Date: 20101213
Docket: T-725-10
Citation: 2010 FC 1278
Ottawa, Ontario, December 13,
2010
PRESENT: The Honourable Mr. Justice Russell
BETWEEN:
THE RUDE NATIVE INC. and RN
WATERLOO INC.
o/a THE RUDE NATIVE BISTRO & LOUNGE
Plaintiffs
and
TYRONE T. RESTO LOUNGE, BRAD
TOWNSEND,
KYLE PRIESTLEY, BRETT TURNBULL,
PETER WILSON, GARY CHIN,
CHRISTOPHER BECKERMANN,
LISA FISHER, NATASHA TOWNSEND,
PATRICIA TOWNSEND, RENE LINTON,
TARA VELANOFF, ANDREA RIDDIOUGH
MAXIMILLIAN SEAGER,
JANE DOE and JOHN DOE
Defendants
REASONS FOR JUDGMENT AND JUDGMENT
THE MOTIONS
[1]
I
have before me two motions in this matter. In one of them the Plaintiffs are
seeking the following relief:
a.
An
interim interlocutory and permanent injunction restraining the Defendants, as
well as their employees, agents, licensees, heirs, estates, successors,
assigns, and all others over whom any of the foregoing exercise authority from:
i.
Infringing
the Plaintiffs’ trademark contrary to section 19 of the Trade-marks Act,
R.S.C. 1985, c. T-13;
ii.
Directing
public attention to their services or business in such a way so as to cause or
be likely to cause confusion in Canada, at the time they commence so to direct
public attention to them, between their services or business and the services
or business of the Plaintiffs, contrary to section 7(b) of the Trade-marks
Act; and
iii.
Using
any trademark registered by the Plaintiffs in a manner that is likely to have
the effect of depreciating the value of the goodwill attaching thereto,
contrary to section 22(1) of the Trade-marks Act;
b.
An
interlocutory and final order requiring the Defendants to deliver up or destroy
under oath materials in their possession, power or control that are contrary to
any Order granted by this Court, in accordance with section 53.2 of the Trade-marks
Act;
c.
Costs
of this motion to be paid by the Defendants, jointly or severally, to the
Plaintiffs, within 30 days of the date of this Order;
d.
Such
further and other relief as counsel may request and this Court may permit.
[2]
In
the second motion (a cross-motion by the Defendants), the Defendants are
seeking the following relief:
a.
Summary
judgment dismissing the Plaintiffs’ claim for infringement of Canadian
Trade-mark Registration Nos. TMA549753 and TMA544499 and in respect of all the
Plaintiffs’ claims, namely:
i.
Dismissing
the Plaintiffs’ claim for a declaration that the Defendants have infringed the
rights of any party in the trademark registrations TMA549753 and TMA544499 or
any marks associated therewith contrary to sections 19, 20 or 22 of the Trade-marks
Act;
ii. Dismissing
the Plaintiffs’ claim for a declaration that the Defendants have passed off
their services and business as and for those of the Plaintiffs contrary to
section 7(b) of the Trade-marks Act;
iii. Dismissing
the Plaintiffs’ claim for an interlocutory and permanent injunction;
iv. Dismissing
the Plaintiffs’ claim for an interlocutory and final order requiring delivery
up or destruction of any materials in the possession of the Defendants;
v. Dismissing
the Plaintiffs’ claim for damages or accounting of profits;
vi. Dismissing
the Plaintiffs’ claim for pre-judgment and post-judgment interest;
vii. Dismissing
the Plaintiffs’ claim for aggravated, punitive and/or exemplary damages; and
viii. Awarding
the costs of this motion and the action herein to the Defendants on a full
indemnity basis.
b.
Such
further and other relief as this Court may deem just and appropriate.
[3]
The
Rude Native Inc. is the registered trademark owner of Trade-marks TMA544499 and
TMA549753.
[4]
Both
Trade-marks deal exclusively with the name, logo and tradewares associated with
the operation of a restaurant business enterprise known as the The Rude Native
Bistro & Lounge.
[5]
The
Plaintiff RN Waterloo Inc. operates The Rude Native Bistro & Lounge out of
premises municipally known as 15 King Street South in the City of Waterloo in the Province of Ontario.
[6]
Since
mid-December 2009, the Plaintiffs say that the Defendant Tyrone T. Resto Lounge
operated a restaurant enterprise that not only infringed upon the registered Trade-marks
of the Plaintiffs, it also mimicked and copied in its totality the restaurant
and dining “concept” offered by The Rude Native Bistro & Lounge. The
Plaintiffs say that Tyrone T. Resto Lounge operated from premises municipally
known as 56 King Street North in the City of Waterloo in the Province of
Ontario, so that Tyrone T. Resto Lounge was located, at most, 100 metres away
from The Rude Native Bistro & Lounge.
[7]
Counsel
advised the Court at the hearing of this matter that the Tyrone T. Resto Lounge
is no longer operating and has gone out of business.
The Plaintiffs’
Motion
[8]
I
see no real dispute between the parties as to what the Plaintiffs must
establish in order to obtain the injunctive relief claimed.
[9]
An
injunction is an extraordinary remedy that is not lightly granted. It should be
granted only in extreme circumstances where the strength of the plaintiff’s
case is obvious and losses before trial will be insurmountable or irreparable.
[10]
There
are three essential conditions for the issuance of the injunction:
1.
There
must be a serious issue to be tried;
2.
The
moving party must show that it will suffer irreparable harm if the injunction
is not granted; and
3.
The
balance of convenience must favour the moving party.
See RJR-MacDonald
Inc. v. Canada (Attorney General), [1994]
S.C.J. No. 17 at paragraph 35.
[11]
Where
an interlocutory injunction is sought to enforce an intellectual property
right, and where title to or the validity of the related registrations are
themselves seriously questioned, the Court will be very hesitant to grant the
relief sought. See Syntex Inc. v. Novopharm Ltd. (1991), 126 N.R. 114,
[1991] F.C.J. No. 424.
[12]
To
obtain an interlocutory injunction enjoining the use of its trademark, a
plaintiff must demonstrate clearly that it will suffer irreparable harm, not
that it might or could suffer irreparable harm. Irreparable damages have to be
established by clear (and not speculative) evidence. See Imperial Chemical
Industries PLC v. Apotex Inc. (1989), 27 C.P.R. (3d) 345 at page 351; Nature
Co. v. Sci-Tech Educational Inc. (1992), 41 C.P.R. (3d) 359 at page 367.
[13]
My
review of the evidence placed before me in this motion leads me to conclude
that the Plaintiffs have not established that they have, or had, a serious
issue to be tried, that they will suffer irreparable harm, or that the balance
of convenience favours them. The Tyrone T. Resto Lounge is no longer operating,
so that the Plaintiffs’ claim for injunctive relief has become moot. In
addition, any harm that the Plaintiffs might have suffered stems from legitimate
competition from the Defendants’ restaurant and not from any trademark
infringement or passing off under sections 19, 20, 7(b) or 22(1) of the Trade-marks
Act.
The
Defendants’ Motion
[14]
Summary
judgment is governed by Rules 213 to 219 of the Federal Courts Rules,
SOR/98-106.
[15]
In
Granville Shipping Co. v. Pegasus Lines Ltd. S.A. (1996), 111 F.T.R. 189
(F.C.T.D.) at paragraph 8, the Federal Court summarized the general principles
applicable to summary judgment:
I have considered all of the case law pertaining
to summary judgment and I summarize the general principles accordingly:
1. the purpose of the provisions is to
allow the Court to summarily dispense with cases which ought not proceed to
trial because there is no genuine issue to be tried (Old Fish Market
Restaurants Ltd. v. 1000357 Ontario Inc. et al);
2. there is no determinative test (Feoso
Oil Ltd. v. Sarla (The)) but Stone J.A. seems to have adopted the reasons
of Henry J. in Pizza Pizza Ltd. v. Gillespie. It is not whether a party
cannot possibly succeed at trial, it is whether the case is so doubtful that it
does not deserve consideration by the trier of fact at a future trial;
3. each case should be interpreted in
reference to its own contextual framework (Blyth and Feoso);
4. provincial practice rules
(especially Rule 20 of the Ontario Rules of Civil Procedure, [R.R.O. 1990, Reg.
194]) can aid in interpretation (Feoso and Collie);
5. this Court may determine questions
of fact and law on the motion for summary judgment if this can be done on the
material before the Court (this is broader than Rule 20 of the Ontario Rules
of Civil Procedure) (Patrick);
6. on the whole of the evidence,
summary judgment cannot be granted if the necessary facts cannot be found or if
it would be unjust to do so (Pallman and Sears);
7. in the case of a serious issue with
respect to credibility, the case should go to trial because the parties should
be cross-examined before the trial judge (Forde and Sears). The
mere existence of apparent conflict in the evidence does not preclude summary
judgment; the court should take a "hard look" at the merits and
decide if there are issues of credibility to be resolved (Stokes).
[16]
In
determining whether there is “no genuine issue to be tried” the Court is
entitled to assume that the parties to the motion have put their best foot
forward and that, if this case were to go to trial, no additional evidence
would be presented. It is not sufficient for the responding party to say that
more and better evidence will (or may) be available at trial. See Trojan
Technologies Inc. v. Suntec Environmental Inc. (2004), 31 C.P.R. (4th)
241 (F.C.A.) [Trojan Technologies] at paragraphs 15, 16 and 18; and Feoso
Oil Ltd. v. Ship Sarla, [1995] 3 F.C. 68 (F.C.A.) [Feoso Oil] at
paragraphs 14 and 16.
[17]
The
Court is expected to be able to assess the nature and quality of the evidence
supporting a “genuine issue for trial.” This test is “not whether [the
responding] party cannot possibly succeed at trial, it is whether the case is
so doubtful that it does not deserve consideration by the trier of fact at a
future trial.” See Granville Shipping, above. If so, then the parties
“should be spared the agony and expense of a long and expensive trial after
some indeterminate wait.” See Avery v. Value Investment Corp., [1990]
O.J. No. 843. See also Feoso Oil, above, at paragraphs 14 and 16, and Trojan
Technologies, above, at paragraphs 15, 16, and 18.
[18]
Actions
without foundation “should not take up the time and incur the costs of a
trial.” See Feoso Oil, above, at paragraph 14. A respondent may not rest
on the mere allegations or denials in its pleadings but must file evidence of
specific facts showing that there is a genuine issue for trial. See Feoso
Oil, above, at paragraphs 14 and 16, and Trojan Technologies, above,
at paragraphs 15-16.
[19]
In
reviewing the evidence placed before me in the Defendants’ cross-motion, I
concur with the following conclusions put forward by the Defendants:
a.
Contrary
to the statement of claim, the Plaintiff, Rude Native Inc., does not appear to
be the current owner of the trademarks. Instead, Rude Food Inc. is the
registered owner of the registered trademarks identified in the statement of
claim, namely:
|
Mark
|
Status
|
Registration #
|
Date of Registration
|
|
THE RUDE NATIVE
|
Registered
|
TMA549753
|
August 14, 2001
|
|
|
Registered
|
TMA544499
|
May 3, 2001
|
b.
There
is no evidence that any of the Defendants used the registered marks or adopted
confusingly similar trademarks or trade names for the Defendants’ business
operated as the Lounge;
c.
The
Lounge carried on business under the trade name TYRONE T. RESTO LOUNGE, and operated
its web site at “tyronet.com” and adopted the following graphic as its logo:
d.
In
promoting its services via the Internet, signage and print media, the Lounge
adopted logos, slogans, graphics, colours, advertising text, entertainment and
menu choices that were distinct from those of the Plaintiffs’ business at the
Bistro;
e.
The
Lounge did not adopt names for any of its menu items that may have been confusing
with those of the Bistro. Where similarities existed, such as “spicy mussels,”
the names cannot be considered distinctive for the related menu items.
f.
Although
the Lounge used some of the same entertainers as the Bistro, the Lounge also
used other entertainers and there was nothing distinctive in the way that
entertainers were used at the Bistro;
g.
The
Lounge constructed an exterior for its restaurant that did not resemble that of
the Bistro;
h.
The
Lounge adopted a distinctly Asian style for its graphics and décor, which
contrasted dramatically with the African style adopted by the Plaintiffs for
the Bistro;
i.
There
were at least seven other restaurants located between the Bistro and the Lounge
and with which both competed;
j.
The
Lounge carried on business since at least December 2009 and the Plaintiffs have
not provided evidence of any instances of confusion to date with regard to the
period when the Lounge was in business.
[20]
This
leads me to the following general conclusions:
a.
There
is no evidence that any of the Defendants adopted trademarks that were
identical or similar to the Registered Marks;
b.
I
see no evidence that any of the Defendants adopted trade names, trademarks,
logos, slogans, interior designs, colours, graphics or advertising that were
the same or similar to those used in conjunction with the Plaintiffs’
restaurant;
c.
I
see no evidence that any of the Defendants adopted menus or names for menu
items that were identical or similar to those used in conjunction with the
Plaintiffs’ restaurant, other than generic descriptions that were not
distinctive of the Plaintiffs’ restaurant business;
d.
There
is no evidence of actual confusion or the likelihood of confusion;
e.
There
is no evidence that would support a claim under sections 19, 20, 22 or 7(b) of
the Trade-marks Act;
f.
The
Plaintiffs wanted to remove the competition that may have resulted from the
Defendants’ restaurant but do not have an arguable case based upon the grounds
stated in their claim.
[21]
At
the hearing of this matter in Toronto on October 14, 2010,
counsel for Plaintiffs conceded that there is no evidence of any infringement
under section 19, 20 or 22 of the Trade-marks Act. He indicated that his
clients’ only real concern was the possibility of passing off under section
7(b) with regard to the menu items. In this case, it is also conceded that
there were no visual cues that gave rise to a likelihood of confusion but that,
combined with other things going on in the Plaintiffs’ restaurant, such as the
use of entertainer Tim Louis, there was a genuine issue for trial over the
likelihood of confusion.
[22]
The
evidence reveals that the descriptions of the meals in question are similar,
but the names are either dissimilar or generic. There is no evidence of
distinctiveness or the likelihood of confusion on this issue.
[23]
In
the end, then, the Plaintiffs have conceded that they commenced the action with
no basis for a claim to infringement under sections 19, 20 and 22 of the Trade-marks
Act. As regards section 7(b) of the Trade-marks Act and the issue of
the menu items, I can find no genuine issue for trial. All in all, the
Plaintiffs’ action looks like nothing more that an attempt to stifle legitimate
competition by using false allegations of passing off and breaches of the Trade-marks
Act. This conduct is high-handed and vexatious and needs to be recognized
in the costs award.
JUDGMENT
THIS COURT ORDERS AND
ADJUDGES that
1.
The
Plaintiffs’ motion for injunctive relief is dismissed;
2.
The
Defendants’ motion for summary judgment is granted;
3.
The
Defendants shall have their costs of both motions on a full indemnity basis.
“James
Russell”
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