Letter Decision No. LET-P-A-67-2011

June 20, 2011

Complaint concerning fares offered by Jazz Aviation LP between Toronto, Ontario and Timmins, Ontario

File No.: 
M4120-3/10-50314

Introduction

On December 16, 2010, Deryk Jackson filed a complaint with the Canadian Transportation Agency (Agency) regarding the alleged unreasonableness of the fares offered by Jazz Aviation LP, as represented by its general partner, Aviation General Partner Inc., carrying on as Air Canada Jazz (Air Canada Jazz) in respect of its services between Toronto, Ontario and Timmins, Ontario.

In its Decision No. LET-P-A-24-2011, the Agency provided a copy of the complaint to Air Canada Jazz and opened pleadings. On March 24, 2011, Air Canada filed submissions on behalf of Air Canada Jazz. As part of the submissions, Air Canada filed a statement by Professor Baumol that it claimed to be confidential. Air Canada also submitted a letter by regular mail claiming that Professor Baumol's statement, as well as his curriculum vitae, had been previously filed with the Agency and had been treated as confidential.

On March 31, 2011, in Decision No. LET-P-A-44-2011, the Agency reminded Air Canada that it could not rely on material previously filed on unrelated cases or on rulings made in those cases with respect to confidentiality. The Agency indicated that Air Canada must file an appropriate request for confidentiality and reasons to justify its position and to specify under which section of the Canada Transportation Act, S.C. 1996, c.10, as amended (CTA) or the Canadian Transportation Agency General Rules, SOR/2005-35 ("General Rules"), it is making the request. On April 4, 2011, Air Canada filed its request for confidentiality.

Issues

  1. Are Professor Baumol's curriculum vitae and statement relevant to the proceeding pursuant to subsection 24(2) of the General Rules?
  2. Is there any specific harm which would likely result from the curriculum vitae and statement's disclosure, pursuant to paragraphs 66(8)(b) and (c) of the CTA and subsection 24(2) of the General Rules?

Relevant Provisions

CTA

66. (8) The Agency may take any measures or make any order that it considers necessary to protect the confidentiality of any of the following information that it is considering in the course of any proceedings under this section:

(a) information that constitutes a trade secret;

(b) information the disclosure of which would likely cause material financial loss to, or prejudice to the competitive position of, the person providing the information or on whose behalf it is provided; and

(c) information the disclosure of which would likely interfere with contractual or other negotiations being conducted by the person providing the information or on whose behalf it is provided.

Access to Information Act (R.S.C., 1985, c. A-1) (ATIA)

20. (1) Subject to this section, the head of a government institution shall refuse to disclose any record requested under this Act that contains

(...)

(b) financial, commercial, scientific or technical information that is confidential information supplied to a government institution by a third party and is treated consistently in a confidential manner by the third party;

(c) information the disclosure of which could reasonably be expected to result in material financial loss or gain to, or could reasonably be expected to prejudice the competitive position of, a third party; or

(d) information the disclosure of which could reasonably be expected to interfere with contractual or other negotiations of a third party.

General Rules

24. (2) The Agency shall place a document in respect of which a claim for confidentiality has been made on the public record if the document is relevant to the proceeding and no specific direct harm would likely result from its disclosure or any demonstrated specific direct harm is not sufficient to outweigh the public interest in having it disclosed.

Analysis and Determination

1) Professor Baumol's Curriculum vitae

Submissions

Air Canada submits that Professor Baumol's curriculum vitae constitutes confidential personal information according to section 3 of the Privacy Act, R.S.C., 1985, c. P-21. In particular, it contains information about an identifiable individual including information relating to the education and employment history of the individual. According to Air Canada, section 8 of the Privacy Act and subsection 19(1) of the ATIA both prohibit the disclosure of the curriculum vitae.

Mr. Jackson submits that Professor Baumol's curriculum vitae is accessible online through New York University's web site and, thus, is already in the public domain. Therefore, Mr. Jackson argues that it would be illogical to grant the request for the curriculum vitae to remain confidential.

In its reply, Air Canada submits that Mr. Jackson did not establish the relevance of Professor Baumol's curriculum vitae. Moreover, Mr. Jackson did not raise any question as to Professor Baumol's qualifications or expertise.

Air Canada argues that Professor Baumol did not consent to the curriculum vitae being filed in this proceeding and, therefore, Air Canada has no authority to consent to such disclosure. Finally, Mr. Jackson failed to illustrate any prejudice that he would suffer from the document being treated as confidential.

Analysis

Air Canada submitted that Mr. Jackson did not establish the relevance of Professor Baumol's curriculum vitae. The Agency has reviewed the curriculum vitae for which Air Canada has made a claim for confidentiality and finds, pursuant to subsection 24(2) of the General Rules, that it is relevant to the proceeding. Air Canada submitted Professor Baumol's statement to support the establishment of its pricing decisions. To give credibility to this statement, Air Canada has filed Professor Baumol's curriculum vitae. In the Agency's opinion, the curriculum vitae demonstrates Professor Baumol's qualifications and area of expertise.

Air Canada raised that Professor Baumol's curriculum vitae includes confidential personal information such as education and employment history as defined in section 3 of the Privacy Act, and that it should not be disclosed pursuant to section 8 of the Privacy Act and subsection 19(1) of the ATIA.

However, Air Canada's burden is to prove the specific harm exception pursuant to subsection 24(2) of the General Rules. Subsection 24(2) of the General Rules states that the Agency shall place a document in respect of which a claim for confidentiality has been made on the public record if the document is relevant to the proceeding and no specific direct harm would likely result from its disclosure or any demonstrated specific harm is not sufficient to outweigh the public interest in having it disclosed. If Air Canada fails to meet the test, the general rule of disclosure applies.

Air Canada has not identified any specific direct harm that could arise from the disclosure of the curriculum vitae. Although Air Canada points out that the curriculum vitae contains information about Professor Baumol's education and employment history, it has not explained the nature and extent of the harm that could result if the curriculum vitae was disclosed. Vague claims of unspecified harm will not suffice.

Furthermore, Professor Baumol's curriculum vitae is already on the public record as it is accessible online through New York University's web site. The Agency has reviewed the curriculum vitae provided by Air Canada and the curriculum vitae appearing in the hyperlink provided by Mr. Jackson and finds that Professor Baumol's education and employment history clearly appear in the hyperlink making the curriculum vitae publicly available. Although there are minor differences between both versions, the curriculum vitae posted in the hyperlink provided by Mr. Jackson has actually more details and is updated as opposed to the one provided by Air Canada.

Finally, the attachments to Professor Baumol's curriculum vitae are related to his testimonies before boards, commissions, tribunals and courts as well as the titles of numerous books and articles he has published. Testimonies and publications are not personal information.

Therefore, the Agency finds that Air Canada has not demonstrated the specific direct harm that it alleges. There is no evidence that the disclosure of Professor Baumol's curriculum vitae would likely cause specific direct harm to Air Canada.

2) Statement by Professor Baumol

Submissions

Air Canada filed a statement by Professor Baumol that it claimed to be confidential as it contained confidential commercial information which is consistently treated as confidential by Air Canada. It also contains specific information regarding other routes, as well as information about considerations taken by Air Canada in making its pricing decisions.

Air Canada also submitted that Professor Baumol's statement constitutes confidential commercial information: its disclosure will result in material financial loss, prejudice to the competitive position of Air Canada and interference with its contractual relations and negotiations with third parties.

Mr. Jackson contends that it is impossible for him to comment on the confidentiality request as he has no knowledge of what is contained in the statement. He adds that he cannot judge the statement from the paraphrasing by Air Canada. Mr. Jackson also asserts that Professor Baumol is the author of numerous papers and textbooks in the field of economics and, for example, made another statement about the Canadian transportation system, specifically rail, that is publicly available. Mr. Jackson concludes that it appears that Professor Baumol is an academic who is more than willing to make his arguments in the public sphere.

Air Canada asserted that Mr. Jackson has failed to establish the relevance and public interest in the disclosure of Professor Baumol's statement.

Finally, Air Canada argues that the ATIA recognizes that information of the nature of that contained in Professor Baumol's statement may not be disclosed to the public. There is no discretion awarded to the head of a government institution in deciding whether information of this nature should be disclosed, as paragraph 20(1)(b) of the ATIA uses the wording "shall refuse to disclose" rather than "may refuse to disclose". According to Air Canada, the statement would automatically be protected from disclosure pursuant to paragraph 20(1)(b) of the ATIA in the context of an access to information request.

Analysis

Air Canada claimed that Mr. Jackson has failed to establish the relevance and public interest in the disclosure of Professor Baumol's statement. The Agency has reviewed the statement for which Air Canada has made a claim for confidentiality and finds, pursuant to subsection 24(2) of the General Rules, that it is relevant to the proceeding. Air Canada relied on this statement to explain its pricing decisions.

The burden of proving the specific harm exception falls on Air Canada and, if it fails to meet the test, the general rule of disclosure applies. Air Canada has not identified any specific direct harm that could arise from the disclosure of the statement. Air Canada has not explained the nature and extent of the harm that could result if the statement was disclosed for the reasons that follow.

Past Practice

Air Canada submitted that Professor Baumol's statement has been previously treated by the Agency as confidential pursuant to paragraphs 66(8)(b) and (c) of the CTA. The Agency made this determination in its cases in 2001-2002.

The Federal Court and Federal Court of Appeal have provided guidance on the concepts under paragraphs 20(1)(c) and (d) of the ATIA. The Agency notes that paragraphs 20(1)(c) and (d) of the ATIA refer to the same concepts as the ones indicated in paragraphs 66(8)(b) and (c) of the CTA (material financial loss, prejudice to the competitive position and interference in contractual relations and negotiations).

There are similarities between subsection 24(2) of the General Rules and paragraphs 20(1)(c) and (d) of the ATIA. Subsection 24(2) refers to "specific direct harm would likely result from its disclosure" and paragraphs 20(1)(c) and (d) of the ATIA refer to "disclosure of which could reasonably be expected to [result/prejudice/interfere]". However, the language used in subsection 24(2) is stronger by the use of the term "likely" as opposed to "reasonably." Nevertheless, the Agency is of the opinion that the case law developed under paragraphs 20(1)(c) and (d) of the ATIA may be relevant and applicable in some respects. Therefore, the Agency is of the opinion that it should review its past practice of treating Professor Baumol's statement as confidential.

Information for which the disclosure would likely cause material financial loss and prejudice to the competitive position of Air Canada

Air Canada submitted that disclosure will result in material financial loss and prejudice to its competitive position pursuant to paragraph 66(8)(b) of the CTA.

Pursuant to subsection 24(2) of the General Rules, the Agency must weigh the facts in order to determine whether Air Canada has established specific harm that would likely result from the disclosure. The evidence of harm must not be speculative. The Federal Court of Appeal came to this conclusion in Canada Packers Inc. v. Canada (Minister of Agriculture), [1989] 1 F.C. 47 (Fed. C.A.). In SNC Lavalin Inc. v. Canada (Minister for International Co-operation), [2003] F.C.J. No. 870 (QL), the Federal Court stated that it is not sufficient for an applicant to establish that harm might result from disclosure. It stated that speculation, no matter how well informed, did not meet the standard of reasonable expeCTAtion of material financial loss or prejudice to competitive position.

In Canadian Pacific Hotels Corp. v. Canada (Attorney General), 2004 FC 444 (F.C.), the Federal Court found that the evidence brought forward by the applicant remained in the realm of speculation. The applicant's argument was essentially that disclosure of the key terms of the Crown Leases could subject the applicant to a much more competitive environment concerning the Jasper Park Lodge that it had to contend with in the past. In the Federal Court's view, however, a more competitive environment did not give rise to a reasonable expeCTAtion of a material financial loss or a prejudice to the applicant's competitive position. The connection was too tenuous and not sufficiently proven.

The Federal Court and Federal Court of Appeal have been requiring specific evidence; general statements of the nature presented by Air Canada do not suffice. In Brookfield LePage Johnson Controls Facility Management Services v. Canada (Minister of Public Works & Government Services), 2003 FCT 254 (Fed. T.D.), affirmed 2004 FCA 214 (F.C.A.)(leave to appeal refused 2005 SCC), the Federal Court reviewed the evidence, including the supplementary affidavit, and concluded that, aside from general statements of possible harm, the applicant had failed to provide insight as to how the competitors might use the record so that the applicant would sustain a reasonable expeCTAtion of probable harm if the records in question were released. There existed insufficient evidence to conclude that there was a basis to establish financial loss or prejudice to the applicant, or financial gain to a competitor. In the present case, there is no evidence filed by Air Canada supporting a finding that a competitor could use the statement to its advantage and to Air Canada's detriment.

In contrast, the Federal Court found that the Canada Post Corporation (CPC) had a reasonable expeCTAtion of probable harm if some information was disclosed to Canada Customs Revenue Agency (CCRA). In Dussault v. Canada (Customs & Revenue Agency), 2003 FC 973 (F.C.), the Federal Court reached that conclusion for the following reasons. First, the Director's evidence established that the information not now disclosed would provide an astute analyst with a fairly accurate picture of the structure and the nature of the compensation that CPC negotiated under an agreement. This information could be used by competitors of CPC to bid against CPC for the provision to the CCRA of the services covered by the agreement. Second, the Director swore that if the information was disclosed it was highly probable that this information would be used by competitors of CPC to bid against CPC for the provision to the CCRA of the service covered by the agreement. Third, the applicant was employed by a public relations and media firm representing UPS, a CPC competitor. In the present case, the Agency has no such evidence as submitted in Dussault v.Canada demonstrating that the statement would provide a fairly accurate picture of Air Canada's structure for pricing decisions. The statement fails to demonstrate any link between the routes involved in the present case as it involves other routes altogether. The Agency fails to see how the statement could be used by competitors against Air Canada.

Air Canada has made general statements that the disclosure of Professor Baumol's statement will result in material financial loss and prejudice to Air Canada's competitive position. However, Air Canada did not bring forward any evidence supporting its general statements. There is no detailed evidence to convince the Agency to refuse the disclosure of the statement.

Air Canada is merely providing grounds for speculation as to possible harm. Speculation is an insufficient ground to protect the statement from disclosure. As indicated by the case law, the threshold is probability, not possibility or speculation. There must exist, in the evidence, an explanation establishing that those outcomes are a likely result.

Aside from general statements of possible harm, Air Canada failed to provide insight as to how its competitors might use Professor Baumol's statement so that it will likely sustain specific direct harm once the statement in question is released. Air Canada states that Professor Baumol's statement contains specific information regarding other routes, as well as information about considerations taken by Air Canada in making its pricing decisions. However, Air Canada does not explain how this information is linked to the likelihood of material financial loss or prejudice to its competitive position.

Therefore, the Agency finds that Air Canada has not demonstrated the specific direct harm that it alleges. There is no evidence that the disclosure of Professor Baumol's statement would likely cause material financial loss and prejudice to the competitive position of Air Canada.

Information for which the disclosure would likely cause interference with Air Canada's contractual relations and negotiations with third parties

Air Canada submitted that disclosure will result in interference with its contractual relations and negotiations with third parties, pursuant to paragraph 66(8)(c) of the CTA. Air Canada bears the burden of demonstrating, on a balance of probabilities, that specific harm would likely result from the disclosure of the statement.

In Saint John Shipbuilding Ltd. v. Canada (Minister of Supply & Services), (1990) 107 N.R. (Fed. C.A.), the Federal Court of Appeal stated that the applicant had to show an obstruction in the actual contractual negotiations. The threshold must be that of probability and not a mere possibility or speculation. The Federal Court of Appeal concluded that the evidence presented by the applicant was lacking in this regard and was insufficient to support a finding.

In St. Joseph Corp. v. Canada (Public Works and Government Services), [2002] FCJ No. 361 (FC), the Federal Court stated that the applicant must show an obstruction in the actual contractual negotiations but the evidence was lacking. The affidavit only speculated as to probable harm. The statements were very general and did not support the contention that disclosure of the requested records would result in a reasonable expeCTAtion of probable harm. This was also the case in 131 Queen Street Ltd. v. Canada (Attorney General), [2007] F.C.J. No. 510, where the Federal Court held that the affidavit filed as evidence did not provide sufficient probative evidence. Unsupported assertions or speculative evidence that disclosure would give rise to a reasonable expeCTAtion of probable harm was not enough. (See also Canadian Broadcasting Corporation v. National Capital Commission, (1998) 147 F.T.R. 264 and Société Gamma Inc. v. Canada (Department of Secretary of State), (1994), 79 F.T.R. 42).

The Agency is not satisfied that Air Canada has met its burden. Air Canada has made general statements that the disclosure of Professor Baumol's statement will result in interference with its contractual relations and negotiations with third parties. However, Air Canada did not bring forward any evidence supporting its general statements. As indicated by the case law, Air Canada must show an obstruction in actual contractual relations and negotiations. However, there is no evidence that Air Canada is presently involved in contractual negotiations with third parties or that its contractual relations may be impacted. The mere heightening of competition is not sufficient to refuse to disclose the statement. Hypothetical problems are insufficient. Air Canada's general statements amount merely to bald assertions unsupported by any evidence as to the likelihood of interference with its contractual relations and negotiations with third parties.

Aside from general statements of possible harm, Air Canada failed to provide insight as to how its competitors might use Professor Baumol's statement so that it will likely sustain specific direct harm once the statement in question is released. Air Canada stated that Professor Baumol's statement contains specific information regarding other routes, as well as information about considerations taken by Air Canada in making its pricing decisions. However, Air Canada did not explain how this information is linked to the likelihood of interfering with its contractual relations and negotiations with third parties.

Therefore, the Agency finds that Air Canada has not demonstrated the specific direct harm that it alleges. There is no evidence that the disclosure of Professor Baumol's statement would likely cause interference with Air Canada's contractual relations and negotiations with third parties.

Statement and ATIA in the context of an access to information request

Based on paragraph 20(1)(b) of the ATIA, Air Canada submitted that information of the nature of that contained in Professor Baumol's statement may not be disclosed to the public. According to Air Canada, there is no discretion awarded to the head of a government institution in deciding whether information of this nature should be disclosed. Paragraph 20(1)(b) of the ATIA uses the wording "shall refuse to disclose" rather than "may refuse to disclose". According to Air Canada, the statement would automatically be protected from disclosure pursuant to paragraph 20(1)(b) of the ATIA in the context of an access to information request.

The argument presented by Air Canada is based on the ATIA. The test outlined in the Federal Courts case law for paragraph 20(1)(b) is not one to be found in the CTA or General Rules. The Agency must assess a claim for confidentiality according to its legislative and regulatory frameworks as it has done above by finding that Air Canada has not demonstrated any specific direct harm that it alleges, pursuant to subsection 24(2) of the General Rules.

The Agency is not dealing with an access to information request in this instance. It cannot be presumed that Professor Baumol's statement would automatically be protected from disclosure in the context of an access to information request. As Air Canada submitted a hypothetical argument, the Agency will not make a finding on it.

Conclusion

For these reasons, the Agency finds the curriculum vitae and statement relevant to the proceeding and no specific direct harm will likely result from their disclosure. The Agency hereby denies Air Canada's claims for confidentiality. Pursuant to paragraph 24(2) of the General Rules, the Agency places Professor Baumol's curriculum vitae and statement on the public record.

Timelines

Considering that the disclosure of these documents may have an impact on Mr. Jackson's application before the Agency, the Agency provides Mr. Jackson with an opportunity to comment, pursuant to section 3 of the General Rules.

To enable the Agency to consider the matter in a timely fashion, Mr. Jackson is hereby provided with seven (7) calendar days from the date of this letter to review the attached curriculum vitae and statement and file with the Agency and serve on Air Canada his comments. Air Canada will then be provided with three (3) calendar days from the date of the receipt of Mr. Jackson's reply to file with the Agency, and to concurrently serve on Mr. Jackson its comments.

It is the parties' responsibility to ensure that their submissions are filed within the stated time frames.

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