Date: 20060814
Docket: T-728-05
Citation: 2006 FC 980
Ottawa, Ontario, August
14, 2006
PRESENT: The Honourable Mr. Justice O'Keefe
BETWEEN:
[1]FILM CITY ENTERTAINMENT
LTD.,
[2] ABBA MOVIES COMPANY LIMITED,
[3] CENTURY CREATOR COMPANY LIMITED,
[4] CHINA STAR PICTURES LIMITED,
[5] EMPEROR MOTION PICTURE (HK) LIMITED,
[6] EMPEROR MULTIMEDIA GROUP (HK) LTD.,
[7] GREAT ENTERTAINMENT LTD.,
[8] I-ANIMATION LIMITED,
[9] L.S. ENTERTAINMENT GROUP INC.,
[10] MATRIX PRODUCTIONS COMPANY LIMITED,
[11] MEDIA ASIA FILMS (BVI) LTD.,
[12] MEDIA ASIA FILMS LTD.,
[13] MEGA STAR PRODUCTION LIMITED,
[14] MEI AH FILM PRODUCTION COMPANY LTD.,
[15] ONE HUNDRED YEARS OF FILMS COMPANY
LIMITED,
[16] S&W ENTERTAINMENT LIMITED,
[17] TEAMWORK MOTION PICTURES LTD.,
and [18] UNIVERSE ENTERTAINMENT LTD.
Plaintiffs
and
JOHN DOE AND JANE DOE AND ALL
PERSONS,
PARTNERSHIPS, AND CORPORATIONS WHO ARE
CARRYING ON BUSINESS FROM THE FOLLOWING
UNITS
OF THE PACIFIC MALL, 4300 STEELES AVE. E.,
MARKHAM, ONTARIO:
UNIT A-58, UNIT B-5, UNIT B-59, UNIT C-12,
UNIT D-17, and UNIT D-69
Defendants
REASONS FOR JUDGMENT AND JUDGMENT
O’KEEFE J.
[1] This is a motion by the
defendant, “Unit B-5”, legally known as 1642312 Ontario Ltd. (hereinafter
called Unit B-5) for:
1. An order pursuant
to paragraph 399(1)(b) of the Federal Court Rules, SOR/98-106 (the Rules)
to set aside my order dated May 16, 2005, which reviewed the motion heard
pursuant to the order of Mr. Justice Yves de Montigny dated May 2, 2005, as it
relates to Unit B-5;
2. An order
adjourning the return of the review motion to allow Unit B-5 to prepare and
file its responding materials and to conduct cross-examinations and extending
the terms of the order of Mr. Justice de Montigny dated May 2, 2005; and
3. An order
granting Unit B-5 its costs of this motion, payable forthwith.
[2] Mr.
Justice de Montigny issued an Anton Piller order in this matter on May 2, 2005
and that order was reviewed by me on May 16, 2005 without the presence of the
defendant, Unit B-5. I issued an order on May 16, 2005 continuing the relief
granted in the Anton Piller order until the final determination of the matters
in dispute in this action or until otherwise ordered by this Court. I also
awarded costs payable by the defendant, Unit B-5, in the amount of $5,000,
payable forthwith.
[3] The
defendant, Unit B-5, has requested that I set aside my order pursuant to Rule
399(1)(b) as the defendant believed a request had been made by counsel for an
adjournment of the review hearing.
[4] In
order to have me set aside or vary my order, the defendant, Unit B-5, must show
that it failed to appear by mistake and Unit B-5 must disclose a prima facie
case why the order should not have been made.
[5] The
Anton Piller order was served on the defendant, Unit B-5, on May 6, 2005. On
that day, Ms. Chen, the president of Unit B-5 attempted to contact her lawyer.
On May 12, 2005, Ms. Chen contacted another lawyer, Mr. Long, who was supposed
to request an adjournment of the matter for her so that she could have further
time to retain an intellectual property lawyer who could assist with the
handling of the review motion. She paid this lawyer a $3,000 retainer. This
lawyer wrote a letter to the supervising solicitor for the Anton Piller search,
requesting an adjournment of the matter. That lawyer did not receive the
request.
[6] Ms.
Chen, believing that the adjournment had been arranged, met with Serge
Anissimoff, a lawyer who practices in the intellectual property area. Ms. Chen
retained his services on May 24, 2005. At that time, Ms. Chen did not know that
my order of May 16, 2005 had been granted. Ms. Chen learned of my order on June
3, 2005, after Mr. Anissimoff learned from the Federal Court Registry that my
order had issued.
[7] Ms.
Chen paid $2,217.58 to Mr. Long for the services rendered.
[8] I
am satisfied, based on these facts, that Unit B-5 did not attend the review
hearing by accident. This is not a case where the defendant stood by and did
nothing.
[9] The
defendant, Unit B-5, must also disclose a prima facie case as to why my
order should not have been made.
[10] The
defendant submitted that there was an absence of requisite intent or knowledge
of copyright infringement to support the grant of the Anton Piller order. In Aldrich
et. al. v. Struk et. al. (1984), 8 C.P.R. (3d) 369 (B.C.S.C.), the
Court stated that there was a strong prima facie case as the plaintiff
had a strong claim to copyright and the defendant had full knowledge of the
copyright in the works. In the present case, there is a dispute as to the
service of the cease and desist letter. Ms. Chen states in her affidavit that
the letter was not served on her or on the defendant, Unit B-5. The affidavit
of service filed before me on the review hearing was served on Pacific Video,
not Pacific Mall. Although the process server, in a subsequent affidavit,
stated that Pacific Video should have read Pacific Mall, the Court is still
left with Ms. Chen’s affidavit stating that the warning letter was not served
on the defendant, Unit B-5. As well, the process server said he served the
letter on an employee by the name of Ms. Leung. In her affidavit, Ms. Chen
stated the defendant, Unit B-5, had no employee by that name.
[11] The
plaintiffs stated that the defendant was an importer of the goods and by virtue
of subsection 27(3) of the Copyright Act, R.S.C. 1985, c. C-42, knowledge
is irrelevant. The plaintiffs stated that the defendant, Unit B-5, is an
importer because of Ms. Chen’s statement in paragraph 5 of her affidavit which
reads:
DC
amongst other places, sources the DVDs from a wholesaler’s market in China,
specifically located in the city of Guang
Zhow, in the province of Guang Dong and takes delivery of the same here in Canada. DC offers the DVDs for sale at its premises.
[12] I
do not take this statement to show that Unit B-5 imported the DVDs. In fact, it
states that Unit B-5 takes delivery of the goods here in Canada. It
seems to me that this would indicate that someone other than Unit B-5 actually
imported the goods. I am of the view that the evidence does not support the
application of subsection 27(3) of the Copyright Act.
[13] Because
there is new evidence that the warning letter was not properly served on the
defendant (which means the defendant lacked knowledge of infringement), the
defendant has made out a prima facie case as to why my order should not
have been made.
[14] I
am of the view that my order of May 16, 2005 should be set aside and that the
matter be adjourned to a date to be fixed to allow the defendant to prepare and
file its responding materials and to carry out any cross-examinations. The
relief sought by the plaintiffs in paragraphs 2 and 3 of their notice of motion
filed May 11, 2005, shall be continued until the motion is dealt with by the
Court.
[15] The
motion of the defendant, Unit B-5, is allowed as noted above. I will not deal
with the defendant’s remaining arguments.
[16] There
shall be no order as to costs.
JUDGMENT
[17] IT
IS ORDERED that:
1. My
order in this matter dated May 16, 2005 is set aside and the matter is
adjourned to a date to be fixed to allow the defendant, Unit B-5, to prepare
and file responding materials and to allow time for any cross-examinations.
2. The
relief sought by the plaintiffs in paragraphs 2 and 3 of their notice of motion
filed May 11, 2005, will be continued until the motion is dealt with by the
Court.
3. There
shall be no order as to costs on this motion.
“John
A. O’Keefe”
ANNEX
The relevant provisions of the Federal Court Rules, SOR/98-106 are as
follows:
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8. (1) On
motion, the Court may extend or abridge a period provided by these Rules or
fixed by an order.
(2) A motion
for an extension of time may be brought before or after the end of the period
sought to be extended.
. . .
189. (1) A
defendant who claims to be entitled to relief against a plaintiff may make a
counterclaim instead of bringing a separate action.
(2) A
counterclaim shall be included in the same document as the statement of
defence.
(3) A
statement of defence and counterclaim shall contain a second style of cause
identifying the plaintiff by counterclaim and the defendants to the
counterclaim.
399. (1) On
motion, the Court may set aside or vary an order that was made
(a) ex parte;
or
(b) in the
absence of a party who failed to appear by accident or mistake or by reason
of insufficient notice of the proceeding,
if the party
against whom the order is made discloses a prima facie case why the order
should not have been made.
. . .
(3) Unless the
Court orders otherwise, the setting aside or variance of an order under
subsection (1) or (2) does not affect the validity or character of anything
done or not done before the order was set aside or varied.
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8.
(1) La Cour peut, sur requête, proroger ou abréger tout délai prévu par les
présentes règles ou fixé par ordonnance.
(2)
La requête visant la prorogation d'un délai peut être présentée avant ou
après l'expiration du délai.
. .
.
189.
(1) Le défendeur qui fait valoir contre le demandeur un droit de réparation
peut, au lieu d'intenter une action distincte, faire une demande
reconventionnelle.
(2)
La demande reconventionnelle et la défense sont réunies dans le même
document.
(3)
La défense et demande reconventionnelle comporte un second intitulé qui donne
les noms du demandeur reconventionnel et des défendeurs reconventionnels.
399.
(1) La Cour peut, sur requête, annuler ou modifier l'une des ordonnances
suivantes, si la partie contre laquelle elle a été rendue présente une preuve
prima facie démontrant pourquoi elle n'aurait pas dû être rendue:
a)
toute ordonnance rendue sur requête ex parte;
b)
toute ordonnance rendue en l'absence d'une partie qui n'a pas comparu par
suite d'un événement fortuit ou d'une erreur ou à cause d'un avis insuffisant
de l'instance.
. .
.
(3)
Sauf ordonnance contraire de la Cour, l'annulation ou la modification d'une
ordonnance en vertu des paragraphes (1) ou (2) ne porte pas atteinte à la
validité ou à la nature des actes ou omissions antérieurs à cette annulation
ou modification.
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The plaintiffs rely on section 27 of the Copyright
Act, R.S.C. 1985, c. C-42, for their claim of copyright infringement, which
sets out the following:
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27. (1) It is
an infringement of copyright for any person to do, without the consent of the
owner of the copyright, anything that by this Act only the owner of the
copyright has the right to do.
(2) It is an
infringement of copyright for any person to
(a) sell or
rent out,
(b) distribute
to such an extent as to affect prejudicially the owner of the copyright,
(c) by way of
trade distribute, expose or offer for sale or rental, or exhibit in public,
(d) possess
for the purpose of doing anything referred to in paragraphs (a) to (c), or
(e) import
into Canada for the purpose of doing anything
referred to in paragraphs (a) to (c),
a copy of a
work, sound recording or fixation of a performer's performance or of a
communication signal that the person knows or should have known infringes
copyright or would infringe copyright if it had been made in Canada by the
person who made it.
(3) In determining
whether there is an infringement under subsection (2) in the case of an
activity referred to in any of paragraphs (2)(a) to (d) in relation to a copy
that was imported in the circumstances referred to in paragraph (2)(e), it is
irrelevant whether the importer knew or should have known that the
importation of the copy infringed copyright.
. . .
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27.
(1) Constitue une violation du droit d'auteur l'accomplissement, sans le
consentement du titulaire de ce droit, d'un acte qu'en vertu de la présente
loi seul ce titulaire a la faculté d'accomplir.
(2)
Constitue une violation du droit d'auteur l'accomplissement de tout acte
ci-après en ce qui a trait à l'exemplaire d'une oeuvre, d'une fixation d'une
prestation, d'un enregistrement sonore ou d'une fixation d'un signal de
communication alors que la personne qui accomplit l'acte sait ou devrait
savoir que la production de l'exemplaire constitue une violation de ce droit,
ou en constituerait une si l'exemplaire avait été produit au Canada par la
personne qui l'a produit:
a)
la vente ou la location;
b)
la mise en circulation de façon à porter préjudice au titulaire du droit
d'auteur;
c)
la mise en circulation, la mise ou l'offre en vente ou en location, ou
l'exposition en public, dans un but commercial;
d)
la possession en vue de l'un ou l'autre des actes visés aux alinéas a) à c);
e)
l'importation au Canada en vue de l'un ou l'autre des actes visés aux alinéas
a) à c).
(3)
Lorsqu'il s'agit de décider si les actes visés aux alinéas (2)a) à d), dans
les cas où ils se rapportent à un exemplaire importé dans les conditions
visées à l'alinéa (2)e), constituent des violations du droit d'auteur, le
fait que l'importateur savait ou aurait dû savoir que l'importation de
l'exemplaire constituait une violation n'est pas pertinent.
. .
.
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