Ontario PC Party loses court skirmish with disgruntled conservative activist over mailing list use

Ontario PC Party loses court skirmish with disgruntled conservative activist over mailing list use

A conservative activist who has been butting heads with the Ontario Progressive Conservatives has won a court skirmish with the party.

A Superior Court justice has found the PC Party took activist Jim Karahalios to court in order to discourage him from voicing his dissent on party issues that are matters of public interest, according to a court decision obtained by QP Briefing.

Karahalios is the activist behind two conservative-leaning political campaigns: Axe the Carbon Tax and Take Back Our PC Party. He has been trying to organize PC party members in order to trigger a clause in the party's constitution that would force a general membership meeting to be held at which the party constitution could be amended via binding votes from the membership.

Karahalios has not yet recruited enough members to trigger such a meeting—but if he should be successful, it would have the potential to derail PC Leader Patrick Brown's agenda and upcoming election campaign.

Karahalios hopes to use that meeting to force Brown and the party executive re-run several nomination contests where fraudulent activity has been alleged, as well as to amend the party's constitution to position the PCs against carbon taxes—even though a carbon tax is at the centre of the party's 2018 election platform.

The party launched a legal application on Nov. 16, 2017, seeking an injunction preventing Karahalios from using contact information derived from the party's confidential membership list, and an order forcing him to give money he "unjustly" made from using the list to a trust for the benefit of the party, among other remedies, the court decision states.

The party had alleged Karahalios unlawfully used a mailing list he had access to due to his involvement in the 2015 PC leadership race.

Karahalios denies this, arguing he used the Nation Builder political organizing platform to compile his own contact list based on data from social media, Elections Ontario lists of PC party donors, and lists obtained from other activists, the decision states.

In response, Karahalios sought to have the PCs' application dismissed, filing Ontario's version of an anti-SLAPP motion, the document states.

In the decision released December 22, Superior Court Justice Paul Perell sided with Karahalios and dismissed the PCs' case.

SLAPP stands for "Strategic Lawsuit Against Public Participation" and an applicant can have a proceeding dismissed if he or she successfully argues it arises from an expression made that relates to a matter of public interest, Perell wrote.

The party had argued that it wasn't opposing Karahalios's right to express his message about the party—merely the means by which he was doing it.

"I disagree," wrote Perell. "The facts reveal that at its heart or essence, the Party's application is designed to discourage the respondents (Karahalios and his two political organizations) from expressing themselves on matters of public interest. The application uses litigation as a means of limiting expression on matters of public interest.

"In other words, the (PCs') application is precisely the kind of application for which the anti-SLAPP provisions were introduced to counter."

Not only did Perell find the party's legal application had arisen from an expression that relates to matter of public interest, he described the party's entire case as "fuzzy" and, in particular, found there was no basis for its claim that Karahalios was unjustly enriching himself with the data.

"There was no transfer of wealth to Mr. Karahalios in the case at bar," he wrote. "The information in this case was not used for its monetary value but for its communicative value in the blood sport of politics."

The PC party told QP Briefing it's reviewing the judge's decision.

“For the Ontario PC Party this issue has always been about the protection of Party members’ personal and confidential information—nothing more, nothing less," said PC Party President Rick Dykstra in a statement. “When the Party believes our members' personal information is being used without authorization, we will always work to protect this confidential information."

Karahalios was not able to provide comment by deadline.

The background to the case

Karahalios (pictured above) has been a conservative activist in provincial and federal politics for the past 15 years.

In 2015, he volunteered on Monte McNaughton's campaign for the Ontario PC leadership. Ultimately, McNaughton withdrew and threw his support to Brown, helping Brown secure his victory.

Karahalios had intended to run for the PC nomination in Cambridge, but withdrew in protest of Brown's announcement that a PC government would implement a carbon tax in Ontario, if elected.

He formed an advocacy group, Axe the Carbon Tax, in response.

In May 2017, Karahalios sent out an email connected to his Axe the Carbon Tax campaign with the subject line, "Can we trust Patrick Brown?" The PC Party had alleged in its application that he unlawfully used a mailing list he had access to because of his involvement with the 2015 leadership race.

The Party said that some members complained after being contacted about "the violation of their privacy and the annoyance of the unsolicited email."

The party then sent a letter to Karahalios alleging he had violated federal privacy, anti-spam and elections financing legislation, as well as the party's terms of access for its mailing list.

Karahalios's lawyer responded, asking for clarification on what email list the party was alleging Karahalios had accessed, and what legal right to that list the party was asserting, but got no immediate response, the decision stated.

"In the summer of 2017, various PC Ontario riding nominations were appealed to the Party's Executive on ground of alleged fraudulent activity. The Executive declined to hear the appeals," the decision states. "Mr. Brown said he was going to appoint candidates, based on nominations that had already occurred, and that the Party would hire the accounting firm PwC to certify nominations going forward."

That prompted Karahalios to launch Take Back Our PC Party. He sent a mailer on November 8 from that group, arguing that Brown and the PC Executive had "usurped essential democratic processes as mandated by the Party Constitution and had deceived Party members as to PwC's role at nomination meetings," the decision said.

On November 21, the party brought forward the court application. The PC party argues that it did not give Karahalios or his organizations approval to use party membership information for those mailers, and in doing so broke a confidentiality agreement he had signed in the 2015 leadership race. It alleged breaches of contract and confidence, "unjust enrichment" from the data.

The party also sought an interim injunction, before the full application could be heard, preventing Karahalios from using contract information derived from the party.

The party revoked Karahalios's membership in the party on November 21—just days before Brown unveiled his party's election platform at an election readiness and policy convention in the Toronto area.

Karahalios filed the anti-SLAPP motion on Dec. 7 and ultimately won, with the judge tossing out the party's application in response.

While Karahalios admits he was given an email list in the 2015 leadership race, he says he didn't use it in his Nation Builder file, but may have used information supplied by other activists that originated in a PC Party membership list.

"Mr. Karahalios deposed that in his 15 years as a political activist he had never seen or heard of a licensing agreement or anything to suggest that historical lists are property of any party or campaign or that a political party would take issue with a party member using historic lists for democratic purposes," the judge wrote.

"He deposed that the exchange of historic lists between organizations and candidates is an essential component of internal party democracy and political organizing, a prime mechanism for dissent in the face of a violation of the Party Constitution by the Executive, and freedom to exchange historic lists is vital to a free and democratic political party system in Canada."


Jessica Smith Cross

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