in Ferreira, it was necessary in the present case to conduct the balancing test after making a finding that the impugned statements did relate to a matter of public interest. The submissions of Cao on that balancing test cannot be said to be frivolous or so unmeritorious as to warrant a reversal of the presumption under s. 137.1(8).

[13] By way of example, Cao raised reasonable challenges to Niu’s evidence on financial damages, as I discussed in the Reasons. Those challenges are not frivolous and will have to be addressed at trial.

[14] The determination of general damages based on the Articles and WeChat Comments will also need to be considered at trial based on evidence as to dissemination and its effect on those readers. While there was evidence to suggest some readers may have become concerned about Niu’s reputation after reading the impugned statements, it was reasonable for Cao to challenge the extent of any such damages, and to rely upon such submissions for the balancing test required under s. 137.1. Again, those submissions by Cao were not frivolous.

[15] Consequently, even if the court could order costs under s. 137.1(8) despite finding that the impugned expression raised a matter of public interest, I would not make such an order since the conduct of Cao was not frivolous, and her position was not unmeritorious despite her lack of success on the motion.

[16] Further, there is no evidence that Cao brought the motion to strategically delay the defamation action.

[17] For the above reasons, I find no basis to rebut the statutory presumption under s. 137.1(8). I order no costs on this motion.

GLUSTEIN J.

Date: 20201019

COURT FILE NO.: CV-18-00607956-0000 DATE: 20201019

ONTARIO SUPERIOR COURT OF JUSTICE

LI NIU Plaintiff

AND:

YUAN CAO a.k.a. REBECCA CAO Defendant

COSTS ENDORSEMENT Glustein J.

Released: October 19, 2020

[^1]: All defined terms are as set out in the Reasons.