By Ahmad Hathout
Corus is suing Telus for $32.5 million after allegedly discovering that the broadcaster had been improperly collecting a wholesale rate discount on the distribution of its channels.
Corus and Telus are currently negotiating the terms on which the latter will continue to distribute the former’s services. The last distribution agreement, which currently governs their relationship, has not yet been renewed past its expiry on December 31, 2023.
Under the current distribution agreement, Telus pays a lower wholesale rate if it rolls Corus’s services in a package with at least five services – “theme packs” and “pick packs” – which benefit from broader distribution. If Telus offers Corus’s services on a standalone basis, however, it must pay a higher rate because the channels receive more limited distribution.
“For any Discretionary Package or Pick Pack package offered to Service Subscribers which does not meet the packaging requirements set out above… TELUS shall pay the Standalone Rate for each Service in such non-conforming package,” the Thursday statement of claim in the Ontario Superior Court says, citing section 6.3 of their agreement.
Corus says it’s not privy to the details of how Telus distributes its services, including whether it’s compliant with the packaging conditions for the lower rate.
“In keeping with industry practice, the Agreement provides Corus with the right to periodic audits, upon which it relies to receive the detailed distribution and subscriber information that is not otherwise available to it,” the claim statement says, adding these audits are allowed only once per 12-month period.
Corus’s selected auditor, Broadcast Auditors of Canada (BAC), which was approved by Telus, examined Telus’s books to scrutinize subscriber numbers, penetration and fees.
“If an audit reveals that Telus has underpaid Corus’s fees, Telus must promptly remit the amount of such underpayment to Corus, and in the case of an overpayment, Corus must repay any overpaid fees,” the claim says.
BAC, which the statement says has done hundreds of these since 2003, conducted an audit for the period between May 2023 and July 2025.
Corus claims the audit report found Telus non-compliant in several areas, including that it was offering discretionary packages that had fewer than five such services; incorrectly reported the number of subscribers to Corus’s services; incorrectly classified standalone subscribers as “bulk subscribers,” which are multi-unit residential buildings; and incorrectly reported commercial subscribers as bulk subscribers.
“BAC concluded that the Standalone Rate applied to the affected subscribers and subsequently determined that, as a consequence of its application of incorrect rates, incorrect reporting, and incorrect classifications, Telus underpaid Corus throughout the audit period by $26,955,179.07, plus tax and interest (as of the date of the audit report), for a total of $32,506,304.18,” Corus claims.
This amount does not include underpayment for other alleged breaches because Corus claims that BAC claimed Telus refused to provide relevant documentation that would have revealed whether other programmers provided Telus with the same packaging flexibility that Corus did.
“Despite repeated demands from Corus, and in the face of the clear language of the Agreement and the clear findings set out in the Audit Report, Telus has refused to pay Corus the amounts identified by BAC as underpayments, which are now due and owing,” Corus claims.
The lawsuit comes after Telus filed its own lawsuit in the same court on January 8, saying it overpaid Corus $2.5 million because of a “mutual mistake of the parties.”
According to that statement, auditors discovered a “labelling error” in February 2024 that resulted from an “inadvertent misapplication of a contractual ‘standalone rate’ instead of the contractual ‘penetration rate’ for certain subscriber packages known as ‘pick packs.’”
To recover the $2.5 million, in June 2024, Telus started withholding payment for Corus’s other services. Corus, however, took issue with that.
“Corus initially objected to the Overpayment Adjustment, taking the position that regardless of the Labelling Error, the Affiliate Distribution Agreement prohibited TELUS from recovering mistakenly paid funds under any circumstances,” the statement reads. “Corus also took the position that TELUS had agreed to accept the findings of the auditors for the relevant periods and therefore was prohibited from seeking recovery for the mistakenly paid funds.”
Telus claims the parties orally agreed to submit to a re-audit to confirm the accuracy of the amount. The terms of the settlement allegedly stipulated that if the amount is confirmed, Corus can’t try to claw it back; if, however, Corus is owed, Telus would pay.
But Corus wasn’t having it. In May 2025, it sued Telus for $2.7 million ($2.5 million plus interest), the amount it allegedly withheld from the media company.
Telus is now asking the court to declare that it overpaid Corus in the amount of $2.5 million, that the overpayment was due to a mistake, and that the oral settlement is valid and enforceable. In the alternative, Telus is asking the court to declare that its way of recovering the overpayment was not contrary to their affiliation agreement. Or, in the further alternative, if Telus is required to pay back the recovered amounts, that restitutionary damages in the same amount be ordered to Telus.
Corus declined to comment on both matters. Telus did not respond to a request for comment.
Corus’s lawsuit also comes a week after Corus received CRTC approval to transfer its licences to a new parent company, which will be held by its debtholders, who will forgive $500 million in debt hanging over the company.
