Court Orders Yellow Marketing Group To Pay $9 Million In Penalties

Author:Mr René Bissonnette
Profession:Gowling Lafleur Henderson LLP

On March 1, 2012, the Ontario Superior Court of Justice found that five companies and three individuals (collectively the Yellow Marketing Group) had made misleading representations to the public in contravention of the federal Competition Act and ordered them to pay over $9 million in administrative monetary penalties (AMPs), the highest ever awarded in contested proceedings regarding false or misleading representations in Canada.

The impugned representations were principally contained in unsolicited faxes that were sent to numerous Canadian individuals, businesses and organizations. The unsolicited faxes contained third-party trade-marks owned by the Yellow Page Group (the Yellow Marketing Group is distinct from the Yellow Pages Group, the latter of which operates the popular telephone directory business), with the "Walking Fingers" logo and the words "Yellow Pages." The Commissioner of Competition alleged that the unsolicited faxes led Canadians to believe that they were updating their existing records with the Yellow Pages Group, whereas the fine print revealed that they were actually signing a new two-year contract with the Yellow Marketing Group for "internet business directory" services. Canadians who responded to the unsolicited faxes by filling out the requested information subsequently received invoices totaling $2,856.

The Court agreed with the Commissioner's assessment of the matter, finding that the unsolicited faxes were "intended to deceive and did, in fact, deceive many Canadian businesses and individuals into believing they were dealing with the [Yellow Pages Group]." Further, the Court found that "the fact...

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