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Don't Blame Employees for Employer's Deeds

Is it fair to saddle an employee with the past deeds of his employer? It’s not a frequent occurrence but occasionally an individual is defamed by having been publicly associated with the actions of a former employer.
 
One such case occurred recently in the Okanagan. Endymion Holdings Ltd. (doing business as Info-Tel) circulated a printed bulletin containing statements about Mark McSeveney and his new company, Maple Leaf Directories.
 
Info-Tel and Maple Leaf are competitors in the business of publishing telephone directories. Prior to founding Maple Leaf in 2006, McSeveney had worked for a third telephone directory company which also was a competitor of Info-Tel’s.
 
It was McSeveney’s alleged activities while an employee of the third company on which Info-Tel’s bulletin focused. The bulletin created the false impression that Mr. McSeveney, in his former employment, had collected advertising deposits and then had failed to publish a directory. The bulletin also falsely suggested that Mr. McSeveney had been fined by a government body, as a result of these activities, for misleading the public.
 
The bulletin containing these false statements was drafted by Bonnie Derry, one of Info-Tel’s two owners. Info-Tel distributed the bulletin to retail addresses throughout the market area in which both Info-Tel and Maple Leaf operated. In many instances, Info-Tel’s delivery staff repeated the content of the bulletin to recipients.
 
The Supreme Court of British Columbia reviewed the contents of the bulletin and the circumstances of its publication by Info-Tel. It found the statements contained in the bulletin, particularly the association drawn between McSeveney and the actions of his former employer, to be false and defamatory. 
The statements in the bulletin may have been true of his former employer, but they were not true of McSeveney personally.
 
In assessing the damages to be paid to McSeveney and Maple Leaf, the Court considered that Info-Tel’s publication of the defamatory bulletin was widespread. It was delivered to approximately 4,800 businesses or commercial establishments in Maple Leaf’s market area. The bulletin itself was drafted using colours and headlines and other features calculated to draw the reader’s attention to its content.
 
The Court also considered that Info-Tel was informed, early on, of McSeveney’s concerns about the bulletin yet continued to distribute it for several weeks after indicating that distribution had ceased. The Court awarded damages to McSeveney and Maple Leaf in the amount of $50,000.
 
This is a classic instance of an employee being publicly blamed for the deeds of a former employer. In effect, the bulletin assumed that anything his former employer had done could be attributed to McSeveney and that, as a result, the statements about McSeveney could be said to be true. 
 
This, of course, is a very dangerous assumption to make. The Court in this case rejected Info-Tel’s defence of truth (or, as it’s known in defamation cases) justification. 
 
The moral of the story is that individuals, employers, and business competitors should be wary about publishing remarks based solely on a person’s prior association with a particular company. That kind of thinking can only lead to litigation.
 

 
Robert Smithson is a partner at Pushor Mitchell LLP in Kelowna practicing exclusively in the area of labour and employment law. For more information about his practice, log on to http://www.pushormitchell.com/.