Libel Crosses Borders: Court rules Israeli paper can be sued in Ontario

CANADIAN PUBLISHERS, BROADCASTERS AND AUTHORS are at risk of being dragged to the far corners of the globe to defend libel suits, say critics of a recent Ontario Court of Appeal decision. ...

CANADIAN PUBLISHERS, broadcasters and authors are at risk of being dragged to the far corners of the globe to defend libel suits, say critics of a recent Ontario Court of Appeal decision. The majority in Goldhar v. Haaretz ruled in late June that an Israeli newspaper that allegedly defamed a Toronto real estate developer by criticizing his management of an Israeli soccer team could be sued in Ontario. “Goldhar suggests that anyone can be sued anywhere, so long as there is at least one reader of the alleged libel in the foreign jurisdiction,” says Paul Schabas of Blake, Cassels & Graydon LLP in Toronto, who represented Haaretz.

Schabas postulates the case of an Israeli resident who has bought the Toronto Maple Leafs and flies to Canada a few times a year to watch the team play. “The owner would be a celebrity here even if no one ever heard of her in Israel, but on the basis of this judgment, she could sue in Israel, and the Canadian publishers of the alleged libel would have no choice but to defend themselves because any Israeli judgment would likely be enforceable in Ontario,” he says. “From the point of view of the communications industry, that’s tantamount to interfering with the media, and also represents a large financial burden, especially on smaller companies.”

But William McDowell of Lenczner Slaght Royce Smith Griffin LLP, counsel for plaintiff Michael Goldhar, who bought the Israeli soccier club Maccabi Tel Aviv F.C., in 2010, doesn’t see things that way. “There’s always a burden on the plaintiff to demonstrate that there is a reason for him to vindicate his reputation in his forum of choice,” McDowell says. “It’s not like we have a completely open season.”

Still, according to Schabas, it doesn’t make practical sense to try the case in Israel. “The evidence is that there are 19 witnesses from Israel to be called by the defendant, and suddenly we have to bring everyone to Toronto,” he explains. “Interpreters are going to be necessary and an enormous expense, and the court will be hearing about matters of public interest in Israel that no one here knows anything about.”

Not surprisingly, Schabas prefers the dissent articulated by Justice Sarah Pepall to the majority ruling written by Justice Janet Simmons and concurred in by Justice Eleanore Cronk. “Pepall’s dissent demonstrates that there’s a real danger in taking jurisdiction when we shouldn’t. If Canadian courts were to refuse jurisdiction, our press would be less exposed to other countries taking jurisdiction in cases involving them.”

Haaretz has a print circulation of 70,000 in Israel. But because the evidence established that up to 300 Canadians read the impugned article online and that many of Goldhar’s 200 employees in Toronto had heard about it, Schabas did not dispute that the alleged tort was committed in Ontario as well as in Israel. Instead, he argued that his client had rebutted the presumption of jurisdiction because there was no real relationship or only a weak relationship between the subject matter of the litigation and Ontario.

But the majority concluded that the action did indeed have a “significant connection” to Ontario: “What is important is that the alleged sting of the article is very much related to how Goldhar conducts business in Canada because the article draws a link between Goldhar’s management model and his Canadian business,” Simmons wrote. “Although the main subject of the article may be the management of an Israeli soccer team, the article makes Goldhar’s management model — and its Canadian origins — an integral part of that subject.”

Pepall, however, reasoned that jurisdiction should attach where Goldhar’s reputation had suffered most. She also concluded that the analysis of the motions judge, Superior Court Justice Mario Faieta, was faulty. Particularly objectionable was his reliance on Goldhar’s undertaking to pay for the travel and accommodation of Haaretz’s witnesses from Israel. Plaintiffs, she wrote, should not “be permitted to buy passage to a forum” due to “his or her financial heft.” Schabas tells Lexpert that his client intends to seek leave from the Supreme Court of Canada, and that he expects interest from intervenors. “This case highlights issues that the high court in its previous decisions left open for another day.”