Docket: T-1036-13
Citation:
2014 FC 853
Ottawa, Ontario, September 8, 2014
PRESENT: The
Honourable Mr. Justice Harrington
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BETWEEN:
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BAUER HOCKEY CORP.
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Applicant
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and
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EASTON SPORTS CANADA INC.
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Respondent
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and
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SPORT MASKA INC.
DBA REEBOK-CCM HOCKEY
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Proposed Intervener
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JUDGMENT AND REASONS
[1]
Federal Courts Rule 109 provides that the
Court “may” grant a person leave to intervene in a proceeding. Sport Maska Inc.
d.b.a. Reebok-CCM Hockey (hereinafter CCM) sought leave to intervene in Bauer’s
appeal from a decision of the chair of the Trade-Marks Opposition Board which expunged
one of its trade-marks from the register. Without the intervention, Bauer’s
appeal will in fact be ex parte as the respondent Easton Sports Canada
Inc. has stated it will not participate.
[2]
In his discretion, Prothonotary Morneau
dismissed CCM’s motion. His reasons are cited as 2014 FC 594. As this was an
interlocutory decision, they have not been posted on the Federal Court website.
This is CCM’s appeal therefrom under Rule 51.
[3]
The case law is very clear as to the standard by
which a judge of the Federal Court is to assess appeals from discretionary
orders of a prothonotary. The judge is only to exercise his or her discretion de
novo if “the questions raised in the motion are vital
to the final issue of the case” or the order is “clearly
wrong, in the sense that the exercise of discretion … was based upon a wrong
principle or upon a misapprehension of the facts” (Merck & Co v
Apotex Inc, 2003 FCA 488 at para 19, [2004] 2 FCR 459).
[4]
A decision on a motion to intervene is not
vital, and so the issue is whether the prothonotary got it wrong in accordance
with the dictates of Merck.
I.
Background
[5]
Bauer is currently the holder of the trade-mark SKATE’S
EYESTAY DESIGN registered in 1989. The mark is a rectangular patch on the
side of an ice skate.
[6]
In January 2011, Bauer took action against Easton under Federal Court docket T-51-11, alleging among other things infringement of the
trade-mark. Easton not only defended and counterclaimed alleging the invalidity
of the trade-mark, but had also requested the registrar of trade-marks to give
notice to Bauer and to determine whether the trade-mark was in use in Canada “at any time during the three‑year period immediately
preceding the date of the notice”. The timeframe in question is the three
years immediately prior to 11 January 2010. While this matter was before the
registrar, Bauer took an action against CCM in docket T-311-12, again alleging
infringement of the trade-mark.
[7]
In April 2013, the chair of the Trade-marks
Opposition Board expunged the trade-mark from the register. Two reasons were
given. The word “Bauer” appeared within the rectangle. This was considered to
be a major deviation so that the registered trade-mark as such was no longer
recognizable. It was also found that one of the evidenced sales did not enure
to the benefit of the registered owner at that time.
[8]
In April of this year, Bauer and Easton reached a settlement by which Easton discontinued its counterclaim and undertook
not to participate in Bauer’s appeal. Thereafter, CCM sought to intervene.
II.
Discretionary Factors
[9]
Until recently, the courts, beginning with Rothmans,
Benson & Hedges Inc v Canada (Attorney General), [1990] 1 FC 74,
29 FTR 267, rev’d on other grounds [1990] 1 FC 90, have identified 6 factors to
be taken into consideration in deciding whether or not to grant a person
intervener status. These factors are not exhaustive, and all 6 need not be met.
They are:
1) Is the proposed intervenor directly affected
by the outcome?
2) Does there exist a justiciable issue and a
veritable public interest?
3) Is there an apparent lack of any other
reasonable or efficient means to submit the question to the Court?
4) Is the position of the proposed intervenor adequately
defended by one of the parties to the case?
5) Are the interests of justice better served
by the intervention of the proposed third party?
6) Can the Court hear and decide the cause on
its merits without the proposed intervenor?
Rothmans at
para 12. See also Canadian Union of Public Employees (Airline Division) v
Canadian Airlines International Ltd, 2000 FCA 233 at para 8, [2000] FCJ No
220 (QL).
[10]
However, in Canada (Attorney General)
v Siemens Enterprises Communications Inc, 2011 FCA 250, 207 ACWS (3d) 229, the
Court of Appeal stated that Rule 109 was “not to be used
in order to replace a respondent by an intervener”.
[11]
More recently, Mr. Justice Stratas, sitting
alone on a motion argued only in writing, was of the view that some of the
factors set out in Rothmans were outmoded and did not meet the
exigencies of modern litigation. In Canada (Attorney General) v
Pictou Landing Band Council et al, 2014 FCA 21, 237 ACWS (3d) 570, he
stated his opinion as follows at paragraph 11:
11 To
summarize, in my view, the following considerations should guide whether
intervener status should be granted:
I. Has the proposed intervener complied
with the specific procedural requirements in Rule 109(2)? Is the evidence
offered in support detailed and well-particularized? If the answer to either of
these questions is no, the Court cannot adequately assess the remaining
considerations and so it must deny intervener status. If the answer to both of
these questions is yes, the Court can adequately assess the remaining
considerations and assess whether, on balance, intervener status should be
granted.
II. Does the proposed intervener have a
genuine interest in the matter before the Court such that the Court can be
assured that the proposed intervener has the necessary knowledge, skills and
resources and will dedicate them to the matter before the Court?
III. In participating in this appeal in
the way it proposes, will the proposed intervener advance different and
valuable insights and perspectives that will actually further the Court’s determination
of the matter?
IV. Is it in the interests of justice
that intervention be permitted? For example, has the matter assumed such a
public, important and complex dimension that the Court needs to be exposed to
perspectives beyond those offered by the particular parties before the Court?
Has the proposed intervener been involved in earlier proceedings in the matter?
V. Is the proposed intervention
inconsistent with the imperatives in Rule 3, namely securing “the just, most expeditious
and least expensive determination of every proceeding on its merits”? Are there
terms that should be attached to the intervention that would advance the
imperatives in Rule 3?
III.
The Prothonotary’s Decision
[12]
In concluding, as he said “on
balance” that CCM should not be granted intervener status, Prothonotary
Morneau set out a number of factors which led him to that determination.
[13]
He began his analysis by stating that if CCM
were allowed to intervene, it would be replacing Easton. He referred to the Siemens
case as authority for the proposition that Rule 109 is not to be used to
replace a respondent by an intervener.
[14]
However, I do not take Prothonotary Morneau as holding
that Siemens automatically barred an intervention by CCM, as he went on
to consider CCM’s submissions with respect to fairness and the interests of
justice.
[15]
Although recognizing that the intervention might
be helpful to the Court, he relied upon a decision of Prothonotary Tabib in a
patent matter (Genencor International, Inc v Canada (Commissioner of
Patents), 2007 FC 376, 55 CPR (4th) 395), in which she found the
fact there would be no party to defend the Board’s decision in an appeal did
not constitute a factor justifying leave to intervene, as the Court could hear
and decide the case on its merits without benefit of the intervention.
[16]
Prothonotary Morneau went on to say that it was “of the uppermost importance that its settlement of the Appeal
with Easton be respected, and that said result be not jeopardized by having CCM
replace and substitute itself for Easton”.
[17]
In my opinion, Prothonotary Morneau misdirected
himself in law on this point. There is a public aspect to the register
maintained under the Trade-marks Act. The dynamics of Bauer’s appeal
will certainly be different if CCM is allowed to intervene. The settlement
between Bauer and Easton is irrelevant.
[18]
He then treated Mr. Justice Stratas’s decision
in Pictou, supra para 11, as an update of the factors to be taken
into consideration, although he also referred to the Rothmans decision,
above.
[19]
Finally, he also took into account that there is
a full debate going on between Bauer and CCM in docket no. T-311-12. He stated
that only the first two of Mr. Justice Stratas’s 5 factors were met.
IV.
The Factors
[20]
I do not think that the factors set out by a
panel of the Court of Appeal in Rothmans, above, or by Mr. Justice
Stratas in Pictou are to be taken au pied de la lettre (see Gillespie
Bros & Co Ltd v Roy Bowles Transport Ltd, [1973] 1 All ER 193 at 199, [1973]
1 Lloyd’s Rep 10, Lord Denning MR).
[21]
Nor do I think Siemens constitutes an
absolute bar to a motion to intervene.
[22]
I do not consider necessary to carry out a
detailed factual analysis based on the factors set out in Rothmans and Pictou.
I mention in passing that in Pictou Mr. Justice Stratas stated at
paragraph 11 that he was sitting as a single motions judge and that his reasons
did not bind his colleagues. It should be noted that the Court of Appeal is
very reluctant to reverse itself. In Miller v Canada (Attorney General),
2002 FCA 370 at para 8, 220 DLR (4th) 149, the Court stated:
the values of certainty and consistency lie
close to the heart of the orderly administration of justice in a system of law
and government based on the rule of law. Accordingly, one panel of this Court
ought not to depart from a decision of another panel merely because it
considers that the first case was wrongly decided.
The appropriate
forum should be the Supreme Court of Canada. Miller stands for the
proposition that the previous decision must be manifestly wrong for the Court
to reverse itself The Supreme Court, however, has questioned this deferential
practice (Phoenix Bulk Carriers Ltd v Kremikovtzi Trade, 2007 SCC 13 at para 3,
[2007] 1 S.C.R. 588).
V.
CCM’s Case
[23]
CCM certainly has an interest. If the trade-mark
remains expunged, the dynamics of its litigation with Bauer will change
dramatically. Bauer will still have an unregistered trade-mark but in theory
its chances of success in proving infringement will diminish.
[24]
The Court would be better served if someone were
present to defend the expungement decision. This is particularly important
because Bauer, as is its right, intends to lead new evidence in accordance with
section 56 of the Trade-marks Act. That information should be tested, as
our system of justice is adversarial at its heart.
[25]
Prothonotary Morneau was clearly wrong in taking
into account Bauer’s settlement with Easton. I agree with CCM on this point.
[26]
CCM also submits that Prothonotary Morneau
downplayed the public aspect of the registry. As stated by Mr. Justice Hugessen
in Meredith & Finlayson v Canada (Registrar of Trade-marks), [1991]
FCJ No 1318 (QL), 40 CPR (3d) 409 at 412, section 45 of the Trade-marks Act
allows anyone, even one who does not have an interest, to call upon the
registrar to give notice to the holder of the trade-mark. This “speaks eloquently to the public nature of the concerns the
section is designed to protect”. This public-interest aspect was also
cited by Chief Justice Lutfy in 1459243 Ontario Inc v Eva Gabor
International, Ltd, 2011 FC 18 at para 4, 197 ACWS (3d) 489, and by Mr.
Justice Evans, as he then was, in Novopharm Ltd v Bayer Inc, [2000] 2 FC
553 at para 50, [1999] FCJ No 1661 (QL). However, I do not think this public
aspect ranks with, say, the types of interventions permitted by the Supreme
Court on cases that affect large segments of the population or raise constitutional
issues.
[27]
CCM could have given its own notice under
section 45. It could still do so, although the three years under consideration
would be different. The public interest is limited in that the issue is not
whether the trade-mark was not used for three consecutive years at any time in
the past, but rather during the three years immediately preceding the notice.
[28]
CCM suggests that although the proceedings under
this docket number will be more complex if it is permitted to intervene, in all
likelihood the proceedings under T-51-11 will be shortened. This is somewhat
speculative.
[29]
The Court might well benefit from CCM’s
intervention as it would give a different perspective, in the sense that Easton is giving no perspective at all.
VI.
Decision
[30]
In my opinion, Prothonotary Morneau was only
clearly wrong on one point, that is the effect of the settlement between Bauer
and Easton. I am not satisfied that without referring to that settlement, he
would have come to a different conclusion. As Mr. Justice Joyal put in Miranda
v Canada (Minister of Employment & Immigration), [1993] FCJ No 437 (QL)
at para 5, 63 FTR 81:
It is true that artful pleaders can find any
number of errors when dealing with decisions of administrative tribunals. Yet
we must always remind ourselves of what the Supreme Court of Canada said on a
criminal appeal where the grounds for appeal were some 12 errors in the judge’s
charge to the jury. In rendering judgment, the Court stated that it had found
18 errors in the judge’s charge, but that in the absence of any miscarriage of
justice, the appeal could not succeed.
[31]
The validity of the
trade-mark is in issue in the litigation between Bauer and CCM in docket
T-311-12. That is the forum in which CCM should make its case. In conclusion,
Prothonotary Morneau’s order was not clearly wrong in that he did not exercise
his discretion upon a wrong principle or upon a misapprehension of the facts.
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