Open courts and corporations

A new court decision highlights the steep hill a corporation must climb to claim anonymity

It is the start of jazz festival season across the country. I will be attending the Ottawa Jazz Festival most days between June 20 and 29. I hope wherever you are you can get out to enjoy jazz in the sunshine.

Notice: The Adjudicator’s Toolkit is taking a summer beach break - there will be no newsletters in the month of July and the first full week of August. For the summer break period only, free subscribers will have access to the newsletter archive.

Anonymization of corporations

The recent decision of the Yukon Superior Court in BC v KP, 2025 YKSC 34 is a good reminder that restrictions on the open court principle should be limited to individuals and not generally be extended to corporations.

This decision involved ongoing litigation involving alleged harassment and assault at a mine site. The plaintiff and the named individual defendants were granted anonymity because of the nature of the allegations. The business that employed the defendants, Sodexo (also a defendant) requested that it be anonymized as well.

The court applied the confidentiality test set out in Sherman Estate v Donovan, 2021 SCC 25:

(1) court openness poses a serious risk to an important public interest;

(2) the order sought is necessary to prevent this serious risk to the identified interest because reasonably alternative measures will not prevent this risk; and

(3) as a matter of proportionality, the benefits of the order outweigh its negative effects.

A loss of business due to the disclosure of information in court proceedings is not sufficient in itself to limit court openness (Sierra Club of Canada v Canada (Minister of Finance), 2002 SCC 41 at para. 55.

Sodexo argued that disclosure of its name would be a serious risk to two important public interests:

• putting its reputation at risk. If named, current and potential clients would not want to use its services and it could lose contracts, money, and its employees would therefore suffer.

• female employees who learn of the court case will feel unsafe working for Sodexo and prospective employees will be dissuaded from applying because of the same concerns.

The court concluded that the risk to the company’s reputation was not an important public interest.

Sodexo stated that reputational risk leading to negative economic consequences has been accepted as being a matter of public interest by the court (A Lawyer v The Law Society of British Columbia, 2021 BCCA 284 and AB v CD, 2022 BCSC 2145). The court said that Sohexho had “misread” the case law. In A Lawyer, the British Columbia Court of Appeal stated that it was not settled whether risk to a party’s reputation is enough to constitute an important public interest (at para. 71). It did not need to determine whether reputation alone could be an important public interest because it concluded that there was more at stake than a simple risk to reputation. The Court of Appeal concluded that the information that would be disclosed was “sensitive personal information that would strike at the core” of the individuals affected and that full court openness would pose a serious risk to the reputational interests of multiple legal professionals. The Yukon Superior Court observed:

[23] Contrary to Sodexo’s submission, A Lawyer does not stand for the principle that risk to reputational harm combined with risk to economic harm may be sufficient to constitute a public interest. Rather, A Lawyer states that a public interest may arise where the reputational risk to the individuals affected is so significant that it affects a core aspect of their lives and dignity.

The court also noted that in both A Lawyer and AB, the negative effects on the parties’ reputations could be sufficient to imperil their abilities to practice their chose professions (lawyer and doctor, respectively). In this case, the allegations are about how Sodexo managed its supervisors and maintained the safety of its work sites - although serious, these allegations do not go the “heart of the services” it provides.

Although in A Lawyer the law firm’s name was anonymized because it bore his name and was owned by the lawyer under investigation: “It would therefore be so closely aligned with the lawyer that anonymization would be required”. In contrast, Sodexo is a large, publicly traded company. Although publicly traded corporations have reputations and privacy interests, the court recognized, “they do not have personal lives or dignity”.

The court concluded that the risks to Sodexo’s reputation (and the potential for economic consequences) was not an important public interest:

[28] … It is inherent in open court proceedings involving individual parties that there will be some invasion of privacy, and with it, can come inconvenience and upset (Sherman at para. 31). There may, additionally, be some risk to the individuals’ reputations. Similarly, for corporations such as Sodexo, some risk to reputation and the risk of some economic consequences may also arise in open court proceedings. Such risks are not, without more, important public interests.

The court also concluded that the risk that female employees and female prospective employees will not feel safe working for Sodexo was an important public interest - but was not a serious risk.

[32] It is not reasonable to conclude that Sodexo’s female employees will feel unsafe in the workplace solely because of knowledge of the allegations in this action. An employee learning of the action would measure the allegations against her own experience in the workplace, and, potentially, against her colleagues’ experiences, as well. Her interactions with her supervisors and other colleagues and prior feelings about the safety of her work environment would have a great influence on how she assesses the allegations and whether Sodexo can provide her with a safe workplace.

Also of some importance was that the work site at issue was now closed.

The court found that there were reasonable alternative measures that could be put in place to address the risk:

[35] An employer has the ability to address employees’ concerns about safety at a worksite. It can provide information to employees and potential employees about how it ensures female employees are not subject to harassment or abuse. It can explain the training it provides to supervisors to recognize and respond appropriately to harassment and abuse. It can also instruct female employees what steps they can take when they are uncomfortable in a work situation. Sodexo has not explained what, if any, steps it has taken to ensure that its female employees and female prospective employees feel safe in the workplace. A corporation should work internally to address potential employees’ concerns before asking a judge to limit court openness.

Lessons for tribunals

• Privacy and dignity interests will rarely apply to corporations, unless the identity of an individual is reflected in the business name or identity. Sole proprietorships and corporations named after partners (such as law firms or other professional practices) may be an exception.

• When looking at reputation of an organization, it is important to determine if the litigated allegations go the “heart of the services” offered.

• Corporations cannot hide behind safety concerns to justify anonymity - at least, not before demonstrating efforts to address those safety concerns internally.

Former Justice La Forest dies

Photo by Michael Bedford, Supreme Court of Canada Collection

Justice Gérard La Forest served on the Supreme Court from 1985 until 1997. He died on June 12 at the age of 99. The Chief Justice issued the following statement:

My colleagues and I mourn the loss of Justice La Forest — an exemplary jurist whose compassion deeply informed the Court’s decisions on issues that touched the lives of all Canadians. As a distinguished appellate judge, legal scholar and public servant, he brought unmatched intellect and experience to the Supreme Court of Canada. His eloquent judgments, spanning many areas of the law, have left a profound and enduring legacy in Canadian jurisprudence. He will be remembered with great respect and admiration.

Former Chief Justice Beverley McLachlin said that he:

…possessed one of the finest legal minds I have ever encountered, shaped by a deep understanding of Canada’s dual legal traditions and marked by clear thinking, wisdom and creativity. He played a seminal role in shaping the jurisprudence that defined the new Charter era.

I will remember him most for his dissent in the Provincial Judges Remuneration Reference. I was working at the federal Department of Justice at the time and was closely involved in crafting the federal government’s legislative response to the decision. Admittedly, my main focus was on the majority decision! But I did appreciate his analysis.

In that decision, the Supreme Court created a new constitutional requirement for judicial compensation committees and a requirement that governments carefully consider their recommendations on judicial salaries and benefits.

Professor Adam Dodek of the University of Ottawa told the CBA’s National Magazine that the dissent was “a tour de force that stands the test of time. It serves as an homage to judicial humility and a caution against judicial overreach”.

Rule of Law Watch

Statement from CBA President Lynne Vicars on Bill S-218

The Canadian Bar Association supports, in principle, the objective of Bill S-218 to introduce safeguards around future federal use of section 33 of the Canadian Charter of Rights and Freedoms, commonly referred to as the “notwithstanding clause”. Requiring greater transparency and deliberation before invoking the notwithstanding clause would help protect fundamental rights, reinforce public confidence in our legal institutions, and curtail uses of section 33 that may have the effect of overriding Charter protections to the detriment of the Canadian public and in particular, to the detriment of marginalized or oppressed individuals and communities.

Economic Development and Henry VIII Clauses: Some Thoughts on Recent Canadian Legislation

…Parliament is considering legislation containing a Henry VIII clause and Ontario’s legislative assembly recently passed a law that tests the boundaries of permissible delegation. In my [Paul Daly’s] view, the proposed federal legislation is constitutionally permissible (and, if appropriately deployed, could be salutary) but the Ontario legislation could well go beyond even the expansive boundaries of delegation of legislative authority recognized by Canadian courts.

A Radical Departure: Remarks on Part II of Bill C-5 (the Building Canada Act)

And this brings me [Martin Olszynski] to sections 21, 22 and 23 – the Act’s Henry VIII clauses – pursuant to which Cabinet will have the authority to make regulations to not merely flesh out the provisions of this Act, as is the normal course, but to modify and even exempt the application of any law in the federal statute book.

This is a staggering power – even by today’s standards. I asked my research assistant to collect and compare the Henry VIII clauses in all such recent legislation – Alberta’s Bill 1(Sovereignty Act), British Columbia’s Bill 7 (Economic Stabilization Act) and Bill 15 (Infrastructure Projects Act), and Ontario’s own Bill 5 (Special Economic Zones Act). Bill C-5 is only matched by Premier Ford’s legislation for its breadth. To their credit, both Premier Smith and Premier Eby scaled back their own versions in the face of public opposition. The Prime Minister should do the same.

Links of interest

FCA Rules that Courts Can’t Tell Government to Fill Judicial Vacancies

In Canada (Prime Minister) v. Hameed, the Federal Court of Appeal set aside a controversial lower court ruling that declared, among other things, that judicial vacancies must be filled within a reasonable time. The Court of Appeal sent a clear message on the importance of the separation of powers, noting that its decision was “an important reminder” for branches of government to maintain “reciprocal respect and deference” for other branches of government.

5 Reasons Lawyers Should Read for Pleasure This Summer