Sealing the Ottawa Senators financial fate

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January 9, 2004 (Ont. SCJ 03-CV-02419)

Maureen L. Murphy, Gowling Lafleur Henderson LLP, contributed this summary of the significance of this case:

1. I attach a recent decision on costs in an application for a sealing order in the proceedings involving the sale of Ottawa Senators Hockey Club Corporation and Palladium Corporation (Corel Centre Arena). The decision emphasizes the important role played by the media in applications for sealing orders and provides that the media should not be subject to the threat of a costs order in such applications.

2. When Capital Sports & Entertainment Inc. and Capital Sports Properties Inc. entered into agreements to purchase the Ottawa Senators Hockey Club and the Corel Centre Arena, respectively, they sought and obtained partial and temporary sealing orders to protect the details of the sales (described in asset purchase agreements) from being disclosed to the public.

3. After the sale processes were complete, Capital Sports sought to make these sealing orders permanent. The Ottawa Citizen Group Inc. and the Canadian Broadcasting Corporation opposed the motions for permanent sealing orders and made submissions to the Court. On October 3, 2003, the Honourable Justice Chadwick granted the applicants' requests and ordered that the asset purchase agreements for both the team and the arena should remain sealed.

4. Counsel for Capital Sports subsequently made submissions seeking an order of costs of the motion in the amount of $26,490.00 plus disbursements against the Ottawa Citizen Group Inc. and the Canadian Broadcasting Corporation. In his decision issued January 9, 2004, Justice Chadwick denied the application for costs and noted the valuable contribution of the media in the sealing order applications.

5. Justice Chadwick found the media acted in good faith and provided assistance to the court and concluded:

In my view, if the media are opposing an application for a sealing order in a responsible and proper fashion, then they should not be subject to the threat of a cost order being made against them.

6. The media should not be subject to a costs order when it is "carrying out its responsibility to keep the public informed."This decision will be a useful precedent in any future application where an applicant attempts to reclaim its costs on a sealing order motion (or on an application for a publication ban) from the media participants.

See In the Matter of the Interim Receivership of Palladium Corporation (PDF)

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