Norwich Orders: Getting Behind the Mask

Introduction

Technology has both lessened and increased people’s ability to stay anonymous in society. Sometimes that anonymity has necessitated the application of old legal and equitable doctrines to new legal problems.

For example, commentary on the internet is frequently made anonymously using pseudonyms so that the true author’s identity remains unknown. Likewise, many social media applications permit users a degree of anonymity in the manner in which identifying information is disclosed, and to whom. The Supreme Court of Canada has equated anonymity with informational privacy, which is particularly important in the context of Internet usage.¹

But should privacy interests surrounding Internet usage yield to disclosure of the identity of wrongdoers? Relatedly, should people be able to use the Internet with impunity to hurt others?²

While in many situations, Internet anonymity may be a good thing (e.g. fostering freedom of speech), anonymity can also be employed to more nefarious ends, including defamation,³ cyberbullying,⁴copyright infringement,⁵ and, of course, fraud.⁶And, while the fact that a person has been wronged may be readily apparent, the identity of the wrongdoer(s) may be unknown or in the exclusive knowledge of a third-party mixed up in the wrongdoing, such as a service provider.

This is where the equitable Norwich order comes in.

Norwich Orders

Norwich orders have their genesis in equity.⁷Broadly stated, they entail the freestanding right to bring an action for discovery against an innocent third-party inadvertently mixed up in some wrongdoing. They are typically, but not always brought pre-action.⁸

Authority for modern Norwich orders is frequently traced back to the 1974 House of Lords decision of Norwich Pharmacal Co. v. Commissioners of Customs & Excise,⁹from which the remedy derives its name. In that case, the House of Lords permitted an American drug company to use a pre-action bill of discovery to obtain the identity of a party secretly importing the company’s patent-protected drug from the English customs authorities so that the importer could be sued for patent infringement. As the House of Lords held: “[I]f through no fault of his own a person gets mixed up in the tortious acts of others so as to facilitate their-wrong-doing he may incur no personal liability but he comes under a duty to assist the person who has been wronged by giving him full information and disclosing the identity of the wrongdoers.”

When faced with a motion for a Norwich order, Canadian courts typically apply a four-part test:

1. Has the moving party shown a valid, bona fide or reasonable claim?
2. Has the moving party shown that the third-party from whom information is sought is somehow involved in the acts complained of beyond a mere witness?
3. Is the third-party the only practicable source of the information? and
4. Do the interests of justice favour the obtaining of disclosure from the third-party?¹⁰

In defamation cases, Norwich orders may be employed against internet service providers to obtain IP addresses and other information necessary to identify an anonymous wrongdoer.¹¹ For example, a Norwich order might be made to identify a competitor purposely posting false reviews about a competing business to destroy its reputation and market share. Such a remedy may be equally applicable in the case of cyberbullying through social media.

However, in addition to identifying wrongdoers, Norwich orders may be used to evaluate whether a cause of action even exists, to trace and preserve property or evidence,¹² and even to obtain exculpatory evidence.¹³ Indeed, Norwich relief has been given such an expansive approach in English jurisprudence that it may apply to novel situations in which the doctrine has never been used.¹⁴

Norwich relief is also readily available where a plaintiff has been defrauded and seeks production of bank records to prove the fraud and recover stolen property.¹⁵ In such a case, the court has held that the innocent third party bank is involved because without the bank’s involvement, the wrongful receipt and possible transfer of funds could not have occurred.¹⁶ In fraud cases involving cryptocurrency, Norwich orders may be useful in both unmasking the true identity of a fraudster and tracing bitcoin across traditional jurisdictional boundaries, possibly in conjunction with the assistance of foreign courts.¹⁷

Indeed, one judge has commented that “[w]here the applicant believes it is the victim of fraud, it is unreasonable to require the applicant to approach the alleged wrongdoer for the information, and the various financial institutions become the only practicable source of the information.”¹⁸

In fraud cases, Norwich orders may be combined with other remedies, including Mareva injunctions (the subject of an upcoming blog), and sealing orders, often on an ex parte basis (without notice to the wrongdoer). For example, a Norwich order could be used to locate funds held in a bank account, followed by a Mareva injunction to freeze those funds pending trial, and the execution of an Anton Pillar order to seize evidence at risk of being destroyed by a fraudster.

There is no doubt that Norwich orders remain powerful equitable remedies. As technological innovation continues to change society, creative litigants and their counsel will employ them in situations in which they have never been used before.