Supreme Court refuses to hear appeal in CBC/Radio-Canada defamation case

In an October ruling, the Quebec Court of Appeal sided with a Montreal businessman who claimed a report produced the Enquête program falsely linked him to the Mafia.

Quebec Court of Appeal ordered broadcaster to pay $60K in damages to developer

CBC's new headquarters in Montreal is located on Papineau Avenue. (CBC)

The Supreme Court of Canada will not review the defamation case involving CBC/Radio-Canada and a Montreal businessman who accused the public broadcaster of falsely linking him to the Mafia.

CBC/Radio-Canada had requested permission to appeal a Quebec Court of Appeal ruling from last October that ordered the broadcaster to pay $60,000 in damages to businessman Lee Lalli.

On Thursday, the country's top court said it would not hear the case.

The defamation case was in connection to a report produced by Enquête, Radio-Canada's French investigative program, which examined a series of real estate transactions made by Lalli between 2002 and 2006.

According to Lalli, the Enquête episode, which aired on March 7, 2013, damaged his honour and reputation, contained inaccuracies and did not abide by journalistic standards.

He launched his defamation suit in March 2014 seeking $200,000 in compensatory damages and $100,000 in punitive damages from CBC/Radio-Canada and journalist Alain Gravel.

On Sept. 10, 2018, a Quebec Superior Court judge ruled against Lalli. 

In a ruling from October of this year, however, all three judges on Quebec's Court of Appeal sided with Lalli, thus overturning the Superior Court ruling.

"I am of the opinion that the judge made the mistake of ignoring the applicable principles in matters of defamation when the author of the litigious remarks is a journalist," wrote Justice Jocelyn Rancourt of the Quebec Court of Appeal. 

According to Rancourt, "the most important error" committed by the journalists and CBC/Radio-Canada "resides in the distorted image of reality resulting from the general impression emerging from the report of the Enquête program and its presentations on other broadcasting platforms."

The real estate deals

Gravel's report focused on a parcel of land in Montreal's Notre-Dame-de-Grâce neighbourhood Lalli purchased in 2003.

The deal was completed with two deeds of sale: One, for the largest chunk of the land, was for $1,800,000. The second, for a stretch of land that runs along Côte-Saint-Luc Road, was for $50,000. 

Lalli then sold the land linked to the first deed to the Church of Jesus Christ of Latter-day Saints for $2 million. 

Lalli was later approached by members of the Mafia — notably Vito Rizzuto and Tony Magi — who were believed to have wanted to associate themselves with Lalli to build a pharmacy under the Pharmaprix banner on the stretch of land along Côte-Saint-Luc Road, which he still owned at the time.

Lalli said he refused their proposition.

That piece of land was ultimately sold for $1,500,000 in February 2006 to another real estate developer, Michel Servant, who had a plan to build a seniors' residence. 

Servant then sold the land to a company for $4,550,000 in November 2007.

Hidden body cameras

Although the appeal court judges highlighted several reasons for their unanimous ruling, Justice Rancourt said it would be "unthinkable" to remain silent about the use of hidden body cameras by Gravel and his producer during a meeting with Lalli.

On Jan. 16, 2013, Gravel and his producer attempted to meet with Tony Magi — a businessman with Mafia ties who was shot and killed in 2019 — with hidden body cameras.

After they were quickly turned away by Magi's bodyguards, the two journalists decided to try to meet with Lalli.

According to the ruling, Gravel had received permission from a CBC/Radio-Canada editorial leader to use a hidden camera for Magi.

"Nothing justified the use of such methods [for Lalli] in those circumstances," Rancourt said.

"Furthermore, at no point during the Enquête report does Gravel indicate that many of the excerpts being broadcast were obtained through the use of secret recording techniques."

The judge also said Lalli was never told that he was being recorded and he willingly answered the journalists' questions, after being informed they were working on a story about Magi. 

'Misleading impression'

In the ruling, Rancourt states that Gravel's report presented an inaccurate picture of what happened because it gave the impression that Lalli bought the land on Côte-Saint-Luc Road for $50,000, without clarifying the fact the purchase was part of a larger deal.

During the broadcast of the report, Lalli was depicted as a "person having ties with the Mafia and connections with the city [of Montreal], a position that would have supposedly allowed him to make immense profits following the sale of land purchased for $50,000 and then sold for $4.5 million," the judge wrote.

The report, the judge said, clearly implies that Lalli benefited from the sale of the land in 2007, even though, as of 2006, he was no longer the owner.

Rancourt acknowledged that Gravel's report mentioned the 2006 sale, but he also pointed out that Servant — the person who purchased the land from Lalli at the time — is never mentioned.

The emphasis is "solely put" on Lalli, the judge wrote.

The judge also said Gravel's description of the process for zoning changes and modifications for the land on Côte-Saint-Luc Road gives the "misleading impression of a fraudulent operation."

According to the judge, the journalist also "extrapolated" the involvement of the mafia in the purchase of that piece of land. 

Gravel's report gives the "clear impression" that Lalli is a member of the mafia, and not just someone who has ties with people from the criminal organization, Rancourt said.

"This general impression distorts the reality," he wrote in the ruling, while adding that Lalli and Magi are presented as equals throughout the television report, as if they had the same type of connections with organized crime.

On the recording CBC/Radio-Canada journalists obtained by hidden camera in January 2013, Lalli can be heard saying he was "raised with those guys," referring to Vito Rizzuto and his son Nick Rizzuto.

The only information Gravel has with regard to Lalli's relationship with the elder Rizzuto is that he knows him and has done favours for him that have nothing to do with illegal activity, Justice Rancourt wrote.

In another report that was published later, on March 12, 2013, Rancourt said Gravel "clearly insinuates" that Lalli falsified a signature that was on a power-of-attorney document for the Villa Notre-Dame-de-Grâce foundation, the company Lalli purchased both parcels of land from.

The power of attorney was needed for Lalli to request a zoning change with the city of Montreal.

The journalist acknowledged that he did not have any information to support this allegation against Lalli, Justice Rancourt wrote in the ruling.

With files from Radio-Canada