Date: 20070725
Docket: T-1440-05
Citation: 2007 FC 773
BETWEEN:
KONINKLIJKE
PHILIPS ELECTRONICS N.V.
Plaintiff (Defendant by Counterclaim)
and
MAPLE
TECHNOLOGIES LTD., CANADIAN VERSATILE DISC
MANUFACTURING INC., DIGITAL DISC
CORPORATION; DISC PLAZA ENTERTAINMENT LTD.; M.S. MEDIA MOVIES & MORE LTD.
(a.k.a. MEDIA
MOVIES & MORE,
a.k.a. MMM); AMMAR JEET SINGH, MANJEET SINGH (a.k.a.
MANJIT SINGH), and
SURINDER KAUR personally, and carrying on business as
CASCADIA
ENTERTAINMENT, CASCADIA LABS, DOUBLE D, DOUBLE D DISTRIBUTION, DVD LIQUIDATORS,
EAGLE MEDIA WHOLESALE,
LowPriceDVD
MANNY’S DVDs, and REALLY CHEAP DVD.COM; and DOE CO.
Defendants (Plaintiffs by Counterclaim)
REASONS FOR
ORDER
HARRINGTON J.
[1]
In
this action, and two related actions, the Plaintiff, Philips, alleges that the
Defendants have manufactured compact discs (CDs) and digital versatile discs
(DVDs) in violation of certain of its patent rights. One of the conclusions of
the action is that the offending material be delivered up to it for destruction.
[2]
The
Defendant, Maple Technologies Ltd., is now in bankruptcy. That bankruptcy had
the initial effect of staying the Federal Court actions as against it.
However, the Bankruptcy Court, the Supreme Court of British Columbia, then gave
leave to Philips to continue the actions.
[3]
In
the meantime, the Business Development Bank of Canada, as a
secured creditor of Maple, has retained agents to sell its property. Philips has
now brought on a motion to enjoin that sale.
[4]
However,
by the time the motion was heard yesterday, it no longer sought injunctive
relief. Rather, it sought leave to add Business
Development Bank of Canada and its declared agents Abakhan
& Associates Inc. and Maynards Industries Ltd., as parties defendant, an
order that the prospective purchasers be put on notice of these proceedings and
orders with respect to the inspection of the property to be sold and the
preservation of relevant documents. To some extent, the relief sought overlaps
with relief already granted by the Supreme Court of British Columbia sitting in
bankruptcy. As the motion was brought on an urgent basis, there was
insufficient time to determine, with precision, what has already been covered
by previous court order.
[5]
Immediately following the hearing, I granted Philips leave to add
the Business Development Bank of Canada as a Defendant, pursuant to Rule 104.
At this stage the Court must presume that the Plaintiff will be able to prove
its allegations. On that basis, the Bank is organizing the sale of property
which may have been or could be used in infringement of Plaintiff’s patent or
other intellectual property rights.
[6]
I adjourned the motion to add Abakhan and
Maynards as Defendants sine die. Their presence as Defendants is not
necessary over the short term, as the Bank, through counsel, readily declared
that they were acting as its agents. Philips, of course, is entitled to take a
separate action against them, if it so chooses and as its counsel points out, a
declaration by the Bank that they are its agents would not shield them from
personal liability. However, there is no need to clutter up this record over
the short term.
[7]
Abakhan, in fact, is wearing two hats. It is
Maple Technologies’ trustee in bankruptcy and also is acting as agent for the
Bank for the purposes of selling the property. In its capacity as trustee in
bankruptcy, it gave notice of assignment, transmission or devolution of
interest or liability pursuant to Federal Courts Rule 117 and so to that extent
is already in the record, even though the style of cause has not been changed.
[8]
As to Maynards and Abakhan as the Bank’s agents,
if, as and when the proposed sale of the property proceeds, Philips may re-present
its motion. The balance of the order permits inspection of property to be sold,
preservation of documents and sampling by the Plaintiff of representative
copies of the CDs and DVDs. As the order specifically requires the Bank and its
declared agents, Abakhan & Associates Inc. and Maynards Industries
Ltd., to co-operate, Philips has suffered no immediate prejudice from the fact
that the latter have not been named as parties defendant.
[9]
The trustee in bankruptcy has recently taken the position that it
takes no position as to the merits of Philips’ action. It may well be that in
time it would want to hire a company to warehouse documents which are currently
in the premises of the bankrupt. It submitted that, to the extent documents are
preserved long-term at the request of Plaintiff, the cost related thereto
should be borne by the Plaintiff pending the resolution of the litigation.
However, that matter was not specifically before me and I make no comment save
that nothing herein serves to prevent the trustee from moving the Court as it
sees fit.
“Sean Harrington”
Ottawa,
Ontario
25
July 2007
Email this Content