Pinsent et al. v. Sandstrom, 2014 ABQB 269

• Judge: Gates, J.
• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: May 09, 2013
• Citations: 2014 ABQB 269;(2014), 587 A.R. 302 (QB)

Pinsent v. Sandstrom (2014), 587 A.R. 302 (QB)

MLB headnote and full text

Temp. Cite: [2014] A.R. TBEd. MY.024

John Pinsent, Daniel J. St. Arnaud and Randy Thompson (plaintiffs) v. Mark Sandstrom (defendant)

(1203 07753; 2014 ABQB 269)

Indexed As: Pinsent et al. v. Sandstrom

Alberta Court of Queen's Bench

Judicial District of Edmonton

Gates, J.

May 1, 2014.

Summary:

The plaintiffs and the defendant were the directors and shareholders of Optimum Communications Services Inc. The plaintiffs released the defendant from his position as President and Chief Executive Officer of Optimum in December 2009, and removed him as a director in January 2010. In 2011, the plaintiffs began to make arrangements to access services provided by ICAP Patent Brokerage LLC. The defendant contacted ICAP and advised them not to do business with the plaintiffs. The plaintiffs sued the defendant for defamation. The defendant failed to file a statement of defence and was noted in default. The plaintiffs applied for default judgment and an assessment of damages.

The Alberta Court of Queen's Bench held that the plaintiffs were entitled to default judgment against the defendant. The plaintiffs were awarded general damages of $45,000, $25,000 and $20,000, respectively, and aggravated damages of $25,000, $15,000, and $15,000, respectively. The court declined to award punitive damages.

Damage Awards - Topic 632

Torts - Injury to the person - Libel and slander - [See Libel and Slander - Topic 4423 ].

Damage Awards - Topic 2406.1

Aggravated damages - Libel and slander - [See Libel and Slander - Topic 4428 ].

Damages - Topic 907

Aggravation - General - Aggravated damages - Libel and slander - [See Libel and Slander - Topic 4428 ].

Damages - Topic 1308

Exemplary or punitive damages - Libel and slander - [See Libel and Slander - Topic 4429 ].

Damages - Topic 2524

Torts affecting the person - Libel and slander - Considerations in assessing damages - [See Libel and Slander - Topic 4423 ].

Libel and Slander - Topic 641

The statement - What constitutes defamatory statements - General principles - General - The plaintiffs (Pinsent, St. Arnaud and Thompson) and the defendant (Sandstrom) were the directors and shareholders of Optimum Communications Services Inc. - The plaintiffs removed Sandstrom from his positions within the company - The plaintiffs began to make arrangements for Optimum to access services provided by ICAP Patent Brokerage LLC - Sandstrom emailed representatives of ICAP, and told them that, inter alia, (1) Pinsent had attempted to avoid admitting to crimes such as identify theft and extortion in the United States; (2) ICAP should terminate its dealings with the plaintiffs because they were fraudulent directors of Optimum - The plaintiffs sued Sandstrom for defamation - Sandstrom did not file a statement of defence and was noted in default - The Alberta Court of Queen's Bench concluded that Sandstrom was liable for defamation - His words, in the absence of any evidence to support them as truthful, tended to lower the plaintiffs' reputations in the eyes of a reasonable person - The statements unequivocally and factually referred to the plaintiffs, as they were specifically mentioned individually by their names - The defamatory words were clearly published in the emails written to ICAP - See paragraphs 15 to 23.

Libel and Slander - Topic 1946

Publication - What constitutes - Correspondence (incl. e-mail) - [See Libel and Slander - Topic 641 ].

Libel and Slander - Topic 4007

Malice - General - What constitutes malice - [See Libel and Slander - Topic 4428 ].

Libel and Slander - Topic 4423

Damages - General damages - Measure of - Elements and considerations - The plaintiffs (Pinsent, St. Arnaud and Thompson) and the defendant (Sandstrom) were the directors and shareholders of Optimum Communications Services Inc. - The plaintiffs removed Sandstrom from his positions within the company - The plaintiffs began to make arrangements for Optimum to access services provided by ICAP Patent Brokerage LLC - Sandstrom emailed representatives of ICAP, and told them that, inter alia, (1) Pinsent had attempted to avoid admitting to crimes such as identify theft and extortion in the United States; (2) ICAP should terminate its dealings with the plaintiffs because they were fraudulent directors of Optimum - Sandstrom was found liable for defamation - The plaintiffs applied for an assessment of damages - The Alberta Court of Queen's Bench awarded general damages of $45,000 to Pinsent, $25,000 to St. Arnaud, and $20,000 to Thompson, based on the following factors: (1) Sandstrom published the defamatory statements by means of a series of emails addressed exclusively to the CEO and general counsel of ICAP; (2) Sandstrom did not apologize or retract his statements, despite a letter from Optimum's counsel which requested that he withdraw the statements; (3) Sandstrom ignored the request letter and sent another email to ICAP reiterating the "unlawfulness" of the plaintiffs' actions; (4) Sandstrom contacted the City of Edmonton, the RCMP, and a bank, alleging that Pinsent had committed fraud; and (5) the defamatory statements affected Pinsent and St. Arnaud emotionally, mentally and physically, such that they lost sleep while obsessively worrying about trying to do the right thing for themselves and Optimum investors - See paragraphs 41 to 52.

Libel and Slander - Topic 4428

Damages - General damages - Measure of - Aggravated damages - The plaintiffs (Pinsent, St. Arnaud and Thompson) and the defendant (Sandstrom) were the directors and shareholders of Optimum Communications Services Inc. - The plaintiffs removed Sandstrom from his positions within the company - The plaintiffs began to make arrangements for Optimum to access services provided by ICAP Patent Brokerage LLC - Sandstrom emailed representatives of ICAP, and told them that, inter alia, (1) Pinsent had attempted to avoid admitting to crimes such as identify theft and extortion in the United States; (2) ICAP should terminate its dealings with the plaintiffs because they were fraudulent directors of Optimum - Sandstrom was found liable for defamation - The plaintiffs sought aggravated damages - The Alberta Court of Queen's Bench awarded aggravated damages of $25,000 to Pinsent, $15,000 to St. Arnaud, and $15,000 to Thompson - Sandstrom demonstrated a lack of remorse - He maliciously published the defamatory statements, and maliciously assailed the plaintiffs' character and reputations - Sandstrom's intention in writing the emails was to frustrate or terminate the business discussions between Optimum and ICAP - Malicious motive was also apparent from the fact that Sandstrom contacted the City of Edmonton, the RCMP, and a bank, alleging that Pinsent had committed fraud - See paragraphs 53 to 59.

Libel and Slander - Topic 4429

Damages - General damages - Measure of - Exemplary or punitive damages - When available - The plaintiffs (Pinsent, St. Arnaud and Thompson) and the defendant (Sandstrom) were the directors and shareholders of Optimum Communications Services Inc. - The plaintiffs removed Sandstrom from his positions within the company - The plaintiffs began to make arrangements for Optimum to access services provided by ICAP Patent Brokerage LLC - Sandstrom emailed representatives of ICAP, and told them that, inter alia, (1) Pinsent had attempted to avoid admitting to crimes such as identify theft and extortion in the United States; (2) ICAP should terminate its dealings with the plaintiffs because they were fraudulent directors of Optimum - Sandstrom was found liable for defamation - The plaintiffs sought general, aggravated and punitive damages - The Alberta Court of Queen's Bench awarded the plaintiffs general damages totalling $90,000 and aggravated damages totalling $55,000, but declined to award punitive damages - Where Sandstrom's emails were addressed exclusively to the CEO and general counsel of ICAP, his approach was not wide-ranging in scope - Sandstrom's reaction to his loss of control over the company was at the core of his misguided actions - His actions did not rise to the level of "egregious conduct" required for an award of punitive damages - The combined award of general and aggravated damages was sufficient to meet the objectives of punishment and deterrence - See paragraphs 61 to 67.

Cases Noticed:

TLA Food Services Ltd. v. 1144707 Alberta Ltd. et al. (2011), 525 A.R. 1; 2011 ABQB 550, refd to. [para. 14].

Grant et al. v. Torstar Corp. et al., [2009] 3 S.C.R. 640; 397 N.R. 1; 258 O.A.C. 285; 2009 SCC 61, refd to. [para. 17].

Malhab v. Diffusion Métromédia CMR inc. et al., [2011] 1 S.C.R. 214; 412 N.R. 1; 2011 SCC 9, refd to. [para. 18].

Hill v. Church of Scientology of Toronto and Manning, [1995] 2 S.C.R. 1130; 184 N.R. 1; 84 O.A.C. 1; 126 D.L.R.(4th) 129, refd to. [para. 22].

Gracey v. Scott et al., [2002] B.C.T.C. 1209; 2002 BCSC 1209, refd to. [para. 28].

Hunter Dickinson Inc. et al. v. Butler et al., [2010] B.C.T.C. Uned. 939; 2010 BCSC 939, refd to. [para. 46].

Cragg et al. v. Stephens et al., [2010] B.C.T.C. Uned. 1177; 2010 BCSC 1177, refd to. [para. 47].

Smith v. Cross, [2007] B.C.T.C. Uned. G52; 2007 BCSC 1757, affd. (2009), 278 B.C.A.C. 262; 471 W.A.C. 262; 2009 BCCA 529, refd to. [para. 48].

Newman et al. v. Halstead et al., [2006] B.C.T.C. 65; 2006 BCSC 65, refd to. [para. 49].

Ley v. Hamilton (1935), 153 L.T. 384 (H.L.), refd to. [para. 51].

Vogel v. Canadian Broadcasting Corp., [1982] 3 W.W.R. 97 (B.C.S.C.), refd to. [para. 51].

Authors and Works Noticed:

Lewis, P., Gatley on Libel and Slander (8th Ed. 1981), pp. 592, 593 [para. 27].

Counsel:

Patrick J. McAllister (Cleall), for the plaintiffs;

No appearance for the defendant.

This application was heard on May 9, 2013, before Gates, J., of the Alberta Court of Queen's Bench, Judicial District of Edmonton, who delivered the following memorandum of decision on May 1, 2014.