Date: 19990727
Docket: T-2027-97
IN THE MATTER OF ss. 7, 9, 19, 20, 22, 25, 50, 52 and 53
of the Trade-marks Act, R.S.C. 1985, Ch. T-13
BETWEEN:
NIKE CANADA LTD., NIKE INTERNATIONAL LTD. and
NIKE (IRELAND) LTD.
Plaintiffs
- and -
JANE DOE and JOHN DOE and
OTHER PERSONS, NAMES UNKNOWN,
WHO OFFER FOR SALE, SELL, IMPORT, MANUFACTURE, DISTRIBUTE,
ADVERTISE, OR DEAL IN UNAUTHORIZED OR COUNTERFEIT
NIKE MERCHANDISE, AND THOSE PERSONS LISTED
IN SCHEDULE "A" HERETO
Defendants
Docket: T-945-98
IN THE MATTER OF ss. 7, 9, 19, 20, 25, 50, 52 and 53 of
the Trade-marks Act, R.S.C. 1985, Ch. T-13
BETWEEN:
FILA CANADA INC.
Plaintiff
- and -
JANE DOE and JOHN DOE and
OTHER PERSONS, NAMES UNKNOWN,
WHO OFFER FOR SALE, SELL, IMPORT,
MANUFACTURE, DISTRIBUTE, ADVERTISE,
OR DEAL IN UNAUTHORIZED OR COUNTERFEIT
FILA MERCHANDISE, AND THOSE PERSONS
LISTED IN SCHEDULE "A" TO THE STATEMENT OF CLAIM
Defendants
Docket: T-1058-98
IN THE MATTER OF ss. 7, 9, 19, 20, 22, 25, 50, 52 and 53 of
the Trade-marks Act, R.S.C. 1985, Ch. T-13
AND IN THE MATTER OF ss. 3, 5, 13, 25, 27 and 34-39 of
the Copyright Act, R.S.C. 1985, Ch. C-42, as amended
BETWEEN:
THE WALT DISNEY COMPANY (CANADA) LIMITED, and
DISNEY ENTERPRISES, INC.
Plaintiffs
- and -
JANE DOE and JOHN DOE and
OTHER PERSONS, NAMES UNKNOWN,
WHO OFFER FOR SALE, SELL, IMPORT,
MANUFACTURE, DISTRIBUTE, ADVERTISE,
OR DEAL IN UNAUTHORIZED OR COUNTERFEIT
DISNEY MERCHANDISE, AND THOSE PERSONS
LISTED IN SCHEDULE "A" TO THE STATEMENT OF CLAIM
Defendants
Docket: T-1064-98
BETWEEN:
TIME WARNER ENTERTAINMENT COMPANY, L.P.
Plaintiff
- and -
JANE DOE and JOHN DOE and PERSONS, NAMES UNKNOWN,
WHO OFFER FOR SALE, SELL, IMPORT, MANUFACTURE, PRODUCE,
PRINT, DISTRIBUTE, ADVERTISE, DISPLAY, STORE, SHIP OR DEAL IN
UNAUTHORIZED OR COUNTERFEIT LOONEY TUNES CHARACTERS
MERCHANDISE, AND THOSE PERSONS WHEN LISTED IN SCHEDULE "A"
Defendants
Docket: T-2295-98
IN THE MATTER OF ss. 52 and 53
of the Trade-marks Act, R.S.C. 1985, Ch. T-13
BETWEEN:
GTFM, INC. and 109652 Canada Inc. carrying
on business as Ruby International CIE
Plaintiffs
- and -
JOHN DOE and JANE DOE AND OTHER PERSONS UNKNOWN TO THE
PLAINTIFFS WHO OFFER FOR SALE, SELL, IMPORT, MANUFACTURE,
ADVERTISE, OR DEAL IN COUNTERFEIT
FUBU COLLECTION CLOTHING AND ACCESSORIES
AND THOSE PERSONS LISTED IN SCHEDULE "A"
Defendants
Docket: T-550-99
BETWEEN:
VIACOM HA! HOLDING COMPANY and
TIME WARNER ENTERTAINMENT COMPANY, L.P.
carrying on business
in partnership as COMEDY PARTNERS
Plaintiffs
- and -
JANE DOE and JOHN DOE and OTHER PERSONS, NAMES
UNKNOWN, WHO OFFER FOR SALE, SELL, IMPORT,
MANUFACTURE, DISTRIBUTE, ADVERTISE, OR DEAL IN
UNAUTHORIZED OR COUNTERFEIT SOUTH PARK MERCHANDISE,
AND THOSE PERSONS LISTED IN SCHEDULE "A" HERETO
Defendants
Docket: T-551-99
BETWEEN:
RAGDOLL PRODUCTIONS (UK) LIMITED and
THE ITSY BITSY ENTERTAINMENT COMPANY and
THE ITSY BITSY ENTERTAINMENT COMPANY (CANADA), INC.
Plaintiffs
- and -
JANE DOE and JOHN DOE and OTHER PERSONS, NAMES
UNKNOWN, WHO OFFER FOR SALE, SELL, IMPORT,
MANUFACTURE, DISTRIBUTE, ADVERTISE, OR DEAL IN
UNAUTHORIZED OR COUNTERFEIT TELETUBBIES MERCHANDISE,
AND THOSE PERSONS LISTED IN SCHEDULE "A" HERETO
Defendants
Docket: T-646-99
BETWEEN:
ADIDAS-SALOMON AG and ADIDAS (CANADA) LIMITED
Plaintiffs
- and -
JANE DOE and JOHN DOE and OTHER PERSONS,
NAMES UNKNOWN, WHO OFFER FOR SALE, SELL, IMPORT,
MANUFACTURE, DISTRIBUTE, ADVERTISE,
OR DEAL IN UNAUTHORIZED OR COUNTERFEIT
ADIDAS MERCHANDISE, AND THOSE PERSONS
LISTED IN SCHEDULE "A" HERETO
Defendants
Docket: T-823-99
BETWEEN:
NINTENDO OF AMERICA INC. and
NINTENDO OF CANADA LTD.
Plaintiffs
- and -
JANE DOE and JOHN DOE and OTHER PERSONS, NAMES
UNKNOWN, WHO OFFER FOR SALE, SELL, IMPORT,
MANUFACTURE, DISTRIBUTE, ADVERTISE, OR DEAL IN
UNAUTHORIZED OR COUNTERFEIT POKÉMON MERCHANDISE,
AND THOSE PERSONS LISTED IN SCHEDULE "A"
TO THE STATEMENT OF CLAIM
Defendants
REASONS FOR ORDERS
REED, J.:
[1] On June 7, 1999, in Vancouver, I was asked to sign a number of orders, more than 80, consequent on the review of the executions of several Anton Piller orders. These reasons relate to 43 of those orders.
[2] The Anton Piller orders in question were granted as follows: T-2027-97 (Nike) on September 28, 1998; T-945-98 (Fila) on May 10, 1999; T-1058-98 (Disney) on May 25, 1998, amended November 30, 1998; T-1064-98 (Time Warner) on May 25, 1998; T-2295-98 (GTFM) on December 7, 1998; T-550-99 (Viacom Ha!) on March 29, 1999; T-551-99 (Ragdoll) on March 29, 1999; T-646-99 (Adidas) on April 12, 1999 and T-823-99 (Nintendo) on May 14, 1999.
[3] Anton Piller orders are given to allow a plaintiff to seize goods and related material for use as evidence in a proceeding that has been commenced against a defendant, evidence that the plaintiff fears will be destroyed if it is not taken into the custody of the Court.
[4] There are two types of Anton Piller orders. In one the identity of the defendant or defendants (or at least of the main defendant or defendants) is known at the time the order is granted. There is evidence before the Court of the particular acts of copyright, trademark, or sometimes patent infringement, that it is alleged the defendants are committing. In the other type of Anton Piller order, the identity of the defendant or defendants is not known at the time the order is granted; the proceeding is commenced against John and Jane Doe. Also, particulars of the alleged infringing activity of the as yet to be identified defendants are not known. A general statement is made in the affidavit filed to support the issuance of the Anton Piller order that the plaintiff is suffering irreparable harm because of the manufacture and sale of counterfeit merchandise, that is, merchandise that infringes the plaintiff's copyright, trademark or other intellectual property rights. This second type of Anton Piller order is known as a "rolling" Anton Piller order.
[5] Once granted, an Anton Piller order of the rolling type typically lasts for approximately a year, and is executed during that time against numerous individuals and corporate entities identified by the plaintiff's agents. The plaintiff's agents who execute the order are usually one or more solicitors, an investigator and one or more off-duty police officers. The orders usually contain a term either requiring or allowing for the assistance of the police in the execution of the order and this could involve on-duty officers.
[6] Usually, the individuals who are served with a rolling Anton Piller order and from whom wares are seized do not appear in Court and judgments are obtained against them on default. Also, they are encouraged by plaintiffs' counsel to agree to consent orders against themselves. Usually the wares are not brought to Court, although under the terms of the Anton Piller order they should be available to the Court at the Court's request. Despite the fiction that the purpose of the order is to preserve evidence for use at trial, trials never in fact occur. The plaintiff adds the persons who have been served as named defendants, obtains an interlocutory injunction against them, and an award of costs. Indeed, a trial would be virtually impossible, for example, T-1058-98 now has over 540 defendants, served at different times and places.
[7] These rolling Anton Piller orders, the Court is told, are an effective weapon against the sale of counterfeit goods. They also contain, however, potential for abuse, whether inadvertent or otherwise. For example, when only a few items are seized from a person even if the goods are genuine, not counterfeit, the owner of the goods is unlikely to come to Court. It is simply not worth either the time or expense for them to do so, and if they do come, they certainly will not be represented by counsel - the cost is prohibitive (one of the orders before me to which these reasons relate involves, according to the respondent"s unsworn testimony, the seizure of approximately only $60 worth of goods). The defendant, Diana Kuan (Fairyland Gifts Inc.) was outraged at the search of her shop that had occurred and appeared in Court personally and filed with the Court a fourteen page hand-written description, including photographs of her shop and the merchandise she sells, as well as stating that the goods taken were worth $60.
[8] While the individuals against whom Anton Piller orders are executed have the right to refuse entry to their premises, it will be explained to them by those executing the order that if they refuse they will be in breach of a Court order and subject to a fine or imprisonment (the terms of the order so provide). Thus, rolling Anton Piller orders, in one sense, allow for warrantless searches (warrantless in the sense that the authority to search a particular premise and seize particular goods is not dependent on a prior determination by a Court that reasonable or probable grounds exist to support that particular search and seizure). This is justified, however, by the relevant jurisprudence, on the ground that the purpose of the searches and seizures is to protect evidence that the plaintiff intends to use at trial, and the searches and seizures are for civil purposes only.
[9] One of the requirements of most Anton Piller orders is that the plaintiff, when seizing goods, must prepare a list of the goods seized, serve that list on the person from whom the goods have been seized, and include that list in the motion to the Court when a review and approval of the execution of the order is sought.
| [10] All of the Anton Piller orders, the executions of which came before me on June 7, are of the "rolling" type, and all contain terms along the following lines: |
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| 12. The plaintiff's solicitor shall ensure that a list is made of all the merchandise, related equipment and records that are seized or delivered up pursuant to this order and shall serve a copy of that list on the defendant. |
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| 13. When records are seized or delivered up such analysis and copying as the plaintiff's solicitor considers necessary shall be done as quickly as is reasonably practical and the records returned by the plaintiff to the defendant forthwith. |
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| 14. All unauthorized or counterfeit merchandise and related equipment and copies of all related records seized or delivered up pursuant to this order, together with a copy of the list prepared pursuant to paragraph 12, shall be deposited for safekeeping with the registry of the Federal Court or may be retained in the custody of counsel for the plaintiff, providing that a copy of the list prepared pursuant to paragraph 12 and a complete photographic (or videographic) record of the merchandise, related equipment and records that have been seized or delivered up are filed by counsel for the plaintiff with the Court. In the case of identical goods, a photograph (or videotape) of one item together with an inventory of the numbers seized will suffice. |
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| The provisions of this paragraph apply whether or not the identity of the person from whom the materials are seized or by whom they are delivered up is known. |
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| 15. The unauthorized or counterfeit merchandise and other materials seized or delivered up pursuant to this order shall be utilized solely for the purpose of civil proceedings in relation to the enforcement of the plaintiff's trade-mark (and copyright rights) or the trade-mark or (copyright rights) of any legitimately interested third party respecting unauthorized or counterfeit merchandise. [Underlining added.] |
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[11] The Anton Piller orders are stated to become effective against each defendant on the commencement of the day on which they are served and to remain in effect for ten to fourteen days unless otherwise ordered by the Court. (It is expected that a review of the execution of the order will occur within that time frame.) All the orders provide that a defendant, that is a person who has been served with the order although not yet added to the action as an identified defendant, is restrained from offering for sale, displaying, advertising, selling, manufacturing, distributing or otherwise dealing in unauthorized or counterfeit merchandise during the ten to fourteen day period in which the order remains in effect after service, pending review of the execution of the order. This restraint, on review of the execution of the order, can be extended for a further period of time, that is, turned into an interlocutory injunction.
[12] None of the motion records seeking approval of the executions that are the subject of these reasons contain a list of the items seized, nor was such a list served on the defendants. (Counsel for the plaintiffs indicated that a list of the items seized could be provided at a later date once the police had prepared the list.) The handwritten solicitor's reports filed in each case contain explanations such as "seizure of counterfeit goods by Vancouver Police" "No seizure by plaintiffs". The typewritten solicitor's comments, in general, contain paragraphs that read:
| The items seized from the Defendant were seized by the officers of the Vancouver Police Department. Det. Paul Ellis advised me that the police will be providing an itemized list of items seized when the inventory process was complete. |
|
| I assisted in the identification of the counterfeit items seized. At the conclusion of the criminal process I explained the relevant provisions of the Federal Court Order and confirmed that the Plaintiffs were not relying on any of the search and seizure provisions of the Order but were relying on the injunctive provisions. I explained that the Defendant was required to defend the action instituted by the Plaintiffs unless the matter was resolved. [Underlining added.] |
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[13] No evidence was put in front of me as to the purpose for which the police had seized the relevant items. In any event, the items are under the custody of neither the plaintiffs nor this Court.
[14] Counsel for the plaintiffs apparently served each defendant with an Anton Piller order, either after the "criminal" search and seizure was completed, or co-incident therewith, as well as a notice stating that the respective plaintiffs were not relying on the "search and seizure" provisions of the Anton Piller orders, but only on the ex parte interim injunction provision contained therein:
| (b) Since law enforcement has now completed a search and seizure pursuant to a criminal search warrant, voluntary surrender or other criminal proceeding the plaintiffs will only be relying on the provisions of the "Anton Piller" Order not relating to their right to conduct a search and seizure pursuant to the terms of the "Anton Piller" Order. |
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| (c) The plaintiffs will not be conducting a further search or seizure at this time. |
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| (d) The plaintiffs will be relying on the injunctive provisions of the "Anton Piller" Order and will seek an extension of those provisions on the Review date set out in the Notice of Motion served on you. |
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[15] On the review of the execution of the Anton Piller orders, then, counsel seeks orders adding the persons who have been served with the Anton Piller order as named defendants, continuing the ex parte interim injunction orders as interlocutory injunctions against them, and awarding the plaintiffs costs against the new defendants for the execution of the Anton Piller orders and the review of that execution by the Court.
[16] I am not persuaded that the orders that are sought should be granted. The injunctive provisions are part of an order that allows for the seizure of allegedly infringing items, which seizure is for the purposes of their retention for use as evidence at trial, and the ex parte interim injunctions continue only until the search and seizure effected pursuant to the Anton Piller order can be reviewed by the Court.
[17] Counsel for the plaintiffs argues that these rolling Anton Piller orders were developed by this Court because it recognized the difficulties that existed in preventing extensive infringement of intellectual property rights in today's market place. I will candidly state that, at the same time, there is unease among many members of this Court because there has been no Court of Appeal direction or assessment of the appropriateness of the remedy that has been crafted. It allows, as is obvious from what has been said above, a plaintiff (through whatever agents it may hire) to seize the property of others on its assertion alone that that property infringes the plaintiffs' intellectual property rights. An evaluation of that assertion is, of course, available after the fact but there can be many considerations, the most important being the cost of legal advice, which will discourage individuals from contesting the plaintiffs' claim after a seizure, particularly if only a few items have been seized.
[18] In any event, counsel for the plaintiffs' argument that the orders that are sought should be granted is based on the assertion that: (1) infringement of intellectual property rights by individuals who carry on business in an "evanescent and surreptitious manner" is a serious problem; (2) the Anton Piller orders contemplate two separate remedies, the seizure of counterfeit goods for use as evidence at trial and an ex parte interim injunction against the person from whom they have been seized, which are co-existent but not co-dependent (and the Federal Court Rules contemplate such separate remedies - see Rules 373, 374 and 377); (3) the orders either direct, or at least contemplate, police assistance in their execution, and thus what occurred in the cases under review should not be criticized; counsel writes "co-ordinated but separate, civil and criminal proceedings have proven to be an effective way for intellectual property rights holders to attempt to prevent the sale of illegal pirated and counterfeit merchandise"; (4) this type of co-ordinated enforcement has been used in the past without adverse comment from the Court.
[19] I accept that the proliferation of counterfeit goods is a serious problem for intellectual property rights owners such as the plaintiffs. I agree that it was because of the seriousness of this problem that this Court developed rolling Anton Piller orders. I remain concerned, however, that there may be insufficient checks in existence to ensure that abuses do not occur - not all of the defendants against whom searches and seizures were conducted were carrying on business in an "evanescent and surreptitious manner". I note, for example, that in the United Kingdom when specific Anton Piller orders are granted, it is a solicitor other than the plaintiff's solicitor who attends on the execution of the order. It is not clear that rolling Anton Piller orders, as opposed to specific ones, are granted in that jurisdiction. I am of the view that it would be preferable if Anton Piller orders were not granted except on condition that the plaintiff paid for a supervising solicitor or amicus curiae of the Court's choosing, who could both monitor the plaintiff's execution of these orders as well as be independent of the plaintiff's interests. In any event, I do not dispute counsel for the plaintiffs assertion that counterfeiting is a serious problem and the Court should lend its support to addressing that problem.
[20] At the same time, I am not persuaded that the Anton Piller orders that were issued at the behest of these plaintiffs were issued on the basis of two separate remedies being granted by the Anton Piller order: an ex parte interim injunction order against John Doe and Jane Doe and an ex parte order for the preservation of evidence pending trial. The ex parte interim injunction provisions found in the Anton Piller orders are not "free-standing". They have not been obtained on production of evidence concerning alleged infringement by the specific individuals who are proposed defendants. The ex parte interim injunction is dependent on the ex parte order allowing the seizure and retention of goods. The paragraphs of the Anton Piller order found under the heading "Court Review of Execution of Order" make it clear that the interlocutory injunction that can be obtained on the review of the execution of the order is tied to the seizure and retention of the goods as evidence for trial.
[21] I agree that the Anton Piller orders contemplate the assistance of the police in their execution. They, however, expressly state that materials seized pursuant to the order are to be used "solely for the purpose of civil proceedings in relation to the enforcement of the plaintiff's trade-mark (and copyright) rights." As I understand this provision it arises from concern that the types of guarantees that are required before the search of a person's residence or business premises can be conducted by the police are not in existence in the case of civil search and seizures. For example, the Associate Chief Justice in Abode Systems Incorporated v. KLH Computer Solutions (T-2725-97, April 27, 1999), at paragraph 33, recently noted that an Anton Piller order "is not ... a search warrant authorizing a plaintiff to enter a defendant's premises against his will, but an order on the defendant in personam to permit the plaintiff entry or be in peril of proceedings for contempt of court ...". Thus, Anton Piller orders issued by this Court generally require that the civil nature of the searches and seizures undertaken pursuant thereto not be confused with those undertaken for criminal law enforcement purposes.
[22] Lastly, counsel argues that many of my colleagues have approved executions of the type that I am now questioning. I am aware of the manner in which these matters are usually placed before the Court. The Anton Piller orders themselves are usually obtained in camera and ex parte. I am aware that usually little time is allotted for the review of their execution and that the Court, being accustomed to operating on the basis of an adversarial proceeding, is greatly disadvantaged in dealing with these, largely unopposed applications. In general the time allotted for review is scarcely more than a few minutes per order. I agree that judicial comity is a value. I am not prepared, however, in the case of these orders to assume that the particular concern that has come, or been brought, to my attention (joining of civil and criminal searches and no itemized list of goods) has been approved by my colleagues unless there is a written record that that concern was expressly addressed by them.
[23] In the present case, I am not prepared to approve the execution of an Anton Piller order that appears to piggy-back on a search and seizure of goods by police pursuant to a criminal proceeding when the terms of the Anton Piller order expressly state that the seizure of goods thereunder is for civil purposes only. Also, I am not prepared to approve the execution given that no list or description of the seized goods was provided to the respondents or to the Court, as required by the terms of the order.
[24] I am aware that some of the orders to which these reasons relate have been consented to by the individuals concerned. Counsel for the plaintiff has a practice of contacting each proposed defendant before the return of the review motions, or at least of speaking to them in Court before the motion is called, in order to see if they will consent to the order that is being sought. In such cases the individual usually does not come to, or remain in, Court. It is trite law that orders are the Court"s orders, not the parties" and that the Court is not bound by consents that are filed.
[25] For the reasons given the motions for orders against the following persons will be dismissed:
Plaintiff Defendant
(T-2027-97) Natalia Artemova and Sergei Artemov
Yaming Huang
Van Hahn Do
Anh Thi Vo
Tat Sam Anthony Lam
Lieu Anh Man Le
(T-945-98)
(T-1058-98) Anh Thi Vo
Lieu Anh Man Le
Rui Fang Tang
Lina Huanc
Wai Lam Chu
Fairyland Gifts Inc. and Diana Kuan
Angelina Mejares
King Yi Shing a.k.a. Anne Shing
| Co-Wealthy Trading Inc. c.o.b. Baby Love Trade Shops and YP Leung a.k.a. Maggie Leung |
Plaintiff Defendant
| Time Warner Lieu Anh Man Le |
(T-1064-98) Rui Fang Tang
Wai Lam Chu
Fairyland Gifts Inc. and Diana Kuan
King Yi Shing a.k.a. Anne Shing
| GTFM Norman Daryll Richard Milne |
(T-2295-98)
| Viacom Ha! The Oriental Dragon Holdings Inc. and Eddie Li |
(T-550-99)
| Ragdoll Co-Wealthy Trading Inc. c.o.b. Baby Love Trade |
| (T-551-99) Shops and YP Leung a.k.a. Maggie Leung |
The Oriental Dragon Holdings Inc. and Eddie Li
Adidas Natalia Artemova and Sergei Artemov
Van Hahn Do
Tat Sam Anthony Lam
Lieu Anh Man Le
Lina Huanc
King Yi Shing a.k.a. Anne Shing
(T-823-99) Rui Fang Tang
Lina Huanc
Fairyland Gifts Inc. and Diana Kuan
Angelina Mejares
King Yi Shing a.k.a. Anne Shing
Kim Fong
| Co-Wealthy Trading Inc. c.o.b. Baby Love Trade Shops and YP Leung a.k.a. Maggie Leung |
Judge
Ottawa, Ontario
July 27, 1999
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