Supreme Court puts off Conrad Black libel ruling

The Supreme Court of Canada reserved judgement Tuesday on whether Ontario is the proper jurisdiction to hear a libel case brought by Conrad Black against former associates at Hollinger International and their adviser.

The case could have important implications for Canadian libel law in the Internet age.

A panel of judges at the country's highest court said Tuesday it will not make an immediate decision after hearing the appeals of Richard Breeden the chief adviser to former Hollinger directors who ousted Black and other defendants named in his suit.

The defendants are appealing a ruling by an Ontario court decision that Black's libel case can proceed in that province, where Hollinger's parent companies were based.

The defendants argue that neither Black nor any of the parties involved are Canadian and thus the suit should not be heard in Ontario where libel laws are more favourable to plaintiffs than in the United States, where Hollinger International had its headquarters.

Black, the former media mogul is attempting to sue members of a special committee of Hollinger International directors over statements about alleged misuse of shareholder money by him and his inner circle of executives.

The libel suit stems from a 2004 report that accused Black of various nefarious financial transactions while at the head of Hollinger. The statements were published on the Chicago Sun-Times Media Inc. website, which Hollinger owned, and republished online by many media outlets in Ontario raising issues surrounding where libel suits should be heard in the fast-paced and globally-connected Internet age.

The Supreme Court's hearing in Ottawa on Tuesday came one day after it heard two other cases that involve whether provincial courts should assume jurisdiction over out-of-province defendants in civil claims. It has also reserved a decision in those cases and will hear another related case Friday.

One of Black's lawyers, Earl Cherniak, said in an interview Tuesday that the Supreme Court's decision will be very influential on libel laws in Canada because it is one of the first times the top court has dealt with the jurisdictional issue in the Internet age.

Given its significance, Cherniak said, a decision may not be handed down until the end of this year or in 2012.

"The court is very interested in coming up with a restatement of the law that will rationalize the circumstances under which a foreign defendant ought to be subject to Ontario jurisdiction."

Who's Who of defendants

The defendants include a number of high-profile former directors, advisers and a vice-president at Hollinger Inc., and Breeden, a former chairman of the U.S. Securities and Exchange Commission, who was appointed as a special advisor to a committee of independent directors investigating Hollinger's finances.

Breeden's lawyer Paul Schabas, argues that Black, who is no longer a Canadian citizen, is engaging in "libel tourism" bringing a lawsuit in the jurisdiction most likely to side in his favour, even if it has no real or substantial connection to the issues raised.

"Conrad Black is a libel tourist. He brings these actions in Ontario even though he is no longer a Canadian citizen and, as a convicted felon, cannot enter the country," Schabas argued in a written submission to the court.

Black is currently attempting to have his convictions overturned in the United States. He has already been found not guilty of most of the charges against him, after a months-long jury trial, and has succeeded in having at least two of the four original convictions thrown out upon appeal.

Meanwhile, Black's legal team argues that the libel actions do have a "real and substantial connection" to Ontario, where Black established his reputation and that he should be vindicated of the allegations about his use of Hollinger shareholder money.

"When you post stuff on the web in the United States and somebody's got a reputation in Ontario, like Conrad Black, and it contains defamatory material, you can be sure the media is going to pick it up," Cherniak said Tuesday.

The Ontario appeals court had agreed with a lower court judge's finding that no single jurisdiction was home to the majority of the parties involved in the lawsuits. Nine of the 11 parties were in the United States, but were spread across six different jurisdictions.

Cherniak said the defendants have not suggested an alternative venue that is clearly more appropriate.

"The defendants have failed to show that the courts below reached an unreasonable result. They seek simply to reargue this issue. They cite no example of this court overturning a discretionary decision about the appropriate forum. "

Black is currently free on bail after serving more than two years in a Florida prison on fraud and obstruction of justice convictions.

He was released in July after the U.S. Supreme Court narrowed the scope of the law used to convict him of three counts of fraud and one count of obstruction of justice.

In October, two of Black's fraud convictions were overturned by a U.S. appeals court. It upheld a third fraud conviction plus the obstruction conviction but Black has asked the U.S. Supreme Court to review the appellate decision.