On April 27, 2015, a jury delivered 60 “not guilty” verdicts thereby acquitting six individuals and three corporations who stood accused of bid-rigging under s. 47(1)(b) of the Competition Act and s. 465(1)(c) of the Criminal Code.
The accused were Marina Durward, Susan Laycock, Philip McDonald, Donald Powell, Thomas Townsend, Ronald Walker, David Watts, The Devon Group Ltd., Spearhead Management Canada Ltd., and TPG Technology Consulting Ltd.
The eight-month-long trial before the Ontario Superior Court of Justice that preceded this verdict was one of the largest proceedings of this nature in Canadian history.
The trial addressed issues in competition and procurement law that had little tono precedent.
The charges related to ten Requests for Proposals (RFPs) issued by Public Works and Government Services Canada (PWGSC), Transport Canada (TC) and the Canada Border Services Agency (CBSA) in the summer and fall of 2005. The Competition Bureau initiated an investigation in 2005 and subsequently laid charges in February 2009.
Had the individuals and companies been found guilty, they faced possible imprisonment of up to five years, debarment from conducting any business with the federal government for up to 10 years and major fines.
The trial involved approximately half-a-million pages of documents and was held in a specially designed electronic courtroom on Elgin Street in Ottawa.
Due to the length of the proceeding, many of the accused could not afford a lawyer, were self-represented and relied on other trial counsel to lead the defence.
In her 300-page charge to the jury, which forms the only legal “decision” arising from the trial (as juries deliver no reasons), Justice Bonnie Warkentin provided important guidance in this area of the law.
There were four general questions that were put to the jury:
1) Was the RFP a “call for bids or tenders”?
2) Did the accused honestly but albeit mistakenly believe that the RFP was not “call for bids or tenders”?
3) Was the bid or tender “arrived at by agreement or arrangement”?
4) Was the agreement or arrangement “made known to the person calling for the bids or tenders at or before the time when they were submitted"?
On the first question, Justice Warkentin turned to principles in procurement law, particularly the Contract A/B paradigm, to find that not every RFP could result in a call for bids or tenders. Instead, the parties had to intend for there to be a contract resulting from the process in order for the process to be a true “call for bids or tenders,” and therefore to fall under the Act.
Second, turning to the well-established criminal law principle of mistake of fact, Justice Warkentin found that if the accused had an honest but mistaken belief that the RFPs were not calls for bids or tenders, they must be acquitted.
Third, Justice Warkentin turned to the wording of the Act and the few legal cases that existed on the question of what constituted “arrived at by agreement or arrangement.” She concluded that this required some impermissible act. In other words, not every agreement in furtherance of delivering a bid would fall under the Act.
This was important in this case because the Crown asserted that agreements by the accused to secure resources, in order to formulate their proposals, were caught by the Act and illegal.
Fourth, Justice Warkentin found that the “made known” defence available under the Act could be satisfied by means other than a formal and explicit notice.
If, for example, the caller of the bids had knowledge of an agreement between bidders, and this was known to it prior to the submission of the bids, this could satisfy the made known requirement.
In advance of trial, there were numerous preliminary decisions including one that went to the Ontario Court of Appeal.
During trial and at the conclusion of the Crown’s case, the judge issued a directed verdict acquitting David Watts, one of the self-represented accused.
A further preliminary decision, and of particular significance to the trial and the jurisprudence, the trial judge struck down s. 69(2) of the Competition Act on Charter grounds.
That section created a reverse onus provision whereby an accused was deemed to have read and accepted the contents of documents seized at their premises. For example, an accused would be deemed to have read and accepted the content of all emails found on their computer. Justice Warkentin took judicial notice that in today’s world, people cannot be assumed to have read all their emails that find their way into their inbox.
She concluded that such a provision violated constitutional guarantees of presumption of innocence and could not be saved by the Oakes test.
Following the jury’s verdict, the Crown decided not to appeal and abandoned the case. It also abandoned its case against four other accused who were awaiting a judge-alone trial arising from the same investigation.
The accused TPG Technology Consulting Ltd. and Philip McDonald were represented by Peter Mantas, Patrick McCann, Tala Khoury and Alexandra Logvin of Fasken Martineau DuMoulin LLP.
The accused Ronald Walker was represented by Leslie E. Wilbur of Leslie E. Wilbur Law Firm.
The prosecution was represented by Denis Pilon, Narissa Somji and Valerie Chénard of the Public Prosecution Service of Canada.
The accused in the abandoned judge-alone trial were represented as follows: Donna Cona Inc., Barry Dowdall and David Gelineau by William Vanveen of Gowling Lafleur Henderson LLP; and Perry Henningsen by Norman Boxall of Bayne, Sellar, Boxall.