Intel Corp. v. 3395383 Canada Inc., 2003 FC 898

Date: 20030718

Docket: T-1993-01

Citation: 2003 FC 898

Montreal, Quebec, July 18, 2003

Present:           RICHARD MORNEAU, ESQ., PROTHONOTARY

BETWEEN:

                                                             INTEL CORPORATION

                                                                                                     Plaintiff (Defendant by Counterclaim)

                                                                                 and

                                                          3395383 CANADA INC. and

                                                            9047-9320 QUEBEC INC.

                                                                                                 Defendants (Plaintiffs by Counterclaim)

                                               REASONS FOR ORDER AND ORDER

[1]                 The Court is faced herein with two motions, one from the Plaintiff and the other from the Defendant 3395383 Canada Inc. (the Defendant), directed to outstanding questions from the examination for discovery of representatives of the parties.

Background

[2]                 The Plaintiff instituted its action against the Defendant claiming inter alia that the Defendant, through its use of PENTIUM CONSTRUCTION and registration and use of the domain name pentiumconstruction.com and Pentium.ca, infringed trade-marks TMA428,593 and TMA534,128 belonging to the Plaintiff, and therefore depreciated the value of its goodwill associated with those trade-marks.

[3]                 Defendant denies any infringement whatsoever of the Plaintiff's marks and further seeks through its Counterclaim to have the Plaintiff's registration No. TMA534,128 expunged on the basis of abandonment or lack of bona fide use in Canada in the normal course of trade.

The Law on Discovery

[4]                 It has been held that, despite statements of principle concerning the broad right of examination, there are limitations on the right of discovery. The Court will not allow discovery to be used as a fishing expedition, nor will the Court require a party to answer any question not within its means or knowledge. Crestbrook Forest Industries Ltd. v. Canada, [1993] 3 F.C. 251 (C.A.).

[5]                 Furthermore, it has been held that while the general tendency of courts is to grant broad discovery, this must be balanced against the tendency of the parties to engage in fishing expeditions. It is improper to ask questions in an effort to find out something of which the party presently knows nothing, only in the hope that he might find something upon which to build a case. Burnaby Machine & Mill Equipment Ltd. v. Berglund Industrial Supply Co. (1984), 81 C.P.R. (2d) 251, at 254 (F.C.T.D.).

Analysis

I            Plaintiff's Motion

[6]                 I shall deal with this motion first.

[7]                 In said motion, the parties relied on a list of questions grouped into three categories, namely:

(a)        Identification of Defendants' Suppliers and Purchasers;

(b)        Electronic Communications;

(c)        Knowledge of Use in Canada.

[8]                 In category (a), the Plaintiff seeks responses to two questions concerning matters which relate to the other party to this action, 9047-9320 Quebec Inc. In particular, in Question 242, the Plaintiff wishes to determine whether the Defendant can make inquiries of Mr. Kotler, a third-party related to the other Defendant in the proceedings, to see if he can provide documents pertaining to suppliers of materials of the model home built by Quebec Inc. Secondly, in Question 245 the Plaintiff wishes the Defendant to identify all of the subcontractors that were utilized in respect of the model home built by Quebec Inc.

[9]                 I am of the view that, by virtue of Rule 241 of the Federal Court Rules, 1998, the Defendant is under no obligation to make inquiries of Mr. Kotler since he is not a present or former officer, servant, agent or employee of the party who might be expected to have knowledge relating to any matter in question in the action. In addition, the Defendant's representative states in an affidavit that he has no right of access to the records of 9047-9320 Quebec Inc.

[10]            Therefore, Questions 242 and 245 need not be answered.

[11]            As for the other questions in this category as well as for the questions in category b), I find that they were put to elicit responses concerning the identification of suppliers, subcontractors and customers of the Defendant and of Quebec Inc., the other Defendant in this action, in order to help the Plaintiff to ascertain whether their exposure to the Defendant's trade-names has actually caused confusion or adversely affected the Plaintiff's reputation.

[12]            However, it appears that the Plaintiff is not aware of any actual cases of confusion since in answer to a question put by the Defendant at discovery, the Plaintiff answered that it was aware of actual confusion only through responses to a survey. Actual confusion occurs when an individual, in the course of its dealings or transactions, is mistaken as to the origin of certain wares or services. The survey would not accordingly reflect actual confusion as it merely reflects responses to questions posed by the Plaintiff to individuals who were not engaged in the such dealings or transactions.

[13]            Therefore, on the basis of the Burnaby Machine case, supra, I am of the view that the Plaintiff would be engaging in a fishing expedition were it be allowed to ask the remaining question in categories a) and b).

[14]            Additionally, I agree that if the Defendant were to furnish the requested information and the Plaintiff were to contact the Defendant's customers, suppliers and subcontractors in order to ascertain whether or not their exposure to the Defendant's trade-names has actually caused confusion or adversely affected the Plaintiff's reputation, such an intrusion into the affairs of the Defendant might lead to strain, and even disruption, of the Defendant's business relations.

[15]            The cases of Remo Imports Limited v. Jaguar Canada Inc. (2000), 6 C.P.R. (4th) 62 at 70-71 (F.C.T.D.) and Canadian Olympic Assn./Association Olympique Canadienne v. Olympic Life Publishing Ltd. (unreported, March 4, 1987, T-1126-84, F.C.T.D.) cited by the Plaintiff are distinguishable since they appear to turn on facts which are different from the factual situation at hand.

[16]            Consequently, the remaining questions in category a) and the questions in category b) need not be answered.

[17]            In category c), the sole question requests the Defendant to undertake to advise whether or not it discovers any constraint to the sale in Canada of non-microprocessor goods in association with PENTIUM trade-mark by the Plaintiff. Since the Defendant maintains the position that it has no knowledge of such sales and is seeking expungement of the Plaintiff's trade-mark registration, I agree with the Plaintiff that it is entitled to know whether or not the Defendant obtains any knowledge regarding this allegation and Counterclaim during the course of the proceedings. Accordingly, the requested undertaking is a proper question and should be answered should any attempt to purchase take place. I do not believe that this undertaking calls for the disclosure of information which is privileged. Any attempt to purchase is a fact and should be disclosed.

[18]            As for re-attendance of the Defendant's representative, unless the parties agree otherwise, I do not see the need to order such re-attendance to take place.

[19]            As for costs on this motion, they shall be in the cause.

[20]            I shall now turn to the Defendant's motion.

II          Defendant's Motion

[21]            The Defendant appears to have organized outstanding questions into seven groups which for ease of reference the Court will refer to as follows:

(a)        "reliance" type questions;

(b)        details of actual confusion;

(c)         damages/profits and depreciation of goodwill;

(d)         loss of distinctiveness and depreciation of goodwill survey;

(e)        meaning of "pente";

(f)          copies of licences; and

(g)         ways that use leads to inference that the Defendant's services are provided, offered, advertised or approved by the Plaintiff.

[22]            During the hearing of the motion, counsel for the Defendant withdrew certain questions. Therefore, the withdrawn questions shall not be referred to herein and shall not be adjudicated

(a)        "reliance" type questions

[23]            It is never permissible to ask a witness on discovery how their counsel intend to establish allegations at trial. In Kun Shoulder Rest Inc. v. Joseph Kun Violin and Bow Maker Inc. (1997), 76 C.P.R. (3d) 488, at 495 (F.C.T.D.), Prothonotary Hargrave explained as follows:

It is proper to ask a discovery witness to speak of all facts, surrounding a certain incident, of which the witness either knows or must properly inform himself or herself about. It is never permissible to ask a discovery witness as to the facts relied upon in support of a certain allegation, for this requires the witness to choose facts and disclose how his lawyer might prove a given allegation. While a witness may know the general approach that his or her lawyer intends to take, a witness cannot know what facts will assist until he or she knows the law. The particular facts that will be relied upon are based upon counsel's view of the law. An examination for discovery of a witness seeks to discover fact, not argument as to what is relevant in order to prove a given plea.

[24]            Questions 1 and 4 in this category ask what facts pleaded in the Statement of Claim the Plaintiff intends to establish through all production documents. This is akin to asking how the Plaintiff intends to rely on these documents. As explained in Kun Shoulder, these are not the sorts of questions that the Plaintiff's representative should be required to answer. Indeed, if this sort of question was required to be answered then it would be asked in every case and counsel would be required to create and reveal their trial strategy to opposing counsel at the discovery phase. Such a question is unreasonable, unduly onerous and encroaches too far into a lawyer's brief, which is privileged.

[25]            Consequently, Questions 1 and 4 need not be answered.

(b)         details of actual confusion

[26]            Questions 30 and 57 have been answered and need not be answered further.

(c)         damages/profits and depreciation of goodwill

[27]            In Montana Band v. Canada, 2001 FCT 297 at paragraph 4 (F.C.T.D.), Mr. Justice Hugessen wrote:

That brings me to the motion I have today with respect to discoveries. It is in my view fundamental that when an order for severance is made the severed issues which are not then going to be tried in the first trial are irrelevant for the purposes of that first trial. To put it in a very familiar context where liability and damages are severed questions relating to damages are not relevant to the trial on the issue of liability.

[28]            Accordingly, where, as in this case, issues regarding the extent of infringement and damages/profits have been separated from issues regarding liability, questions relating to the extent of damages and/or profits should not be ordered to be answered at the liability stage. To do so would undermine the very purpose of Rule 107.

[29]            I am of the view that Questions 32 to 34, 64 and 66 are all directed to the general allegation that "the Plaintiff has suffered damage". In view of the bifurcation order in place, said questions need not be answered.

(d)         loss of distinctiveness and depreciation of goodwill survey

[30]            Question 37 has been answered and no further clarification is required.

(e)        meaning of "pente"

[31]            Question 40 asks the Plaintiff to provide its opinion on whether the word "pentium" finds its origin in the Greek word "pente" which means "five". Whether the Greek word "pente" means "five" is a matter for an expert in language or etymology. As the Plaintiff's representative was not examined as an expert, his opinion is immaterial and, therefore, irrelevant.

[32]            Question 41 has been clearly and completely answered in the negative.

[33]            As for Question 42, the Plaintiff has agreed to answer it in its reformulated form. It shall do so within ten (10) days of the date of this Order.

(f)         copies of licences

[34]            With respect to Question 52, the Court notes that the Plaintiff has agreed to provide the Defendant with copies of licence agreements with Compaq, if they are available.

(g)         ways that use leads to inference that the Defendant's services are provided, offered, advertised or approved by the Plaintiff

[35]            Impugned Question 60 in this category has been withdrawn.

[36]            As for costs on this motion, they are granted to the Plaintiff under Column III of Tariff B.

Richard Morneau

                 Prothonotary

                  FEDERAL COURT

Date : 20030718

Docket : T-1993-01

BETWEEN:

INTEL CORPORATION

                                    Plaintiff

                 (Defendant by Counterclaim)

and

3395383 CANADA INC. and

9047-9320 QUEBEC INC.

                                   Defendants

                (Plaintiffs by Counterclaim)

         REASONS FOR ORDER AND ORDER

                                  FEDERAL COURT

                    COUNSEL AND SOLICITORS OF RECORD

DOCKET:

STYLE OF CAUSE:

T-1993-01

INTEL CORPORATION

                                   Plaintiff

                (Defendant by Counterclaim)

and

3395383 CANADA INC. and

9047-9320 QUEBEC INC.

                                  Defendants

             (Plaintiffs by Counterclaim)

PLACE OF HEARING:Montreal, Quebec

DATE OF HEARING:July 14, 2003

REASONS FOR ORDER OF RICHARD MORNEAU, ESQ., PROTHONOTARY

DATED:July 18, 2003

APPEARANCES:

SOLICITORS OF RECORD: