Recent Decisions April 2001
I. FEDERAL COURT DECISIONS
(a) Patents
1. Pfizer v. Apotex et al., January 10, 2001, FCA (Isaac, Létourneau, McDonald J.J.A.) Prohibition/Mootness/Patented Medicines (Notice of Compliance) Regulations
Appeals from two orders dismissing applications by Pfizer for orders prohibiting the Minister of Health from issuing NOCs to Apotex and Nu-Pharm. After the appeals were filed, but before the appeals could be heard, the Minister issued NOCs to Apotex and Nu-Pharm.
Held: Appeals dismissed. Once the prohibition proceedings were dismissed by the Trial Division, the Minister was entitled to, and did issue the NOCs to Apotex and Nu-Pharm. The appeals were rendered moot once the Minister issued NOCs under the regulations; the summary procedure under the NOC Regulations was spent.
2. Budd Canada et al. v. Noma, January 17, 2001, FCTD (Lutfy A.C.J.) Summary Judgment/Patent Infringement/Contradictory Evidence
Motion by defendant for summary judgment in a patent infringement action.
Held: Motion dismissed because there are genuine issues for trial. The defendant relied on certain responses obtained during its cross-examination of the plaintiff’s experts in support of its position that its product lacks the essential element of the claim in dispute. However, there is also very substantial, contradictory evidence from the very witnesses relied upon by the defendant.
3. Bristol-Myers Squibb Canada v. A.G. Canada et al., January 19, 2001, FCTD (Campbell J.) Judicial Review/Removal of Patent from Patent Register/Patented Medicines (Notice of Compliance) Regulations
Application for judicial review of the Minister of Health’s decision to remove a patent from the Patent Register maintained under the NOC Regulations.
Held: Application dismissed. The Minister’s decision is correct in law. Bristol-Myers inadvertently omitted a patent from a patent list filed under the NOC Regulations. After several attempts to rectify the omission, Bristol-Myers changed the brand name of its drug and sought to use the requirements of the Food and Drug Regulations with respect to brand name changes in order to file a new patent list. The Minister initially placed the omitted patent on a patent list, only to reconsider the decision and subsequently remove the patent from the Register. To allow the use of the Food and Drug Regulations in this way to add patents to the Register would allow innovative companies to circumvent the timing requirements of the NOC Regulations, contrary to the specific intention of Parliament. The effect of this practice would be to inhibit the entry of generics into the marketplace. The Food and Drug Regulations cannot be used to achieve the result pursued by Bristol-Myers.
4. Apotex v. The Wellcome Foundation et al., January 26, 2001, FCA (Strayer, Noël, Evans, J.J.A.) Reference Appeal/Accounting of Profits/Comparative Approach/Apportionment
Appeal and cross-appeal from a decision on a reference to the Trial Division determining the extent of infringement by the appellant of a patent owned by the respondents.
Held: Appeal and cross-appeal dismissed because the Trial Judge’s reasons did not contain any error that would justify intervention. The Trial Judge was right to refuse to reduce the amount of profits payable with respect to a batch of tablets containing a mix of infringing and non-infringing product (it was impossible to determine what proportion was in fact infringing). The Court rejected the appellant’s overall argument that no profits were made as a result of the infringement as the appellant could have made its tablets with non-infringing product. The Court also rejected the argument that since the appellant could have avoided infringement by exercising its rights under an existing compulsory license, it should not have to account for profits in excess of the license’s royalty fee. The comparative approach advocated by the appellant is not the law in Canada; such an approach would provide no incentive to individuals to take steps to avoid infringement. The Trial Judge did not err in adopting an incremental accounting method; while the full absorption method may be appropriate in some cases, the incremental method has been more regularly endorsed in Canada. The Trial Judge acted appropriately in apportioning the revenues between those attributable to the infringing ingredient and those ingredients in the tablets that were not infringing; the principles applicable to the equitable remedy of an account of profits are not necessarily identical to those applicable to the common law remedy of damages.
5. Apotex v. Merck et al., February 2, 2001, FCTD (McKeown J.) Summary Judgment/Declaration/Res Judicata/Discretion/ Rights in Rem
Motion and cross-motion for summary judgment in an action by Apotex for a declaration that its use does not infringe Merck’s patent. Apotex bought product that had been manufactured under a now-extinguished compulsory licence. It is this product that is the subject of the sought-after declaration.
Held: Summary judgment issued in favour of Merck. This case involves identical parties and issues and almost identical facts to an earlier case that found infringement at both the trial and appeal divisions and res judicata applies. The Court rejected Apotex’s argument that use rights should exist in rem after the compulsory licence was extinguished. The Court was not convinced that there were special circumstances that warranted the exercise of its discretion regarding the application of res judicata.
6. Glaxo Group v. The Minister of Health and Apotex, February 2, 2001, FCTD (Hansen J.) Dismissal/Abuse of Process/ Patented Medicines (Notice of Compliance) Regulations
Motion by Apotex to dismiss a prohibition application on the grounds that it is frivolous, vexatious and an abuse of process. Glaxo had made an earlier application for prohibition that was dismissed following a hearing on the merits. When Apotex made a minor variation in its drug formulation, Glaxo brought the present, second application for prohibition.
Held: Motion granted – application dismissed. Glaxo’s second application is an abuse of the Court’s process. The applicants and the patents are the same in both proceedings, and the issues were fully litigated in the first proceeding. The only distinguishing aspect is that Glaxo has obtained samples of Apotex’s tablets which it will now be in a position to test. Litigants who have already litigated a matter, but lost, should not be permitted to re-litigate because they have acquired new evidence.
7. Goldfarb v. W.L. Gore & Associates, February 9, 2001, FCTD (Lemieux J.) Section 45(8) Patent Act/Conflict Proceedings/First Inventor/Date of Invention
Proceedings under the now repealed s. 45(8) of the Patent Act. The Registrar had awarded half of the conflict claims to each of the parties on the basis that each was the first inventor of four of such claims. The invention related to an artificial vascular prosthesis made from ePTFE.
Held: The plaintiff succeeds; the Registrar shall award all of the conflict claims to him. Regarding the true inventor, the Court accepted that: a true inventor is a person who demonstrates inventive ingenuity; a person’s skill and knowledge are relevant in determining whether that person is the true inventor, particularly with respect to inventions of a complex and technical nature; presenting a problem for solution is not an act of invention. In order to determine who was the first inventor, the Court first determined that the essential feature of the invention is the distance between the nodes (or the length of the fibers connecting them) that form part of the internal structure of the ePTFE tubing. The question then was who first determined, with a reasonable expectation of success, the fibril lengths that would produce grafts which would permit tissue growth. When the plaintiff began his experiments on ePTFE tubing he knew what he wanted in terms of fibril length; but while he may have been on the right track, he could not reasonably know that he was. The plaintiff’s second set of experiments, wherein he implanted grafts with his specifications as to fibril length, established a date of invention for him as of the success of the grafts, at which point of time the plaintiff crossed the line to reasonably knowing that his fibril lengths would work. The defendant’s claimed date of invention was rejected because the defendant’s inventor could not have appreciated at that time the key part that fibril length played in a successful graft.
8. Eli Lilly Canada v. The Minister of Health et al., February 12, 2001, FCTD (Blais J.) Leave to Intervene/Rule 109/Judicial Review Proceeding/Patented Medicines (Notice of Compliance) Regulations
Motion by Apotex (the proposed intervener) seeking leave to intervene in an application by Eli Lilly for judicial review. Eli Lilly sought review of a decision of the Minister of Health to remove a patent from the register administered under the NOC Regulations.
Held: Motion dismissed. The granting of leave to intervene is governed by r. 109 and the principles developed in the jurisprudence of the Court. In the present case, the proposed intervener failed to show that it has an interest in the outcome of the proceeding and that its rights would be seriously affected by the outcome of the litigation. The proposed intervener has an interest only in relation to the interpretation of jurisprudence, and that is not sufficient to be granted intervener status.
9. Novartis Pharmaceuticals Canada v. Rhoxalpharma et al., March 1, 2001, FCTD (Tremblay-Lamer J.) Prohibition/Patented Medicines (Notice of Compliance) Regulations/Purposive Construction
Application by Novartis for an order prohibiting the Minister of Health from issuing an NOC to RhoxalPharma in respect of cyclosporin capsules until after expiry of the Novartis patent.
Held: Application dismissed. The patent on cyclosporin itself has expired. The claims in the present Novartis patent are directed, in part, to pharmaceutical preparations which include as the active ingredient cyclosporin in the form of a hydrosol. Hydrosols comprise a fine dispersion of solid particles in an aqueous medium. RhoxalPharma alleged that the patent would not be infringed, because its capsules do not contain a hydrosol. Novartis admitted that the capsules do not contain a hydrosol, but argued that a hydrosol would form following ingestion of the capsules, resulting in infringement of the patent. The Court was unable to agree with the Novartis interpretation of the patent. Applying the decision of the Supreme Court in Whirlpool Corp. v. Camco Inc. [2000] S.C.J. No. 68, it is clear that the Court must adopt a purposive construction of patent claims for all purposes, infringement actions and judicial review proceedings alike. In the present patent, the 12 examples illustrating the invention do not contemplate oral administration. Neither the disclosure nor the claims refer to a hydrosol formed after ingestion. The purpose of the Novartis invention is to provide a hydrosol with small, stable pharmacologically active agent particles for intravenous use. Obviously, that is not the purpose of the respondent’s product which is administered orally. The applicant has failed to show that RhoxalPharma’s capsules would infringe the patent.
(b) Trade Marks
1. Renaud Cointreau v. Cordon Bleu International, June 16, 2000, FCTD (Tremblay-Lamer J.) Section 45 Appeal/ Services/Purpose of Section 45
Appeal from s. 45 decision that maintained a registration for CORDON BLEU for the following services: recipes, suggestions and other instructive matter printed on the food product labels, said printed matter being applicable to the preparation, the cooking and/or improvement of said food products. The evidence showed that products were sold with labels that bore the trade-mark and printed matter of the type set out in the statement of services.
Held: Appeal dismissed. Services should be given a broad and liberal interpretation and services may be incidental to the sale of products; therefore the appellant's argument that the registrant was not providing services was rejected. Section 45 is not intended as a means of challenging the validity of the registration itself.
2. Consorzio del Prosciutto di Parma v. Maple Leaf Meats, January 25, 2001, FCTD (McKeown J.) Section 57/Expungement/ Misdescriptiveness/ Survey Evidence/ Distinctiveness/ Get-up/Delay
Application to expunge a registration for PARMA for various meat products because 1) the mark was deceptively misdescriptive at the time it was registered and 2) at the date of the commencement of these proceedings, there was an association amongst members of the Canadian public between the word “PARMA” and both a region in Italy and meat products, resulting in the registration being invalid for lack of distinctiveness.
Held: Application dismissed. The Court rejected the misdescriptiveness ground because it did not accept that, at the time of the registration, ordinary Canadian consumers knew that Parma was a city in Italy and that this city was a source of high quality prosciutto. Canadians cannot have been deceived by the use of the mark in 1971 because survey evidence shows that at the present time the majority of Canadians do not recognize Parma as a source of pork products, nor do they associate “PARMA” meat products with Parma, Italy. Although the Trade-marks Act is intended to protect consumers from deception as to the source of wares, it also aims at ensuring stability in the marketplace, which includes allowing owners of registered marks to invest in building up goodwill. Regarding distinctiveness, the applicant failed to meet the onus of showing that the mark is not distinctive. Distinctiveness is made-out when appreciable portions of general Canadian consumers recognize the mark as distinctive; the applicant’s evidence from people with a special knowledge of the Italian food industry in Canada and Italy was therefore not relevant. The repeated assignment of the mark does not lessen the respondent’s rights, the applicant having failed to demonstrate that the mark was ever separated from its goodwill. ”Get-up” is not relevant with respect to distinctiveness in an expungement action.
Although a delay argument was not determinative of the Court’s decision, the Court noted that the delay in bringing this expungement action still has some weight because the applicant’s earlier s. 45 proceedings cannot be viewed as some sort of notice that proceedings would probably be brought concerning the mark’s validity.
3. Merial v. Novartis Animal Health Canada, January 31, 2001, FCTD (Hansen J.) Opposition Appeal/Confusion/Categorization of Wares/Considering Marks in their Totalities
Appeal of opposition decision that refused an application to register ELIMINEX for veterinary anti-parasitic preparations on the basis of the likelihood of confusion with a prior application for ELIMINATOR for insecticidal ear tags.
Held: Appeal allowed. The Board's conclusion that the two marks are confusing, which was based on the common prefix ELIMIN and its connotation of elimination, failed to take into account the totalities of the two marks. The different suffixes are significant; EX creates a coined word while ATOR creates a common word. The common prefix is weak and non-distinctive so the impact of the suffix is of greater importance. There is no evidence of the respondent's mark having acquired any reputation as of the material date and the applicant's mark would not cause a purchaser to infer that its wares emanate from the same source as those of the respondent.
Although both parties' wares have anti-parasitic properties, the Board erred in characterizing them as "medical preparations". However, this mischaracterization was not material as the Board was still justified in disregarding the third party registration for ELIMIN-ODOR for a home deodorant as such wares do not fall into the same category of veterinary wares as those of the parties.
4. Bay Rest Bedding v. Bedford Furniture, February 6, 2001, FCTD (O'Keefe J.) Opposition Appeal/Confusion/Coexistence/ Surrounding Circumstances/Hearsay
Appeal of opposition decision that refused an application to register SPINAL CARE for mattresses, box springs and mattress sets due to a likelihood of confusion with the respondent's mark SPINAL GUARD. New evidence filed by the applicant on appeal, including state of the register evidence.
Held: Appeal allowed. The Board erred in placing little significance on the surrounding circumstance that there was no evidence of actual confusion despite 15 years of coexistence. The following surrounding circumstances are also relevant: mattresses are relatively expensive items which are not purchased hastily; and mattresses are purchased with the assistance of a knowledgeable salesperson, bear a warranty label that identifies the manufacturer, and are commonly grouped together in retail stores according to their manufacturer.
The respondent's evidence concerning use of its mark was provided with respect to bedding units, which were defined as mattresses, beds and upholstered furniture; such evidence is irrelevant as only evidence with respect to the registered wares, mattresses, is relevant with respect to S. 12(1)(d). Evidence provided by the affiant relating to a time period prior to his employment with the respondent is irrelevant as hearsay given that the respondent's detailed records were destroyed prior to his employment.
5. Smithkline Beecham v. Pierre Fabre Médicament, February 13, 2001, FCA (Desjardins, Décary, Noël, J.J.A.) Opposition Appeal/Confusion/Average Bilingual Con-sumer/New Hearing before Trial Division
Appeal of opposition decision concerning an application to register IXEL for antidepressants. The Opposition Board held that there was a likelihood of confusion with Smithkline Beechams' mark PAXIL. On appeal, the FCTD rejected the opposition after considering new evidence filed by both parties from bilingualism experts.
Held: Appeal allowed. Both the Registrar and the Trial Judge erred concerning the applicable test. It is not appropriate to consider only the perception of the average bilingual consumer as opposed to the perceptions of the average French-speaking and English-speaking consumers. In some special instances, the average bilingual consumer should also be considered, but this is not such a case.
The Court declined to issue a decision on the merits because the evidence presented to the Trial Judge might have been distorted by the Registrar's error. Matter sent back for a trial de novo before another Trial Division judge on the basis of whatever new evidence the parties consider appropriate to file in addition to the evidence previously filed with the Registrar.
6. Brain Tumor Foundation of Canada v. Starlight Foundation, February 22, 2001, FCA (Richard, Evans, Sharlow, J.J.A.) Filing Additional Evidence/Section 56(5)
Appeal of decision that upheld the Prothonotary's decision to strike out an affidavit under s. 56(5) of the Trade-marks Act. The Prothonotary based his decision on the ground that evidence cannot be filed on appeal where no evidence was filed by that party in the original proceeding before the Registrar.
Held: Appeal allowed. Section 56(5) applies to all appeals from any proceedings before the Registrar, including opposition and expungement proceedings. As stated in Austin Nichols & Co. Inc. v. Cinnabon Inc. (1998), 82 C.P.R. (3d) 513 (F.C.A.), the words "in addition to" do not imply that there had to be prior evidence.
7. Warner-Lambert v. Concord Confections, March 2, 2001, FCTD (Lemieux J.) Summary Judgment/Trade Mark Infringement/Confusion/Get-up/interlocutory Injunction/Irreparable Harm/Delay
Motion for summary judgment in an action for infringement of Warner-Lambert's CHICLETS trade mark, or in the alternative for an interlocutory injunction. The defendant manufactured CHICLE BYTES gum that was virtually identical in appearance to the plaintiff's gum. The defendant ceased using the CHICLE BYTES trade-mark but then began using CHICLE CHEWING GUM for the same gum. The defendant argues that CHICLET is a generic term for this specific type of gum and that the appearance of the plaintiff's gum is functional and does not identify any particular source.
Held: Motion dismissed. The defendant has raised a genuine issue for trial on the merits with respect to the likelihood of confusion (in particular, with respect to the differences in the gum, packaging, and trade channels). There is also the unresolved legal issue of whether get-up or packaging is a relevant consideration when dealing with registered trade mark infringement versus passing-off. Another issue is whether DOUBLE BUBBLE CHICLE chewing gum, which is now being sold by the defendant, comprises one mark or two. Regarding the interlocutory injunction, the plaintiff failed to establish irreparable harm for 5 reasons: the plaintiff's expert's opinion was based on facts which he only assumed were true; there is an element of speculation in the expert's analysis; the expert admitted that loss sales were quantifiable; loss of goodwill is problematic since it hinges on a finding of confusion based on assumptions that are uncertain, particularly in the absence of evidence of confusion despite coexistence; and the plaintiff has not clearly demonstrated any harm suffered that would not be compensable in damages. The significant delay in seeking an injunction results in the balance of convenience favouring the defendant.
(c) Practice
1. Beaudry et al. v. Goldman et al., January 19, 2001, FCTD (Morneau, P.) Scope of Examination for Discovery
Motion to overrule objections made during examination for discovery. The plaintiffs are suing the defendants for copyright infringement for allegedly reproducing a substantial portion of their musical work in another musical work. The defendants have had close to 225 objections from the plaintiffs during their examination for discovery.
Held: Motion granted in part. The basic test for determining whether questions at examination for discovery are well-founded is whether the information requested could be relevant to the issues in dispute in the pleadings of the two parties. However, “fishing expeditions” are not to be encouraged, particularly when the questions are not easily connected to the “heart of the litigation”. In this situation, the issues in question are the presence, nature and degree of similarity between the two works, access to the plaintiff’s work by the defendant and the originality of the works. The defendants had asked a great many questions that were tangential to these issues and to which the plaintiffs did not have to respond. All but 36 of the objections were sustained. One of the questions required a response because the witness had brought up the subject in question himself and his professional background allowed him to properly handle the technical aspects of the question.
2. Faulding (Canada) v. Pharmacia, February 2, 2001 FCTD (Hugessen J.) Late Stage Amendments
Virtually on the eve of trial, Hugessen J. allowed an amendment by the plaintiff to plead sound prediction because the defendant's experts had been asked to deal with that point and they had done so in their reports. As the defendant was not taken by surprise, the amendment was allowed. Two other amendments were requested, to plead inoperable embodiments and anticipation on the basis of prior publication. There was no specific plea relating to inoperable embodiments in the pleadings prior to the proposed amendments and Hugessen J. held that to introduce that element at a late stage risked causing serious prejudice, so it was not allowed. The plaintiff had previously only pleaded anticipation based on prior use and knowledge and not prior publication. Hugessen J. held that although the two pleas were closely related, they raised different issues and as the defendant's experts had dealt with anticipation on the basis of prior use and knowledge that was the basis on which the case was order to go to trial.
3. Canadian Tire v. P.S. Partsource, February 8, 2001 FCA (Richard C.J., Rothstein J., Malone J.) Motion to Strike/Hearsay/Rule 81(1)
The FCA struck hearsay statements as to confusion by customers of the respondent, which were contained in an affidavit filed in an expungement proceeding. The proceeding was brought under s. 59(3) of the Trade-Marks Act on the basis of affidavit evidence. Such proceedings were held to be final, as opposed to interlocutory, as the eventual court order would determine the substantive rights of the parties. The Court held that the hearsay statements were made to prove the truth of their contents and not merely to prove that the statements were made. The Court held that r. 81(1) required the affidavits to be confined to facts within the personal knowledge of the deponent. Evidence of necessity and reliability is required in order to establish that the hearsay evidence should be admitted according to the "principled" approach (Ethier v. Canada [1993] 2 F.C. 659 (C.A.)).
4. Bell Canada v. US West et al., February 14, 2001 FCTD (Morneau P.) Motion to Strike/Motion for Particulars/Jurisdiction of Federal Court
The plaintiff's motion to strike or alternatively for particulars was dismissed in part and allowed in part. The test on such a motion was held to be whether it is "plain and obvious" that the allegations in the defence disclose no reasonable cause of defence or action (Canada (A.G.) v. Inuit Tapirisat, [1980] 2 S.C.R. 735 at 740), or if the pleading is not struck, whether the party has enough information to be able to understand the opposing party's position and prepare a responsive defence, whether a defence or reply (Astra Aktiebolag v. Inflazyme Pharmaceuticals Inc. (1995), 61 C.P.R. (3d) (FCTD) at 184). The purpose of a particulars motion is not to enable the defendant to know all the facts on which the action is based. The Court commented that the defence must be read as a whole and not by stopping or limiting oneself to a single paragraph that may be found here or there in the defence. If a plaintiff wishes details of "who said what to whom and when" it needs to file evidence that it needs that information in order to plead and the circumstances because of which it cannot itself make an internal investigation to determine those aspects. Counterclaims based on the common law torts of "unlawful interference with economic and contractual relations", "injurious falsehood and intimidation", "disparagement of defendant's business", "deliberate intention to eliminate the defendants from the market" were struck as disclosing no cause of action, as they sought conclusions of law which had no connection with the Trade-Marks Act and were outside the jurisdiction of the Federal Court.
5. Canadian Olympic Association v. Olymel et al., February 21, 2001 FCTD (Heneghan J.) Motion to Extend a Time Limit
Motion to extend a time limit to appeal. The COA had missed a deadline to file an appeal to the Federal Court of Appeal from a decision of the Trial Division in an opposition. The deadline had been missed by one day due to the inadvertence of the solicitor for the COA. The respondent would not consent to the late filing of the appeal.
Held: Extension of time granted with costs against the respondent forthwith and in any event of the cause. The Court reviewed and applied the six part test set out in Sim v. The Queen (1996), 67 C.P.R. (3d) 334 at 336, namely: (1) whether the appeal had merit; (2) the special circumstances showing or explaining why the appeal was not brought in time; (3) whether the intention of the plaintiff to appeal existed before the time to appeal ran out; (4) whether the delay was excessive; (5) whether the respondent would be prejudiced by the extension of time; (6) whether it was in the interest of justice to grant the time extension.
6. Contour Optik v. Hakim Optical Laboratory, February 27, 2001 FCTD (Morneau P.) Motion for Particulars/Pleading Invalidity Defences
Morneau P. ordered particulars on a motion in which no supporting affidavit was filed. It was held that the need for particulars was obvious from the file (Covington Fabrics Corp. v. Master Fabrics Ltd. (1993), 48 C.P.R. (3d) 521 at 522). The defence pleaded eight general grounds of invalidity and attached schedules containing over 80 references. The Court cited B & J Mtg. Co. v. Canadian Pneumatic Tool Co. (1984), 77 C.P.R. (2d) 257 at 259 in which Jerome A.C.J. had commented that although it is common practice to plead invalidity defences in language as close as possible to the statute or jurisprudence, as a matter of principle and good practice counsel ought to make a more direct connection between the general defences and the particular issues in suit. With respect to the numerous references, the Court cited Bror With v. Ruko of Canada Ltd. (1976), 31 C.P.R. (2d) 3 for the proposition that reliance on the whole of a patent is not adequate pleading, the part that anticipates must be specified. The defendant's submission that the inventions cited were not complex and therefore no further particulars were required was rejected.
II. OTHER COURT DECISIONS
1. Bayer v. Apotex, January 2, 2001 OSCJ (Lederman J.) Patent Infringement/ Entitlement to Damages or Profits/ Apportionment
Reference to determine the remedies for patent infringement. The issue was whether Bayer was entitled in equity to elect to recover Apotex's profits or whether Bayer was restricted to recovering damages that it actually suffered. Apotex argued that because it did not use Bayer's patent for the purposes envisaged by the invention, Bayer should have no right to profits. Alternatively, Apotex submitted that the profits should be apportioned.
Held: Plaintiff awarded damages or an accounting of profits, whichever it may, upon inquiry, elect. Because the defendant cannot point to some feature of its product which was non-infringing and which contributed to the marketability of its product, there can be no apportionment of profits. The fact that the plaintiff's product was sold by the defendant as a whole raises a serious question as to whether apportionment would be appropriate even if it there were non-infringing elements to which a portion of the profits could be attributed.
2. British Columbia Automobile Assn. v. Office and Professional Employees' International Union, Local 378, January 26, 2001 BCSC (Sigurdson J.) Copyright Infringement/Websites/Meta Tags/Passing Off/ Section 22 Trade-marks Act/Free Speech/ Charter of Rights
The plaintiff claims that the defendant established websites that infringed the copyright in the plaintiff's website and that the defendant has committed passing-off and depreciated the goodwill associated with the plaintiff's marks by using the plaintiff's domain names and meta tags. The plaintiff submits that the defendant’s use of the domain names "bcaaonstrike" and "bcaabacktowork" and the words in the meta tags constitute a passing-off because the defendant is intercepting people intending to search for the plaintiff.
Held: The current Union website (which deleted certain words and included a disclaimer) does not constitute a passing-off because there is no confusion or possibility of confusion in the minds of an internet web user that the site is associated with the plaintiff. The common law should be interpreted in a manner consistent with the Charter of Rights. When a website is used for expression in a labour relations dispute, as opposed to commercial competition, a reasonable balance must be struck between the legitimate protection of one party's intellectual property and another party's right of expression. Nevertheless, the first Union site constituted passing-off because certain aspects demonstrated an intention to mislead people looking for the plaintiff’s site, e.g. the phrase, "Greetings BCAA is on Strike” and the striking visual similarities between the sites. It is also significant that the meta tags associated with the defendant’s initial site duplicated the plaintiff’s meta tags and contained references that had nothing to do with the defendant’s site. An Internet user would not recognize immediately that the defendant’s initial website was not the plaintiff’s site.
Regarding s. 22 of the Trade-marks Act, there are 3 essential issues: the offending use must include an element of commercial use; the activities must be services to which s. 22 applies; and there must be evidence of a depreciation of goodwill. The non-commercial status of the Union's website means that the trade marks were not used in association with wares or services, resulting in the defendant’s use being outside the scope of s. 22. The interpretation that the plaintiff seeks would place an unwarranted restriction on free speech. The non-commercial provision of information alone is not a service as contemplated by s. 4 of the Trade-marks Act. The appearance of a trade mark on a picket sign or on the website, does not depreciate the goodwill associated with that mark as that term is used in s. 22; any depreciation of goodwill is not brought about by the manner of the use of the mark but rather occurs if the Union is successful in its arguments in support of its members. The Union is entitled to express its position and speak freely provided it does not violate s. 22 of the Trade-marks Act.
Concerning the copyright claim, it is clear that there has been copying of a substantial portion of the plaintiff's first site. The plaintiff’s website was an original artistic work because it organized certain colours, frames, margins, logos, and navigation tools in a unique and original way.
Nominal damages awarded for breach of copyright and passing-off but the Court declined the plaintiff’s requests for a declaration and injunction.
3. Welch Foods v. Cadbury Beverages Canada, February 1, 2001 OCA (Doherty, Moldaver and MacPherson JJ.A.) Trade Mark Licence Agreement/Co-packing/Consent not to be Unreasonably Withheld
Appeal from a judgment that held that Welch had unreasonably withheld its consent for Cadbury to use a co-packer. The Trial Judge also imposed certain constraints on any future decisions by Welch relating to consent to co-pack. Welch had licensed Cadbury to use its trade mark in association with a grape drink for many years. The licence agreement stated that Cadbury required Welch’s consent to use co-packers but that such consent could not be unreasonably withheld. After Cadbury declared its intentions to close its own plant in order to use a third party plant (the co-packer) to save money, Welch decided that it would be to its advantage to deal directly with grape growers and subsequently withdrew its consent for Cadbury to use the co-packer, allegedly on the basis that the co-packer did not meet its quality standards, even though it had already approved such co-packer on an interim basis.
Held: Welch unreasonably withheld its consent but the Trial Judge’s holding that any future refusals based on considerations of competition or confidentiality are ipso facto unreasonable cannot stand. The co-packing agreement was a non-controversial matter for Welch until it decided to appropriate the benefits of the licence given to Cadbury. Welch’s decision to withhold its consent to a continuation of the co-packing arrangement was made for a collateral and impermissible purpose. It was, therefore, not a reasonable withholding of consent "consistent with the tenor and purpose of the Agreement". Cadbury’s actions after Welch decided to withhold its consent cannot be relied on as a basis for withholding consent.
4. FBI Foods v. Glassner, February 1, 2001 BCSC (Dillon J.) Liability re Breach of Confidence/Equitable Claim for Contribution
The plaintiff claims contribution against the defendant for half of the amount that the plaintiff paid to settle a breach of confidence claim previously brought by Cadbury against both parties. The defendant says that the amount paid by the plaintiff was for lost profits and royalties and because the defendant was found not liable to Cadbury for lost profits at trial and then settled against Cadbury, the plaintiff cannot seek contribution.
Held: There is no reason to bar the plaintiff's claim. The plaintiff and defendant are concurrent wrongdoers, severally liable because there were different wrongs committed based upon different participation in the breach of confidence. In equity, a finding of liability is not required; contribution will ensue as long as a benefit has been paid on the defendant's behalf. The benefit derived here was payment by the plaintiff of damages for the lost profits and royalties from the eastern market which was operated through a company that was owned equally by the plaintiff and the defendant.
5. Zesta Engineering v. Cloutier et al., February 22, 2001 OSCJ (Wright J.) Confidential Information
The plaintiff claims, inter alia, damages for breach of an injunction that prohibited the defendants from using any confidential information of Zesta.
Held: Zesta's thermocouple manufacturing is not confidential. “It is true that any company manufacturing thermocouples would keep confidential its day to day operations with respect to particular thermocouples it was manufacturing for a particular customer, and its costing and pricing information. However, that level of confidentiality does not prohibit former employees of a company from using their knowledge, skill and experience to fairly compete with their former employer.”
III. OPPOSITION BOARD DECISIONS
1. Borden and BFC Investments v. Aliments Pro-marque, January 11, 2001 (Partington) Confusion
Proposed-use application for PRONTO CLASSICO for portions of various meats, uncooked, frozen and with sauces, in individual portions, vacuum packed. Opposition based, inter alia, on s. 12(1)(d) due to confusion with eight marks that begin with CLASSICO, e.g. CLASSICO D'ABRUZZI, which are used with pasta sauces and s. 16(3)(a) due to confusion with the mark CLASSICO previously used by the opponent for pasta sauces.
Held: Application refused. As of the date material with respect to the non-entitlement ground, there was no evidence of third party use of CLASSICO and the Chairperson resolved the doubt that he had concerning the likelihood of confusion against the applicant. The s. 12(1)(d) ground failed because the opponent’s registered marks are not inherently strong and bearing in mind the differences in the parties' wares and that the applicant had shown that there was use of a third party CLASSICO mark on olive oil as of the material date.
2. Allianz of Canada et al. v. Alliance Maturité, January 11, 2001 (Partington) Confusion
Use-based applications for ALLIANCE MATURITÉ and ALLIANCE MATURITY for insurance services. Opposition based, inter alia, on s. 12(1)(d) due to confusion with the mark ALLIANZ & Design registered for insurance services.
Held: Applications refused because the trades and services overlap and there is some similarity between the marks, and bearing in mind that the applicant did not file any evidence.
3. 1055779 Ontario v. Aliments Carrière, January 12, 2001 (Herzig) Deceptively Misdescriptive/Section 12(1)(b)/Confusion
Proposed-use application for MARKET FRESH for frozen fruits and vegetables. MARKET and FRESH disclaimed. Opposition based, inter alia, on s. 12(1)(b) and 12(1)(d) due to confusion with the opponent’s mark MARKET FRESH & Design registered for operation of a food store.
Held: Application refused because there is a likelihood of confusion between the parties' marks. The s. 12(1)(b) ground did not succeed. The opponent argued that given that the wares are frozen, the mark is deceptively misdescriptive. However, the Board Member held that the term "market fresh" has no precise meaning and at most is suggestive of produce that is relatively fresh; when used in association with the applicant's wares, the term is an oxymoron that would not deceive consumers in any way but rather would be recognized as a form of puffery.
4. Era Clothing v. David L. Burton, January 16, 2001 (Partington) Confusion/ Amendment of Wares after Oral Hearing/Channels of Trade/Section 30(e)
Proposed-use application for HOLLYWOOD SHORTS for underwear clothing. The wares were redefined twice during the opposition, with the last revision (which took place after the oral hearing) leaving the wares as novelty boxer shorts marketed and distributed through stores as a novelty product. SHORTS disclaimed. Opposition based, inter alia, on s. 12(1)(d) due to confusion with the opponent’s marks HOLLYWOOD ERA and HOLLYWOOD JEANS registered for clothing including shorts, T-shirts and sweat tops and s. 30(e) because the applicant did not intend to use the mark.
Held: Application refused. The s.12(1)(d) ground succeeded because the Chairperson was left in doubt as to the likelihood of confusion between HOLLYWOOD SHORTS and HOLLYWOOD JEANS. There is a significant degree of resemblance between the marks and the fact that the opponent has not sold its wares through novelty stores to date is not significant given that its registrations do not restrict its channels of trade. The s. 30(e) ground failed even though the applicant is an entrepreneur who creates new ideas and licenses them to various companies because cross-examination of the applicant revealed that he was uncertain if he would use the mark himself or license its use to a third party.
5. Hudson's Bay v. Bay Networks, January 16, 2001 (Partington) Confusion
Proposed-use application for BAY NETWORKS for computers and parts thereof,… maintenance services for computer hardware and software etc. NETWORKS disclaimed. Opposition based, inter alia, on s. 12(1)(d) due to confusion with the opponent’s marks THE BAY and BAYCREST registered for operation of a retail department store and various electronic goods (e.g. speakers, headphones, radios, television sets).
Held: Opposition rejected. There is little similarity between the applicant's computer wares and the wares covered by the opponent's registrations. Although there might be an overlap in the trade, the parties' wares are not the sort that an average consumer would purchase in a hurried manner.
6. Safety First Fire Prevention v. Huck Glove Groopco, January 16, 2001 (Partington) Confusion
Proposed-use application for SAFETY 1ST & Design for inter alia protective eye goggles, protective respiratory systems, safety belts and burn blankets. Opposition based, inter alia, on s. 12(1)(d) due to confusion with the mark SF SAFETY FIRST & Design registered for fire detectors, smoke detectors, portable extinguishers, first-aid kits and vehicle emergency kits.
Held: Application refused. Despite the inherent weakness of the opponent's mark, the Chairperson was left in doubt as to the likelihood of confusion given the similarity between the marks and the overlapping wares.
7. Babcock & Wilcox v. MAN, January 17, 2001 (Bradbury) Confusion/Section 30(b)/ Clearly Inconsistent
Application for MAN B&W Design for marine diesel engines and parts therefor. Opposition based, inter alia, on s. 12(1)(d) due to confusion with the opponent’s mark B&W registered for steam boilers and equipment useful in the production or utilization of special nuclear material or atomic energy and s. 30(b).
Held: Opposition rejected. Confusion unlikely because of the inherent weakness of the opponent's mark, the lack of evidence of use of the opponent's mark, and the differences between the wares. In support of its s. 30(b) ground, the opponent submitted that the applicant's invoices bore names other than that of the applicant and that there was no evidence that use by any licensees of the applicant qualified under s. 50. However, the Hearing Officer held that the opponent had not satisfied its evidential burden with respect to s. 30 because the evidence was not clearly inconsistent with the applicant's claims and noted that the opponent could have cross-examined in order to seek clarification of those points in the applicant's evidence which are open to more than one interpretation.
8. Novartis Crop Protection v. Rohm and Haas, January 17, 2001 (Bradbury) Confusion
Proposed-use application for DUO SHOT for fungicides, herbicides, insecticides and pesticides. Opposition based, inter alia, on s. 12(1)(d) due to confusion with the opponent’s mark DUAL registered for herbicides.
Held: Application refused due to the resemblance between the marks and the overlap in the wares.
9. Fashion World v. Bravek Enterprises, January 24, 2001 (Partington) Confusion
Proposed-use application for BIJON SPORT for costume jewellery and jewellery of precious metals. Opposition based, inter alia, on s. 12(1)(d) due to confusion with the opponent’s mark BIJAN registered for jewellery and perfume.
Held: Application refused. The applicant did not meet its onus given the degree of resemblance between the two marks as both applied to jewellery.
10. 943524 Ontario v. Price International, January 26, 2001 (Herzig) Clearly Descriptive/Section 12(1)(c)
Proposed-use application for TALL BOYS for trading cards and confectionery, namely chewing gum. Opposition based, inter alia, on s. 12(1)(b) and (c) because the mark is clearly descriptive of the wares and is the name of the wares.
Held: Application refused. The opponent has shown, on a balance of probabilities, that from the point of view of card collectors, TALL BOYS clearly describes, and is the name of, a subset of sports trading cards, namely oversized cards.
11. Jakqumar v. Reckitt Benckiser, January 29, 2001 (Partington) Section 12(1)(b)
Proposed-use application for NEUTRA AIR for air fresheners, rug and room deodorizers for household use. Opposition based, inter alia, on s. 12(1)(b) because the mark describes that the wares will "neutralize the air".
Held: Opposition rejected. The opponent did not file any evidence but in any event the Chairperson concluded that the mark is at most suggestive of the result achieved from using the wares.
12. Bruce Trail Association v. Bruce Trail Enterprises, January 31, 2001 (Folz) Section 12(1)(e)/Official Marks/Public Authority/ Confusion
Use-based application for BRUCE TRAIL ENVIRO P.I. for electronic broadcast products and radio and television entertainment services. Opposition based, inter alia, on s. 12(1)(e) in view of the official mark BRUCE TRAIL owned by the opponent and s. 16(1)(a) due to confusion with the opponent's BRUCE TRAIL mark previously used with, inter alia, various paper articles, clothing and mugs.
Held: Application refused because the applicant's mark so nearly resembles as to be likely to be mistaken for the opponent's official mark. The applicant did not succeed in casting doubt on the opponent's status as a public authority but the Board Member nevertheless indicated that she was satisfied that the opponent is a public authority because: by managing and maintaining the Bruce Trail for the public benefit, it fulfills duties of a public nature; regarding government control, the opponent has been delegated its responsibilities under a plan created under legislation and most of its funding comes from the government; and any profit earned is not for private benefit. The s. 16 ground failed because of the inherent distinctiveness of the applicant's mark and the differences between the parties' wares and trades (the applicant's mark is the name of a fictional character depicted in cartoon form).
13. McPherson's et al. v. General Electric, January 31, 2001 (Folz) Confusion
Use-based application to extend the wares in a registration for SURE GRIP to include handles for ranges. Opposition based, inter alia, on s. 12(1)(d) due to confusion with the opponent's mark TRUE GRIP registered for knives, cutlery and barbecue utensils.
Held: Opposition rejected. Confusion not likely in view of the low degree of resemblance in appearance and sound between the marks and the differences in the nature of the parties' wares and channels of trade.
IV. SECTION 45 DECISIONS
1. Living Realty v. Cheung Kong (Holdings), January 16, 2001 (Bradbury) Ambiguous Evidence/Relevancy of Prior Opposition Decision
CHEUNG KONG registered for various real estate development and investment services.
Held: Registration expunged. The registrant’s evidence was ambiguous because it was unclear as to which company was using the mark, whether the mark was being used in Canada, and whether CHEUNG KONG was being used as a trade mark or trade name. The registrant relied on a FCTD decision in an opposition appeal involving the same parties in support of its position that the registrant was ”not simply a registered owner with a ‘dog in the manger attitude’” but the Hearing Officer considered that decision to be irrelevant.
2. Premier Dental Products v. Premier Cutlery, January 16, 2001 (Bradbury) Normal Course of Trade/Classification of Wares
PREMIER registered for manicure and surgical instruments.
Held: Registration maintained. The requesting party argued that manicure instruments should be deleted because the registrant’s affiant did not refer to, or discuss, the registrant’ normal course of trade. The Hearing Officer held that this was not fatal as there is no reason to believe that the sales evidenced were not normal commercial transactions; the packaging shows that the registrant imports the wares and the invoices show that the registrant sells the wares to a variety of customers. The sale of bandage scissors supports the maintenance of surgical instruments, even though they were listed on one occasion on a price list under the heading "Manicure and Grooming Aids".
3. Borden & Elliot v. Wen Chang, January 16, 2001 (Bradbury) Sufficiency of Evidence
TRAVELEX Design registered for all services inherent in and ancillary to the operation of a travel agency.
Held: Registration expunged. The reference to the mark having been "assigned by license" was unclear and not supported by any documentary evidence. There was no evidence of use of the mark by the registrant during the relevant time period and it was questionable if the trade mark TRAVELEX was being used or whether it would be perceived as part of a composite mark or as a trade name.
4. Hart & Cooley v. Thermolec, January 26, 2001 (Savard) Proper Notarization/Normal Course of Trade/Special Circumstances
AIRVECTOR registered for heating, ventilation and air conditioning products, namely: air distribution products consisting of grilles, registers, diffusers and air mixing boxes.
Held: Registration amended to delete "air mixing boxes". The registrant said that it had not used the mark for such wares during the relevant time period because of the high costs associated with their production but that a third party intends to acquire the mark for such wares and begin manufacturing them in a few months; these facts do not amount to special circumstances that justify the non-use. Regarding the remaining wares, it can be inferred from the invoices that the sales occurred in the normal course of trade. Although the exhibits were not properly notarized, they were accepted as having been properly filed; technical shortcomings will not render evidence inadmissible in s. 45 proceedings.
5. Shapiro Cohen v. Toronto-Dominion Bank, January 26, 2001 (Savard) Categorization of Services/Relevancy of Wares and Services Manual
INSIGNIA CLUB CARD registered for banking, securities, real estate, computerized data processing and insurance services.
Held: Registration restricted to banking services. The registrant uses the mark on certain credit cards that it issues. The requesting party argued that credit card services are not banking services and pointed to the fact that the Trade-marks Office Examiner's Wares and Services Manual lists credit card services separately from banking services. However, the Senior Hearing Officer held that the term "banking services" is broad and would include credit extended by a bank; it matters not that entities other than banks provide credit card services. The Manual referred to by the requesting party is not relevant in these proceedings.
6. Bereskin & Parr v. Kittling Ridge, January 30, (Savard) Use of Composite Mark
HURRICANE registered for distilled alcoholic beverages.
Held: Registration expunged. The registrant is using HARRY'S HURRICANE, not HURRICANE per se. The registrant's statement that customers sometimes refer to the beverage as HURRICANE is hearsay and, in any event, does not indicate that customers perceive the mark as HURRICANE (they may be simply abbreviating it). A recipe for a drink called "HURRICANE" on the back label of the beverages is not use of the mark to distinguish the registrant's beverages from those of others.
7. Gowling, Strathy & Henderson v. Spirax Sarco, January 30, 2001 (Savard) Distributor/Use with Specific Wares
TD-50 registered for steam traps.
Held: Registration expunged. The price lists and invoices do not refer to steam traps but rather to parts thereof. The fact that invoices bear the name of the registrant's distributor is not sufficient to conclude that the use is not by the registrant.
8. Bereskin & Parr v. The Great Atlantic & Pacific Company of Canada, January 30, 2001 (Savard) Use by Whom
BELIEVE IN IT registered for operation of retail stores…
Held: Registration maintained. The only argument made by the requesting party was that the mark is used by Miracle Food Mart, not the registrant, and the use does not enure to the benefit of the registrant. However, the Senior Hearing Officer concluded that there is nothing in the evidence to suggest that Miracle Food Mart is a distinct legal entity; rather it is either a trade name or another trade mark of the registrant.
9. GSW v. Sta-Rite Industries, January 30, 2001 (Savard) Use by Registrant
FLOTEC registered for hydraulic pumps and parts therefor.
Held: Registration maintained. The requesting party argued unsuccessfully that the registrant's name must be sufficiently drawn to the attention of the public for the use to constitute its use. The Trade-marks Act does not require a registrant to display its name on the product, only that the use be by the registrant or accrue to the registrant. Here the registrant has made it clear that the trade marked wares emanate from it, that it attaches the mark to the product and that sales in Canada accrue to it.
10. Swabey Ogilvy Renault v. Targa Electronics Systems, January 30, 2001 (Savard) Amendment of Wares
TARGA registered for solid state data storage systems.
Held: Registration maintained. The evidence showed use in association with "solid state data storage drives" and the affiant stated that "solid state data storage systems" include "solid state data storage drives". The requesting party's argument that the term "systems" in the statement of wares ought to be amended was rejected because the issue in s. 45 proceedings is not whether the wording in a registered statement of wares is apt, but rather whether the mark is in use with those wares.
11. GSW v. Sta-Rite Industries, January 30, 2001 (Savard) Sufficiency of Evidence
SR WATER SYSTEMS registered for various types of pumps.
Held: Registration maintained. The Senior Hearing Officer was prepared to accept that a portion of the sales figures provided was in respect of the registered wares. It matters not for s. 45 proceedings that some of the evidence may show use by another party, so long as there is also evidence of use by the registrant.
12. MacRae v. Western Profiles, January 30, 2001 (Savard) Sufficiency of Evidence
SUPER-E registered for windows and weatherstripping.
Held: Registration restricted to windows. The registrant stated that the trade mark is associated with weatherstripping by being prominently displayed on packing slips that accompany the wares; but the packing slips bear an abbreviation of the mark (SE), not the mark itself. The mark is associated with windows by appearing in contracts between the dealer of the wares and the customer who is purchasing the windows.
13. Osler, Hoskin & Harcourt v. Sears Canada, January 30, 2001 (Savard) Deviation from Registered Trade Mark
SHOPPER STOPPERS & Design registered for advertising and promotional activities in the operation of a department store and catalogue sales.
Held: Registration expunged. The mark as registered comprises two distinctive elements: the word SHOPPERS; and the term STOPPERS written with an octagonal shape design instead of the letter "O". Changing the octagonal shape design in the word STOPPERS to the letter "O" consists of a substantial change and results in non-use of the registered mark. Using an octagon shape separate from the word STOPPER results in use of a mark that is substantially different from the registered mark.
14. Osler, Hoskin & Harcourt v. Sears Canada, January 30, 2001 (Savard) Deviation from Registered Trade Mark/Incidental Services
SHOPPER STOPPERS registered for advertising and promotional activities in the operation of a department store and catalogue sales.
Held: Registration maintained. The use of SHOPER STOPPER and SHOPPER STOPPERS! constitutes use of the registered mark, as the deviations have not resulted in the mark losing its identity. The display of the mark in the registrant's catalogues is use in association with advertising and promotional activities in the operation of a department store as well as in association with catalogue sale services because the publication of the catalogue is an activity that is also incidental to the operation of the registrant's stores.
15. GSW v. Sta-Rite Industries, January 30, 2001 (Savard) Use by Whom
BERKELEY & Design registered for water pumping systems.
Held: Registration maintained. The registrant's normal course of trade is to manufacture the wares, affix the mark to the wares and then ship the wares to its wholly-owned subsidiary to sell in Canada. The Canadian subsidiary merely acts as a sales and distribution organizer and its invoices clearly inform the purchasers that the products emanate from the registrant.
16. Fetherstonhaugh v. Sum-Spec Canada, January 30, 2001 (Savard) Deviation from Registered Mark
PURE LIFE & Design registered for various wares.
Held: Registration expunged because the differences between the mark as used and the registered mark are quite significant with respect to shape, layout and overall impression.
17. Gowling, Strathy & Henderson v. Sassy Lassy, January 30, 2001 (Savard) Sufficiency of Evidence/Proving Use Within Relevant Time Period
TD4 Design registered for dresses.
Held: Registration expunged. None of the documents shows a transfer of dresses bearing the mark having occurred in Canada in the normal course of trade during the relevant period. The affiant stated that its computer was incapable of isolating such specific transactions but that he personally recollected one such sale. The purchase orders concerning that sale referred to different labels but the affiant stated that he recalled that TD4 Design labels were substituted for the requested label. The Senior Hearing Officer questioned the affiant's recollection but in any event expunged the registration because there was no evidence as to when the wares referred to in the purchase order were delivered, i.e. no evidence that the transfer occurred within the relevant 3 year period.
