Subway must pay CBC $500,000 for failed lawsuit

TORONTO • Subway has been ordered to pay the CBC $500,000 in legal costs following its failed bid to sue the public broadcaster for defamation.

In his decision, Ontario Superior Court Justice Ed Morgan attributed much of the length and complexity of the legal battle to the approach taken by the fast-food chain.

Subway had sued the CBC for defamation over a Marketplace report in February 2017 that focused on the amount of chicken in its chicken sandwiches. The world’s largest fast-food operator sought $210 million in damages.

The CBC succeeded in November in having Morgan dismiss the action pretrial under so-called ANTI-SLAPP legislation, which aims to protect free speech on matters of public interest.

“Its materials were overwhelmingly aimed at the issue of truth in the news magazine item that was the subject of the suit — an issue which goes to the heart of the merits of Subway’s defamation claim, but is only relevant in a minor way to the SLAPP criteria,” Morgan said. “The motion turned into a massive undertaking to which CBC, as moving party, was compelled to reply.”

Both Subway’s approach and the CBC’S response required a “herculean lawyering effort” resulting in a “monument to high-end legal work” in complex litigation, Morgan said.

In addition to ordering Subway to pay CBC $500,000 for legal costs, the restaurant company will also have to pay the broadcaster another $178,000 in fees and disbursements.