|Forensic accountant to look at WestJet files
Staff hard drives
July 9, 2004
Air Canada and WestJet Airlines Ltd. agreed yesterday to allow a forensic accountant to examine computer hard drives belonging to four WestJet employees -- including three vice-presidents -- to determine what should be turned over to the Montreal airline as evidence in its lawsuit over alleged corporate espionage.
Also, Air Canada is set to receive formal court approval for an order that prohibits WestJet from destroying, distributing and using data collected from its rival's internal Web site over a 12-month period. The two airlines signed off on the order, on the condition of some amendments.
These were the two main developments from a 90-minute hearing yesterday at Ontario's Superior Court of Justice on the Air Canada lawsuit.
"Air Canada virtually got what it wanted," Earl Cherniak, a lawyer for the airline, said after the hearing.
The legal action alleges WestJet unlawfully obtained confidential business information -- mostly load factors, or seats filled, on flights -- and used it to challenge Air Canada on its most profitable flights and determine expansion plans. WestJet admits information was obtained, but denies it was ever used for commercial purposes.
The next stage in the legal action involves the two airline agreeing upon a court-approved forensic expert to go through the computer hard drives of four WestJet employees -- including two co-founders, a former head of marketing, and a high-tech staff member who wrote software to enable easy penetration of the Air Canada data base.
This expert, to be sanctioned by the court, will determine what data from the hard drives may be forwarded to Air Canada in relation to its legal claim, as opposed to letting Air Canada's lawyers comb through all the WestJet hard drives.
The two sides are to develop a protocol within the next few days to determine, among other things, dates as to when certain evidence must be produced.
In arguments yesterday, Mr. Cherniak warned Mr. Justice Ian Nordheimer that once evidence is turned over, "it may show a much more significant use of that [confidential] information for a significant period of time."
The next crucial court date is July 22, when WestJet lawyers will seek permission from the Ontario judge overseeing Air Canada's bankruptcy reorganization for permission to countersue. WesJet is prohibited from launching legal action against Air Canada due to the terms of the court order granting the airline creditor protection.
Air Canada lawyers are in court today to get approval of its plan of arrangement and permission to send it out to creditors.
© National Post 2004