This article is an excerpt from Government Procurement, which is available for purchase.
In its February 2012 decision in Freeman v. Mnjikaning First Nation, the Ontario Superior Court of Justice dismissed a breach of confidence claim made by an unsuccessful proponent who claimed that Mnjikaning First Nation (“MFN”) misappropriated proprietary business information contained in its proposal. The case dealt with an RFP issued by MFN for the operation of retail space at Casino Rama. The plaintiff submitted a proposal in response to that RFP, in which she proposed naming the retail space “The Gathering Place – The Shops at Rama”. Another proposal was ultimately selected and the retail space was eventually named “The Gathering Place”. The unsuccessful proponent sued MFN, alleging, among other things, breach of confidence in relation to the use of ideas contained in her proposal. The court rejected the breach of confidence claim after finding that the plaintiff was not the original creator of the term “The Gathering Place” since that term had historically been associated with MFN well before the RFP process:
Counsel for both sides conceded they had been unable to locate any case in which facts similar to ours had been litigated. By way of analogy, however, counsel for the plaintiff relied on the decision of the Supreme Court of Canada in Lac Minerals Ltd. v. International Corona Resources Ltd.,
[1989] 2 S.C.R. 574.Lac involved the claim for breach of confidence. The court held that the defendant Lac had received information about a particular gold mining property in confidence from the plaintiff Corona and that it had breached that confidence in acquiring the property. The court concluded that the information could not be used by the defendant to the detriment of the plaintiff, and awarded ownership of the property to the plaintiff.
In my view, the Lac decision is of no assistance to the plaintiff in the present case. The key difference is that there was no confidential information given by Ms. Freeman to MFN. Rather, without having been requested to do so, and gratuitously on her part, Ms. Freeman included in her response to the RFP a suggested name for the retail area. As I have found above, however, not only was the name not confidential, but it was a term already known to and part of the history and terminology used by MFN. Simply put, it was not an original creation by the plaintiff. (paras. 52-54)As this case illustrates, purchasing entities may face claims from proponents regarding the misuse of information contained in their proposals. While not all information contained in a proponent’s submission constitutes confidential business information to which a breach of confidence claim can successfully attach, purchasing entities should tread carefully to ensure that they are not misappropriating information or ideas flowing out of a bidding process to which proponents, particularly unsuccessful proponents, could successfully lay future claim. One of the factors relied on by the court in coming to its conclusion was the fact that the scope of the RFP did not include any request that respondents recommend names for the proposed retail shopping area. This underscores the importance of clearly scoping the purpose and sought-after requirements under the solicitation documents as part of the broader disclosure exercise in a tendering process.
