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Executive Summaries Sep 16, 2022

Is the Loss of Personal Information Sufficient to Justify the Success of a Class Action on the Merits?

By

Shaun E. Finn, Camille Rivard

In an article published by Thomson Reuters[1], our partner Shaun E. Finn and law student Camille Rivard discuss an important judgment of the Court of Appeal of Québec, which confirms the first dismissal on the merits of a privacy class action in Canada.

The Court of Appeal of Québec recently upheld the conclusions and reasoning of the Superior Court of Québec in the judgment Lamoureux c. Investment Industry Regulatory Organization of Canada (IIROC).

In first instance, the Superior Court dismissed a class action for loss of personal information contained on a laptop on the basis that the “generally negative feelings felt” following this loss did not cross the threshold of the “annoyances, anxieties and fears that people living in society routinely, if sometimes reluctantly, accept.”

The Court of Appeal confirmed that, for the compromise of personal information to justify the success of a class action on the merits, the claim must prove, among other things, that the members of the class suffered compensable harm. It is not enough to plead the inconveniences with which people living in society must contend. Moreover, the presence of a fault recognized by the defendant itself is not necessarily fatal.

A defendant may minimize the chances that a class action will be allowed – or granted – against it, including:

  • creating an institutional culture that values the personal information and privacy of its customers, clients and/or employees;
  • adopting policies, as well as appropriate protective measures (technological and human), and ensuring that they are diligently implemented;
  • taking the proper steps following the loss or dissemination of personal information or a cyberattack; and,
  • act proactively to avoid or mitigate any harm that may result from such an incident.

This decision of the Court of Appeal of Québec is an important precedent as it confirms the first dismissal on the merits of a class action in matters of privacy in Canada and provides businesses and institutions with a roadmap in order to protect themselves from such proceedings.

[1] Shaun E. FINN and Camille RIVARD, “Commentaire sur la décision Lamoureux c. Organisme canadien de réglementation du commerce des valeurs mobilières (OCRCVM) – La Cour d'appel confirme que les gens vivants en société doivent accepter certains désagréments à contrecœur”, in Repères, September 2022, Reference, EYB2022REP3504.

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