By: Sangeetha Punniyamoorthy and Thomas Kurys  (Toronto)

The Supreme Court of Canada recently released a landmark decision in which a broad worldwide injunction was upheld restraining Google from including certain websites in its search results anywhere in the world. Intellectual property rights-holders seeking to enforce intellectual property rights in an online world where infringers are outside Canada or operating globally welcomed the decision in Google Inc. v. Equustek Solutions Inc. 2017 SCC 34. The finding from Canada’s highest Court gives creators and intellectual property content owners an effective tool where the enjoining conduct is “occurring online and globally” via search engines. As the Supreme Court emphasized:

“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.”

Background

In the underlying case, Equustek Solutions Inc. (“Equustek”) had sued the defendants (“Datalink”) for allegedly selling products online that infringed the trademark and trade secret rights of Equustek. Datalink failed to comply with interim court orders and fled the jurisdiction. Equustek then approached Google to have it remove from its search indexes certain websites related to Datalink. Google, a non-party to the underlying litigation, was not alleged to have acted unlawfully or to have contravened any existing court orders. Google agreed to remove over 300 specific pages (or URLs) from its google.ca search results, but refused to block Datalink’s entire domain or to remove the offending websites from google.com or other national Google domains. This enabled Datalink to easily circumvent Google’s efforts by setting up websites under different URLs, thus creating a “Whack-A-Mole” problem for Equustek.

Equustek was not satisfied and pursued the injunction to enjoin Google from displaying any part of Datalink’s websites on any of Google’s search results worldwide. The motions Judge found that an interlocutory remedy compelling Google to block Datalink’s websites worldwide was necessary to preserve the Court’s process in the new reality of e-commerce. Google unsuccessfully appealed to the British Columbia Court of Appeal who concluded that there had been “no realistic assertion” that the order would offend the sensibility of any other state’s core values and the only practical way for the offending websites to be inaccessible was to grant a worldwide injunction. Google then appealed to the Supreme Court of Canada.

Supreme Court of Canada’s Decision

In a 7:2 split decision, the majority of the Supreme Court dismissed Google’s appeal and held that a worldwide injunction was necessary to prevent the irreparable harm to Equustek that flowed from Datalink carrying on business on the Internet. Limiting the injunction to Canada or google.ca would not prevent the harm. Purchasers outside Canada would still be able to purchase the offending products and purchasers in Canada would still be able to find Datalink’s websites. Moreover, the worldwide effect of the injunction did not tip the balance of convenience in Google’s favour. Google need only take steps where its search engine is controlled – not around the world. And Google did not suggest that in de-indexing the websites it would be inconvenienced or incur expenses in a material or significant way.

Furthermore, the majority dismissed as “theoretical” the argument that the injunction violates international comity because it is possible the injunction may not have been obtained in a foreign jurisdiction or that compliance would result in Google violating the laws of that foreign jurisdiction. Nor did the majority see freedom of expression issues being engaged in any way that tips the balance of convenience. The majority noted that if Google had evidence that compliance would violate foreign laws, it was free to apply to the lower courts to vary the order.

Implications and Next Steps (Updated August 2, 2017)

This decision affirms that Canadian courts will assume jurisdiction and make extraterritorial orders with global effect against innocent search engines and Internet intermediaries located outside Canada to prevent access to content deemed unlawful. As such, this decision has relevant implications not only for Internet intermediaries, but also for rights-owners and others seeking to protect intellectual property rights. Although this ruling arose in the intellectual property context, it can also support global orders against Internet intermediaries in which the underlying dispute relates to other areas of law, such as defamation, privacy, cybersecurity, and beyond.

However, this is not the end of the battle. After the disappointing result for Google from Canada’s highest Court, on July 24, 2017, Google filed a claim with the United States District Court for Northern California alleging that globally removing the search results violates U.S. law and thus Google should not be required to comply with the Canadian Supreme Court’s “novel worldwide order”. Google states that it has “exhausted its Canadian appeals” and alleges that the Canadian order is unenforceable since it offends the First Amendment right and the Communications Decency Act.  Google further argues that the order violates principles of international comity, particularly since Equustek “never established any violation of their rights under U.S. law”.  Clearly this is not the end of this dispute and the legal community will be watching this case very closely to see how the U.S. District Court grapples with these issues.

Until then, Canada is an ideal venue to enforce rights in many areas of law and seek a global remedy when dealing with the realities of unlawful conduct occurring on or encouraged by a borderless internet operating around the world.