Docket:
T-409-16
Citation: 2016 FC 1085
Ottawa, Ontario, September 26, 2016
PRESENT: The
Honourable Mr. Justice Zinn
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BETWEEN:
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HERTZ SYSTEM,
INC., HERTZ CANADA EQUIPMENT RENTAL PARTNERSHIP, MATTHEWS EQUIPMENT LIMITED
AND HERTZ EQUIPMENT RENTAL CORPORATION
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Plaintiffs/Defendants
to Counterclaim
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and
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HERC EQUIPMENT RENTALS
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Defendant/Plaintiff
by Counterclaim
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ORDER AND REASONS
[1]
The Defendant/Plaintiff by Counterclaim [HERC]
moves against the Plaintiffs/ Defendants to Counterclaim [HERTZ] for:
1. An
interim and/or interlocutory injunction restraining the Plaintiffs, and each of
them individually, as well as their parent, subsidiary and affiliated
companies, officers, directors, employees, agents, licensees, successors,
assigns, and any others over whom the Plaintiffs exercise lawful authority or
with whom the Plaintiffs act in concert, until trial or other disposition of
this action, from directly or indirectly:
(a)
adopting and using any trademarks that are
confusingly similar to any of HERC Trademarks (as defined below);
(b)
directing public attention to their business,
goods, and/or services in such a way as to cause or be likely to cause
confusion in Canada between the business, goods, and/or services of the
Plaintiffs and those of the Defendant, contrary to s. 7(b) of the Trade-marks
Act; and
(c)
displaying, advertising, using or adopting as a
trademark, the word HERC, or any other mark design incorporating the word HERC,
or which is confusingly similar thereto in any manner likely to lead to the
mistaken inference that the Plaintiffs’ business, goods, and/or services are or
have been authorized, endorsed, sponsored, or approved by the Defendant, or are
commercially associated with the Defendant in connection with the sale,
distribution, advertising, or promotion of the Defendant’s business, goods,
and/or services in Canada.
[2]
On March 8, 2016, HERTZ commenced this action
seeking, among other things, a declaration that it is the owner of three
registered Canadian trademarks: HERTZ, HERTZ EQUIPMENT RENTAL, and HERC 360
& Design. HERTZ refers to these marks in its pleading as the “HERC Trademarks” however, in these reasons I shall
refer to them as the HERTZ Trademarks. HERTZ is also seeking a declaration
that HERC’s use in Hamilton and Mississauga of HERC [the HERC Trademark] in
connection with the rental of equipment is confusing with and infringes the
HERTZ Trademarks.
[3]
On April 19, 2016, HERC filed its defence and
launched a counterclaim against HERTZ. It seeks a declaration that it is the
owner of the HERC Trademark as described in the Counterclaim and seeks an
injunction preventing HERTZ using that mark.
[4]
There is little dispute regarding the facts.
Although both parties filed a substantial amount of materials, I have concluded
that this motion may be determined with reference to little of it.
[5]
HERC operates a construction and industrial
equipment rental business in Hamilton (the original location) and Mississauga.
The acronym HERC stands for Hamilton Equipment Rental Centre. HERC presented
evidence that it has used the word “HERC” to
identify itself since 2000.
[6]
HERC and HERTZ have had business dealings for
about 15 years, without objection by HERTZ to the use of HERC in the
Defendant’s business name. They have business operations close to each other
on the same street.
[7]
In March 2014, HERTZ announced its plan to make
its equipment rental business a stand-alone business (from its vehicle rental
business) and further announced that this stand-alone business would be known
as Herc Rentals. I accept that this would have come to the attention of HERC.
[8]
By letter from its solicitors dated November 11,
2014, HERC indicated that it intended to oppose and/or seek the expungement of
the HERC 360 & Design Trademark. It took no further action until after
HERTZ commenced this action.
[9]
In July of this year HERTZ sent letters to its
Canadian customers, including HERC, that provide as follows:
As a highly valued supplier of Hertz
Equipment Rental Corporation, we want to advise you that as of June 10, 2016,
we have changed our name in the United States to Herc Rentals Inc.
In Canada, we will continue to do
business as Hertz Equipment Rental Corporation.
[emphasis added]
[10]
In RJR-MacDonald Inc v Canada (Attorney
General), [1994] 1 S.C.R. 311, 111 DLR (4th) 385 the Supreme Court of Canada
approved the test for an interim or interlocutory injunction as stated by the
House of Lords in American Cyanamid Co v Ethicon Ltd, [1975] RPC 513.
To succeed in this motion HERC must establish on the balance of probabilities:
a. A serious issue to be tried;
b. That it will suffer irreparable harm if the injunction is not
granted; and
c. That the balance of convenience favours the granting of an
injunction.
[11]
As HERC notes, it is established that these
factors are interrelated and should not be assessed in isolation from one
another: Movel Restaurants Ltd v EAT at Le Marché Inc (1994), 59 CPR
(3d) 73 at 77, 89 FTR 72 (FCTD).
[12]
It is also the case, as HERTZ notes, that in the
case of an interim injunction, this Court has held that the moving party must
establish that sufficient urgency exists to require the injunction: See Pfizer
Ireland Pharmaceuticals v Lilly ICOS LLC, 2003 FC 1278, 29 CPR (4th) 466
(FC), and Laboratoires Servier v Apotex Inc, 2006 FC 1443 at para 17, 57
CPR (4th) 245.
[13]
I am not persuaded that any urgency exists that
would warrant granting this interim injunction even if HERC had persuaded me
(and it has not) that it met the tri-partite test for the issuance of an
injunction.
[14]
HERC submits that this is a blatant case of
HERTZ adopting the Herc name while knowing of its use by the Defendant. It
says that both parties supply the same goods and services, to the same
customers, in the same market, and that “mass confusion
is inevitable.”
[15]
I note that there is very little direct evidence
of confusion provided by HERC notwithstanding the adoption of the Herc name by
the Plaintiffs has been known for many months. I further note that there is no
evidence of even one lost sale or rental as a result. Most importantly, the
letter from HERTZ advising that the Herc name will be used by it only in the
United States of America and not Canada, strongly supports that confusion in
Canada is unlikely.
[16]
I am also not persuaded that HERC has shown that
it will suffer irreparable harm if an injunction is not granted. Evidence of
harm must be clear and not speculative, and it must be harm that cannot be
quantified in monetary terms or which cannot be cured. HERC asks the Court to
infer irreparable harm to its goodwill and reputation from the actions of
HERTZ. I am unable to do so; particularly in light of the evidence that HERTZ
will not be identifying itself as Herc in Canada. For the same reason, I am
unable to find that the possibility of loss is other than mere speculation and
conjecture.
[17]
I am also not persuaded that the balance of
convenience rests with HERC given its dilatory conduct. I agree with the
submission made by HERTZ that those who seek an interim injunctive remedy must
act promptly. HERC has known of the issue with HERTZ adopting the Herc name
for many months and did nothing until this action was commenced.
[18]
For these reasons, the motion will be dismissed.
[19]
I advised the parties that it is my view that
this claim and counterclaim ought to be case managed; they agreed.
Accordingly, an order will issue referring this matter to the Chief Justice for
the appointment of a case-management judge.
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