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The Financial Post
Friday, July 10, 1998

Philip pierces Net secrecy

Court decision gives beleaguered company access to names and addresses of people who have made negative comments about the firm in Internet chat group

by Sandra Rubin

Philip Services Corp., its stock decimated by a barrage of writedowns and troubling accounting practices, has quietly won a court order forcing about a dozen Internet providers to cough up names and addresses of people who posted negative comments about the firm in an Internet chat group.

The move has potentially chilling implications for privacy and the Internet. It means Canadians who exchange information and opinions in chat groups have lost the traditional cloak of anonymity and can be held liable for what they say.

The order, granted by Ontario Court Justice Nick Borkovich in Hamilton, was made ex parte without Internet providers, including America Online Inc., AOL's CompuServe division, iStar Internet Inc., and Weslink Datalink Corp., being notified or present to make arguments.

It instructs the providers to hand over to Philip names, addresses, e-mail addresses, telephone numbers, computer serial numbers, and other information for a specific list of messages posted on Yahoo in April, May, and June.

It doesn't stop there. The providers were also told to preserve "all other messages sent by such persons through the Internet providers".

And they were ordered to supply Philip with the real identity of the users who posted messages under pseudonyms - common practice in chat groups.

Philip was granted leave to examine the information, although that decision was later reserved pending another hearing.

The court also ruled that the files be sealed and expressly forbade the company, its employees, and agents to "publish, speak about, or distribute this order, or any documents provided with the order".

Many of the messages, which can still be read, appear to make allegations of criminal activity against Philip executives and express fears of what might happen to anyone who exposes too much about the firm's activities.

But Philip spokeswoman Lynda Kuhn said it was company employees who felt threatened by what they were reading. That's why Philip decided to act. She said some of the worst messages have now been pulled by Yahoo at Philip's request.

"The tone of the board became increasingly malicious and downright defamatory", Kuhn said.

"It libelled employees of the company, issued threats of stalking, a whole range of ethnic slurs, and got to the point where employees were very concerned. So the company decided it was going to take action." At least one service provider, Weslink, said yesterday in a letter to Philip's lawyers it was complying with the request and provided information.

John Gallagher, a former member of Hamilton city council in 1985-91, had his name, address, and telephone number turned over.

Gallagher, a municipal activist who walks with a cane as a result of a spinal injury received in a car accident, scoffed at notions he is threatening. He said he stands by what he wrote, but disagrees with the judge's decision to grant the motion ex parte - denying him a chance to speak.

"I'm disturbed that I wasn't present, or that I didn't have a representative present, to make submissions", he said. "I believe I had good reason for using aliases."

Gallagher, who said he has never owned Philip shares, also said he's troubled by the fact Weslink provided his name.

"I'm a little surprised that my server would not fight this vigorously and I have a lot of concern and I'm sure a lot of Internet providers will feel this as well that they didn't fight this all the way to the Supreme Court [of Canada]."

Weslink said in a late-day statement it views customer information as "private to be utilized only for the purposes for which it has been provided". It said rather than complying with the original order, it went back to the court and was able to have the scope narrowed somewhat.

Lawyer Alan Gahtan, who is co-writing a book on Internet law, said obliging a provider to turn over all messages sent by a particular user is "troubling".

"I think it's a serious infringement on privacy", said Gahtan, with the law firm Bennett Jones Verchere. "It sounds like they went too far.

"It's almost like someone could go in and look at all the books that you've read. They can go in and get all messages. Well, when you extrapolate it, does it mean that someone can go in and get an order for every Web page you've looked at? You're getting into someone's head".

People shouldn't be allowed to use the Internet to commit illegal acts, such as libel, said George Takach, who heads the high-tech practice at McCarthy Tétrault.

He predicted this case will send a definite signal.

"It'll definitely be a wake-up call to that part of the Internet culture that views the Internet as no-man's land where you can do anything and get away with anything."


Copyright © 1998 by The Financial Post. All Rights Reserved. Reprinted with permission.