Date: 20000120
Docket: T-915-99
BETWEEN:
TOMMY HILFIGER LICENSING, INC.
TOMMY HILFIGER CANADA INC.
Plaintiffs-respondents
- and -
2970-0085 QUÉBEC INC.
Defendant-applicant
REASONS FOR ORDER AND ORDER
LAFRENIÈRE, P.
[1] This is a motion by the defendant to strike out the statement of claim, and in the alternative to strike out allegations or obtain further particulars under Rule 181 of the Federal Court Rules, 1998.
[2] The action in this case commenced May 21, 1999 through a claim by the plaintiffs for trade mark infringement and "passing-off", which was served on the defendant May 27, 1999.
A. Striking out the statement of claim
[3] The defendant claims that the statement of claim is a proceeding that is characterized as a private dispute between some individuals, a purely contractual dispute addressed to the licensing procedures arranged between the parties. As such, it says, this Court does not have the necessary jurisdiction to hear it.
[4] Indeed, the cases are clear that this Court does not have jurisdiction over claims of a contractual nature between private parties. See Flexi-Coil Ltd. v. Smith Roles Ltd. (1980), 50 C.P.R. (2d) 29, [1981] 1 F.C. 632; R. W. Blacktop Ltd. v. Artec Equipment Co. (1991), 39 C.P.R. (3d) 432, 50 F.T.R. 225 (F.C.T.D.) and Lawther v. 424470 B.C. Ltd. (1995), 60 C.P.R. (3d) 510 (F.C.T.D.).
[5] However, as Associate Chief Justice Jerome, as he then was, said in Titan Linkabit Corp. v. S.E.E. Electronic Engineering Inc. (1992), 44 C.P.R. (3d) 469:
| Intellectual property disputes which include contractual disagreements are not unusual. It will not preclude the court"s jurisdiction, provided the subject -matter of the action primarily concerns a patent, trade mark or copyright. |
[6] In my opinion, the statement of claim does not raise contractual issues other than incidentally to the action, which is addressed primarily to the protection of intellectual property rights. Moreover, the contractual dispute between the parties is clearly relevant to the case. Consequently, I conclude that this Court has jurisdiction to decide these issues.
[7] On July 19, 1999, on the hearing of the motion, I held that it was unnecessary to strike out either the statement of claim or, in the alternative, paragraph 17 as well as a portion of paragraph 22 of the statement of claim, as requested in the notice of motion. The motion was then adjourned to allow the parties to supply further written submissions concerning the defendant"s request for further particulars.
[8] It now remains to determine whether the requested particulars, in relation to paragraphs 10, 11, 12, 14, 16, 17, 18, 20, 21 and 24 of the plaintiffs" statement of claim, are necessary in order to enable the defendant to adequately plead its case.
B. Motion for further particulars
[9] Rule 181(2) provides that a party may obtain particulars in relation to the pleadings of the adverse party:
| 181. (2) On motion, the Court may order a party to serve and file further and better particulars of any allegation in its pleading. |
[10] The Court of Appeal decision in Gulf Canada Limited v. The "Mary Mackin", [1984] 1 C.F. 884 (C.A.) lists the various criteria that ought to be considered on such a motion:
| (1) to inform the other side of the nature of the case they have to meet as distinguished from the mode in which that case is to be proved.... |
| (2) to prevent the other side from being taken by surprise at the trial.... |
| (3) to enable the other side to know what evidence they ought to be prepared with and to prepare for trial.... |
| (4) to limit the generality of the pleadings.... |
| (5) to limit and decide the issues to be tried, and as to which discovery is required.... |
| (6) to tie the hands of the party so that he cannot without leave go into any matters not included.... |
[11] In Glaxo Canada Inc. v. Department of National Health and Welfare of the Government of Canada et al. (1987), 15 C.P.R. (3d) 1 (F.C.T.D.), Rouleau J. made the following comment on the requirement applicable to particulars:
| Proper pleadings define with precision and clarity the question in dispute between the litigants. Both parties are entitled to fair notice of the case which they are bound to meet so that they may procure evidence relevant to the issues disclosed by the pleadings. |
[12] Also relevant, in my opinion, are the following observations by Prothonotary Morneau in Desrochers v. Bombardier Inc., T-390-98, March 19, 1999, which explain the right of a party to obtain particulars at the pleadings stage:
| However, any request for particulars also appears to be the subject of certain restrictions. In short, before making an order on such a matter the Court must consider whether a party has sufficient information to understand the opposing party"s argument and prepare a sufficient response, whether a defence or a reply. (See Astra Aktiebolag v. Inflazyme Pharmaceuticals Inc. (1995), 61 C.P.R. (3d) 178 (F.C.T.D.), at 184.) |
C. Defendant"s submissions
[13] Generally speaking, the defendant states in its written submissions that certain paragraphs in the plaintiffs" statement of claim contain vague and ambiguous allegations. It also demands particulars concerning the documents cited by the plaintiffs, as they likely contain information the defendant will need in order to prepare an intelligent and valid defence.
[14] The defendant argues that it is unnecessary to support its motion for particulars by an affidavit proving that the particulars are necessary in order to prepare its defence and that the particulars requested are unknown to it since the lack of particulars in the plaintiffs" statement of claim is apparent on its face.
[15] Notwithstanding, the defendant"s motion is accompanied by the affidavit of one of its solicitors. He begins by identifying the allegations that he characterizes as vague and ambiguous as well as the particulars that are sought, and then goes on to state:
| 31. For the purpose of preparing its defence, the defendant is advised and entitled to request that the plaintiffs provide the particulars regarding the said paragraphs of their statement of claim; |
| 32. The defendant demands the particulars in order to know the exact nature of the acts alleged against it and in order to limit the issues in dispute in this matter, in particular concerning the time of the alleged acts and the nature of the clothing that is the subject of the statement of claim; |
[16] In paragraph 10 of their statement of claim, the plaintiffs allege:
| 10. THLI has licensed TH Canada to use each of the THLI Registered Trade-marks in Canada in association with articles of clothing and accessories under the strict control of THLI as to the character and quality of such use. |
The defendant is seeking to obtain particulars as to the terms of the requested licencing agreement because, it says, the terms used in this agreement are essential to the meaning of Rule 177 of the Federal Court Rules. Furthermore, the validity of the use of the THLI trade marks by TH Canada depends on the validity of the licencing agreement between the two parties.
[17] In paragraph 17 of their statement of claim, the plaintiffs allege:
| 17. The Defendant has purchased from TH Canada the articles of clothing referred to in paragraph 16 herein under agreements of purchase and sale which include the following conditions: |
| 1. no rights in pattern or design of goods covered by this contract pass to BUYER [the Defendant] accept [sic] as an integral part of the goods, and BUYER agrees not to cause or permit, either directly or indirectly, any such pattern or design to be copied or reproduced; |
| 2. no right to the use of any trademark, trade name, or logo licensed to SELLER [TH Canada] passes to BUYER under this contract, and BUYER agrees to refrain from using, either directly or indirectly, and shall not permit, in any advertising or otherwise, the use of such trademark, trade names or logos, unless authorized in writing by SELLER. |
[18] Since the plaintiffs cite a "breach of contract" by the defendant, the defendant says it is entitled to some requested particulars concerning the "agreements of purchase and sale" in order to produce its defence.
[19] The defendant also requests a copy of these "agreements of purchase and sale" in order to know the general terms of sale contained in these invoices since it is possible, under article 1437 of the Civil Code of Québec , to invalidate a contract of adhesion, it says.
[20] In paragraph 11 of their statement of claim, the plaintiffs allege:
| 11. THLI has extensively used, advertised and promoted in Canada the Hilfiger Flag Trade-marks in association with articles of clothing, cosmetics and accessories. By reason of such use, advertisement and promotion, and since prior to the commencement of the acts of the Defendant described herein, the Plaintiffs have developed a good and valuable reputation and goodwill in Canada in and to the Hilfiger Flag Trade-marks have become famous in Canada. |
[21] The defendant seeks to know the following particulars:
| (a) how long they have been using the said trade marks in Canada; and |
| (b) when the defendant"s actions allegedly began; |
| (c) what type of clothing, cosmetics and accessories are specifically involved; |
| (d) whether the reputation is linked to the joint use of the flag and the trade marks. |
[22] The defendant states that a generally accepted trade-mark principle holds that the rights to a trade mark are acquired through the use of the mark. Thus a party cannot claim to hold rights prior to the date of use of the trade mark.
[23] The date when the trade marks began to be used is also important for the purpose of determining whether third parties wee using the marks before that date, thus diluting the trade marks.
[24] In paragraph 12 [sic] of their statement of claim, the plaintiffs allege:
| 14. THLI has prominently displayed the THLI Registered Trade-marks on articles of clothing by incorporating the trade-marks into the design of the articles of clothing. With respect to shirts it is common for THLI to prominently display the THLI Registered Trade-marks on the breast portion of the shirts. |
[25] The defendant wants to know how the said trade marks are incorporated into clothing other than sweaters. This particular is important, it says, since the rights to trade marks are acquired through use. Thus the use of the plaintiffs" marks must be comparable with the acts alleged against the defendant.
[26] In paragraph 16 of their statement of claim, the plaintiffs allege:
| 16. The Defendant, carrying on business under the trade-name XTREME, has purchased from TH Canada articles of clothing marked with one or more of the THLI registered trade-marks and has offered for sale and sold such articles of clothing in its retail clothing stores. Said stores include the retail clothing store located at Place Henri-Bourassa, 6000 Henri-Bourassa East, Montreal, Quebec operated in association with the trade-mark or trade-name XTREME. |
[27] The defendant wants to know the following particulars:
| 1. what type of clothing was purchased by the defendant; and |
| 2. exactly what trade mark of the plaintiffs appears on the said clothing; |
| 3. whether the defendant"s stores other than the one in Place Henri-Bourassa are covered by the present statement of claim. |
[28] The defendant claims it is entitled to know the type of clothing and the exact trade marks appearing on this clothing, given that the plaintiffs hold a number of registrations for the various trade marks alleged.
[29] In paragraph 18 of their statement of claim, the plaintiffs allege:
| The Defendant has also manufactured, or caused to be manufactured articles of clothing marked with one or more of the trade-marks TOMMY SPORT, TOMMY DESIGN and TOMMY bearing labels marked with the trade-mark XTREME ("Xtreme Clothing") including articles of clothing consisting of blocks of red, white and blue colour suggestive of the Hilfiger Flag Trade-marks. Samples of Xtreme Clothing are depicted in Schedules I, J, K, L, M and N attached hereto. |
without specifying:
[Translation]
| 1. when the said articles of clothing were allegedly manufactured; |
| 2. where the said articles of clothing were allegedly sold; |
| 3. whether the trade marks TOMMY SPORT, TOMMY DESIGN and TOMMY are registered trade marks of the plaintiffs and, if so, the registration numbers; |
| 4. whether the trade mark XTREME is a trade mark of the plaintiffs; |
| 5. whether the plaintiffs are pleading that the combined colours red, white and blue are exclusive to the plaintiffs; |
| 6. what articles of clothing other than those described in Schedules I, J, K, L, M and N, manufactured by the defendant, allegedly contravene the plaintiffs" rights; |
[30] The defendant needs the requested particulars concerning the time when the clothing was manufactured and the place where it was sold in order to produce a defence against confusion. Under section 6 of the Trade-marks Act, confusion is analyzed, inter alia, in terms of the parties" distribution system.
[31] In regard to the TOMMY trade mark, the defendant wishes to obtain further particulars because there is a grey area in regard to the topic given the widespread concurrent use of this word.
[32] In regard to the combination and sequence of colours cited by the plaintiffs, the defendant wants to circumscribe the argument as to the monopoly the plaintiffs claim to have, since the plaintiffs state that certain of the defendant"s clothing models carried blue, white and red colours suggestive of the plaintiffs" trade marks, although these colours are part of the public domain.
[33] In paragraph 20 of their statement of claim, the plaintiffs allege:
| 20. The Defendant has offered for sale and sold Xtreme Clothing marked with one or more of the trade-marks TOMMY SPORT" TOMMY DESIGN and TOMMY including at its retail stores at which it also offers for sale and sells the articles of clothing referred to in paragraph 16 herein." |
without specifying:
| 1. what stores are involved |
| 2. exactly what articles of clothing; |
[34] These particulars are required by the defendant for the purpose of defining the parties" distribution network in order to determine whether the trade marks cause confusion within the meaning of section 6 of the Trade-marks Act .
[35] In paragraph 21 of their statement of claim, the plaintiffs allege:
| 21. The Defendant has advertised and promoted Xtreme Clothing in association with the trade-marks TOMMY SPORT, TOMMY DESIGN and TOMMY. Such advertisements have appeared in the Defendant"s retail stores that also prominently display instore signage marked with THLI"s trade-marks TOMMY JEANS, Hilfiger Flag Logo and Hilfiger Flag Logo (as lined for color). The Defendant has placed such instore signage in such a way that the trade-marks TOMMY JEANS, Hilfiger Flag Logo and Hilfiger Flag Logo (as lined for color) are associated with Xtreme Clothing at the time the Defendant transferred property and possessions of such clothing to its customers." |
without specifying:
| 1. what advertising, other than the signage described in paragraph 21, was allegedly done by the defendant; |
| 2. when such advertising was allegedly done; and |
| 3. which of the defendant"s stores are involved; |
[36] In paragraph 24 of their statement of claim, the plaintiffs allege:
| 24. The Defendant is willfully and deliberately infringing the rights of the Plaintiffs and has demonstrated a cynical and reckless disregard for the exclusive rights of the Plaintiff THLI in and to the Registered Trade-marks in that: |
| 1. the Defendant intentionally and deliberately adopted the trade-marks TOMMY SPORT, TOMMY DESIGN, TOMMY, TOMMY JEANS, Hilfiger Flag Logo and Hilfiger Flag Logo (as lined for color) for use in association with articles of clothing having full knowledge of the reputation and goodwill associated with the THLI Registered Trade-marks; |
| 5. the adoption of the trade-mark TOMMY SPORT, TOMMY DESIGN, TOMMY TOMMY JEANS, Hilfiger Flag Logo and Hilfiger Flag Logo (as lined for color) for use in association with Xtreme Clothing forms parts of a strategy of the Defendant to appropriate the trade-marks of THLI and make an extraordinary and unlawful profit. |
without specifying:
| (c) which articles of clothing are referred to in paragraph 24(a); |
| (d) what other parts of a strategy are referred to in paragraph 24(e); |
[37] The defendant demands particulars in order to know the exact nature of the acts alleged against it and in order to limit the issues in dispute in this matter, particularly in regard to the time of the alleged acts and the nature of the clothing that is the subject matter of the statement of claim.
[38] In paragraph 25 of their statement of claim, the plaintiffs allege:
| 15. By reason of the acts of the Defendant described herein, the Plaintiffs have suffered loss and damage and the Defendant has made a profit. |
without specifying:
| (a) what is the amount of the damages suffered by the plaintiffs; |
| (b) without opting for either of the remedies; |
The defendant is seeking particulars as to the breakdown of the damages suffered by the plaintiffs as well as requiring that the plaintiffs determine whether they are seeking damages or profits from the defendant.
D. Plaintiffs" submissions
[39] Counsel for the plaintiffs states that following the hearing of the motion, he forwarded to the defendant four copies of representative agreements as referred to in paragraph 17 of the statement of claim.
[40] The plaintiffs state that some of the particulars sought by the defendant in its written submissions, for example in paragraphs 10 and 17 of the statement of claim, go beyond those requested in the notice of motion. Moreover, a number of facts for which particulars are sought are either known by the defendant or are unnecessary at this stage of the proceeding.
[41] The plaintiffs submit that Unitel Communications Co. v. MCI Communications Corp. (1996), 72 C.P.R. (3d) 247 (F.C.T.D.) explains that a motion for particulars may be granted absent production of an affidavit when the lack of particulars complained of by a party is apparent on its face. In any other case, the plaintiffs argue, a motion should be dismissed in the absence of an affidavit showing that the defendant has a genuine need for particulars in order to prepare its defence.
[42] In short, the plaintiffs say the statement of claim contains a concise statement of the substantive facts on which they rely and that the defendant has sufficient information to understand its argument and to prepare an adequate reply.
E. Analysis
[43] I might have been inclined to allow the defendant some of the particulars it is seeking. However, the affidavit submitted in support of this motion adopts a style and wording that are much too vague and limited. This affidavit does not contain the specific factual explanations to show a genuine need on the part of the defendant, as opposed to its solicitors, for particulars in order to be able to reply intelligently to the statement of claim. The defendant had to establish, as Muldoon J. put it in Cooper Canada Ltd. v. Amer Sport International Inc. (1996), 9 C.P.R. (3d) 549, that:
| (a) the information sought must be necessary, or material, particulars; |
| (b) the particulars are not within the defendant"s knowledge, or the pleader has no cause to assume that they are within the knowledge of the party demanding them; and |
| (c) they are necessary, not just for preparation for trial, but to enable the defendant or other party to plead in response to the impugned pleadings. |
[44] Furthermore, I adopt the additional written representations filed by the plaintiffs in opposition to the motion before me. The statement of claim, as a whole, sufficiently sets out the plaintiffs" argument. It is therefore unnecessary to order further particulars at this stage in order to allow the defendant to reply intelligently to the statement of claim.
ORDER
[45] The motion is dismissed.
[46] The defendant shall have fifteen (15) days from the date of this order in which to serve and file its defence.
[47] The costs shall be awarded between the parties on the basis of written arguments submitted within five days following the date of these reasons.
Toronto, Ontario
January 20, 2000
Certified true translation
Martine Brunet, LL.B.
| TOMMY HILFIGER LICENSING, INC. |
| TOMMY HILFIGER CANADA INC. |
| REASONS FOR ORDER AND ORDER |
FEDERAL COURT OF CANADA
TRIAL DIVISION
NAMES OF COUNSEL AND SOLICITORS OF RECORD
| STYLE: TOMMY HILFIGER LICENSING, INC. |
TOMMY HILFIGER CANADA INC.
- and -
2970-0085 QUÉBEC INC.
| PLACE OF HEARING: MONTRÉAL, QUEBEC |
| DATE OF HEARING: MONDAY, JULY 19, 1999 |
REASONS FOR ORDER AND ORDER OF PROTHONOTARY LAFRENIÈRE
DATED: THURSDAY, JANUARY 20, 2000
APPEARANCES AND
WRITTEN SUBMISSIONS: Glen A. Bloom
For the plaintiffs-respondents
Bruno Barette
For the defendant-applicant
SOLICITORS OF RECORD:
| 50 O"Connor Street, Suite 1500 |
| For the plaintiffs-respondents |
| Brouillette Charpentier Fortin |
| 1100, boul. René-Lévesque Ouest |
| For the defendant-applicant |
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