In Pollard Banknote Limited v. Babn Technologies Corp. and
Scientific Games Products (Canada) ULC (2016 FC 1193), Justice
Locke dealt with the issue of costs following his finding that the
claims of Canadian Patent No. 2,752,551 were invalid or, in the
alternative, not infringed. In his Judgment, Justice Locke provided
that should the parties be unable to agree on costs, they were to
provide written submissions of no more than 15 pages.
The parties could not agree on
costs and both parties provided written submissions to the
Pollard sought a lump sum award of
$1,348,315.00 representing 50% of its legal fees and 100% of its
disbursements, noting that costs calculated using Tariff B of the Federal Court Rules
would entitle Pollard to recover only 17-22 % of its actual legal
spend. In support of its submission, Pollard referred to a
"trend in recent caselaw favouring the award of a lump sum
based on a percentage of the actual costs to the party when dealing
with sophisticated commercial litigants that clearly have the means
to pay for the legal choices they make".
Scientific Games argued that the
default costs award under Column III of Tariff B as contemplated in
Rule 407 should apply and that elevated costs were not warranted.
Citing Wihksne, Scientific Games further argued
that if recovery of costs under Tariff B is inadequate, the remedy
is not to ignore the Tariff, but for the Governor-in-Council to
amend the Rules.
Justice Locke held that although
there were grounds on which an award of elevated costs was
justified, Scientific Games' conduct was not so reprehensible
as to justify a lump sum award of costs at the level sought by
Pollard, holding :
 I have considered
Pollard's argument that costs should be awarded as a lump sum
based on its actual legal expenses, but I am not convinced that an
award of costs based on Tariff B will be inadequate. However,
because of my concerns with SG's conduct during this case, I
conclude that the fees portion of costs should be elevated by 50%
above what is contemplated in the previous paragraph. As discussed
above, I am particularly concerned about (i) SG's standard of
review argument, (ii) the manner in which SG dealt with Mr.
Finnerty's testimony, and (iii) SG's argument for a claim
construction that defers to the Patent Office's decision to
allow the 551 Patent to issue, and simultaneously ignores its
submission during prosecution that led to that decision.
Justice Locke further awarded
Pollard $2500 for the costs submissions, noting that Scientific
Games' single-spaced, 10-point font submissions did not comply
with the Federal Court Rules, effectively
allowing Scientific Games to exceed the 15 page limit for its
 Before continuing, I must note
that SG's submissions do not appear to comply with the Rules.
They appear to use a 10-point font (rather than the 12-point font
required by Rule 65) and to be single-spaced (thus exceeding the
limit of 30 lines per page exclusive of headings). The result of
SG's failure to comply with the Rules is that its 15-page
submissions total 116 paragraphs versus 47 paragraphs for
Pollard's submissions in chief. SG has effectively exceeded the
page limit for costs submissions more than two-fold without seeking
leave to do so. I have reviewed and considered SG's costs
submissions in their entirety, and I will reflect SG's
disrespect for the Rules in awarding costs related to this
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A recent decision of the Federal Court of Canada has highlighted the difficulties in asserting trademark and copyright rights related to the appearance of functional products with unique design elements.
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