Date: 20010809
Docket: T-1065-98
Neutral Citation: 2001 FCT 872
BETWEEN:
CHIC OPTIC INC. and
CONTOUR OPTIK INC.
Plaintiffs
- and -
HAKIM OPTICAL LABORATORY LIMITED
- and-
KARIM HAKIMI
Defendants
REASONS FOR ORDER AND ORDER
BLAIS J.
[1] This is a motion for an order staying the contempt proceeding commenced by the plaintiffs.
[2] On August 12, 1999, Madam Justice McGillis, upon consent of the parties, issued a judgment enjoining Hakim Optical Laboratory Limited from infringing the claims of the ‘714 Patent, and ordering it to destroy all infringing eyewear devices in its possession.
[3] On June 14, 2001, Mr. Justice Pinard issued an order for a show cause hearing that reads:
The plaintiffs' motion for a show cause hearing is granted. The defendant Hakim Optical Laboratory Limited's president, Mr. Karim Hakimi in his personal capacity, is added as a defendant in these proceedings. It is hereby ordered that the defendants appear before the Federal Court of Canada, sitting in Motions Court, in the City of Montreal in the province of Quebec, on Monday, the 30th day of July, 2001, at 9:30 a.m., to hear proof of the following acts, purportedly committed by the defendant Hakim Optical Laboratory Limited on the instructions or orders of the defendant Karim Hakimi, with which they are charged herein and to urge any grounds of defence that they may have in order to avoid being found guilty of contempt of court and be sentenced pursuant to rule 472 of the Federal Court Rules, 1998, SOR/98-106:
a) having knowingly and intentionally imported, transported, used, advertised, offered for sale and sold eyewear devices which infringe the plaintiffs' Canadian Patent No. 2,180,714 (the Patent);
b) having knowingly and intentionally failed to destroy all eyewear devices which infringe the Patent;
c) having knowingly, intentionally and recklessly failed to put into place the necessary procedures to ensure that the terms of the Order rendered by Madam Justice McGillis on August 12, 1999 were respected by its officers, servants, agents and all those over whom it exercises control or authority;
d) having purposely, knowingly and intentionally orchestrated and executed a scheme to disobey the Order of Madam Justice McGillis dated August 12, 1999;
e) having knowingly and intentionally distributed to some or all of its greater Toronto area stores, eyewear devices which infringe the Patent having done so in a clandestine manner in a deliberate attempt at avoiding detection, said infringing eyewear devices being either new orders, and/or being infringing eyewear devices which the defendant failed to destroy following the August 12, 1999 Order of Madam Justice McGillis;
f) having knowingly and intentionally ordered some or all of its greater Toronto area stores to take special measures to display clandestinely and discretely offer for sale eyewear devices which infringe the Patent.
If an interested party is of the opinion that the above hearing is likely to exceed two hours, such a party shall, within twenty (20) days from the date of this Order, make a request pursuant to rule 35 for an appointment of a special time and place for the sitting of a judge of the Trial Division to hear the matter.
Costs in the cause.
[4] The plaintiffs have alleged that the defendants are in contempt by willfully and intentionally infringing Canadian Patent No. 2,180,714 ("the ‘714 Patent") in breach of a consent judgment issued on August 16, 1999.
[5] On June 25, 2001, the defendants filed an appeal of Mr. Justice Pinard's order dated June 14, 2001.
[6] The plaintiff Contour Optik Inc. is seeking to re-issue the ‘714 Patent to change its scope.
[7] The defendants suggest that the question of infringement in the contempt proceeding cannot be determined until the scope of the ‘714 Patent is resolved by the re-issued application.
[8] The defendants suggest that section 50 of the Federal Court Act allows them to be granted a stay of the contempt proceeding.
[9] On the other hand, the plaintiffs suggest that the defendants have brought their motion before the wrong division of this Court.
[10] Rule 398(1) of the Federal Court Rules, 1998, states as follows:
| 398. (1) On the motion of a person against whom an order has been made,
(a) where the order has not been appealed, the division of the Court that made the order may order that it be stayed; or
(b) where a notice of appeal of the order has been issued, a judge of the division of the Court that is to hear the appeal may order that it be stayed.
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398. (1) Sur requête d'une personne contre laquelle une ordonnance a été rendue :
a) dans le cas où l'ordonnance n'a pas été portée en appel, la section de la Cour qui a rendu l'ordonnance peut surseoir à l'ordonnance;
b) dans le cas où un avis d'appel a été délivré, seul un juge de la section de la Cour saisie de l'appel peut surseoir à l'ordonnance.
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[11] The plaintiffs suggest that if the defendants want to appeal the decision of Mr. Justice Pinard, they have to bring a motion for a stay before the Court of Appeal.
[12] Counsel for the defendants suggests that the defendants are not seeking a stay of an order but a stay of a contempt proceeding and that it is in the interest of justice that no person should face the prospect of imprisonment or a finding of contempt until the basis of the contempt allegation is resolved. Therefore, the whole proceeding should be stayed.
[13] With all due respect, I cannot agree with the defendants' suggestion; in fact, the defendants suggest that this Court should simply drag its feet and wait until a decision is made on the re-issuing of the patent before fixing a date for the hearing of the contempt.
[14] In my view, the contempt proceeding is done in many steps: first, the plaintiffs have filed and presented a motion for a show cause order. Secondly, Mr. Justice Pinard has assessed whether the applicants, in their motion and supporting affidavit evidence, have made out a prima facie case of contempt within rule 467. After being convinced that there is a prima facie case, Justice Pinard issued an order to show cause.
[15] The final step of a contempt proceeding is defined in rule 466 when, after a hearing, a judge is convinced that a person has disobeyed a process or order of the Court and is, consequently, guilty of contempt of Court.
[16] In the case at bar, only the last final step has not yet been done which is the hearing, the length of which also has to be decided by this Court today.
[17] Even if I were to take for granted that there is a subtle difference between a stay of proceeding and a stay of an order, in the case at bar, one has to admit that there is no difference at all: the defendants have not asked a stay of the proceeding as a whole but have asked for a stay of the contempt proceeding (my emphasis). The last element to comply with the order of Justice Pinard is the hearing. Therefore, for those reasons, I am convinced that the defendants have brought this motion before the wrong division of this Court and this motion for a stay should be dismissed with costs.
[18] Regarding the order of Justice Lemieux, dated July 11, 2001 and also pursuant to the oral directions from the Court, dated July 26, 2001, after discussions with the parties:
THIS COURT ORDERS THAT the Administrator schedule a hearing of seven days for the hearing of the contempt proceeding at the next date available.
Pierre Blais
Judge
OTTAWA, ONTARIO
August 9, 2001
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