A Labrador couple under investigation by the Canada Border Services Agency has launched a legal challenge against the federal government after the two were publicly blacklisted from using the Temporary Foreign Worker Program.

Jeff and Miriam Staples, the owners of Jungle Jim's restaurant, Greco Pizza and Captain Sub franchises, argue they were denied due process when they were one of three businesses suspended from using the program nearly four months ago.

It is the first attempt at a judicial review of the program since it was overhauled following a series of stories by CBC's Go Public team reporting alleged abuses of the program by several employers.

The government suspended the Staples's applications for temporary foreign workers in April, citing "reasonable grounds to suspect that the employer or group of employers provided false, misleading or inaccurate information in the context of the request for that opinion."

A senior source with knowledge of the suspension told CBC News the Staples's applications were halted because of an investigation launched by the border agency months earlier.

Investigation continues

A border agency spokesperson told CBC News this week the investigation "is still ongoing."

As CBC News reported on Jan. 14, the agency was investigating the couple over allegations they provided false information about the living conditions of more than two dozen foreign workers they were housing in support of applications for Labour Market Opinions.​

LMOs, now known as Labour Market Impact Assessments, are required for employers to prove the need to hire a foreign worker over a Canadian one.

Border agency officials executed search warrants at the couple's home and at Jungle Jim's restaurant in November 2013.

The couple denied the allegations, blaming former disgruntled workers for spreading false stories.

Mario Bellissimo, the Toronto immigration lawyer representing the Labrador couple, sent CBC News excerpts of the documents filed in court, but was travelling outside of the country and would not agree to an interview.

"We do not want to litigate through the media, as this an active matter," Bellissimo said in an email.

He did not respond to subsequent questions about the border agency investigation.

A call to the couple's home went unanswered.

Retroactive rules 'unfair'

The Staples allege, in the excerpts of the court documents, they were informed of their suspension in a letter dated April 4 from Employment Minister Jason Kenney, but were never notified their company names would be published on the government's website.

"The applicants had no notice or warning that their Labour Market Opinions were to be suspended until it was already done. They have still not been provided with the allegations or given an opportunity to respond," the court documents say.

New rules that went into effect on Dec. 31, 2013, allow the government the right to suspend applications for foreign workers if employers are suspected of breaking the rules, and revoking applications in cases where employers were found guilty.

The Staples argue the government should not have been able to suspend their application for foreign workers retroactively since they were approved in October 2013, before the rules changed.

"Canadian employers need certainty to enable them to order their affairs. That their LMOs may be suspended based on what may be an ever-changing version of public policy considerations is unfair, and leads to what the Supreme Court has termed a 'standard-less sweep.' 

"In the result, employers do not know the standards that they are required to meet in order to avoid their LMOs being suspended or revoked until after the minister publishes the information," the court documents say.

The couple argues the suspension has had an effect on the businesses and the temporary foreign workers they employ.

"The permanent residence applications of a number of the temporary foreign workers have been refused as they are employed by a suspended employer and are consequently not eligible for the program. For this reason, temporary foreign workers​ are leaving the applicants' businesses in order to find work with eligible Canadian employers."

Kenney, the couple argue, "exceeded his jurisdiction" when he changed the rules to publish the names of businesses on his department's website. 

The employment minister was not available for comment.

"As this issue is currently before the courts, it would be inappropriate to comment on the specifics of this case," a media relations officer for Kenney told CBC News in an email.

The government also suspended the owner of three McDonald's locations in Victoria, pending investigation, and permanently revoked permits for the Boathouse Restaurant in Fenelon Falls, Ont. Owners of the Parvaz Film Corporation​ in B.C. were also later suspended from using the program pending investigation. Their company names remain on the government's blacklist.

Eassons Transport Ltd. saw its name removed from the government's blacklist after a two-month investigation concluded the owners of the trucking company in New Brunswick did not abuse the rules of the program.

With files from CBC's Christopher Ensing