Background
SS&C Technologies Canada Corporation licensed proprietary securities-pricing data to Bank of New York Mellon Corporation under an agreement prohibiting redistribution to affiliates and other parties. SS&C discovered in 2016 that BNY had supplied the data without charge to CIBC Mellon after CIBC Mellon terminated its own licensing agreement. The evidence indicated that BNY may have shared SS&C’s data with as many as 65 unauthorized affiliated entities over 17 years.
After SS&C requested preservation of records showing how, where, and for how much the data had been redistributed, BNY refused to preserve or produce the information. The trial judge found a contractual breach and drew limited adverse inferences, but did not expressly find spoliation. Using a “rateable approach,” the judge awarded SS&C US$5,696,850 based on the 55.4 percent of data BNY could not account for. The Ontario Court of Appeal expressly found spoliation but upheld the damages award. SS&C appealed.
The Court’s Holding
The Supreme Court unanimously allowed SS&C’s appeal. It upheld the finding that BNY committed spoliation, which requires intentional destruction, alteration, mutilation, or concealment of relevant evidence when litigation is underway or reasonably contemplated, in circumstances supporting an inference that the conduct was intended to affect the litigation. Once spoliation is established, a rebuttable presumption arises that the missing evidence would have been unfavourable to the spoliator. If unrebutted, adverse inferences are mandatory, although their scope and any additional remedies remain context-specific and proportionate.
The trial judge’s inferences were too weak to fill the evidentiary gaps created by BNY and improperly left SS&C bearing the resulting uncertainty. The damages methodology was also legally and factually flawed: it treated the unaccounted-for data as shared only once with one unauthorized entity, relied on unsupported centralized-pricing assumptions and an arbitrary rate, and failed to reflect the possible repeated use of the data by up to 65 entities.
The Court set aside the damages award and remitted damages quantification alone to the Ontario Superior Court. The reassessment must use adverse inferences that produce concrete findings about unauthorized usage and the data’s value. It will proceed on the existing record, subject to the trial judge’s discretion to admit additional evidence, particularly expert pricing evidence.
Key Takeaways
- Spoliation requires intentional destruction, alteration, mutilation, or concealment of relevant evidence, while litigation is underway or reasonably contemplated, with a reasonable inference that the conduct was intended to affect the litigation.
- Unrebutted spoliation requires an adverse inference capable of filling the evidentiary gap, but trial courts retain discretion over the inference’s scope and proportionate additional remedies.
- Damages may be estimated despite evidentiary uncertainty, but the award must remain tied to the proven breach, the evidence, and properly drawn adverse inferences.
Why It Matters
The decision modernizes and clarifies Canadian spoliation law for an era in which critical evidence is often electronic and easily deleted or withheld. A party that intentionally creates an evidentiary vacuum cannot benefit from it; courts must shift the resulting uncertainty through meaningful adverse inferences.
The ruling also limits judicial flexibility in quantifying difficult contractual losses. Even when misconduct makes precision impossible, a court must connect its methodology to concrete findings about the scope and value of the loss rather than construct an arbitrary compromise.