Nike Canada Ltd. v. Doe, docket T-1636-99

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docket T-1636-99

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Date: 19990930

Docket: T-1636-99

Toronto, Ontario, Thursday the 30th day of September, 1999

PRESENT: The Honourable Mr. Justice Pelletier

BETWEEN:

NIKE CANADA LTD. and NIKE INTERNATIONAL LTD.

Plaintiffs

- and -

JANE DOE and JOHN DOE and OTHER PERSONS,

NAMES UNKNOWN, WHO OFFER FOR SALE, SELL,

IMPORT, MANUFACTURE, DISTRIBUTE, ADVERTISE,

OR DEAL IN UNAUTHORIZED OR COUNTERFEIT

NIKE MERCHANDISE, AND THOSE PERSONS LISTED

IN SCHEDULE "A" TO THE STATEMENT OF CLAIM

Defendants

ORDER

UPON PLAINTIFFS" EX PARTE MOTION made on September 27, 1999, for an Anton Piller Order and other relief, dated September 22^nd, 1999, heard on Monday, September 27, 1999, and upon hearing the submissions of counsel for the Plaintiffs, and relying upon the Affidavits of Brent Akeson, sworn September 22, 1999 and the Affidavit of Jack Hunter, sworn September 22, 1999, and the Affidavits of David Lafave sworn September 15, 1999, and September 18, 1999, filed in the Nike Canada Ltd. et al v. Goldstar Design Ltd. et al. matter (Court File No. T-1951-95), and the pleadings and proceedings herein;

IT IS HEREBY ORDERED THAT:

Commencement and Term of Order

1. The terms of this Order shall become effective against each Defendant only from the commencement of the day on which it is served on that defendant and shall remain in effect for fourteen days thereafter, unless otherwise ordered by the Court.

2. This Order may be served and executed anywhere in Canada for a period not exceeding thirteen months from its date, but may prior to that date be set aside or modified by the Court either on its own motion or on motion by any of the parties. The review of the Court of the execution of this Order and the Order"s continuation with or without variation, may be heard by any Judge of the Trial Division.

Explanation of Search and Seizure Authority

3. The Plaintiffs" solicitor shall ensure that the nature and effect of this Order is explained fairly and in everyday language to the persons served with the Order. In particular that:

i) they are ordered to allow the persons enforcing this Order to search for and seize unauthorized or counterfeit NIKE merchandise;

ii) they are ordered to provide the persons enforcing this Order with their full and correct names and addresses and to cooperate with the persons enforcing this Order in all matters related to its enforcement;

iii) if they refuse to comply with the terms of this Order they may be found in contempt of Court which can result in fines or imprisonment;

iv) they must immediately cease the offering for sale, or otherwise dealing in unauthorized or counterfeit NIKE merchandise;

v) they may consult a solicitor before complying with this Order (provided that such advice is sought and obtained forthwith);

vi) they have an opportunity to attend in Court on the date fixed in the accompanying notice of motion to make submissions concerning the issuance, service or execution of this Order against them;

vii) they may bring an application to the Court at any time before the date set out in the Notice of Motion, upon proper notice to the Plaintiffs" solicitor, to contest the issuance, service or execution of this Order.

If the actions of a person being served with this Order, render the giving of an explanation not reasonably possible, the attempt to provide such explanation will be deemed to constitute the giving of an explanation to that person.

Search for and Seizure of Unauthorized or Counterfeit Merchandise and Related Materials

4. Each Defendant or person in charge of a Defendant"s premises shall permit the persons who are authorized to enforce this Order (that is, the Plaintiffs" solicitor together with such persons as may be authorized by the solicitor, being in total not more than four in number, plus such law enforcement officers as may be required) to enter and search the Defendant"s premises on any day of the week at any time between 7:00 a.m. and 9:00 p.m., for the purpose of searching for, and removing all unauthorized or counterfeit NIKE merchandise, related equipment and records.

5. Each Defendant or person in charge of a Defendant"s premises shall open and make available to the persons enforcing this Order any vehicle, container, or storage area within their possession, custody or control and open any locked doors of the premises behind which the persons enforcing this Order have reasonable grounds to believe there may be any unauthorized or counterfeit NIKE merchandise, related equipment or records.

6. Each Defendant or person in charge of a Defendant"s premises shall immediately deliver up to the persons enforcing this Order all unauthorized or counterfeit NIKE merchandise, related equipment or records within their possession, custody or control.

7. The Defendant and any person in charge of a Defendant"s premises shall not take any steps to destroy or conceal any unauthorized or counterfeit NIKE merchandise, related equipment or records.

Disclosure of Information

8. Each Defendant or person in charge of a Defendant"s premises shall disclose to the persons enforcing this Order:

i) the whereabouts of all unauthorized or counterfeit NIKE merchandise, related equipment and records or which they have knowledge, whether on the defendant"s premises or elsewhere;

ii) their full and proper name and the address at which registered mail sent to them will be received;

iii) the name and address of all suppliers who have supplied them with unauthorized or counterfeit NIKE merchandise;

iv) the name and address of the customers to whom they have sold or distributed unauthorized or counterfeit NIKE merchandise; and

v) the name and address of all persons of whom they have knowledge who are engaged in or who assist in the activities enjoined by paragraphs 17 and 18 below.

9. Each Defendant or person in charge of a Defendant"s premises shall allow the persons enforcing this Order to photograph or videotape the premises.

Non-Disclosure of Order

10. Every person on whom this Order is served or who has notice of the service of Order is prohibited for a period of twenty-four hours after such service from:

i) disclosing to or discussing with any other person the existence of these proceedings or the Orders herein;

ii) otherwise informing or warning any other person that the Plaintiffs might execute this Order against him or her.

11. Notwithstanding paragraph 10, any person on whom this Order is served and any person having notice of it may at any time consult a solicitor for the purpose of obtaining legal advice with respect to these proceedings.

Custody and Use of Merchandise and Related Materials Seized

12. The Plaintiffs" solicitor shall ensure that a list is made of all the merchandise, related equipment and records that are seized or delivered up pursuant to this Order and shall serve a copy of that list on the Defendant.

13. When records are seized or delivered up such analysis and copying as the Plaintiffs" solicitor considers necessary shall be done as quickly as is reasonably practical and the records returned by the Plaintiffs to the Defendant forthwith.

14. All unauthorized or counterfeit NIKE merchandise and related equipment and copies of all related records seized or delivered up pursuant to this Order, together with a copy of the list prepared pursuant to paragraph 12, shall be deposited for safekeeping with any registry of the Federal Court or may be retained in the custody of counsel for the Plaintiffs, providing that a copy of the list prepared pursuant to paragraph 12 and a complete photographic record, videographic record or record or digital electronic images of the merchandise, related equipment and records that have been seized or delivered up are filed by counsel for the Plaintiffs with the Court. In the case of identical goods, a photograph, videograph or digital electronic image of one item together with an inventory of the numbers seized will suffice.

The provision of this paragraph apply whether or not the identity of the person from whom the materials are seized or by whom they are delivered up is known.

15. The unauthorized or counterfeit NIKE merchandise and other materials seized or delivered up pursuant to this Order shall be utilized solely for the purpose of civil proceedings in relation to the enforcement of the Plaintiffs" trade-mark and copyright rights or the trade-mark or copyright rights of any legitimately interested third party respecting unauthorized or counterfeit merchandise.

Assistance in Enforcing the Order

16. Where a breach of the peace is apprehended as a result of the execution of this order, the sheriff and such other police officers, law enforcement officers and authorities in those locations where this order is sought to be enforced, as may be required by the persons enforcing this order, may attend to prevent such apprehended breach of the peace.

Restraining Infringement

17. Each Defendant is restrained from offering for sale, displaying, advertising, selling, manufacturing, distributing, or otherwise dealing in unauthorized or counterfeit NIKE merchandise.

18. Each Defendant is restrained from directing public attention to his or her wares in such a way as to cause or be likely to cause confusion in Canada between those wares and the wares of the Plaintiffs.

Court Review of Execution of the Order

19. The persons enforcing this Order against any Defendant shall serve on that Defendant a copy of this Order together with a copy of the statement of claim as well as a Notice of Motion providing for the review by the Court of the execution of this Order and the Order"s continuation. That Notice of Motion shall be returnable within fourteen days of service, or so soon thereafter as it is possible to have the matter heard by the Court, at the Federal Court premises closest to the location at which this Order was executed.

If the actions of a defendant make service pursuant to this paragraph not reasonably possible, leaving a copy of the documents to be served at the location at which service was attempted shall be deemed to be proper service.

20. The Notice of Motion should request, in the case of a John Doe or Jane Doe defendant whose identity has become known, the addition of that person as a named Defendant. It should also request an Order allowing the detention of the merchandise and related equipment, which was seized or delivered up, until final disposition of the claim against the Defendant. In the case of a defendant whose identity has not been ascertained but from whom merchandise, related equipment or records have been seized, the motion may seek disposition of the property to the Plaintiffs after ninety days if the defendant has not appeared on the return of the motion and if no steps have been taken to defend the action or otherwise contest the Orders given.

21. The notice of motion may request an Order, converting the interim injunction, described in paragraphs 17 and 18, into an interlocutory injunction, or if the former has expired, the issuance of an interlocutory injunction against the Defendant who has been served with this Order, in which case the Plaintiffs need not, pursuant to Rules 362 and 364 of the Federal Court Rules, 1998, serve or file a Motion Record unless otherwise ordered by the Court and the Defendants need not, pursuant to Rule 365 serve or file a Motion Record unless otherwise ordered by the Court.

22. A motion for review of the execution of this Order and its further continuation shall be supported by an affidavit from the attending and supervising solicitor setting out a full and accurate report of the execution or executions under review, including any execution with respect to which the defendant"s identity was not ascertained, and including a full description of goods, equipment and records seized as described in paragraph 14.

23. When a person is added as a named Defendant, it shall not be necessary to amend the style of cause but merely to add the name of the person to Schedule A to the Statement of Claim, each such addition being listed and numbered in sequence, in the Order in which they are added, with the date of the addition also being noted. All subsequent documentation respecting that Defendant, filed with the Court, shall include that numerical designation.

24. The defendant may request an earlier hearing of the review motion referred to in paragraphs 19, 20, and 21 for the purpose of having the Order as against the Defendant set aside or varied, or to determine whether the Plaintiffs should be required to post security. Any such request shall be by Notice of Motion properly served on the Plaintiffs" solicitor.

Terminology

25. To ensure that the terms of this Order are not misunderstood, the following explanation of words used herein is given:

i) "unauthorized or counterfeit NIKE merchandise" means goods or things bearing, without the Plaintiffs" authorization, any of the Plaintiffs" trade-marks or logos shown on Schedule "B" or bearing any mark or logo confusing therewith;

ii) "related equipment" means equipment used to manufacture unauthorized or counterfeit NIKE merchandise;

iii) "related records" means any records, documents or files pertaining to the purchase, manufacture, distribution or sale of unauthorized or counterfeit NIKE merchandise including any records that may be stored in any computer memory device, on disk, on tape or in any other form;

iv) "defendant"s premises" includes any stand booth, vehicles, cart or wagon used in the defendant"s business but does not include any premises actually occupied as residential premises;

v) "containers" which the person in charge of a defendant"s premises is required to open includes, for example, bags, boxes, cabinets, drawers, lockers, display cases;

vi) "plaintiffs" solicitor" includes any solicitor agent appointed by the Plaintiffs" solicitor;

vii) "dealing in unauthorized or counterfeit NIKE merchandise" includes activities such as importing, exporting, warehousing, shipping and transferring such merchandise.

Plaintiffs" Undertaking

26. This Order is issued on the Plaintiffs" undertaking to obey promptly any Order of the Court with respect to damages, that may issue, arising out of any unauthorized execution of this Order or upon the setting aside of the Order.

Compliance with Federal Court Rules, 1998

27. Compliance with the following Rules is dispensed with regarding service of this Order except as ordered herein or by Order of this Court:

a) Rule 203 (requiring a Statement of Claim to be served within sixty days after it is issued). The Plaintiffs may serve the Statement of Claim on the Defendants during the time this Order is in force and effect;

b) Rule 206 (requiring every document referred to in a pleading to be served with the pleading or within ten days after service of the pleading);

c) Rule 362 (requiring any affidavit required under Rule 363 to be served and filed at least two days before the date set out in the notice for the hearing of the motion);

d) Rule 364 (requiring service of a motion record);

e) Rule 365 (requiring a respondent to a motion to serve a respondent"s motion record);

f) Rule 395 (requiring a copy of every Order to be sent by the Administrator by registered mail to all parties). Orders need only be served on the parties to the Order or any other interested parties.

"J.D. Denis Pelletier"

JUDGE

Date: 19990929

Docket: T-1636-99

BETWEEN:

NIKE CANADA LTD. and NIKE INTERNATIONAL LTD.

Plaintiffs

- and -

JANE DOE and JOHN DOE and OTHER PERSONS,

NAMES UNKNOWN, WHO OFFER FOR SALE, SELL,

IMPORT, MANUFACTURE, DISTRIBUTE, ADVERTISE,

OR DEAL IN UNAUTHORIZED OR COUNTERFEIT

NIKE MERCHANDISE, AND THOSE PERSONS LISTED

IN SCHEDULE "A" TO THE STATEMENT OF CLAIM

Defendants

REASONS FOR ORDER

PELLETIER J.:

[1] The applicant asks for an Order for the issuance of a fresh Statement of Claim together with the making of a new "rolling" Anton Piller Order consequent upon the fresh claim.

[2] The reason for the issuance of a fresh claim is that approximately 800 defendants have been added to the action since its inception. Registry has reached the limit of its ability to manage that many defendants in the context of a single action. A new Statement of Claim is to be issued so as to facilitate the management of the file. An order for the issuance of a fresh Statement of Claim is sought in order to avoid any future arguments about multiplicity of proceedings.

[3] I am not inclined to make an Order with respect to the issuance of a Statement of Claim. The Rules make no allowance for such an Order. However, given that the need for a new Statement of Claim is administrative, I find that the issuance of a fresh Statement of Claim is not an abuse of process or an instance of multiplicity of proceedings.

[4] At the hearing of this matter I raised the question of the adequacy of the evidence in support of the application for the Anton Piller Order. The evidence referred to in the Motion Record, consists of the affidavit of Brent Akeson sworn September 22, 1999, the affidavit of Jack Hunter, an investigator, dated September 22, 1999 and affidavits filed on motions to review the execution of Anton Piller Orders. Also referred to were the affidavits of David Lafave sworn September 15, 1995, and September 18, 1995. The latter affidavits were filed in support of the issuance of the original Anton Piller Order in 1995.

[5] My concern with respect to the evidence is that the recent affidavits (Akeson and Hunter) are general in nature and tend to speak of the belief of the deponents that counterfeiting will occur in the future, that evidence will be destroyed without the assistance of an order, and that an order is needed. In themselves, these affidavits do not establish specific instances of the need for an extraordinary remedy such as an Anton Piller order. The affidavits of David Lafave do establish a specific need but only as it existed in 1995. Notwithstanding the belief of the deponents that an order is required, the affidavits would not, in themselves, justify the issuance of the order sought.

[6] This is not to put into question the right of the Plaintiffs to protect their valuable intellectual property. Because of the intrusive nature of an Anton Piller order, I wish to be satisfied that there is a present need for such an extraordinary remedy. I also wish to be satisfied that the evidence supports the geographical scope of the order, which in its draft form is Canada wide.

[7] In the application before me, the best evidence of the need for the order is the record of enforcement of the order which is about to expire. The fact that there have been approximately 800 executions of the order in various parts of the country in the space of four years demonstrates to my satisfaction that there is a present need for the issuance of a new order on a Canada wide basis. In the material before me, those executions are referred to but, for obvious reasons, are not part of the motion record. It would assist the Court if counsel who intend to rely upon the record of enforcement could prepare an affidavit which summarizes the enforcement record pursuant to a prior order or orders. The summary could be in tabular form if necessary. This would save the Court the trouble of wading through some very large files.

[8] Upon the issuance of the Statement of Claim, an order will issue in the form attached to these reasons as Schedule A.

[9] The order contains two modifications from what I am told is the "standard" order. The definition of "defendant"s premises" at paragraph 25 iv) of the Order has been amended to read as follows:

"defendant"s premises" includes any stand booth, vehicles, cart or wagon used in the defendant"s business but does not include any premises actually occupied as residential premises.

On the evidence before me, the need for an order which would extend to premises which are occupied as residential premises has not been demonstrated. If the need for such an order arises, a specific application can be brought for that purpose.

[10] Paragraph 16 dealing with police and other assistance has been changed to reflect the fact that the such peace officers as may be in attendance are not executing the order itself but preventing a breach of the peace in what are often volatile situations:

[11] I wish to thank counsel for his cooperation and his helpful submissions.

"J.D. Denis Pelletier"

JUDGE

TORONTO, ONTARIO

September 30, 1999

SCHEDULE A