CP Rail sued by former employee in dispute over affidavit

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Canadian Pacific Railway Ltd. is facing a lawsuit by a salesman who alleges he was dismissed after refusing to sign an affidavit the company prepared in connection with a corporate espionage case launched by rival Canadian National Railway Co.

The former employee, Jason Hylton-Foster, alleges he was told by CP lawyers to sign a document that stated his superiors told him not to contact companies on a confidential list of CN customers, in accordance with a court undertaking CP made after being sued by CN.

Mr. Hylton-Foster alleges he asked that the affidavit be revised but was told by a CP lawyer to sign it "for the good of the company."

In September, Mr. Hylton-Foster alleges he was told by the lawyer to sign the affidavit, which stated he was told to cease using the list on Aug. 14. He refused, and a few days later was called to a meeting where he was told he had lost his sales job and was escorted off the property. He was given a letter that told him he could apply to return to his former job as a unionized labourer, but the union told him this was not possible, the statement of claim says.

"At no point was the plaintiff directed to stop soliciting CN customers," says the statement of claim, which contains allegations that have not been tested in court.

CP declined to comment.

The lawsuit, filed in Calgary, marks a new twist in CN's legal fight against CP.

CN's $100-million lawsuit was launched in August after CN learned that CP was soliciting clients from a list of CN customers "unlawfully" taken by two salesmen who quit for jobs at CP.

CN is suing CP, operating chief Keith Creel, consultant Stanley Jablonski and the two salesmen, Greg Shnerer and Derek Ackford. All are former CN employees; Mr. Shnerer and Mr. Ackford were Mr. Hylton-Foster's bosses.

CP has said it will defend itself against the CN suit. The company has also said it regrets that the documents were taken and used , but says they are no longer available to its employees. It has agreed in court not to contact certain CN customers.

Mr. Hylton-Foster, who is seeking $298,000, including damages and lost income, did not respond to interview requests. His lawyer declined to comment.

Mr. Hylton-Foster began working at CP in 2012 as a unionized labourer, and was promoted in June, 2015, to work in CP's Calgary intermodal shipping department as a new business account manager. He was paid $50,000 a year, plus commission. He alleges in the statement of claim that he was told he was part of the company's strategy to target customers of CN and given a list of companies to solicit.

The list, allegedly provided by Mr. Shnerer, included the customers' freight volumes and revenues with CN, as well as geographic details of shipping routes.

After CN sued CP in August, the same list was subject to a litigation hold, and Mr. Hylton-Foster received an e-mail "on or about" Aug. 13 from his employer that said he was not to destroy any documents he received from Mr. Shnerer or Mr. Ackford.

On Aug. 14, 2015, CP appeared in a courtroom and gave an undertaking not to use CN's confidential information, and agreed to collect and preserve the client lists.

But Mr. Hylton-Foster alleges he was told on Aug. 18 to continue soliciting CN customers on the list.

In a ruling on a matter related to the lawsuit between the railways, an Ontario judge found there were "shortcomings" in CP's initial compliance with the undertaking. However, he attributed this to CP's lack of "due diligence" and found no deliberate attempt to ignore its obligations.

CP has said Mr. Ackford and Mr. Shnerer are suspended. The two executives in charge of the intermodal division have been reassigned.