Fish farm giant Mowi suing fisheries ministers, taxpayers for Discovery Islands closures

An international aquaculture giant is suing two former Canadian fisheries ministers for alleged damages from a federal decision to close fish farms in B.C.’s Discovery Islands region.

Mowi Canada West, a subsidiary of the Norwegian seafood company, filed a civil suit in the Supreme Court of British Columbia in March against the Canadian government that personally names former fisheries ministers Bernadette Jordan and Joyce Murray.

The move follows a February decision by Murray confirming the region’s fish farm licences won’t be renewed to protect wild juvenile Pacific salmon migrating through the area.

The suit originates with a decision by Jordan in December 2020 to phase out fish farms by July 2022 in the Discovery Islands — an area of concern identified in a 2012 report by the Cohen Commission, a body tasked with investigating the disappearance of Fraser River sockeye salmon.

Jordan cited consultations with First Nations as a key reason for the decision. Despite court challenges that followed, Murray finalized the decision noting the need to take a precautionary approach to protect endangered salmon.

Mowi’s statement of claim — with allegations not proven in court — accuses the former ministers of “misfeasance in public office,” negligence, expropriation stemming from unlawful conduct and a clear disregard for two prior Federal Court rulings, among other complaints.

A dollar amount wasn’t stipulated, but Mowi is seeking damages for a variety of reasons after 11 of its farms’ licences weren’t renewed.

However, Mowi’s claim alleges the decision “wiped out 30 per cent” of its business. It also refers to a former judicial review where the company alleged it faced $26 million in lost investment and the forced cull of 1.18 million fish.

The ministers’ decision was taken without adequate notice or justification and had no rational basis under the Fisheries Act, the claim alleges.

“The Fisheries Ministers engaged in deliberate and unlawful conduct in the exercise of public functions with the actual and constructive knowledge that the conduct was unlawful and would or was likely to injure Mowi,” the claim reads.

The ministers were aware a fish farm production cycle from egg to harvest takes approximately five years and the decision’s timeline would harm operations, Mowi alleged.

Mowi also states it didn’t know Jordan's consultations with area First Nations before the decision involved the possibility of phasing out the farms.

Fisheries and Oceans Canada’s (DFO) response to Mowi’s civil claim, filed Sept. 24 — which has also not been tested in court — asserts the ministers’ decisions were made in good faith and in keeping with their “absolute discretion'' under the Fisheries Act.

“Minister Jordan and Minister Murray acted, at all material times, lawfully, and within the scope of the statutory powers of their office, and in furtherance of their duties to manage, conserve, and develop fisheries on behalf of Canadians in the public interest,” DFO’s response said.

Following the release of the Cohen Commission report and since 2016, Mowi fish farm licences have only been issued on a one-year basis rather than the previously granted five-year licences, DFO noted. Additionally, at that time, fish farms operating in other areas of the province were issued six-year licences.

Recommendation 18 of the Cohen report also says if the minister determines open-net pens in the region pose more than a minimal risk to migrating sockeye salmon, the sites should promptly be ordered to close, DFO’s response noted.

Mowi may have structured its business on the predictable replacement of federal authorizations, DFO said. But the company was aware, or ought to have been, of the evolving licensing process in the environmentally sensitive region.

The company was also aware, or should have been, that ministers must consider any adverse effects a decision might have on the rights of Indigenous Peoples under the Fisheries Act, DFO said.

In 2019, B.C. also declared it would only grant tenures to fish farm operators that negotiated agreements with First Nations in whose territories they planned to operate.

While ministers are generally aware fish farms’ production involves a five-year cycle, regardless, Mowi only had one-year licences for its Discovery Islands sites, DFO’s response said.

DFO denies there was no notice or indication about the possibility of the 2020 Discovery Islands decision.

The federal government acted on and announced intentions to meet the Cohen Commission recommendations. There were also a minimum of four meetings between DFO and government staff and industry, including Mowi, in fall 2020 when it was noted licensing changes were being considered.

Mowi also communicated with DFO staff and the fisheries minister’s office about possible economic impacts closing the farms might have on the local community, the response said.

Any of Mowi’s losses aren’t due to the ministers’ decisions but the company’s failure to plan for potential changes to the licence approval process or make necessary changes to its business, it said.

“Mowi failed to mitigate the risks inherent in investing in a highly regulated industry by not adequately planning, financially and otherwise, for existing and future uncertainty and changes in the regulatory framework,” the response said.

“Mowi could, by exercise of due diligence, have reduced the amount of any alleged loss, damage, or expense it says it suffered and now claims.”

Mowi and two other international salmon farming companies, Cermaq and Grieg Seafood and two area First Nations launched another judicial challenge after Murray’s latest decision that is still underway.

However, Mowi’s civil suit appears to be the first tied to the Discovery Islands trying to make the federal government and taxpayers pay for decisions by ministers with the authority to protect Canadian fisheries and oceans, said Stan Proboszcz, science adviser with Watershed Watch Salmon Society.

“This industry operates in public waters, and if they bully Canadians into the belief that we can't stop them from operating how they like, [the fish farms] may potentially continue to have impacts on wild fish.”

It’s absurd Mowi thinks it should be compensated for ministerial decisions affecting its bottom line but has never been financially accountable for any environmental impacts associated with operating open-net pen fish farms in B.C. waters, Proboszcz added.

Independent science shows fish farms amplify the threat of disease or parasites, such as sea lice, to threatened wild salmon stocks, he said.

“We don't see any of those costs reimbursed to Canadians or First Nations, but when they're deprived of their licences, they have the gall to try to sue Canadians and taxpayers for potentially tens of millions of dollars.”

No court dates had been scheduled in online records as of Wednesday.

Rochelle Baker / Local Journalism Initiative / Canada’s National Observer