Date: 20021007
Docket: T-802-02
Neutral citation: 2002 FCT 1045
BETWEEN:
HANSON INTERNATIONAL INC.
and
HANSON MARKETING INC.
Plaintiffs
and
WHIRLEY INDUSTRIES INC.
and
GREG AUCOIN d.b.a. GT SALES
Defendants
REASONS FOR ORDER
RICHARD MORNEAU, ESQ., PROTHONOTARY:
[1] This is a motion by the Defendants under Rules 208 and 221(1)(a), (b), (c) and (f) of the Federal Court Rules, 1998 (the Rules) in opposition to the Amended Statement of Claim filed by the Plaintiffs. At the hearing of the motion, I understood counsel for the Defendants to rely mainly on Rule 221.
[2] In the alternative to the striking out of the Plaintiffs' claim, the Defendants request that the Plaintiffs provide particulars of their claim and that the Defendants be granted an extension of time to serve and file their Statement of Defence.
Background
[3] The Plaintiffs served and filed an Amended Statement of Claim on Defendants Whirley Industries Inc. (hereinafter "Whirley") and Greg Aucoin, d.b.a. GT Sales (hereinafter "Mr. Aucoin"), alleging industrial design infringement and the procurement and inducement of industrial design infringement of Plaintiffs' Canadian Industrial Design No. 92298.
The Law on Striking Out
[4] As stated by Mr. Justice Décary in Sweet et al. v. Canada (1999), 249 N.R. 17, at pages 23-24:
Statements of claim are struck out as disclosing no reasonable cause of action only in plain and obvious cases and where the court is satisfied that the case is beyond doubt (see [1980] 2 S.C.R. 735">Inuit Tapirisat of Canada and National Anti-Poverty Organization v. Canada (Attorney General), [1980] 2 S.C.R. 735; 33 N.R. 304; 115 D.L.R. (3d) 1, at 740 [S.C.R.]; Operation Dismantle Inc. et al. v. Canada et al., [1985] 1 S.C.R. 441; 59 N.R. 1; 13 C.R.R. 287; 18 D.L.R. (4th) 481; 12 Admin. L.R. 16 and Hunt v. T & N plc et al., [1990] 1 S.C.R. 959; 117 N.R. 321; 4 C.C.L.T.(2d) 1; 43 C.P.C.(2d) 105; 49 B.C.L.R.(2d) 273; 74 D.L.R.(4th) 321). The burden is as stringent when the ground argued is that of abuse of process or that of pleadings being scandalous, frivolous or vexatious (see Creaghan Estate v. Canada, [1972] F.C. 732 (T.D.), at 736 (T.D.), Pratte, J.; Waterside Ocean Navigation Co. v. International Navigation Ltd. et al., [1977] 2 F.C. 257 (T.D.), at 259 (T.D.), Thurlow, A.C.J.; Micromar International Inc. v. Micro Furnace Ltd. (1988), 23 C.P.R.(3d) 214 (F.C.T.D.), Pinard, J., and Connaught Laboratories Ltd. v. Smithkline Beecham Pharma Inc. (1988), 158 F.T.R. 194; 86 C.P.R.(3d) 36 (T.D.) Gibson, J.). The words of Pratte, J. (as he then was), spoken in 1972, in Creaghan Estate, supra, are still very much appropriate:
"... a presiding judge should not make such an order unless it be obvious that the plaintiff's action is so clearly futile that it has not the slightest chance of succeeding ..."
[5] The Defendants seek to strike out the Amended Statement of Claim principally on the basis that it alleges no reasonable cause of action. In support of this argument, the Defendants have filed evidence in the form of two affidavits from Mr. Aucoin and Robert Sokolski, a representative of Whirley, in an attempt to demonstrate that sales of the Whirley DC32 bottle took place outside the jurisdiction of this Court.
[6] In his affidavit or further in cross-examination on said affidavit, the Defendant Aucoin admitted that he has contacted customers such as Petro-Canada to see if they were interested in "acquiring" the products of Whirley. He has also admitted that he "facilitated" in Canada the sale of the Whirley DC32 bottle, that he assisted Petro-Canada in filling out a purchase order listing form for the purchase of the Whirley DC32 bottle.
[7] Mr. Aucoin has shown catalogues depicting the Whirley DC32 bottle in Canada.
[8] In the course of its dealings with Whirley regarding the Whirley DC32 bottle, Petro-Canada communicated with Whirley through Mr. Aucoin.
[9] As to the Defendant Whirley, it has caused samples of the Whirley DC32 bottle to be shown to prospective Canadian customers in Canada.
[10] Whirley has represented to the public that Mr. Aucoin is Whirley's sales representative in Canada.
[11] Whirley features the Whirley DC32 bottle on a website, www.whirley.com, which is accessible by Canadians and contains content expressly directed to Canadians. Mr. Aucoin has admitted that he has seen this website.
[12] Whirley has given credit to Canadian recipients for Whirley DC32 bottles damaged in shipment, despite Mr. Sokolski's claim that all sales of the bottles were FOB Pennsylvania.
[13] It would appear that both Whirley and Mr. Aucoin offered or exposed the Whirley DC32 bottle for sale in Canada, either through the provision of physical samples, sales catalogues, or website advertising.
[14] Surely, the evidence regarding the transactions in question in this motion is contradictory. It is not by any means plain and obvious at this early stage in the proceedings that the Defendants have not offered or exposed for sale in Canada within the meaning of Section 11 of the Industrial Design Act, R.S.C. 1985, c. I-9, as amended. Section 11(1) reads as follows:
| 11.(1) During the existence of an exclusive right, no person shall, without the licence of the proprietor of the design,
(a) make, import for the purpose of trade or business, or sell, rent, or offer or expose for sale or rent, any article in respect of which the design is registered and to which the design or a design not differing substantially therefrom has been applied; or
(b) do, in relation to a kit, anything specified in paragraph (a) that would constitute an infringement if done in relation to an article assembled from the kit.
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11.(1) Pendant l'existence du droit exclusif, il est interdit, sans l'autorisation du propriétaire du dessin:
a) de fabriquer, d'importer à des fins commerciales, ou de vendre, de louer ou d'offrir ou d'exposer en vue de la vente ou la location un objet pour lequel un dessin a été enregistré et auquel est appliqué le dessin ou un dessin ne différant pas de façon importante de celui-ci;
b) d'effectuer l'une quelconque des opérations visées à l'alinéa a) dans la mesure où elle constituerait une violation si elle portait sur l'objet résultant de l'assemblage d'un prêt-à-monter.
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[15] As well, it is not clear and obvious that title to the Whirley DC32 bottles was transferred outside Canada. From a reading of Exhibit 1 to the Affidavit of Mr. Sokolski, one cannot exclude the possibility that Whirley accepts responsibility for goods damaged in shipment. This could tend to establish that responsibility and title to the goods are transferred, not in Pennsylvania but in Canada.
[16] As for the action of inducing and procuring infringement, the Amended Statement of Claim alleges that the Defendants have induced and procured the offer for sale and sale in Canada of the Whirley DC32 bottle by Petro-Canada through its sale of the bottle to Petro-Canada, as Petro-Canada has sold the infringing bottle in Canada.
[17] In order "to induce or procure another person to infringe an intellectual property right", one must do something that leads that other person to infringe the intellectual property right, or must:
(a) knowingly;
(b) induce or procure (for example, by offering for sale, and knowing that their use by the purchaser would be an infringement);
(c) another to infringe the intellectual property right.
(See Valmet Oy v. Beloit Canada Ltd. (1988), 20 C.P.R. (3d) 1 (F.C.A.) and Slater Steel Industries Ltd. v. R. Payer Co. Ltd. (1968), 55 C.P.R. 61 at 83 (Ex. Ct.).)
[18] On the contradictory evidence submitted so far, I cannot conclude that the Plaintiffs' Amended Statement of Claim is clearly lacking with regard to that offence.
[19] Finally, the fact that paragraph 11 of the Plaintiffs' Amended Statement of Claim alleges that the Defendants have acted in concert does not seem contradictory to Section 11 of the Industrial Design Act although the said Act uses the expression "no person shall". By such wording, the Act does not preclude the possibility that more than one person could be involved in an infringing matter. A joint tortfeasor offence could be in play (see Domco Industries Ltd. v. Mannington Mills, Inc. et al. (1988), 23 C.P.R. (3d) 96, at 102).
[20] For the above reasons, I cannot conclude that the Plaintiffs' Amended Statement of Claim must fall under Rule 208 or any or all of the paragraphs of Rule 221 relied upon by the Defendants in the motion at bar.
[21] However, as acknowledged by counsel for the Plaintiffs, paragraphs 11 to 14 of their Amended Statement of Claim need to be further and better particularized. Particularly, the Plaintiffs must allege and support by material facts the exposure for sale scenario if they intend to rely on it. All particulars shall be incorporated by the Plaintiffs in a Re-Amended Statement of Claim that the Plaintiffs shall serve and file within ten (10) days of the date of the accompanying order.
[22] The time under the Rules for the Defendants to serve and file their Statement of Defence shall start to run from the date of service of the Plaintiffs' Re-Amended Statement of Claim.
[23] As success is divided on the instant motion, no costs are awarded.
Richard Morneau
Prothonotary
Montreal, Quebec
October 7, 2002
FEDERAL COURT OF CANADA
TRIAL DIVISION
Date : 20021007
Docket : T-802-02
Between :
HANSON INTERNATIONAL INC.
and
HANSON MARKETING INC.
Plaintiffs
and
WHIRLEY INDUSTRIES INC.
and
GREG AUCOIN d.b.a.GT SALES
Defendants
REASONS FOR ORDER
FEDERAL COURT OF CANADA
COUNSEL AND SOLICITORS OF RECORD
DOCKET:
STYLE OF CAUSE:
T-802-02
HANSON INTERNATIONAL INC.
and
HANSON MARKETING INC.
Plaintiffs
and
WHIRLEY INDUSTRIES INC.
and
GREG AUCOIN d.b.a.GT SALES
Defendants
PLACE OF HEARING:Montreal, Quebec
DATE OF HEARING:September 16, 2002
REASONS FOR ORDER: RICHARD MORNEAU, ESQ., PROTHONOTARY
DATE OF REASONS FOR ORDER:October 7, 2002
APPEARANCES:
| Mr. Henry Lue
Ms. Jenna l. Wilson
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for the Plaintiffs
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| Ms. Hélène D'Iorio
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for the Defendants
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| Dimock Stratton Clarizio
Toronto, Ontario
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for the Plaintiffs
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| Gowling Lafleur Henderson
Montreal, Quebec
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for the Defendants
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