When I deliver competition compliance seminars and talk to industry groups, I often discuss the fact that imprisonment is one possible criminal penalty under the Competition Act (though is, somewhat curiously, more commonly imposed for deceptive advertising than for price-fixing or other criminal competition law conduct).
While that may soon change with the recent elimination of conditional sentences for cartel offences (e.g., price-fixing and other per se illegal agreements between competitors) and bid-rigging, earlier today the Competition Bureau announced that a Canadian court has once again imposed a prison sentence for misleading advertising.
In particular, an Alberta man has been sentenced to two-and-a-half years imprisonment for being convicted of misleading advertising and breaching a court order (violating a registered consent agreement with the Bureau). For my original post on this case last June see: Competition Bureau cracks down on advertiser in first criminal breach of registered consent order case.
The case relates to materially false or misleading claims in relation to oil and gas job opportunities and was one in which the Bureau initially commenced civil misleading advertising enforcement (securing a consent agreement) and later criminal enforcement.
In making today’s announcement, the Bureau said:
“In June 2013, Mr. Hovila was found guilty under the Act of making materially false or misleading representations with respect to finding employment in the oil and gas industry on his former website www.oilcareer.com and of contravening a consent agreement registered with the Competition Tribunal.
This is the first time the Bureau has obtained a conviction for the contravention of a registered consent agreement. Mr. Hovila was convicted of breaching a 10-year consent agreement signed with the Bureau in 2006 regarding the same website and he paid a $100,000 administrative monetary penalty. At that time, Mr. Hovila admitted he had violated the Act’s civil false or misleading representations provision and agreed to cease the conduct and notify the public. Consent agreements that are registered with the Tribunal have the same force and effect as a court order.”
This case is a bit of reminder that in Canada, misleading advertising can be enforced either on a civil or criminal track (with potential criminal fines and imprisonment on the criminal side). It is also an illustration of the Bureau’s efforts to more closely monitor settlements entered into with parties, including registered consent agreements (which have the force of court orders once registered and can lead to criminal penalties themselves when violated).
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I am a Toronto competition/antitrust lawyer and advertising/marketing lawyer who helps clients in Toronto, Canada and the US practically navigate Canada’s advertising and marketing laws and offers Canadian advertising/marketing law services in relation to print, online, new media, social media and e-mail marketing.
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