WestJet faces new spying allegations
Ran '007 Project,' Air Canada says
By BRENT JANG
Friday, December 9, 2005 Page B1
TRANSPORTATION REPORTER
Air Canada alleges that WestJet Airlines Ltd. ran an espionage campaign code-named the "007 Project" to steal confidential data from the larger carrier's "evil empire," allowing WestJet to strategically launch flights to the United States.
In new court filings, Air Canada further alleges that WestJet's snooping was designed in part to thwart the Montreal-based carrier's emergence from bankruptcy protection.
Not only did WestJet spy on Air Canada and defunct Jetsgo Corp., but it also gained access to secret statistics at CanJet Airlines of Halifax, according to documents filed in the Ontario Superior Court.
Air Canada said the latest revelations came to light after court-appointed forensic auditors scrutinized hard drives seized from Calgary-based WestJet.
In April last year, Air Canada launched a $220-million lawsuit accusing WestJet of corporate espionage. WestJet denies any wrongdoing and none of the allegations have been proven in court.
Air Canada sought protection in April, 2003, under the Companies' Creditors Arrangement Act, and emerged from bankruptcy protection in September, 2004.
Benjamin Smith, Air Canada's vice-president of planning, said in an affidavit that WestJet "attempted to undermine" the CCAA process.
Mr. Smith attached 24 exhibits to his affidavit, including a copy of an e-mail exchange between WestJet co-founders Mark Hill and Clive Beddoe, WestJet's chairman and chief executive officer.
Mr. Hill said in an e-mail from his BlackBerry, dated Sept. 11, 2003, that WestJet obtained a list of Air Canada's 200 weakest routes. If WestJet were to leak such information, "AC would have some serious back-tracking and explaining to do to potential investors, and would further weaken their credibility in all quarters," Mr. Hill said.
Another e-mail written by Mr. Hill, WestJet's former vice-president of strategic planning who resigned from the airline in mid-2004, points to the "evil empire" database, referring to Air Canada's load factors, or the proportion of available seats filled.
Code words used in the subject fields of e-mails included "Schtuff" and "Wayne," to alert recipients that the topic would be the 007 Project, and "WestJet and Hill often used the term 'evil empire' to refer to" Air Canada, according to Mr. Smith's affidavit, dated Nov. 28.
Various e-mails show that Air Canada's confidential data was used by WestJet to help plan transborder flights to the United States from Canada, Mr. Smith said.
Air Canada and a subsidiary allege that their smaller rival hacked into a confidential website for Air Canada employees and retirees.
Forensic auditors have determined that Mr. Hill "was analyzing the plaintiff's confidential employee website information in order to assist WestJet in expanding its routes into the United States," Mr. Smith said.
Mr. Smith alleges WestJet gained access to confidential data from CanJet and Jetsgo, and that WestJet found it "both useful and valuable" to obtain Air Canada's "real-time, flight-specific" information.
He added that Mr. Hill sent an e-mail "thoroughly analyzing Jetsgo's, CanJet's and Air Canada's load factors into Florida's destinations" in an effort to plot WestJet's new flights. "The information in this e-mail is not publicly available and could not have been obtained from manual counting of passengers at airport terminals," Mr. Smith said.
Air Canada alleges that WestJet's 007 Project grew increasingly sophisticated as the discount carrier found a way to automate "the accessing and analyzing" of Air Canada's internal data.
Air Canada said it uncovered e-mails from Mr. Hill at the address "mhyyj@shaw.ca" (MH are the initials of Mark Hill; YYJ is airport code for Victoria, where he lives). The e-mails appear to indicate he had access to sensitive information, including a letter written by an Air Canada employee to Victor Li at Trinity Time Investments Ltd., which had offered to bail out Air Canada but later withdrew its offer.
Mr. Smith complains that WestJet has yet to produce documents to shed more light on why WestJet transferred its Central Canadian base to Toronto's Pearson International Airport from Hamilton.
good one WJflyer.....
