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One of BC's largest traffic control companies has been awarded $1.5 million after it was smeared by one of its main competitors when they were both going after a lucrative BC Hydro contract.

Included in the large payment is $500,000 of punitive damages, handed out by the court to punish the individuals who BC Supreme Court Justice Andrew Mayer described as "inherently malicious."

In a lengthy 30,000-word Aug. 2 BC Supreme Court decision, Justice Mayer ruled that Remon Hanna, Philip Keith Jackman, and Trevor Paine participated in a "campaign of defamation" that "intended to harm" the reputation of Raoul Malak, and his company Ansan Traffic Group. The trio did it so they could obtain a multi-million dollar BC Hydro contract.

"The defendants carried out a planned and deliberate defamation campaign over an extended period of time, which was advanced for the purpose of profit and eliminating competition," the justice said. "The defendants concealed their misconduct, and were well aware that it was wrong."

The $1.5-million defamation award is likely one of the biggest in BC history.

The case dates back to 2012 when Malak's company Ansan Traffic Group and Jackman's company Valley Traffic Systems were two of the biggest players in the province for providing traffic control services.

The decision says both companies were keen to obtain the largest traffic control services contract ever put out for bid in BC.

However, in 2012 a series of websites, blogs, and other internet media posted lies about Malak saying he was involved in corruption, bribery and money laundering. They said he was involved with gangsters, involved in kickback schemes, and guilty of tax evasion. The allegations ranged from Malak corruptly securing contracts from BC Hydro and paying illegal kickbacks to
fraud and embezzlement.

One story said he was a pimp who had married an internet mail-order bride.

The stories were read by the cities, municipalities and utilities companies who were Malak's customers. They were also sent to then-Premier Christy Clark and Rich Coleman, the minister responsible for BC Hydro, and it's likely that his company's roughly 400 staff also read them.

Ultimately, Malak didn't get the BC Hydro contract and it was awarded to Jackman's company Valley Traffic Systems.

Malak took steps to shut down the websites and eventually determined that the author of the publications was Remon Hanna, a former employee who Malak had had a falling out with and who had "an axe to grind."

The decision goes through a lengthy play-by-play of how Hanna went to work for Jackman and Paine at what was once his competition.

Jackman and Paine testified that they didn't know that Hanna was the author of the publications.

The justice didn't buy it.

"I find it more likely that they knew that Mr. Hanna was the author and did not take steps to stop the publication of these materials, because the dissemination was part of the defendants’ common design to defame the plaintiffs," Justice Mayer said.

The decision says Jackman paid Hanna $500,000 a year in a profit-sharing arrangement although he brought little to the table.

"It is possible that the alleged profit-sharing arrangement was a complete fabrication, meant to mask the true reason for payments made by Valley Traffic Systems to Mr. Hanna, being compensation for carrying out a campaign of defamation to harm the business reputation of (Malak) thereby benefitting Valley Traffic Systems and by extension, Mr. Jackman, Mr. Paine and Mr. Hanna," Justice Mayer said.

Jackman and Paine point out that they paid Hanna $1.5 million even after a 2017 court decision where it found Hanna created the defamatory publications.

However, the Justice said the reason they'd paid the money was so Hanna didn't implicate Jackman and Paine in an appeal.

The Justice found that Hanna, Jackman, and Paine had participated in a common design to defame Malak so Valley Traffic Systems could win the BC Hydro contract.

Malak sued for $6.9-million arguing the BC Hydro was worth that.

However, the justice ruled the defamation wasn't the reason the company didn't get the contract, and instead ordered Hanna, Jackman, Paine, and Valley Traffic Systems pay Malak $1.5-million.

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