Executive Summary: Key Legal and Evidentiary Issues

• Adequacy of Olymel’s Counterclaim under Rules 25.06 and 25.11, particularly whether material facts (not conclusions) were pleaded to support breach of contract, breach of confidence, and copyright infringement.
• Sufficiency of pleaded damages for breach of contract, including whether “detriment” and “competitive advantage” were enough without concrete facts showing loss flowing from the alleged breach.
• Particularization of confidential information and misuse, and whether broad categories such as “business strategies” and “price lists” met the pleading standard for a breach of confidence claim.
• Identification of copyright “works” and chain of title, including whether Olymel adequately pleaded which documents were protected, how it owned the copyright, and how they were infringed.
• The impact of the plaintiff’s admitted unauthorized downloading and retention of approximately 466 files on the viability (and potential amendment) of Olymel’s causes of action.
• Discretion to strike a pleading with or without leave to amend, and whether this was one of the “clearest of cases” justifying refusal of leave, including the handling of the stand-alone punitive damages claim and costs.

Factual background

Vincenzo Contino was employed by Olymel L.P., a meat packing and processing company with Canadian and international operations. He joined in July 2013 as an Account Manager, was promoted to Director of Sales in November 2020, and received a further promotion in May 2023. In late 2024 he decided to leave the company. On November 22, 2024, Contino gave notice of resignation effective December 13, 2024. While cleaning up his company computer near the end of his employment, he downloaded various files, including both personal and work-related documents. Shortly thereafter, on November 27, 2024, he was called into a meeting with his manager and two human resources representatives. He was told that Olymel knew he had been downloading files and that the company had a list of those files, although this list was not shown to him. He was terminated on the spot. Contino later returned the downloaded files to Olymel on a USB key, though the record did not clearly establish whether he kept copies or a list before doing so. In December 2024, he commenced new employment as Vice President of Sales at Freshstone Brands Inc., which Olymel pleaded is a competitor. Olymel also alleged that on December 31, 2024, Contino signed a statutory declaration confirming he had surrendered all “Stolen Property” (the term Olymel used for the 466 files in issue), that he had not accessed or forwarded these files to others, had not saved them to other media or cloud storage, had not printed or kept copies other than those returned, had no means of accessing them, and had not used or disclosed them to any third party, including his new employer or immediate family.

The wrongful dismissal action and Olymel’s Counterclaim

On April 14, 2025, Contino issued a Statement of Claim for wrongful dismissal against Olymel. Olymel responded on May 16, 2025, with a Statement of Defence and Counterclaim. The Counterclaim sought damages for breach of confidence, breach of the employment contract, and copyright infringement, all arising from the alleged unauthorized downloading and retention of approximately 466 confidential files, which Olymel collectively labeled “Stolen Property.” Olymel’s pleading asserted that in his role as Director of Sales, Contino had access to proprietary and confidential information, and that he downloaded confidential documents to a USB stick and emailed some to his personal email address. The categories of information allegedly taken included deals, business projections, price lists, customer lists, kilos and prices of various meat products, and business strategies. Olymel also pleaded that Contino had executed an Employment Agreement, a Non-Disclosure Agreement (NDA), and a Code of Conduct, each imposing confidentiality obligations and requiring the return of documents and equipment on departure. The NDA was said to require him to keep confidential information secret, restrict disclosure to a need-to-know basis, avoid using information for unauthorized purposes, and indemnify Olymel for losses resulting from breaches, including assigning any benefit gained from misuse.

The parties’ positions on the adequacy of pleadings

After receiving the original Counterclaim, plaintiff’s counsel promptly raised concerns that it contained bare allegations and legal conclusions rather than material facts, and invited Olymel to amend. On July 3, 2025, Olymel delivered a proposed Amended Statement of Defence and Counterclaim, which the plaintiff continued to regard as deficient. Contino then brought a motion under Rule 25.06 and Rule 25.11 of the Rules of Civil Procedure to strike the Counterclaim in its entirety, and, in oral argument, sought to do so without leave to amend. He argued that the Counterclaim did not adequately plead the constituent elements or factual underpinnings of breach of contract, breach of confidence, or copyright infringement, particularly with respect to damages and the specific information or works at issue. Olymel, in response, stressed that striking a pleading is a drastic remedy reserved for exceptional cases and that its pleadings, read generously, set out all essential elements of each claim. It contended that the underlying facts were largely within the plaintiff’s knowledge and that any remaining detail could be provided by way of particulars or discovery rather than striking the claims at the threshold stage.

Court’s analysis on breach of contract

The court began by reviewing the basic pleading standard: a party must plead a concise statement of material facts, not evidence, and a pleading that contains no material facts may be struck as frivolous or vexatious. For a breach of contract claim, sufficient particulars are required to identify the nature of the contract, the parties, privity, the relevant terms, the specific terms said to be breached, and the damages flowing from the breach. Applying these principles, the judge accepted that Olymel adequately pleaded the existence of contractual relationships via the Employment Agreement, NDA, and Code of Conduct, all of which imposed confidentiality obligations. The pleadings set out that Contino was required to safeguard confidential information, limit disclosure on a need-to-know basis, use it only for authorized purposes, and return all confidential materials upon leaving, with ongoing obligations after departure. The Counterclaim further alleged that Contino breached these terms by emailing confidential documents to his personal account, downloading approximately 466 files containing sensitive business information to a USB stick, and retaining, mishandling, copying and disseminating the “Stolen Property” or its contents, including to his new employer. On these elements—existence of the contract, parties, terms, and specific acts said to constitute breach—the court found the pleading adequate when read as a whole. However, the judge viewed the pleading of damages as critically deficient. The Counterclaim stated, in essence, that the plaintiff’s conduct resulted in disclosure of confidential information to third parties, including Freshstone, to Olymel’s detriment, and that the contents of the Stolen Property gave the plaintiff and his new employer a competitive advantage they would not otherwise have had. At the same time, Olymel expressly pleaded that the particular information disclosed, the persons to whom it was disclosed, and the full extent of Olymel’s losses were “presently unknown” and would be determined later. Relying on authorities such as Lysko v. Braley and Region Plaza, the court held that a party cannot simply allege detriment and competitive advantage in the abstract, nor rely on speculative future discovery when it lacks actual knowledge of facts supporting its conclusions. Even on a generous reading, there were no concrete material facts explaining the nature, mechanism, or quantification of the alleged loss. Because the damages component remained speculative and unsupported by specific factual allegations, the cause of action for breach of contract was struck.

Court’s analysis on breach of confidence

The breach of confidence claim overlapped factually with the contract claim but required its own elements: that the information was confidential, communicated in confidence, and misused to the detriment of the confider. The plaintiff argued he was entitled to know precisely what confidential information was said to have been misappropriated so he could assess whether it was in fact confidential and respond properly to the allegations. The court accepted this reasoning, drawing heavily on the decision in Evertz Technologies Ltd. v. Lawo AG. In Evertz, a claim based on alleged misuse of confidential information was struck because the plaintiff relied on vague categories like “software, architecture, product solution, roadmap, materials, workflow and pricing information,” which did not disclose with particularity what confidential information had been taken or how it was misused. Justice Cavanagh held that defendants are entitled to know, before discovery, what specific confidential information and what acts of misuse are alleged. Here, Olymel described the allegedly misappropriated data as proprietary documents such as deals, business projections, price lists, customer lists, kilos and prices of meat products, and business strategies, and said some—but not necessarily all—of the 466 files were confidential. The court found these descriptions were similarly too broad and generic to satisfy the requirement to plead material facts about what information was confidential, as opposed to simply business documents generally. The judge emphasized that this ruling did not require a complete list of every single document, but the use of large, undefined categories did not give Contino fair notice of the specific confidential information at issue. More significantly, the pleadings did not set out material facts about the alleged misuse—what Contino or Freshstone did with the information—and how that misuse caused loss to Olymel. The allegations of “misuse” and “detriment” were regarded as bald conclusory statements. In the absence of real factual content about either the information or its misuse, the court held that Olymel had not met the minimum requirement under Rule 25.06 and struck the breach of confidence claim.

Court’s analysis on copyright infringement

The Counterclaim also advanced a cause of action for copyright infringement under the Copyright Act. The court summarized that to plead copyright infringement properly, the party must set out material facts regarding the existence of a “work,” ownership of copyright in that work, the existence of an infringing work, and absence of consent. Olymel’s theory was that Contino infringed copyright by downloading and retaining the Stolen Property without authorization. The judge accepted that, based on the statutory declaration, the lack of consent and the act of unauthorized downloading were adequately pleaded, and the typo referring to reproduction “with authorization” was clearly an error in context. The central problems lay in identifying the “works” and establishing ownership. The court relied on authorities such as AOM NA Inc. v. Reveal Group and Dermaspark Products Inc. v. Prestige MD Clinic, which stress that a party must say what it claims is covered by copyright, not simply describe a universe of materials. In Dermaspark, referring generically to works on a website was found insufficient because the defendants could not tell which specific works, authors, or chains of title were in issue. Similarly, even though Olymel characterized the 466 files by function—sales forecasts, pricing data, customer lists, product metrics, strategic plans—the court found it unclear from the pleadings which, if any, of these files were actually copyright-protected “works” and whether all or only some of them were implicated. More detail was required to identify the works said to be the subject of copyright. On ownership, the court rejected Olymel’s reliance on an alleged presumption under s. 13(3) of the Copyright Act that the employer owned all of the documents in question. Section 13(3) speaks to works made in the course of employment, but Olymel’s pleadings did not specify which documents were created by the plaintiff, by other employees, by the company itself, or by third parties. Nor did the pleadings indicate whether ownership was said to arise by operation of law, assignment, or some other chain of title. Simply asserting that Olymel “owned” the copyright in all of the works did not explain how that ownership came about. Although in some cases modest defects in chain-of-title pleading might be cured by particulars, here the court concluded that the Counterclaim, as drafted, did not set out sufficient material facts regarding ownership. As a result, despite finding that infringement by unauthorized downloading had been adequately alleged, the court struck the copyright claim in its entirety for want of particularization of the works and ownership.

Leave to amend and treatment of punitive damages

Having decided to strike all three substantive causes of action—breach of contract, breach of confidence and copyright infringement—the court turned to whether Olymel should be granted leave to amend. The governing principle is that amendments should generally be allowed unless they would cause non-compensable prejudice, are themselves abusive, or reveal no reasonable cause of action even if amended. Leave to amend is only refused in the clearest of cases. Contino argued that Olymel had already had multiple opportunities: in its original pleading, in its proposed amendment, and in the time leading up to the motion, and that its failure to fix the defects showed there was no realistic prospect of improvement. The court acknowledged this concern but distinguished the case from situations where a motion to strike had been outstanding for years without the plaintiff moving to improve the pleadings. Here, the timeline between the original pleadings, the amendment, and the motion was relatively short. The judge also emphasized that there was “more than a scintilla” of a cause of action, given the admitted unauthorized downloading and the contractual and confidentiality framework. The deficiencies were described as significant but still capable of being remedied through more precise pleading of damages, the confidential information, the copyrighted works, and chain of title. Accordingly, the judge exercised discretion to grant leave to amend and directed Olymel to deliver a fresh as amended Statement of Defence and Counterclaim within thirty days of the reasons, with Contino to have 30 days thereafter to respond. On punitive damages, the plaintiff argued that if the substantive claims were struck without leave, the punitive damages claim could not stand on its own, and, in any event, the request for punitive damages was boilerplate and not particularized. Because leave to amend was granted, the court did not need to deal with the argument that punitive damages were parasitic on other causes of action. On the particularity point, the court referred to Whiten v. Pilot Insurance, which favours pleading punitive damages with as much detail as circumstances permit but also recognizes that any uncertainty can be addressed by a request for particulars. The judge concluded that striking the punitive damages claim outright was not appropriate at this stage and that the plaintiff could seek particulars if more detail was needed. The punitive damages claim therefore survived, contingent on the amended Counterclaim moving forward.

Outcome and implications

In the result, the court granted Contino’s motion to strike the Counterclaim but did so with leave, directing Olymel to serve a fresh as amended Statement of Defence and Counterclaim within thirty days and allowing Contino thirty days to reply or defend as required. The decision underscores that in commercial employment disputes involving alleged misuse of confidential information and intellectual property, parties must plead with real specificity: they must identify the contracts, the confidential information, the copyright works, the ownership chain, the alleged misuse, and the resulting loss, rather than relying on broad categories and conclusory assertions. On costs, the court applied the usual principles under the Courts of Justice Act and Rule 57, focusing on reasonableness and the expectation of what an unsuccessful party might be ordered to pay. Noting that Contino had been largely successful on the motion and that his partial indemnity bill of costs (approximately $5,803.70) was significantly lower than the amount Olymel itself had budgeted for such a step, the court ordered Olymel to pay Contino costs fixed at $5,803.70, payable within thirty days. In practical terms, the successful party on this motion was the plaintiff, Vincenzo Contino, and the total monetary amount ordered in his favour at this stage consisted solely of this costs award of $5,803.70; no damages have yet been adjudicated on the underlying wrongful dismissal or on any re-pleaded counterclaims.