LEXPERT MAGAZINE
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JULY/AUGUST 2016 35
COMMISSIONER OF COMPETITION V.
TORONTO REAL ESTATE BOARD
DECISION DATE: APRIL 27, 2016
In an important decision that is bound to
have wide-ranging implications on the real-
estate brokerage industry in Toronto, the
Competition Tribunal held that the To-
ronto Real Estate Board (TREB) abused its
dominant position under s.79 of the Com-
petition Act. e Tribunal ordered TREB
to stop restricting access to certain Multiple
Listing Services (MLS) information on the
password-protected virtual office websites
(VOW) of its member real estate brokers and
salespersons (Members) and to stop restrict-
ing the manner in which Members may dis-
play and use that information.
e Commissioner of Competition
launched the application in 2011. At the
heart of the dispute was the Commissioner's
claim that TREB intentionally restricted
how its Members could use certain MLS
information (principally sold prices) on
VOWs. e Commissioner alleged that
TREB acted to insulate its traditional Mem-
bers operating in a "brick and mortar" office
from innovative VOW-based competition
and online services. TREB responded that
privacy legislation kept it from making sold
prices more available online as the Commis-
sioner sought. It also argued that the Com-
missioner had not proved all three elements
of the test under s. 79: (i) that TREB con-
trols a class or species of business in Canada,
(ii) that TREB had engaged in a practice of
anti-competitive acts, and (iii) that TREB's
practice had or would likely substantially
lessen or prevent competition.
In a 150-page decision, the Tribunal found
in favour of the Commissioner and rejected
TREB's arguments. First, the Tribunal held
that TREB did control a market even if it
does not actually participate or compete in
the industry. e Tribunal held that a trade
association, such as TREB, comes within the
purview of s. 79 if it has the ability to exercise
substantial market power to insulate all or
some of its members from competition.
e Tribunal then examined whether
TREB engaged in a practice of anti-compet-
itive acts. It concluded that TREB had acted
intentionally to exclude VOWs to insulate its
Members from a disruptive form of competi-
tion in the GTA. e Tribunal also found it
reasonably foreseeable that TREB's conduct
would have an exclusionary or disciplinary
negative effect on VOW-based competitors
as the Commissioner alleged. It dismissed
TREB's arguments about privacy as an "af-
terthought," lacking evidentiary support.
Concluding that the requirements of para-
graphs 79(1)(a) and (b) had been met, the Tri-
bunal then concluded that TREB had pre-
vented or lessened competition substantially
in the market pursuant to paragraph 79(1)(c).
Among other things, the Tribunal concluded
that TREB had: a) adversely impacted entry
into the market for brokerages that would
like to offer full information VOWS in the
GTA; b) undermined the ability of full-
information VOWs to compete because of
higher costs; c) negatively affected the range
and quality of real estate brokerage services
in the GTA, which would likely be consider-
ably broader and of higher quality "but for"
TREB's conduct; and d) reduced innovation
and dynamic competition.
Considering the above factors collectively,
the Tribunal held that the magnitude and
duration of these effects were substantial and
that in the absence of an order, considerable
adverse impacts were likely to continue.
Lastly, the Tribunal reviewed TREB's
claim that it owns copyright in the MLS
database. In dismissing TREB's claim, the
Tribunal found based on the evidence that
TREB's compilation of data from real estate
listings amounted to a mechanical exercise
that doesn't attract copyright protection.
e Tribunal prohibited TREB from en-
gaging in the anti-competitive conduct and
to take certain steps to overcome the effects
of the anti-competitive conduct to date.
Bennett Jones LLP and the Department
of Justice represented the Commissioner of
Competition with a team that included John
Rook, QC, Andrew Little, Emrys Davis and
Tara DiBenedetto.
e Toronto Real Estate Board was rep-
resented by Affleck Greene McMurtry
LLP with a team that was composed of
Donald Affleck, QC, David Vaillancourt
and Fiona Campbell.
Sandra Forbes and Michael Finley of Da-
vies Ward Phillips & Vineberg LLP acted
for the Canadian Real Estate Association,
which intervened in the hearing.
VIDEOTRON S.E.N.C. AND GROUP
TVA INC. V. BELL EXPRESSVU LP
DECISION DATE: MARCH 6, 2015
On March 6, 2015, the Quebec Court of Ap-
peal, reversing a Montreal Superior Court
judgment, awarded $82 million, plus inter-
est and costs, in damages to plaintiffs Video-
tron and Group TVA, following a finding by
the lower Court that Bell ExpressVu should
have proceeded more rapidly to swap the
access cards in the set-top boxes of its satel-
lite TV customers which were the subject of
piracy in the early 2000s. Following a 57-day
trial, the trial judge had awarded damages of
$650,000, plus interest and costs, to plain-
tiffs. e decision of the Quebec Court of
Appeal is unprecedented regarding the cri-
terion of "palpable and overriding error" as a
basis for intervention by a court of appeal and
the amount by which the damages awarded
were increased. e decision also highlights
the distinction between Quebec civil law
and tort law on extra-contractual liability, as
interpreted by the Quebec Court of Appeal.
e Supreme Court of Canada denied leave
to appeal the decision.
Videotron and TVA were represented by
Woods LLP. e Woods team for the appeal
consisted of James Woods, Patrick Ouellet
and Alexandre Paul-Hus.
BEV was represented by McCarthy Té-
trault LLP. e McCarthy Tétrault team
for the appeal consisted of Chantal Tremblay
(now a judge of the Superior Court), Jean
Lortie and Marc-André Russell (now with
Morency, Société d'Avocats, s.e.n.c.r.l.).
A LOOK AT THE COMPETITION TRIBUNAL DECISION ON THE TORONTO REAL ESTATE BOARD, WHICH HELD THAT THE BOARD
ABUSED ITS DOMINANT POSITION UNDER THE COMPETITION ACT; AND THE VIDEOTRON CASE, IN WHICH THE COURT OF APPEAL
REVISED A PREVIOUS AWARD FOR DAMAGES USING THE CRITERION OF "PALPABLE AND OVERRIDING ERROR"
BIG SUITS
