Supreme Court clears way to B.C. class-action against Facebook

The Supreme Court of Canada has ruled that a clause in Facebook’s terms of use is “unenforceable” in this country, clearing the way for a Vancouver woman to sue the social media giant for what she claims was a breach of her privacy.

Deborah Douez brought a lawsuit against Facebook over a now-defunct advertising format that saw her name and profile photo featured in “sponsored stories” from companies she had ‘liked’ on the website.

She alleged her name and profile photo were used without her permission and the ads were sometimes displayed on her friends’ Facebook newsfeeds.
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Facebook had argued that its terms of use include a forum selection and choice-of-law clause that requires disputes be resolved in California, where it’s based, according to California law.

A lower court judge in British Columbia declined to enforce the clause and certified a class-action lawsuit. But that was reversed by the B.C. Court of Appeal.

In a 4-3 decision issued on Friday, the Supreme Court ruled that clause unenforceable in Canada.

Douez’s proposed class-action lawsuit includes all B.C. residents who had their name or picture used in sponsored stories. The estimated size of the class is 1.8 million people. Ultimately, the class-action suit intends to seek damages based on a claim that the format violated B.C.’s Privacy Act.

“Ms. Douez has established strong reasons not to enforce the clause at issue here,” the ruling said.

“The grossly uneven bargaining power between the parties and the importance of adjudicating quasi-constitutional privacy rights in the province are reasons of public policy that are compelling, and when considered together, are decisive in this case.”

Writing on behalf of the dissenting three justices, Chief Justice Beverley McLachlin and Justice Suzanne Cote said they saw no reason to depart from established international law upholding forum selection clauses.

“We agree with the Court of Appeal of British Columbia that strong cause has not been shown and that the action must be tried in California, as the contract requires,” they wrote.

The case now returns to British Columbia for a trial on the merits of the claim.

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