Ruling notes lack of precedents for imposing such a penalty for contempt
Recognizing that no precedents appeared to exist for imposing such a penalty, Canada’s Federal Court fined a company and its director $1,000 for contempt through breaching confidentiality in a court-ordered mediation by posting public videos on social media.
In Planet Fitness Inc v. Planet Fitness Franchising LLC (PFIP, LLC), 2025 FC 1713, the plaintiff brought an action to expunge the two defendants’ 19 registered PLANET FITNESS trademarks and obtain damages for passing off.
According to the plaintiff, it owned the unregistered trademark PLANET FITNESS and used it for a gym in Red Deer, Alberta, since at least 1992. The defendants’ counterclaim asserted infringement of their registered trademarks and depreciation of goodwill.
At the court’s direction, the parties attended mediation sessions with an associate judge on Feb. 20, 2024, and Mar. 25, 2024. After both sessions, the plaintiff’s director posted videos on social media.
In the videos, he disclosed information he learned during the confidential mediation, including details of the defendants’ settlement offers, the judge’s preliminary assessment of the merits, and the contents of potential witness testimonies at trial. He made threats and disparaging comments regarding the defendants, their officers, and counsel.
The defendants’ counsel viewed the videos and notified the court and the parties. The director removed the videos in response to the defendants’ demand. Contempt proceedings followed.
During the liability phase, the director testified that he did not know that the mediation was confidential or that the person overseeing the mediation was a judge.
On May 7, the court found the plaintiff and its director in contempt. The court found that the director:
- improperly and intentionally disclosed confidential information learned during the mediation
- egregiously breached the confidentiality needed to ensure a proper mediation process
- negatively impacted the parties’ faith in the process
- wasted limited judicial resources
- made threats and provided a self-serving and unbelievable testimony, which exacerbated his conduct
- violated the court’s process
On Sept. 8, the defendants updated the court about the discontinuation of the underlying action and counterclaim.
$1,000 fine set
The Federal Court ordered the plaintiff and its director, jointly and severally, to pay a fine in the appropriate amount of $1,000, considering the relevant factors in the case.
According to the court, while this amount was at the lower end of the range under the applicable jurisprudence, it matched the contempt’s gravity. The court noted the apparent absence of precedents for imposing a penalty for contempt arising from a confidentiality breach during a court-ordered mediation.
The court held that the main aggravating factor in this case was the contempt’s scope and scale. The court noted that the director uploaded publicly accessible videos that divulged numerous details about the confidential mediation and disparaged and threatened the defendants and their representatives.
However, the court acknowledged mitigating factors such as the director’s immediate steps to take down the videos, his genuine words of remorse, and his personal circumstances. The court noted that the director expressed his respect for Canada’s courts.
