Those interested in accounting of profits as a remedy for wrongdoing may be intrigued by the decision of the Supreme Court of Canada in Nova Chemicals Corp. v. Dow Chemical Co., 2022 SCC 43. There have been many cases in Canada over the last decades grappling with exactly how such profits should be measured (eg what expenses of the defendant may be deducted).

 

Causation (in the sense of a but-for link to a wrongful act) is irrelevant in the fiduciary rule against unauthorized profits, because it imposes a primary liability to surrender all profits acquired via the fiduciary role. But where accounting of profits is deployed as a remedy for wrongdoing, this logic does not apply. The majority affirms the relevance of the causal inquiry and sets out a framework that aims to deal with the many arguments that plaintiffs and defendants have deployed in Canadian cases. Côté J dissented and in a lengthy judgment aimed (while addressing many other matters) to articulate why accounting operates differently in fiduciary law and in intellectual property.

 

Lionel