Date: 20050209
Docket: T-815-04
Citation: 2005 FC 212
BETWEEN:
WHITE MOUNTAIN TOURS LTD.
Plaintiff
Defendant by Counterclaim
and
DISCOVER BANFF TOURS LTD.
Defendant
Plaintiff by Counterclaim
REASONS FOR ORDER
PHELAN J.
[1] In this application, the defendant seeks to sever the liability issues from the damages issues. The Defendant asks for an order deferring all issues of (a) quantification of the infringement of any right, (b) damages flowing from the infringement of any right, and (c) profits arising from the infringement of any right, to a separate determination to be conducted after the trial of the liability issue.
[2] The Plaintiff (respondent in this motion) has commenced an action for trade mark infringement, depreciation of goodwill, causing confusion and for passing off in respect of the trade mark JOHNSTON CANYON ICE WALK. The principal relief sought is injunctive and damages.
[3] The Defendant (applicant in this motion) denies that the Plaintiff has a proper trade-mark and denies infringement of any legitimate trade-mark. The Defendant counterclaims for an order expunging the Plaintiff's trade-mark or alternatively, disclaimer of the words "ice walk".
[4] The case centres on the conflict between the trade-mark "JOHNSON CANYON ICE WALK" and the Defendant's use of the phrase "Ice walk in Johnson Canyon".
[5] The parties are still disputing various aspects of proposed amendments to the pleadings. The case is in its early stages but because of the seasonal nature of the respective business of ice walk tours, there is some impetus to move this case along, particularly on the liability issues and injunctive relief.
[6] The Defendant relies in large part on the fact that the issues of liability and damages and the documents related thereto are not so inter-connected that they cannot be segregated, that severance will expedite the principal issue of liability and that the disclosure of financial details as between competitors in a small market is inherently risky, even with complete compliance with the confidentiality undertaking in discoveries, and, even with the best of good faith.
[7] The Plaintiff resists this motion principally on the grounds that liability documents and damages documents are inextricably integrated, that there are no cost or time savings which would result from severance, and, that there is no good reason to depart from the normal right of a Plaintiff to have liability and damages determined in the same proceeding.
[8] With great respect, it has not been established that the documents are so integrated that severance is neither possible nor practical.
[9] The parties seem to agree, and I concur, that the principal relief is injunctive, as that relief determines the future for the respective businesses. Damages are important to deal with the past, but in terms of the business future, liability is critical, particularly when it can be combined with injunctive relief.
[10] A Plaintiff's usual right to have liability and damages determined at the same time flows from the more usual types of claims where the suit is about past wrongs. In those situations, a liability finding may be of little practical value. In cases such as this, involving existing competitors, the future is often more important than the past - the liability and injunction is of great if not primary importance.
[11] Severance should result in time and cost savings. If there is no liability, both the parties' and the Court's time dealing with damages will be saved. Even where liability is found, parties often are able to settle the damages calculations with little or no involvement of the Court.
[12] It is my view that the decision in Parmalat Dairy Inc. v. Compagnie Gervais Danone S.A. 34 CPR 4th 380, is compelling authority. Prothonotary Morneau's following comment is particularly apt to this case.
However, contrary to the plaintiff's submission, I think that technically the issues on which the defendants are seeking severance are not interrelated. There is a clear delineation among these issues. The Court must first determine whether the plaintiff's trade-marks are valid, whether they have been infringed, whether there is a proven situation of passing off, and whether false and misleading statements were made. It is only when all of these issues are adjudicated by the Court that the issue of relief will come into play.
[13] As the parties have expressed the view that resolving the issues before the next season would be beneficial, severance would assist in this regard.
[14] The Court indicated that it could, at the present time, offer the parties trial dates in June. Through cooperation and, if necessary case management, this case could be ready for trial in this time frame.
[15] I leave it to the parties (or either of them) to seek the Court's assistance to move this case along or to deal with issues arising in the interim including the need for any confidentiality orders. As to such issues as taking a view, which was raised by the parties, again this is a matter which can be raised with the Court.
[16] The Defendant's motion will be granted. Costs will be in the cause.
(s) "Michael L. Phelan"
Judge
FEDERAL COURT OF CANADA
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: T-815-04
STYLE OF CAUSE: WHITE MOUNTAIN TOURS LTD. v. DISCOVER BANFF TOURS LTD.
PLACE OF HEARING: Calgary, Alberta
DATE OF HEARING: January 10, 2005
REASONS FOR ORDER: Phelan J.
DATED: February 9, 2005
APPEARANCES:
Mr. Michael J. Donaldson
Ms. Sonya A. Morgan FOR THE APPLICANT IN MOTION (DEFENDANT)
Mr. Neil F. Kathol FOR THE RESPONDENT IN MOTION (PLAINTIFF)
SOLICITORS OF RECORD:
Burnett Duckworth & Palmer LLP
Calgary, Alberta FOR THE APPLICANT IN MOTION (DEFENDANT)
Brownlee LLP
Calgary, Alberta FOR THE RESPONDENT IN MOTION (PLAINTIFF)
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