Fortress Real Developments Inc v Rabidoux 2018 ONCA 686

Note

The ONCA upheld the lower court decision under s. 137.1 of the CJA and dismissed Fortress's appeal from the order dismissing its action against Mr. Rabidoux.

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Decision Summary

Mr. Rabidoux operates his own “one-man” business. He provides market research and opinions to institutional investors and to various media outlets. Mr. Rabidoux focuses on the real estate market in Canada. In his affidavit filed on the motion, Mr. Rabidoux indicates that he is regarded as “a leading expert in Canadian housing and household credit trends”. He holds the view that Canadian real estate is, generally speaking, overvalued and that some of those who promote certain kinds of real estate investments, such as some kinds of syndicated mortgages, significantly underestimate the risks associated with those investments. In essence, Mr. Rabidoux sees the real estate investment market in Canada as overhyped and under-regulated.

Mr. Rabidoux is not shy about expressing his opinions. He does so regularly through various forums, including his Twitter account. The evidence on the motion was that as of April 2016, he had about 3,880 followers. At least some of Mr. Rabidoux’s followers are avid supporters. He and his supporters often retweet each other’s tweets.

The corporate appellants, Fortress Real Developments Inc. and Fortress Real Capital Inc., are in the real estate development business across Canada. They identify and develop large real estate projects, including condominiums and commercial properties. Their projects are mainly financed by large institutional lenders and by individuals through syndicated mortgage loans. Fortress also offers advice to other real estate developers.

The alleged defamatory tweets were made in the course of an ongoing Twitter exchange between Mr. Rabidoux and his supporters on one side, and Fortress and its supporters on the other. Their exchanges have gone on for years. Many are referred to in the motion record. Some of the comments made by both sides take on the tone of what would be described in the sports world as “trash talk”. Most of the tweets can be understood only by persons who are familiar with the prior Twitter exchanges and the subject matter of those exchanges. Some of the comments, coming from both sides, are sarcastic and seem more calculated to entertain or to embarrass than to enlighten.


Fortress raises two grounds of appeal. First, it argues that the motion judge interpreted s. 137.1(3) too broadly and without regard to either the appellants’ established right to sue for defamation, or the kind of expression s.137.1 was designed to protect. Fortress submits that the phrase “matter of public interest” in s. 137.1(3) must, as a matter of statutory interpretation, be read narrowly to minimize the interference with a plaintiff’s established right to seek compensation for damages arising from defamatory statements. Fortress further argues that the legislation is only intended to protect “responsible” and “legitimate” expression on matters of public interest.
Second, Fortress submits that the motion judge erred in her interpretation of s. 137.1(4)(b). Fortress argues that the motion judge wrongly limited her harm assessment to evidence of specific damages suffered as a direct consequence of the impugned expression. Fortress further submits that the motion judge erred in failing to consider the nature of the public interest engaged in protecting the actual expression found in the impugned tweets. Fortress refers to the tweets as “insults or invective intended to harm the Appellants” with no real public interest value.
Applying the analysis in Pointes, I read the tweets as intended to educate and caution the investing public about the risks associated with certain kinds of real estate-based investments. The identified risks include sudden downturns in the real estate market, false predictions of future investments, and “shady”, inadequately regulated operators who understate the risks associated with certain kinds of investments. In my view, alerting the investing public to risks associated with the purchase of certain products in the public marketplace is a matter of public interest.
...while the motion judge’s public interest analysis was not as fulsome as it should have been, my analysis arrives at the same result. Fortress failed to show that the harm caused or likely to be caused to it by the impugned tweets is “sufficiently serious” to outweigh the public interest in protecting Mr. Rabidoux’s right to freedom of expression.
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Last modified on 24 November 2018, at 12:49