Docket: T-1016-23
Citation: 2026 FC 933
Toronto, Ontario, July 13, 2026
PRESENT: The Honourable Madam Justice Furlanetto
|
BETWEEN:
|
|
ADVANTAGE CAR & TRUCK
RENTALS LTD.
|
|
Plaintiff
|
|
and
|
|
ORLANDO RENTCO LLC
(D.B.A. ADVANTAGE RENT-A-CAR)
|
|
Defendant
|
REASONS AND JUDGMENT
[1] This is a motion for default judgment brought pursuant to Rule 210 of the Federal Courts Rules, SOR/98-106 [Rules] against the Defendant, Orlando Rentco LLC, doing business as Advantage Rent-A-Car [Orlando]. The Plaintiff, Advantage Car & Truck Rental Ltd [Advantage], alleges that Orlando has engaged in passing off contrary to subsection 7(b) of the Trademarks Act, RSC 1985, c T-13 [TMA].
[2] While Orlando initially participated in the proceeding, its Statement of Defence was subsequently struck, and Orlando remains non-compliant with a Court order. Advantage was granted permission to bring this motion because of this status and non-compliance.
[3] For the reasons set out below, I find Orlando is in default and that it has acted contrary to subsection 7(b) of the TMA such that judgment should be granted. I also find it would be in the interests of justice to set aside the Court’s prior bifurcation order and to award a fixed amount of damages along with the other remedies set out herein
I. Background
[4] Advantage is a family-owned vehicle rental and leasing business that began its operations in 1991 and has been continuously operating in the Greater Toronto Area [GTA] since that time. Advantage delivers vehicle rentals and leases directly to customers which include leisure travelers, corporate clients, repair shops, insurance companies, and airports. It currently operates from 10 locations throughout the GTA, including locations near Toronto Pearson International Airport [YYZ] and Billy Bishop Toronto City Airport [YTZ].
[5] Since 1991, Advantage has used the following unregistered trademarks, trade names, and domain names in association with its business [collectively, the Advantage Trademarks]:
[ADVANTAGE Design]
[ADV Favicon]
[6] Advantage displays its Advantage Trademarks in all aspects of its business. The ADVANTAGE Design trademark has been in continuous use in Canada since at least 1992 and the ADV Favicon has been widely used by Advantage to advertise and promote the Plaintiff’s website.
[7] Advantage also owns the following domain names and has operated an active website at “advantagecarrentals.com”
since 1999:
|
Domain Name
|
Registration Date
|
|
advantagecarrentals.com
|
September 15, 1999
|
|
advantagetrucks.ca
|
November 18, 2014
|
|
advantagecars.ca
|
April 8, 2015
|
|
advantagecarrentals.ca
|
April 5, 2023
|
[8] Advantage uses its domain names to direct internet consumer traffic to its booking website “advantagecarrentals.com”
. Through this website, customers located inside and outside Canada book automobile rentals to be picked up and dropped off at the Plaintiff’s various locations in the GTA, including near YYZ and YTZ. Customers can also make bookings for vehicles to be delivered to their homes anywhere in the GTA.
[9] Orlando is a Florida limited liability company with a principal place of business in Orlando, Florida. Orlando operates its vehicle rental business as an online vehicle rental platform. Customers in the GTA who rent vehicles from Orlando do so by making an online booking reservation through: (a) Orlando’s website at the domain www.advantage.com; (b) third-party online travel agencies; or (c) social media.
[10] Orlando began offering and promoting vehicle rental services in association with the marks shown in subparagraphs (a) to (d) in December 2022, and the mark shown in subparagraph (e) in 2025 [collectively, the Impugned Marks] and entered the GTA market in January 2023:
-
1)ADVANTAGE
-
2)ADVANTAGE RENT-A-CAR
-
3)
-
4)
-
5)
[11] From January 2023 to April 2024, Orlando offered and promoted its vehicle rental services through its licensed affiliate, 2439517 Ontario Inc, doing business as York Car Rental [York], with a principal place of business located at 600 Dixon Road near YYZ. While these activities appeared to cease between April 2024 and March 2025, Advantage alleges that Orlando is once again offering vehicle rental services in the GTA in association with the Impugned Marks, through a new affiliate, Ways Car Rental, Inc [Ways], with a place of business near YYZ.
[12] In 2004, Advantage sued an unrelated party to this proceeding, Advantage Rent-a-Car Inc, under subsection 7(b) of the TMA [2004 Litigation]. The 2004 Litigation was discontinued by Advantage in October 2010 when Advantage Rent-a-Car Inc filed for bankruptcy in the United States, abandoned the Canadian market, and removed its Canadian counsel as solicitor of record. From the conclusion of this litigation until January 2023, Advantage asserts it has been the exclusive user of the Advantage Trademarks in the Canadian vehicle rental market.
[13] This action was commenced in May 2023 and was initially brought against Orlando, York, and Mikail Fathi-Kazerouni (the founder and CEO of York) in his personal capacity. Both Orlando and York filed Statements of Defence. Mr. Fathi-Kazerouni was removed as a Defendant on November 6, 2023 by Amended Statement of Claim.
[14] A bifurcation order was issued on consent of the parties on January 30, 2024, bifurcating liability for passing off and entitlement to remedies from the quantification of damages [Bifurcation Order]. First round examinations for discovery were conducted in February 2024 and answers to undertakings were exchanged in April and May 2024.
[15] Advantage reached a settlement agreement and discontinued its action against York on April 9, 2025. The settlement was reached shortly after its solicitors (ROBIC LLP) requested and were removed as solicitors of record.
[16] On June 16, 2025, ROBIC LLP also brought a motion to be removed as solicitors of record for Orlando. In the Order granting the request, Orlando was ordered to appoint a new solicitor of record but failed to do so and its Statement of Defence was struck on September 29, 2025. The present motion for default judgment was filed on December 1, 2025.
[17] On January 12, 2026, Orlando appointed Shift Law as solicitor of record and on January 14, 2026 filed a Notice of Motion requesting that the Court adjourn Advantage’s motion for default judgment and grant leave for Orlando to refile its Statement of Defence.
[18] On January 22, 2026, Justice Mandy Aylen issued an order granting the motion in part. The Order adjourned Advantage’s motion for default judgment but dismissed Orlando’s request for leave to refile its Statement of Defence without prejudice to its right to file the motion with proper supporting submissions by February 2, 2026. The Order also required Orlando to pay Advantage’s costs for preparing for the default motion in the fixed amount of $25,000 by no later than February 2, 2026. If Orlando did not comply with either aspect of Justice Aylen’s Order, Advantage was permitted to reinstate its default motion.
[19] On February 2, 2026, Orlando brought a motion to set aside the Court’s September 29, 2025 Order that struck its Statement of Defence. However, it did not comply with the costs ordered on January 22, 2026. On February 12, 2026, the case management judge directed that the motion would not be adjudicated because Orlando had not satisfied the costs award.
[20] On February 24, 2026, Advantage requested a new hearing date for its motion for default judgment, which was set down for hearing by Order of the Acting Chief Justice Martine St. Louis.
[21] On the eve of the hearing of the motion, Dipchand LLP filed a letter requesting adjournment on the basis that Orlando was in the process of removing Shift Law as solicitors of record and appointing Dipchand LLP. At the hearing of the motion, a Notice of Change of Solicitor was submitted for filing. Upon hearing the submissions of counsel and being advised that Orlando remained in violation of the Court’s January 22, 2026 Order, as it had still not paid the costs ordered to be paid to Advantage, the adjournment request was denied.
[22] The following reasons relate to the Court’s disposition on the default motion and Advantage’s request to set aside the Court’s Bifurcation Order and award damages.
II. Issues
[23] There are three issues for determination:
-
1)Is Orlando in default?
-
2)If so, is Advantage entitled to judgment against Orlando?
-
3)Can the Court also set aside the Bifurcation Order and award Advantage damages and the other relief requested?
III. Analysis
[24] Rule 210 of the Rules provides that a plaintiff may bring an ex parte motion for judgment against a defendant who is in default of filing a statement of defence. To obtain judgment, a plaintiff must first establish that the defendant has not filed a statement of defence in compliance with the Rules; and second, the evidence must enable the Court to find, on a balance of probabilities, that the plaintiff has established its claim: Ragdoll Productions (UK) Ltd v Jane Doe (TD), 2002 FCT 918 [Ragdoll] at paras 23-25; Trimble Solutions Corporation v Quantum Dynamics Inc, 2021 FC 63 [Trimble] at para 35.
A. Is Orlando in default?
[25] As set out earlier, on September 29, 2025 the Court struck Orlando’s Statement of Defence. Advantage thereafter filed this motion for default judgment. Pursuant to the Court’s January 22, 2026 Order, Orlando was required to both: (a) file its motion for an order granting leave to refile its Statement of Defence; and to (b) pay Advantage the fixed amount of costs awarded (i.e., $25,000), by no later than February 2, 2026. Each was a condition of the Court’s Order and if either condition was unfulfilled, Advantage was entitled to bring back its motion for default judgment.
[26] While Orlando filed a motion to set aside the Court’s September 29, 2025 Order that struck its Statement of Defence and to reinstate the Statement of Defence, the costs ordered to be paid on January 22, 2026 were never fully paid by Orlando. As this condition was not satisfied, the case management judge determined that Orlando’s pleadings motion would not be entertained and that Advantage’s motion for default judgment could be re-engaged. An order setting the hearing date for Advantage’s motion for default judgment was made by the Acting Chief Justice shortly thereafter.
[27] As there is currently no Statement of Defence pending on behalf of Orlando, nor have the conditions of the Court’s January 22, 2026 Order been satisfied, Orlando remains in default.
B. Advantage is entitled to judgment
[28] To obtain default judgment, a plaintiff must establish its claim on a balance of probabilities, based on sufficiently clear, convincing, and cogent evidence: Trimble at paras 35-37. This requirement exists because the allegations in a statement of claim are deemed denied unless they are admitted: Rule 184, Rules; Dermaspark Products Inc v Aveena Cosmetic Clinic Inc, 2025 FC 979 at para 3; Ragdoll at para 23.
[29] Subsection 7(b) of the TMA provides that “no person shall direct public attention to his goods, services or business in such a way as to cause or be likely to cause confusion in Canada, at the time he commenced so to direct attention to them, between his goods, services or business and the goods, services or business of another.”
This provision is the statutory codification of the common law tort of passing off.
[30] There are three necessary components to establish passing off under subsection 7(b): (1) the existence of goodwill; (2) deception of the public due to a misrepresentation; and (3) actual or potential damage to the plaintiff: Ciba-Geigy Canada Ltd v Apotex Inc, 1992 CanLII 33 (SCC) at 132; Kirkbi AG v Ritvik Holdings Inc, 2005 SCC 65 at para 66.
[31] In addition, for an action under subsection 7(b), the plaintiff must also meet an initial threshold requirement of establishing possession of a valid and enforceable trademark, either registered or unregistered, at the time the defendant first began directing public attention to its own goods and services: Sandhu Singh Hamdard Trust v Navsun Holdings Ltd, 2019 FCA 295 at para 39. Given the definitions of “trademark”
and “use”
in sections 2 and 4 of the TMA, the evidence must show that Advantage used the Advantage Trademarks for the purpose of distinguishing Advantage’s goods or services from those of others.
[32] In this case, the evidence establishes each of the conditions for passing off under subsection 7(b) of the TMA.
(1) Advantage has valid enforceable trademarks
[33] The evidence from Advantage’s Director of Marketing and Business Development, Danial Rajabi [Rajabi Affidavit] establishes that Advantage has been operating under the Advantage Trademarks since 1991 and the ADVANTAGE Design since at least as early as 1992, and that Advantage has always, in a continuous, uninterrupted manner, presented and marketed its services under the Advantage Trademarks.
[34] Advantage has prominently and continuously displayed the Advantage Trademarks in all aspects of its business, including: on the interior and exterior of its vehicle rental locations; in its online and traditional modes of advertising; on decals affixed to its fleet of vans and trucks; and on contracts, invoices and other printed materials used by Advantage in the ordinary course of its business.
[35] The Rajabi Affidavit provides representative examples of the Plaintiff’s use of the Advantage Trademarks at various locations across the GTA in association with its rental vehicles, as well as use in print advertisements, online, and in various promotional materials. This includes use of the ADVANTAGE word marks and the ADVANTAGE Design mark. The evidence also establishes that the ADV Favicon has been widely used to advertise and promote Advantage’s services on the internet.
[36] The evidence demonstrates that Advantage has valid and enforceable trademarks such that it can assert subsection 7(b) of the TMA.
(2) Goodwill
[37] From the evidence provided in the Rajabi Affidavit, I am satisfied there is a strong reputation and goodwill associated with the Advantage Trademarks throughout the GTA. Advantage has acquired this reputation and goodwill through extensive use and promotion of its vehicle rental and leasing services to customers across the GTA in connection with the Advantage Trademarks.
[38] The Rajabi Affidavit provides representative examples of the manner in which Advantage has used and promoted its services in association with the Advantage Trademarks, including by:
-
generating nearly one million rental agreements since 1991;
-
acquiring the domain name www.advantagecarrentals.com in 1999 and other related domain name registrations to offer online services and to direct internet consumer traffic to its booking website;
-
using the Advantage Trademarks as an essential part of Advantage’s internet marketing strategies, search engine optimization and search engine marketing campaigns to maintain a strong online search engine presence for relevant search keywords related to vehicle rentals in Canada and attracting millions of pageviews to its website between September 2016 and September 2023, along with website reservation revenue of about $10.5 million from Canadian customers;
-
investing $1.8 million in online advertising and $1.9 million on referral commissions that prominently feature the Advantage Trademarks; and
-
maintaining an active presence on social media where it actively promotes its services and engages with customers in association with the Advantage Trademarks; and
-
accumulating online customers reviews across various online platforms, including Yelp, Yellow Pages and Google Business Profiles.
(3) Deception of the public due to misrepresentation
[39] Application of the factors outlined in subsection 6(5) of the TMA demonstrate that Orlando’s use of the Impugned Trademarks creates a likelihood of confusion sufficient to satisfy the second element of the passing off test.
[40] As set out in Masterpiece Inc v Alavida Lifestyles Inc, 2011 SCC 27, the degree of resemblance (paragraph 6(5)(e) of the TMA) often has the greatest effect on the confusion analysis, even though it is the last factor listed in subsection 6(5) (at para 49). Here, the Impugned Marks are nearly identical to the Advantage Trademarks in that they contain the same identical word “Advantage”
and use the same dominant prefix “ADV”
in their design format.
[41] Assessing the other confusion factors under subsection 6(5) of the TMA further reinforces the likelihood of confusion.
[42] Significantly, the nature of services and channels of trade (paragraphs 6(5)(c) and 6(5)(d) of the TMA) are directly overlapping. Both Advantage and Orlando use their trademarks in association with vehicle rental services in the same geographic area, targeting the same end consumer, and by advertising and promoting their services across many of the same online travel agency platforms and through Google. The identical services and channels of trade diminish any differences between the marks and increase their likelihood of confusion: Reynolds Presto Products Inc v PRS Mediterranean Ltd, 2013 FCA 119 at paras 26-29.
[43] The inherent and acquired distinctiveness of the marks and the length of time they have been in use (paragraphs 6(5)(a) and 6(5)(b) of the TMA) also favours Advantage. The Advantage Trademarks have been extensively used and promoted in Canada since as early as 1991, while Orlando’s activities have only been conducted in Canada for a short period of time (since January 2023). There is also no evidence that the Impugned Marks have become known in Canada to any extent.
[44] Although the record shows that Orlando had raised arguments during the proceeding that it had earlier use of “Advantage”
in Canada in association with vehicle rental services through its acquisition of several companies and their corresponding trademark rights, I have insufficient evidence before me to make this finding. First, there is no evidence that any Canadian trademarks were assigned to Orlando from any alleged predecessor-in-title by way of acquisition. Second, the trademarks in question were expunged for non-use on June 14, 2021. Third, the record before me relating to these assertions, which includes only inconclusive discovery materials and prior filings from the 2004 Litigation, provides insufficient evidence to substantiate any use of the expunged trademarks in Canada in association with vehicle rental reservations beyond 2005. Thus, any goodwill or reputation that the expunged trademarks might have enjoyed (which has not been established) would have been extinguished through a lengthy period of non-use. The evidence is insufficient to support any prior use of “Advantage”
by Orlando, or to establish any claim of entitlement to the pre-existing goodwill of others.
[45] The evidence, however, does demonstrate that actual confusion has occurred since Orlando entered the market. Advantage has provided evidence showing that within weeks of Orlando entering the market in January 2023, Advantage began receiving phone calls, emails, and online enquiries from consumers that were related to Orlando. The calls dropped off when the relationship between Orlando and York concluded and began again when Ways became affiliated with Orlando.
[46] The Rajabi Affidavit also speaks to online confusion resulting from overlapping search engine results. This overlap is created by the organic ranking benefits associated with the higher domain authority attributed to Orlando’s “advantage.com”
website.
[47] While proof of actual confusion is not necessary to establish a likelihood of confusion, where there is evidence of actual confusion over a period of time, as in this case, it can be a weighty factor that must be considered as part of the surrounding circumstances in the subsection 6(5) analysis: Diageo Canada Inc v Heaven Hill Distilleries, Inc, 2017 FC 571 at para 114.
[48] Admittedly, Orlando’s principal, Mr. Remon Aziz, had express knowledge of Advantage, its business, and the Advantage Trademarks when it entered the Canadian market. Even after Orlando’s association with York concluded, Orlando chose to re-enter the Canadian vehicle rental market in the GTA with the Impugned Marks through its affiliation with Ways, despite its knowledge of the Advantage Trademarks and the evidence of consumer confusion. I agree that these surrounding circumstances provide further support that the second element of the passing off test has been met.
(4) Actual or potential damage
[49] Advantage asserts that it has suffered damage due to Orlando’s activities, including through lost sales, loss of control and distinctiveness of the Advantage Trademarks, and increased marketing costs.
[50] While the evidence relating to lost sales is admittedly thin, I note that the mere loss of control over reputation, image or goodwill can be sufficient to establish the damages required to support a claim for passing off: Sadhu Singh Hamdard Trust v Navsun Holdings Ltd, 2016 FCA 69 at para 31; Cheung v Target Event Production Ltd, 2010 FCA 255 [Cheung] at para 28. The Federal Court of Appeal has also recognized that where a defendant is in direct competition with a plaintiff, damage can be established by showing a probability of loss of sales and business to a competitor: Cheung at para 26.
[51] In this case, I am satisfied that there is a likelihood that those who are looking for the services of Advantage will be directed or misdirected to Orlando’s similarly named website. As Advantage has no control over the services offered by Orlando, Orlando’s offering of services under confusing trademarks is sufficient to demonstrate potential damages resulting from a loss of control over the reputation and goodwill in the Advantage Trademarks and a loss of their distinctiveness. Mr. Rajabi provides representative examples of negative customer reviews published online relating to Orlando’s vehicle rental services offered in association with the Impugned Marks. As further established through the Rajabi Affidavit, Orlando’s partnerships with various online travel agencies and the benefits associated with its domain name have reduced Advantage’s online visibility, leading to a measurable decrease in online traffic and higher input costs. In my view, this is sufficient to establish the third element of the passing off test.
[52] For all these reasons, I am satisfied that Advantage has established the existence of all three elements required to support its claim for passing off under subsection 7(b) of the TMA.
C. Remedies
(1) Injunction and removal of offending materials
[53] In view of the ongoing activities of Orlando, and pursuant to subsection 53.2(1) of the TMA, I agree that a permanent injunction should be issued on the terms proposed. However, I do not agree that it is necessary or appropriate to order a quia timet injunction. A quia timet injunction may be requested where an infringing party is not yet in the marketplace: Boston Pizza International Inc v Boston Market Corp, 2003 FCT 382 at paras 23-25. This is not the case here. While Advantage has adduced evidence that Orlando is actively looking for new affiliates, in my view, the permanent injunction requested is broad enough to cover future Orlando affiliates, which makes a quia timet injunction unnecessary.
[54] Advantage seeks removal of all promotional and advertising materials used to promote Orlando’s services, including all third-party online travel agency postings, listings, advertisements, webpages, metadata, or other third-party online content for vehicles offered, rented, or leased in the GTA that reference the Impugned Marks or any other confusingly similar mark. In my view, these requests are reasonable and appropriate in view of my findings above.
[55] Advantage asserts that it is additionally appropriate for Orlando to withdraw, abandon, or amend all business name registrations consisting or comprising of the Impugned Marks or any confusingly similar term, relying on 1196278 Ontario Inc (Sassafraz) v 815470 Ontario Ltd (Sassafras Coastal Kitchen & Bar), 2022 FC 116 [Sassafras] at para 106.
[56] In Young v Li, 2025 FC 210, Justice Janet Fuhrer similarly ordered the defendant to withdraw or cancel its business name registrations and ordered the delivery-up of materials: paras 80-81.
[57] In my view, an order requiring Orlando to take steps to withdraw, abandon, or amend all relevant business name registrations should likewise follow in this case and is supported by this case law.
[58] Advantage further requests that the Court order Orlando to take all steps necessary to irrevocably withdraw or abandon any trademark applications that comprise the Impugned Marks or any confusingly similar marks that are filed with the Canadian Intellectual Property Office. It refers to two trademark applications in its written materials: Canadian Trademark Application Nos. 2268040 (ADV) and 2268036 (ADVANTAGE), both of which I am advised are currently the subject of opposition proceedings involving Advantage. As I understand the parties are also engaged in opposition proceedings relating to pending trademark applications filed by Advantage. I am advised that Orlando is actively represented in these proceedings and that it has submitted separate evidence in connection with these matters. In my view the issues relating to these applications and the pending oppositions should be dealt with by the Registrar of Trademarks (Trademarks Opposition Board) and as such, I will not include trademark applications as part of this order: Copperhead Brewing Co v John Labatt Ltd, 1995 CanLII 19208 (FC) at 322, 325; see also Wanakome Inc v Martin, 2024 FC 688 at para 49, aff’d 2026 FCA 12.
(2) Damages
[59] Advantage seeks to reverse the Court’s Bifurcation Order, which bifurcated the quantification of damages from the main action such that it would only be determined if liability and entitlement to remedies was found.
[60] Advantage claims that since it has already entered into a settlement agreement with York and Orlando is no longer participating in the action, the rationale for bifurcation no longer applies. It asserts that it is in the interests of justice to set aside the Bifurcation Order and to make an award of damages on the present motion. I agree.
[61] As similarly held in Dunn’s Famous International Holdings Inc v Devine, 2021 FC 64 at paragraph 14, as the initial rationale for bifurcating the issues no longer applies, it makes little sense to maintain the bifurcation of issues in the circumstances.
[62] In this case, Advantage requests an award of $30,000 as compensatory damages. While Advantage acknowledges that they do not have any evidence quantifying damages, as passing off has been established, Advantage asserts that nominal damages should be awarded.
[63] Advantage argues that the range of nominal damages is typically between $10,000 and $30,000: Deco Tre LLC v 9392-2789 Quebec Inc (26 February 2025), Ottawa T-351-22 (FC); Toys “R”
Us (Canada) Ltd v Herbs “R”
Us Wellness Society, 2020 FC 682 at paras 67-68; Trans-High Corporation v Conscious Consumption Inc, 2016 FC 949 at para 40; Sassafraz at paras 110-111; Bean Box Inc v Roasted Bean Box Inc, 2022 FC 499 at para 78; Stock Market Inc v 1736735 Ontario Inc (Hello Pink Lawn Cards Inc), 2017 FC 779 at paras 87-88; Telugu Association of North America, a Corporation of the State of Maryland, USA v Telugu Association of North America, a Canadian Federal Corporation with No 1243934-4, 2024 FC 631 at para 67.
[64] Advantage requests that the top end of this scale be awarded in this case, citing to the list of considerations identified in Techno-Pieux Inc v Techno Piles Inc, 2023 FC 581 at paras 172-175:
[172] In the absence of any evidence of lost sales or other actual damages suffered from the Defendants’ infringement, the Court must rely on “the available evidence, reasonable inferences and a dose of common sense”.
[173] Put differently, the Plaintiff is “entitled to the Court’s best estimate of [its] damages without necessarily being limited to nominal damages”, whatever “nominal” may mean.
[174] The point of departure is that the goodwill associated with registered trademarks will be reduced to some extent whenever those marks have been infringed by sales of goods or services over a sustained period of time.
[175] The more significant the nature, scope, and duration of the infringing activity, the greater the damages that may be inferred. However, account must also be taken of other factors that may be relevant, including the extent of any quality differences between the infringing goods and services and those of the Plaintiff; the extent of likely confusion in the market; and any intent, willful blindness, recklessness or disregard for the Plaintiff’s rights after having received notice of them.
[65] In view of the identical services offered, the instances of actual confusion, the high degree of similarity between the trademarks in issue, and Orlando’s complete disregard for Advantage’s trademark rights, I am satisfied that the damages requested should be ordered.
[66] Advantage contends that punitive damages in an amount of $100,000 are also justified in this case in view of Orlando’s conduct. It asserts that Orlando manufactured, fabricated, and backdated legal documents produced on discovery, attempting to falsely demonstrate use of the Impugned Marks for the purpose of misleading the Court with respect to both the timing and extent of its activities in Canada. Advantage provides an affidavit from the founder and CEO of York, Mr. Fathi-Kazerouni, who attests to an earlier effective date on the affiliate agreement with York that was produced on discovery, and to the falsification of earlier rental agreements so that they included the Impugned Trademarks.
[67] As set out in Whiten v Pilot Insurance Co, 2002 SCC 18 [Whiten], punitive damages are for exceptional cases where “malicious, oppressive and high-handed”
misconduct represents a “marked departure from ordinary standards of decent behaviour”
and offends the court’s sense of decency (at paras 36, 94). Relevant factors include: (a) whether the conduct was planned and deliberate; (b) the intent and motive of the defendant; (c) whether the defendant persisted in the outrageous conduct over a lengthy period of time; (d) whether the defendant concealed or attempted to cover up the misconduct; (e) the defendant’s awareness of the wrongdoing; and (f) whether the defendant profited from the misconduct: Whiten at para 113.
[68] I agree with Advantage that Orlando’s deliberate and wrongful conduct during this proceeding, including its violation of the Court’s January 22, 2026 Order justifies a punitive damages award. While I agree that the award should be substantial enough to get the attention of Orlando (Louis Vuitton Malletier SA v Singga Enterprises (Canada) Inc, 2011 FC 776 at para 169), I am mindful that the award should not be higher than rationally required: Whiten at para 50; Kwan Lam v Chanel S de RL, 2016 FCA 111 at paras 23-26; Chanel S de RL v Lam Chan Kee Company Ltd, 2016 FC 987 at paras 54-66, aff’d Lam v Chanel S de RL, 2017 FCA 38 at paras 12-13. In the context and circumstances of this proceeding, in my view, $50,000 is a more reasonable award than the $100,000 requested and thus, I will limit the amount of the award accordingly.
[69] In the draft order, Advantage requests payment of all damages forthwith. However, this request is not supported by any specific submissions nor authority and therefore this condition shall not be included in the Judgment, although the Judgment shall include post-judgment interest on the terms requested, which I consider to be reasonable and appropriate, and pre-judgment interest as it relates to the payment of compensatory damages.
IV. Costs
[70] Advantage seeks its costs in this action fixed in the lump sum amount of $30,000. It asserts that this amount represents approximately 10% of Advantage’s actual legal expenses, plus disbursements. In support of its request, Advantage provides a detailed draft bill of costs.
[71] In my view, Advantage’s requested costs are reasonable, and I shall therefore provide for $30,000 in costs as part of my Judgment.
Email this Content