Dennis v. Genex Communications Inc., 2003 FC 974

Date: 20030812

Docket: T-1226-03

Citation: 2003 FC 974

BETWEEN:

FELIX DENNIS

and

DENNIS PUBLISHING INC.

Plaintiffs

and

GENEX COMMUNICATIONS INC.

and

6057276 CANADA INC.

Defendants

Motion by the plaintiffs for:

(A)       an order that an interim injunction, an interlocutory injunction and a permanent injunction issue to the defendants, their agents, officers, directors, representatives, employees, licensees, successors and assignees, related or associated companies and everyone over whom the defendants have exercised a measure of control or anyone acting under, by, through or with the direction, control or permission of the defendants, or anyone having knowledge of this order, prohibiting them from directly or indirectly:

            (i)         infringing Canadian trade mark No. 509,557 for the trade mark "Maxim";

            (ii)        selling, distributing or advertising wares or services in association with any trade mark trade name and/or domain a name which includes "Maxim" or any trade mark and/or trade name creating confusion with the latter in association with printed publications or in electronic format, including magazines, but not limited thereto; and

            (iii)       directing public attention to the defendants' wares, services or business to such an extent that there is a possibility of confusion in Canada between the defendants' wares, services or business and the plaintiffs' wares, services or business;

(B)       an order directing the defendants to pay the cost of this action on a solicitor-client basis; and

(C)       any other conclusion with the Honourable judge of this Court may consider appropriate.

[Sections 80, 359, 364, 373 and 374 of the Federal Court Rules (1998)

and ss. 7, 19, 20 and 22 of the Trade-Marks Act]

REASONS FOR ORDER

PINARD J.

[1]        The Court must consider here only the motion for an interlocutory injunction, as the plaintiffs were granted an interim injunction effective to the date of the order supported by these reasons. In questions involving trade marks infringement, the party seeking an interlocutory injunction most generally show:

(a)        the existence of a serious question to be tried;

(b)        that the plaintiff will suffer irreparable harm if the injunction is not issued; and

(c)        that the balance of convenience favours the plaintiff.

The failure to meet any one of these requirements will be sufficient for the motion to be dismissed (see RJR-Macdonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311 (S.C.C.)).

[2]        That is the test which I intend to apply in the case at bar, as I do not consider that this is a flagrant violation by the defendants of the plaintiffs' trade mark MAXIM.

[3]        After hearing counsel for the parties and reviewing the evidence in the record, I consider that the plaintiffs have established a sufficient colour of right, thus meeting the first of the three requirements. On their Internet site the defendants announced their intention to begin selling their magazine, including the word "MAXIMUM" in the title, on or about early August 2003. At the hearing in this Court, their counsel indicated that the specific date was August 15, 2003. It further appeared that the defendants intended to use the word "MAXIMUM" in association with a magazine appealing to men and proposed to sell it in Quebec. As the word "MAXIMUM" contains the word "Maxim", which is the plaintiffs' mark also associated with a magazine for men sold inter alia in Quebec, I find that at this stage there is a sufficient basis for me to conclude, despite the distinctions argued by the defendants, that the confusion resulting from use of the word "MAXIMUM" by the defendants constitutes a serious question to be tried.

[4]        However, the plaintiffs have not persuaded me that if the temporary remedy sought is not granted they would suffer irreparable harm, that is, harm which cannot be offset by damages, or only with difficulty. I feel that if the plaintiffs ultimately succeed in obtaining a permanent injunction, they could be adequately compensated by damages. The latter could readily be established from the detailed accounts which the defendants through their counsel have undertaken to keep of the sales of their magazine "MAXIMUM". There is no good evidence that casts any reflection on the defendants' integrity, nor on their ability to pay such damages.

[5]        As to the loss of good will that might result from what is ultimately recognized as a confusion, it is well settled that this can readily be compensated for by damages. In the Federal Court of Appeal judgment in Centre Ice Ltd. v. National Hockey League (F.C.A.), [1994] F.C.J. No. 68, at para. 9, Heald J.A. stated:

On the evidence adduced herein, the learned Motions Judge found that the Appellants' use of the trade name "Center Ice" was confusing to the public. In my view, this conclusion was reasonably open to him on this record. He then went on to state:

As well, there is evidence, that this confusion has resulted in members of public being discontent to find out that the plaintiff does not carry the products advertised by the defendants. Thus, it can reasonably be concluded that to allow the defendants to continue using the trade name "Center Ice" will result in confusion between the litigants' products and a loss of goodwill which the plaintiff cannot be compensated for in damages.

...

I am unable to agree that a finding of confusion between competing products necessarily leads to a loss of goodwill for which the plaintiff cannot be compensated in damages. A similar issue was considered by the Alberta Court of Appeal in Petro-Canada Inc. V. Good Neighbor Fast Food Stores Ltd. Kerans J.A. speaking for the Court said:

The suit here sounds in passing off, and the first category of harm alleged is diminution of goodwill as a result of confusion of names in the minds of reasonable persons. There is evidence in the material presented by the applicant to indicate that it is reasonable for him to allege the existence of confusion. That kind of confusion, as we have said in other suits, leads to loss of "name" goodwill the loss of which in the normal course is a kind of damage which, when suffered by a commercial firm in the ordinary course, is fairly readily calculable and therefore can be fairly compensated for in damages.

                                                                                                                                                      (My emphasis.)

[6]        Finally, the alleged depreciation of the mark MAXIM, resulting from the use the defendants intend to make of the word "MAXIMUM", is purely speculative. No copies of the defendants' magazine have yet been put on sale and there is nothing in the evidence to seriously support the argument made by the plaintiffs that the publishers of the magazine MAXIMUM will publish vulgar and obscene contents. It is well settled that the harm alleged to be irreparable in such cases cannot be purely speculative. In reaching this conclusion, I am not saying that the lack of marketing of products containing a trade mark alleged to be a contravention is a bar as such to any application for an interlocutory injunction by an injured party. That would surely not be the case, for example, when there is a flagrant violation of a trade mark or when the inability of the user of the mark to pay damages is well established. However, it is beyond question that the lack of a complete and real product to be examined, as in the case at bar, makes the task of someone who must prove irreparable harm much more difficult.

[7]        Accordingly, as the plaintiffs have failed to prove the necessary irreparable harm, the temporary remedy of the interlocutory injunction sought cannot be granted.

[8]        The motion is accordingly dismissed.

[9]        However, as the plaintiffs met the requirement of establishing a sufficient colour of right, there will be no immediate award of costs: these will follow the outcome of the principal case.

Montréal, Quebec

August 12, 2003

Certified true translation

Suzanne M. Gauthier, C. Tr., LL.L.

                          FEDERAL COURT

                   SOLICITORS OF RECORD

FILE:                                                                               T-1226-03

STYLE OF CAUSE:                                                     FELIX DENNIS

and

DENNIS PUBLISHING INC.

Plaintiffs

and

GENEX COMMUNICATIONS INC.

and

6057276 CANADA INC.

Defendants

PLACE OF HEARING:                                                Montréal, Quebec

DATE OF HEARING:                                                  August 11, 2003

REASONS FOR ORDER:                                           PINARD J.

DATE OF REASONS:                                                  August 12, 2003

APPEARANCES:

Mario Welsh                                                                      FOR THE PLAINTIFFS

Louis Duquet                                                                      FOR THE DEFENDANTS

SOLICITORS OF RECORD:

Heenan, Blaikie, Aubut                                                     FOR THE PLAINTIFFS

Québec, Quebec

O'Brien, Attorneys                                                            FOR THE DEFENDANTS

Québec, Quebec