Written on behalf of Feigenbaum Consulting
The Supreme Court of Canada recently issued a groundbreaking decision involving Google, search data, and a plaintiff’s request to have search results de-indexed (i.e. a request to have Google change what appears when you search for a particular term online). This is one of many cases worldwide dealing with traditional legal disputes, such as injunctions, within a new technological and digital reality.
Equustek, a small tech company in British Columbia, sought a court order compelling Google to globally de-index the websites of Datalink, another tech company that was in breach of several court orders, including an order against illegally selling Equustek’s intellectual property.
At the heart of the legal dispute was an Equustek product (a networking device) that Equustek claimed Datalink had been re-labeling and passing off as its own (while Datalink had been contracted to distribute the product on behalf of Equustek).
When Equustek discovered what had been happening, it terminated its agreement with Datalink and demanded that Datalink delete all references to Equustek’s products and trademarks on its websites. Datalink refused.
Initial Injunction Ordered
Equustek then obtained an injunction ordering Datalink to return all intellectual property that Datalink had in its possession that belonged to Equustek and further prohibiting Datalink from referring to Equustek or any of Equustek’s products on its websites. Instead of complying with the injunction, Datalink set up a location outside of Canada and continued to do the same thing.
A series of additional injunctions ordered by a Canadian court followed, with Datalink ignoring each one and, as the Supreme Court noted, “continu[ing] to carry on its business from an unknown location, selling its impugned product on its websites to customers all over the world.”
Since Equuistek did not know where Datalink or its suppliers were, and having been unsuccessful in its attempts to have the websites removed by the websites’ hosting companies, Equuistek approached Google and asked Google to de-index the Datalink websites.
Google refused, limiting the de-indexing to any searches conducted on Google’s Canadian site (google.ca). The problem was that Datalink’s websites containing Equuistek’s products could be accessed through Google’s other country specific sites, even by someone searching in Canada. As such, Google’s de-indexing was not effective.
This de-indexing involves having a webpage, image or other online resource removed from the search engine’s results when a particular search term (in this case, the name of Equuistek’s product) is used. The ongoing de-indexing dispute in this case was well outlined by the Supreme Court:
Google had limited the de-indexing to those searches that were conducted on google.ca. Google’s search engine operates through dedicated websites all over the world. The Internet search services are free, but Google earns money by selling advertising space on the webpages that display search results. Internet users with Canadian Internet Protocol addresses are directed to “google.ca” when performing online searches. But users can also access different Google websites directed at other countries by using the specific Uniform Resource Locator, or URL, for those sites. That means that someone in Vancouver, for example, can access the Google search engine as though he or she were in another country simply by typing in that country’s Google URL. Potential Canadian customers could, as a result, find Datalink’s websites even if they were blocked on google.ca. Given that most of the sales of Datalink’s GW1000 were to purchasers outside of Canada, Google’s de-indexing did not have the necessary protective effect. In order to de-index the search across all Google search engines, Equuistek then asked the court for an interlocutory injunction.
In order to de-index the search across all Google search engines, Equuistek then asked the court for an interlocutory injunction. Interlocutory Injunctions are temporary court orders ordering a party to take certain steps, continue acting in a certain manner, or refrain from particular action until a further order is made.
The Supreme Court applied a three pronged test from a previous case to determine whether to grant an interlocutory injunction against Google to compel the search engine giant to de-index Datalink websites worldwide:
- Is there a serious issue to be tried;
- Would the company suffer irreparable harm if the injunction were not granted; and
- Is the balance of convenience in favour of granting the injunction or denying it?
Google argued that they were a non-party in the process, simply providing a search engine, and so should be excused from having to act on the injunction. While the Court found that Google was not liable for the damages caused to the manufacturer, they could still be subject to an interlocutory injunction.
The Court argued that although the company was outside Canada, the internet has no borders and the search could be accessed within Canada and had a direct link to Canadian commerce:
The problem in this case is occurring online and globally. The Internet has no borders — its natural habitat is global. The only way to ensure that the interlocutory injunction attained its objective was to have it apply where Google operates — globally. As Fenlon J. found, the majority of Datalink’s sales take place outside Canada. If the injunction were restricted to Canada alone or to google.ca, as Google suggests it should have been, the remedy would be deprived of its intended ability to prevent irreparable harm. Purchasers outside Canada could easily continue purchasing from Datalink’s websites, and Canadian purchasers could easily find Datalink’s websites even if those websites were de-indexed on google.ca. Google would still be facilitating Datalink’s breach of the court’s order which had prohibited it from carrying on business on the Internet. There is no equity in ordering an interlocutory injunction which has no realistic prospect of preventing irreparable harm.
Google had made the argument that de-indexing the company would run contrary to the principle of freedom of expression. However, the court disagreed. The court found that since Equuistek’s trademark rights were being violated by Datalink illegally manufacturing their trademark-protected property,Datalink should not be protected under the grounds of freedom of expression, because freedom of expression is not a principle meant to protect illegal activity.
What Does This Mean Going Forward?
While on the surface, this case was simply a matter of an infringement of trademark rights, because the case revolved around the access to the information, and demanding a search engine, claiming non-party status, to remove information from their site that acted against the commercial interests of a wronged party, it opens the door for greater accountability of the providers of information, and for the roles communication providers play in the modern world.
As much of the global economy increasingly looks to new forums and means of connecting people with shared interests across common communication channels, often garnering a profit for connecting people, and since so much of this communication is channelled around marketing and finding newer and more sophisticated marketing platforms, cases such as the above begin to set guidelines, rules, and laws to govern and tame the flow of information.
If you are involved in a corporate commercial dispute, including a commercial dispute in a novel or emerging area of law, or any related litigation, contact Mark Feigenbaum for exceptional representation and guidance. We have many years of interdisciplinary knowledge in law, accounting, and finance and significant cross-border tax experience that make us well-equipped to represent you, your business, and your assets. Contact Mark online or call us at (905) 695-1269 or toll-free at (877) 275-4792 to book a consultation.