IP Law Daily San Jose court blocks Canadian Supreme Court order requiring Google to delist search results
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Friday, November 3, 2017

San Jose court blocks Canadian Supreme Court order requiring Google to delist search results

By Cheryl Beise, J.D.

The federal district court in San Jose has granted Google LLC’s motion for a preliminary injunction to prevent defendants Equustek Solutions Inc., Clarma Enterprises Inc., and Robert Angus (collectively, "Equustek") from enforcing a Canadian court order requiring Google to delist certain search results worldwide. Google was very likely to succeed on its claim that, as the publisher of the third-party content at issue in the Canadian court order, it was entitled to immunity from liability under safe harbor provided by Section 230 of the Communications Decency Act. In addition to causing irreparable harm to Google, enforcement of the Canadian court order would undermine the policy goals of Section 230 and threaten free speech on the global Internet (Google LLC v. Equustek Solutions Inc., November 11, 2017, Davila, E.).

Canadian lawsuit. Equustek manufactures networking devices that allowed complex industrial equipment made by one manufacturer to communicate with complex industrial equipment made by another manufacturer. In 2011, Equustek brought suit in a British Columbia court against Datalink Technology Gateways Inc. and Datalink Technologies Gateways LLC (together, "Datalink"), asserting that Datalink, while serving as a distributor of Equustek’s products, began to re-label one of the products and pass it off as its own. Datalink also allegedly conspired with a former Equustek engineer to acquire confidential information and trade secrets belonging to Equustek, using them to design and manufacture a competing product.

The trial court issued an injunction ordering Datalink to return to Equustek any source codes, board schematics, and any other documentation it may have had in its possession that belonged to Equustek. The court also prohibited Datalink from referring to Equustek or any of Equustek’s products on its websites. Datalink left Canada and did not comply with the court’s orders. For its part, Google eventually blocked more than 300 Datalink websites from appearing in its Canada-specific search results at google.ca, but it did not remove Datalink websites from search results targeted to users outside of Canada. Beginning in 2014, the Canadian trial court issued several orders requiring Google to delist Datalink search results worldwide. Google appealed.

The Court of Appeal for British Columbia affirmed, and on June 28, 2017, the Supreme Court of Canada issued an order affirming the trial court’s order. The Supreme Court found that Google’s remedial actions were not effective in stopping Datalink from selling counterfeit products through its websites. In the Canadian High Court’s view, the harm being addressed in this case was occurring globally, and the only way for the injunction to be effective was to apply it globally. Justices Cote and Rowe wrote in dissent, arguing that principles of judicial restraint should have led the court to refrain from issuing the injunction. According to the dissenting Justices, the majority’s order was unduly burdensome, particularly given that Equustek had available alternative remedies, such as seeking a freeze of Datalink’s assets in France and pursuing injunctive relief against the Internet service providers that facilitated the offending websites.

San Jose declaratory judgment action. In July 2017, Google filed the instant suit, seeking "a declaratory judgment that the Canadian court’s order cannot be enforced in the United States and an order enjoining enforcement." Equustek did not file an opposition brief. The court granted Google’s motion for a preliminary injunction, finding that Google was very likely to show that it was immune from liability for publishing third-party content under Section 230. Section 230 states "[n]o provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider." 47 U.S.C. § 230(c)(1).

The court reasoned that the Canadian order treated Google as a publisher of third-party content because the order would hold Google liable as the "publisher or speaker" of the information on Datalink’s websites and would impose liability for failing to remove third-party content from its search results. The court also found that, absent an injunction, the Canadian order would cause irreparable harm because it would deprive Google of the benefits of U.S. federal law by restricting activity Section 230 was designed to protect.

An injunction also would serve the public’s interest in free speech. The court noted that Congress enacted Section 230 in 1996 to grant broad immunity to online intermediaries in order to encourage the unregulated development of free speech on the Internet. "By forcing intermediaries to remove links to third-party material, the Canadian order undermines the policy goals of Section 230 and threatens free speech on the global internet," the court said

The case is No. 5:17-cv-04207-EJD.

Attorneys: Carolyn Myrle Homer (Quinn Emanuel Urquhart & Sullivan, LLP) for Google LLC.

Companies: Google LLC; Equustek Solutions Inc.; Clarma Enterprises Inc.

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