It has now been almost 10 years since the Supreme Court of Canada's decision in Hryniak v. Mauldin, 2014 SCC 7, wherein the Supreme Court of Canada unanimously called for a "culture shift" in the way that disputes are litigated in Canada, in favour of summary resolution and other mechanisms that resolve disputes without a full trial.Since that decision, the majority of intellectual property infringement disputes heard by our courts are still litigated with the machinery of a full trial, and viva voce evidence presented to the Court.
While litigants before the Federal Court have not yet firmly embraced the "culture shift" sought by the Supreme Court of Canada, the Federal Court of Canada offers numerous options for parties to litigate their disputes without the machinery of a full trial.
In Techno-Pieux Inc v Techno Piles Inc et al, 2023 FC 581, a comprehensive decision authored by Chief Justice Crampton of the Federal Court of Canada, the Court adjudicated claims for trademark infringement, copyright infringement, depreciation of goodwilland passing-off. Thisrecent decision illustrates the utility of motions for summary trial as a means of litigating intellectual property disputes, and presents a good opportunity to review summary trial and other options available to litigants to resolve intellectual property disputes in the Federal Court of Canada, without the need for a full trial.
Rather than proceeding by way of action for infringement of its intellectual property rights, an IP owner (called the "applicant" in this context) may instead choose to proceed by way of application served on the alleged infringer (called the "respondent" in this context). Proceeding by way of application is restricted to Affidavit evidence, and there is no documentary or oral discovery available to the litigants.
In BBM Canada v. Research in Motion Limited, 2011 FCA 151, the Federal Court of Appeal held that trademark infringement proceedings could be brought by application rather than by action, overturning a decision of the Trial Division on this issue. While the plaintiff in that case was ultimately unsuccessful in its application for trademark infringement, the decision shows that infringement proceedings may be brought by application rather than by action in appropriate cases.
Proceeding by way of application may be an option where all necessary evidence on all relevant issues is available to the applicant without the need for documentary or oral discovery.
A summary judgment motion pursuant to Rules 213-215 of the Federal Courts Rules may be brought where there is no genuine issue for trial. Summary judgment may be sought with respect to all or part of a claim, and motions for summary judgment are typically brought where there are no credibility issues to be resolved in the record.
In the context of patent proceedings, summary judgment has traditionally been used in United States proceedings to adjudicate questions of claims construction, in advance of trial (so-called Markman hearings).That approach has also been adopted in Canada to resolve patent construction and infringement issues, on a handful of occasions.
In CanMar Foods Ltd. v. TA Foods Ltd, 2019 FC 1233, aff'd 2021 FCA 7, the Court granted the Defendant's motion for summary judgment, accepting the defendant's proposed construction of two key claim elements, and found as a result of the proposed constructionthat the there was no genuine issue for trial with respect to the plaintiff's claim for infringement of the asserted patent claims.
Therefore, summary judgment motions may be well-suited to determination of a specific issue that could have a determinative effect on the proceeding.
Summary trial and Techno-Pieux v Techno Piles
Pursuant to Rules 213 and 216 of the Federal Courts Rules,a summary trial motion may be brought with respect to all or part of a claim, and may include additional sources of evidence. Summary trial is generally considered to be more suitable than summary judgment for resolving contested questions of fact, and may be suitable for adjudication of contested disputes where viva voce evidence is not necessary, and where the Affidavit evidence and cross-examination transcripts are sufficient to resolve any conflicts in the evidence. Summary trial has been employed to adjudicate some or all issues in a range of intellectual property disputes. In Vachon Bakery Inc v Racioppo, 2021 FC 308, claims for trademark infringement and passing-off of the plaintiff's HOSTESS trademark were successfully brought, and the defendant's invalidity counterclaims dismissed, in the context of a motion for summary trial. And in Ark Innovation Technology Inc v Matidor Technologies Inc, 2021 FC 1336, the parties litigated a software dispute by summary trial on consent, with the plaintiff ultimately succeeding in its motion and obtaining declaratory, injunctive, and monetary relief against the defendant for copyright infringement and passing-off.
The recent decision in Techno-Pieux Inc v Techno Piles relates to a dispute between Techno-Pieux Inc., owner of the TECHNO PIEUX and TECHNO METAL POST trademarks and related intellectual property rights, and former distributors who re-branded under the trade name and trademark "TECHNO PILES." The plaintiff sued for claims including trademark infringement, copyright infringement, depreciation of goodwill, and passing-off. In an earlier motion, reported at Techno-Pieux Inc v Techno Piles Inc et al, 2022 FC 721, the parties each moved for summary judgment on their respective claims. The Court found there was no genuine issue for trial with respect to several aspects of the Plaintiff's claims, including the Court's assessment of the confusion factors set out in paragraphs 6(5)(a), (b), (c) and (e) of the Trademarks Act, but the Court found that there was a genuine issue for trial in respect of certain aspects of the Plaintiff's claims, including the nature of the parties' respective trades (paragraph 6(5)(d) of the Trademarks Act). The Court referred the balance of the dispute to adjudication by way of summary trial.
In the summary trial motion, the Court adjudicated the balance of the dispute between the parties, resulting in the decision reported at Techno-Pieux Inc v Techno Piles Inc et al, 2023 FC 581. The Court refused to consider new evidence filed by the Defendants on issues where the Court had previously found that there was no genuine issue for trial, noting that it was "not appropriate" to consider evidence that could reasonably have been obtained before the summary judgment motion. Regarding the natures of the trades, the Defendants argued that confusion was unlikely because they operated at a different level of the trade from the Plaintiff, and a majority of the Defendants' sales were made through personal contacts, referrals and repeat business, and those customers were not likely to be confused between the parties' respective trademarks and trade names. The Court rejected those arguments, finding that the Plaintiff is deemed to operate at the same level of the trade as its licensed distributors (who, in turn, operate at the same level of the trade as the Defendants) by virtue of the license and section 50(1) of the Trademarks Act, and because the Defendants built their reputationin the business operating as distributors for the Plaintiff, it was not relevant that a majority of their business had come from personal contacts, referrals and repeat customers.
In all of the circumstances, the Court found that there was a reasonable likelihood of confusion between the Plaintiff's registered TECHNO PIEUX and TECHNO METAL POST trademarks and the Defendants' TECHNO PILES trademark and trade name, and that the Defendants' use of TECHNO PILES infringed upon the Plaintiff's registered trademarks. The Court also held that the Defendants had passed off their services as and for those of the Plaintiff (contrary to section 7(b) of the Trademarks Act), and had depreciated the goodwill in the Plaintiff's registered trademarks (contrary to section 22 of the Trademarks Act), and that, by using and reproducing design marks that substantially reproduced design versions of the Plaintiff's trademarks, the Defendants had infringed copyright in those designs and artistic works. The Court ordered declaratory and injunctive relief, and delivery up. On damages, the Court awarded damages of $20,000 CAD for trademark infringement, passing-off, and depreciation of goodwill, and $10,000 CAD for copyright infringement.
The organizing principle of the Federal Courts Rules is the cost-effective, just, and inexpensive adjudication of disputes. The Federal Court has repeatedly expressed its commitment to cost-effective and efficient adjudication of disputes, and as illustrated above, the Rules and authorities offer numerous options for adjudicating intellectual property disputes without the machinery and attendant costs of a full trial.
Depending on the circumstances, available options may include motions to resolve specific or discrete issues, motions designed to resolve a subset of issues (such as, e.g., adjudicating liability issues on a first motion and bifurcating remedies issues to a later hearing or trial), and applications or motions designed to resolve all issues in dispute between the parties.
While not appropriate in all cases, taking such steps where reasonably available can help ease the cost and procedural burdens of litigation by resolving issues and proceedings at an early stage, and ultimately help ameliorate backlogs and facilitate the administration of justice as a whole.
Read the original article on GowlingWLG.com
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.