Kaplan v. Casino Rama Services Inc., 2019 ONSC 2025

Justice Edward Belobaba of the Ontario Superior Court of Justice dismissed a motion to certify a privacy class action arising out of a cyberattack on Casino Rama that included allegations of breach of privacy, breach of contract and negligence. This was the first contested certification hearing relating to a cyberattack against an Ontario company.

The proposed class proceeding related to a criminal cyberattack in 2016 in which an anonymous hacker accessed Casino Rama’s computer system and stole data relating to customers, employees, and suppliers. When ransom demands proved futile, the hacker posted the stolen data on the internet. Casino Rama and the Ontario Lottery and Gaming Corporation promptly responded to the cyberattack by, among other things, notifying all appropriate authorities and implementing a broad notice program for patrons and employees. By the time of the certification motion, there was no evidence that anyone had experienced compensable financial or psychological loss as a result of the cyberattack.

The court held that “[t]he fact that there are no provable losses and that the primary culprit, the hacker, is not sued as a defendant makes for a very convoluted class action. Class counsel find themselves trying to force square (breach of privacy) pegs into round (tort and contract) holes.” Justice Belobaba held that the proposed class action ultimately “collapse[d] in its entirety” under the common issues certification criterion. “Any common issues are completely overwhelmed by these individual investigations, such that commonality is not established,” he wrote.

The plaintiffs have filed notices of appeal of the decision with the Ontario Divisional Court and the Ontario Court of Appeal.

The plaintiffs were represented by Theodore P. Charney and Tina Q. Yang of Charney Lawyers and David Robins of Strosberg Sasso Sutts LLP.

The defendants, CHC Casinos Canada Limited, the Ontario Lottery and Gaming Corporation, Casino Rama Services Inc., and Penn National Gaming, Inc., were represented by Blake Cassels & Graydon LLP, with a team led by Cathy Beagan Flood and Nicole Henderson, and including Anne Glover, Wendy Mee, John Tuzyk, Bryson Stokes, Jessica Lam and Christopher DiMatteo.