Defendant in libel suit filed by lobbyist ordered to pay plaintiff costs in fending off SLAPP motion

An Ontario court judge has ruled that a defendant in a defamation case must pay $50,000 towards the costs incurred by political lobbyist Kory Teneycke in successfully fending off a Strategic Litigation Against Public Participation (SLAPP) motion, hoping it will deter similar unwarranted lawsuits.

“Awarding costs to the plaintiffs in these circumstances will go some way toward dampening not only these defendants but perhaps other defendants’ enthusiasm for taking the anti-SLAPP route where, as here, the factual context simply does not fit the SLAPP description,” Justice Edward Morgan of the Superior Court of Justice for Ontario wrote in a decision released earlier this month.

He decided on costs earlier this month after ruling in April that Teneycke, Premier Doug Ford’s campaign manager, would proceed with a suit against controversial evangelist Charles McVety.

The decision is one of several handed down recently involving costs surrounding SLAPP applications, including a recent decision that awarded $315,000 towards costs of the Canadian Nurses Association and Together News Inc. They were defendants in a $1-million libel action by three nurses, calling themselves Canadian Frontline Nurses, who faced disciplinary action for their anti-vaccine views during the pandemic.

Superior Court of Justice judge Marie-Andrée Vermette dismissed the action in December, calling the plaintiffs’ decision to sue “puzzling” and “surprising.” Earlier this month, the judge awarded costs on a full indemnity basis to CNA Defendants ($250,000) and $65,000.00 on a substantial indemnity basis to the TNI Defendants. The nurses’ group had originally asked for $410,000 and TNI about $75,000.

The nurses’ association argued that the libel action bore “the hallmarks of a strategic lawsuit against public participation and was intended to chill off the CNA defendants from opposing the plaintiffs’ positions about COVID-19 health measures and protecting the public.”

Justice Vermette said this case “may not be a traditional SLAPP suit involving, among other things, a financial or power imbalance.” Still, there is “significant importance of the expression in issue, the chilling effect of the lawsuit, the failure to show that the publications in issue had caused any harm, and the puzzling nature of the Plaintiffs’ decision to sue the CNA defendants and the TNI defendants.

Lawyer Paul Champ, who acted for the TNI defendants in getting the successful SLAPP-related motion, says there is "no question that the court system is being clogged" with these applications. "I’ve been on both sides." 

On the one hand, Champ says he hopes these cases will lead to fewer defamation actions on matters that pertain to the public interest, but at the same time, "I also feel strongly that we are seeing these motions used as a procedural weapon, primarily because under [current rules] there are presumptively no cost consequences for the defendant if the motion is dismissed."

There aren’t many cases where judges have ordered costs against defendants who bring unsuccessful motions, Champ says, but "clearly this judgment by Justice Morgan suggests that may be starting to change."

In the Teneycke case, in a 13-page April ruling, Justice Morgan rejected McVety’s bid to have Kory Teneycke’s defamation suit thrown out as a SLAPP action. Teneycke, president of Rubicon Strategy, had sued McVety in 2021 after the evangelical Christian leader made numerous public accusations against the veteran political strategist.

“It was McVety’s expressed view that it was Teneycke, who McVety alleged had lobbied the government on behalf of pharmaceutical companies, who was the ‘real reason’ for the government’s change of heart on vaccine passports,” Morgan wrote in his decision.

He referred to Ford’s move during the COVID-19 pandemic to issue digital passports for Ontarians vaccinated. During the health emergency, proof of vaccination had to be shown to enter gyms, indoor restaurants, theatres, sports venues, and casinos.

“He [McVety] began to flag in speeches, on the internet, and on social media that Teneycke’s company, Rubicon, is a registered lobby firm that has represented, among other clients, some major pharmaceutical companies and vaccine producers, including Pfizer and AstraZeneca,” the judge wrote. 

Justice Morgan noted that McVety also blamed Teneycke, whose clients include the Council of Ontario Universities, for allegedly opposing Canada Christian College gaining university status.

McVety and the CCC had asked that the defamation suit be dismissed under the SLAPP rules, as their allegations were “expressions of truthful facts and responsible communication and/or fair comment on political issues, such that the charge of defamation has no merit and the defences will prove to be valid.”

However, Teneycke argued that his claim had merit, that McVety and the college “have no viable defence to the claim,” and that the public interest to permit the proceeding to continue outweighs the public interest in protecting free speech.

After McVety lost his motion, Teneycke applied to the court for costs. Justice Morgan noted in the June ruling that judges have the discretion to award costs against a defendant on an unsuccessful motion to dismiss a lawsuit under SLAPP rules in cases with “compelling facts” to justify the award. 

Justice Morgan wrote: “In the present case, the sting of the defendants’ words was significant for the plaintiff – especially the individual plaintiff, Kory Teneycke – whose claim is based on defamation in respect of his professional reputation.”

But that alone does not differentiate the case from many such cases since anti-SLAPP motions most typically arise in lawsuits alleging defamatory speech.

“More significant here is that the defendant, Charles McVety, holds a prominent position as a clergyman and educator. His outspokenness and prominence give him a particularly wide audience in traditional media as well as social media. Accordingly, any reputational harm engendered by his words and broadcasts reverberates further than for other less media-savvy speakers.”

Justice Morgan also found “there was malice underlying the [McVety’s] publications and speeches about the plaintiffs, which adds significantly to the harm inflicted upon them.” McVety “went out of his way” to mass e-mail members of the Ontario legislature and federal Parliament about Teneycke, who, as a professional lobbyist, considers this a direct “targeting” of his livelihood. 

“McVety’s words, broadcast directly to a group of politicians, accused [Teneycke] of quasi-criminal misconduct, including illegal lobbying and corruption. This was exceptionally damaging, intentional conduct.”

Justice Morgan referenced a recent decision by the Ontario Court of Appeal, Park Lawn Corporation v. Kahu Capital Partners Ltd, which stressed “the need for courts to re-focus on the issue of costs in the anti-SLAPP context.

The law that allows for SLAPP motions was “meant to forestall meritless and expensive litigation by providing a preliminary and expeditious way of dealing with issues of public speech.” However, such motions have become “expensive, time-consuming and open to abuse.” One reason for that is, if successful, the motion “can be dispositive of the entire claim.”

Typically defendants in defamation suits “put great effort into scoring this kind of early, total victory,” Justice Morgan said. “In response, plaintiffs and their lawyers typically put considerable resources into responding to anti-SLAPP motions, as they have much – indeed, everything – to lose if they do not put their best foot forward.”