The Ontario Court of Appeal has dismissed an appeal by VAC Developments Limited in a defamation case against a former employee who had accused the company of failing to take action after he faced multiple racially motivated threats at his workplace.
The decision upheld a lower court ruling that dismissed VAC’s $1.5 million counterclaim for defamation, interference with economic relations, and punitive damages against the worker — A.W.. The case stemmed from A.W.’s public statements to the media, where he criticized VAC’s handling of the threats against him and his subsequent layoff.
A.W., an aerospace sheet metal mechanic at VAC, became the target of anonymous threats, including a noose drawn on his locker and racist graffiti in a washroom. He requested that VAC involve the police in investigating the incidents, which the company eventually did after a second threat. Dissatisfied with the response and fearing reprisal, he was laid off in June 2021, shortly after the incidents. He believed his layoff was directly connected to his insistence that police be involved.
In the months that followed, A.W. went public with his story, contacting news outlets such as CTV. In a subsequent article, A.W. was quoted saying that VAC had failed to protect him from racist death threats and had laid him off as reprisal for his complaints. VAC did not comment on the article before its publication and chose not to seek a retraction or take legal action against the media outlet.
VAC responded by filing a counterclaim against A.W., alleging defamation and seeking damages. However, the company’s defamation claim was dismissed by the Superior Court of Justice in 2023 under Ontario’s anti-SLAPP (Strategic Lawsuit Against Public Participation) legislation, which protects individuals from lawsuits aimed at stifling free expression on matters of public interest.
Justice Heather A. McGee, who presided over the motion, concluded that VAC had not demonstrated that its defamation claim had substantial merit and that the harm caused by A.W.’s public statements was not significant enough to outweigh the public interest in protecting free expression. She also found that VAC failed to show it had suffered any economic loss due to A.W.’s statements.
VAC appealed the ruling, arguing that the motion judge erred in assessing the merits of the defamation claim and in her analysis of the public interest balancing test. The appeal court, however, sided with the motion judge, dismissing VAC’s arguments.
In its reasons for dismissing the appeal, the Court of Appeal acknowledged that while the motion judge’s analysis of whether his statements were defamatory was somewhat underdeveloped, it ultimately agreed that VAC had not proven sufficiently serious harm. Citing the Supreme Court’s decision in Hansman v. Neufeld, the court emphasized that VAC was required to present evidence of actual harm, not just general assertions of reputational damage.
“VAC has simply provided nothing beyond the assertion that it will likely suffer commercial loss because its reputation has been besmirched,” the Court of Appeal noted. “The appellant urged this court to accept that (A.W.’s) statements were not made sincerely but were advanced for the collateral purpose of putting pressure on VAC… But it is not clear that this was argued before the motion judge, or that there was evidence in the record in support of this assertion.”
The court also dismissed a motion by VAC to admit fresh evidence related to a separate defamation case the company had brought against A.W.’s legal counsel. This motion was rejected as the evidence was deemed irrelevant to the appeal.
The appeal decision marks the end of the legal battle over the defamation claim, but the broader issues related to his original complaint of wrongful dismissal and workplace harassment remain unresolved. A.W. had filed a lawsuit against VAC following his layoff, alleging wrongful dismissal and seeking damages under the Human Rights Code and the Occupational Health and Safety Act.
The Court of Appeal’s ruling underscores the challenges employers face in pursuing defamation claims under Ontario’s anti-SLAPP laws, particularly in cases involving matters of public interest such as workplace harassment and racism. Under these laws, defendants are protected from lawsuits that are intended to silence or retaliate against individuals for speaking out on issues of public concern.
In this case, VAC’s inability to demonstrate actual harm stemming from the public statements proved fatal to its defamation claim. The court’s decision emphasized the need for claimants to provide concrete evidence of harm, beyond mere assertions of reputational damage, in order to justify such legal actions.
As the court concluded, “Presumed general damages are insufficient for this purpose, as are bare assertions of harm.”
For more information, see Williams v. VAC Developments Limited, 2024 ONCA 713 (CanLII).
