Ontario decision shows that courts still expect old-fashioned detail from employers alleging digital theft
When a senior sales executive at a national meat processor resigned in late 2024, his employer alleged he did not leave empty‑handed.
According to court filings in Contino v. Olymel L.P., the company said he had downloaded roughly 466 internal files — including deals, business projections, price lists, customer lists, “kilos and prices of various meat products,” and business strategies — before moving to a competitor.
The employee was terminated and he sued for wrongful dismissal, to which Olymel responded with its own counterclaim: breach of contract, breach of confidence and copyright infringement – backed up by an employment agreement, a non‑disclosure agreement and a code of conduct, all signed by the complainant.
The employer argued that these agreements more than covered what it said was an act of theft by the departing employee.
However, in its December decision, the Ontario Superior Court of Justice struck the counterclaim in its entirety, with leave to amend, finding that Olymel had not been specific enough in describing what confidential information was misused, and exactly what financial consequences it had suffered as a result.
Common law duties and written confidentiality clauses
According to Ryan Berger, partner at Lawson Lundell in Vancouver, there is a common law expectation that all employees must maintain confidentiality in respect to their employer’s information. But that’s not the whole picture.
“An employer shouldn't necessarily need an additional agreement to protect their confidential information,” Berger says. “However, it is a best practice to do so.”
This is illustrated by the court’s decision, he adds. Although it was prepared to accept that Olymel had contracts and policies around confidentiality, it found that the evidence given was not enough to clinch a win.
“Broadly referring to 466 files without identifying the documents said to hold confidential information, fails to meet the minimum level of factual disclosure required by Rule 25.06. [of Rules of Civil Procedure],” the decision states.
“This decision should not be taken as requiring a list of every document taken; but using broad categories such as ‘business strategies,’ ‘price lists’ and ‘deals’ is too vague and general.”
The employer itself, the court adds, didn’t yet know the particulars of the confidential information or the extent of potential damage or losses: “The full extent of Olymel’s losses are presently unknown, but will be determined prior to trial.”
The evidentiary problem: proving loss after data exfiltration
In Contino, Olymel argued that the information provided the former employee and his new employer with a competitive advantage they would not otherwise have had, and that its business had suffered as a result.
The court, citing earlier decisions, said that was not enough. It wanted to see material facts about lost business, impaired relationships or other measurable impacts, not simply the conclusion that harm must have occurred.
Berger said that tension is familiar to organizations facing suspected data exfiltration by departing staff, when timing, slow business cycles and the amorphous nature of digital data can complicate attempts to pinpoint losses.
“It is challenging, especially at the beginning, to determine and identify what the damages are,” he says.
“The damages don't often materialize right away. For instance, loss of business if clients move – that sort of thing doesn't necessarily happen right away … contracts or purchases don't necessarily change in the first month or two.
That can leave employers in a bind, he says: move quickly and risk being faulted for speculative pleadings or wait for damages to emerge and risk evidence getting stale or even more data loss or misuse.
The court’s solution was balanced: strike down Olymel’s counterclaim but allow the company 30 days to file a more detailed version.
Managing access to confidential information during notice
The ruling also prompts questions about how employers handle access to confidential information when an employee is serving out notice or has announced plans to resign.
In the Olymel case, the plaintiff had given several weeks’ notice. Before his final day, he was called into a meeting with his manager and two human resources representatives. He was confronted about the downloaded files and terminated on the spot.
Berger explains that when an employee continues to work during a notice or resignation period, employers may need to recalibrate access, “It is appropriate for the employer to, for instance, isolate their access to confidential information.”
Another example is monitoring the employee in question for unusual email activity, he adds – but only with appropriate stopgaps to ensure they aren’t overstepping employee privacy laws.
The Contino decision did not turn on privacy statutes, but as Berger explains, provincial rules governing the collection and use of personal information — and evolving case law on reasonable expectation of privacy in the workplace — frame what employers may do when suspicion arises.
“In doing monitoring and evidence gathering, an employer shouldn't necessarily be rifling through the employee's inbox in total, but should apply appropriate techniques like filtering and targeted monitoring,” Berger says.
“It's a good reason to have a third-party expert involved, because they can also help to screen the employer and limit any over-collection of unrelated or irrelevant personal information.”
