| Court File No. T-1163-99
FEDERAL COURT TRIAL DIVISION
BETWEEN
TORONTO.COM
Plaintiff
AND
RITCHIE SINCLAIR AND GARTH COLE
Doing business as
FRIENDSHIP ENTERPRISES
Defendants
MEMORANDUM
OF FACTS AND LAW
PART
I - STATEMENT OF FACTS
The
Plaintiff's Allegations
1.
The plaintiff makes two primary allegations:
A.
That the defendant has breached the copyright of the plaintiff's web site
by linking and framing to it, in violation of the Copyright Act.
B.
That the defendants operate a web site that displays and offers wares and
services that are identical to the plaintiff's in association with an Internet
address and web site name that is similar to the plaintiff's, in violation
of section 7(b) and (c) of the Trade-marks Act. The defendant has
thereby passed off its web site for that of the plaintiff's.
Statement
of Claim, Motion Record, Vol. I, Tab 4
The
Parties
2.
Although some uncertainty exists as to which corporations form the partnership,
known as toronto.com, the plaintiff appears to be a partnership of three
large corporations; Bell Actimedia Inc. (formerly Tele-Direct, the publisher
of the Yellow Pages), Citysearch Canada Inc., and either Metroland Printing,
Publishing & Distribution Ltd. ("Metroland"), or Torstar Corporation.
Affidavit
of George Jewell, Paras. 4 and 7, Motion Record Vol. I, Tab 2
Cross-exam.
of George Jewell, Q.'s 33-38, 194, Responding Motion Record, Tab 3
3. The
defendants are individuals who carry on "business" under the name "Friendship
Enterprise", out of Garth Cole's apartment. The defendant, Ritchie Sinclair
is an artist. The defendant, Garth Cole works for the City of Toronto.
Responding
Affidavit of Ritchie Sinclair, Paras. 3, 60
Cross-exam.
of Ritchie Sinclair, Q. 39, Motion Record, Vol. III, Tab 2
The
Evidence
4.
In support of its motion for an interlocutory injunction, the plaintiff
filed an Affidavit of George Jewell, sworn July 30, 1999, an Affidavit
of Jeff MacPherson, sworn July 29, 1999, and a Reply Affidavit of George
Jewell, sworn September 29,1999.
Affidavit
of George Jewell, Motion Record, Vol. I
Affidavit
of Jeff MacPherson, Motion Record, Vol. I
Reply
Affidavit of George Jewell, Motion Record Vol. II
5.
George Jewell, who swore the vast majority of evidence filed on behalf
of the plaintiff, and upon which the plaintiff substantially relies, has
admitted that he is unqualified to tender any of his evidence which relates
to general technological aspects of the Internet, to general business analysis,
and to questions of law. The plaintiff has not filed any evidence by an
expert in any of the fields that it purports to give evidence in relation
to.
Cross-exam.
of George Jewell, Q.'s 7-32, 189-192, 251-252, Responding Motion Record,
Tab 3
6. As
Exhibits to his Affidavit, George Jewell purports to file survey evidence
of "customer loyalty", but does not provide any meaningful explanation
of how these statistics were arrived at.
Cross-exam.
of George Jewell, Q.'s 174-188, Responding Motion Record, Tab 3
7.
The plaintiff has not filed any evidence demonstrating that it is well
known in Canada, such as polls.
Affidavit
of George Jewell, Motion Record, Vol. I
Affidavit
of Jeff MacPherson, Motion Record, Vol. I
Reply
Affidavit of George Jewell, Motion Record Vol. II
toronto.com
8.
The plaintiff's web site is located at the Internet address of http://www.toronto.com
and is called "toronto.com", all is smaller case letters. The defendants'
web site is located at the Internet address of http://www.Toronto2.com
and is called "Toronto2", beginning with a capital "T" and ending with
the number "2". Both web site addresses have been registered with Network
Solutions Inc..
Responding
Affidavit of Ritchie Sinclair, Para. 20
Cross-exam.
of George Jewell, Q.'s 33-38, 50-Q. 66 and 256-263, Responding Motion Record,
Tab 3
Affidavit
of George Jewell, Paras. 35 and 9, Motion Record Vol. I, Tab 2
9. The
plaintiff enjoys a substantial number of visits to its web site, likely
in the 5-figure range, but has not provided any actual verification for
this. The defendant on the other hand, has enjoyed only a modest number
of visits to its site.
Responding
Affidavit of Ritchie Sinclair, Para. 68, and Exhibit "I" thereto
Cross-exam.
of George Jewell, Q.'s 99-105, Responding Motion Record, Tab 3
Affidavit
of George Jewell, Paras. 14, Motion Record Vol. I, Tab 2
10. Both
web site are programmed to display their respective exact Internet addresses
so as to enable a viewer to identify the particular site that he or she
is visiting.
Responding
Affidavit of Ritchie Sinclair, Para. 7
Cross-exam.
of George Jewell, Q.'s 307-308, Responding Motion Record, Tab 3
11. Visitors
looking for a site about Toronto or looking specifically for toronto.com
may locate it by typing in the words, www.toronto.com into their web browser.
Cross-exam.
of George Jewell, Q.'s 94-97, Responding Motion Record, Tab 3
12. In
or about September, 1997, Metroland, Citysearch Canada Inc., Torstar Corporation,
and CitySearch Inc. commenced the operation of a web site called, "Toronto
Star City Search".
Affidavit
of George Jewell, Paras. 7, Motion Record Vol. I, Tab 2
13. These
aforementioned corporations then reorganized to form the plaintiff partnership,
and purchased a new name for their web site: toronto.com. The limited
use of toronto.com commenced in January of 1998, however it was not until
at least March 30, 1998 that the plaintiff actually commenced the operation
of a web site located at and called, toronto.com.
Affidavit
of George Jewell, Paras. 7-12, Motion Record Vol. I, Tab 2
Cross-exam.
of George Jewell, Q.'s 86-92 and Q. 107, Responding Motion Record,
Tab
3
14. The
plaintiff has refused to provide any documentation evidencing its actual
title to the Internet address, http://www.toronto.com, other than the registration
with Network Solutions.
Cross-exam.
of George Jewell, Q.'s 108-110, Responding Motion Record, Tab 3
15. One
of the benefits for the plaintiff in using this new name, toronto.com,
was
that
it described the nature of its wares and services as relating to the City
of Toronto and originating from the City of Toronto. The plaintiff's place
of business is in the City of Toronto and its web site consists of a guide
and directory to goods, services, and attractions in the City of Toronto.
Affidavit
of George Jewell, Paras. 4 and 7, Motion Record Vol. I, Tab 2 Cross-exam.
of George Jewell, Q.'s 75, 86-92, 107, 332-333, Responding Motion
Record, Tab 3
16. Despite
its name, toronto.com is not affiliated with the City of Toronto.
Cross-exam.
of George Jewell, Q. 372, Responding Motion Record, Tab 3
17. The
plaintiff web site is a commercial enterprise and finances itself through
substantial advertising revenues. The plaintiff's web site is predominantly
in the nature of a guide and directory to goods and services in
the City of Toronto.
Cross-exam.
of George Jewell, Q.'s 72-85, Responding Motion Record, Tab 3
Affidavit
of George Jewell, Para. 13, and Exhibit "C", thereto, Motion Record
Vol. I, Tab 2
Toronto2
18.
The Internet address, http://www.Toronto2.com was registered with Network
Solutions on or about February 28, 1999 and went on-line in or about April,
1999. The web site was connected to the Internet in order to facilitate
the design process, not to attract visitors or to be open to the public.
Responding
Affidavit of Ritchie Sinclair, Paras. 16-18
19. Prior
to June 29, 1999, the Toronto2 web site displayed a Notice that clearly
indicated that the web site was not open to the public and was currently
under construction until June 29, 1999. The within lawsuit was commenced
on or about June 24, 1999.
Responding
Affidavit of Ritchie Sinclair, Paras. 17
Cross-exam.
of Jeff MacPherson, Q. 44-47, Responding Motion Record, Tab 2
Cross-exam.
of George Jewell, Q.'s 235-236, Responding Motion Record, Tab 3
Statement
of Claim, Motion Record Vol. I, Tab 4
20. The
defendants' web site address and web site name were selected by the defendants
with the intention of honestly describing their web site as a 'second'
or 'parallel' community of Toronto in cyberspace. There is no evidence
of an intention of picking a name and address that would mislead the public
into thinking that the defendants' web site was actually the plaintiff's
web site.
Responding
Affidavit of Ritchie Sinclair, Paras. 41, 42, 44
Cross-exam.
of George Jewell, Q.'s 279-282, Responding Motion Record, Tab 3
21. The
Toronto2 web site currently offers free electronic mail services, free
communication forums, and free web site building and hosting for individuals.
The plaintiff web site does not offer any of these services but instead
offers a guide and directory to the City of Toronto.
Responding
Affidavit of Ritchie Sinclair, Paras. 25-28
Cross-exam.
of Ritchie Sinclair, Q. 's 395, 397, 400, Motion Record, Vol. III, Tab
2 Cross-exam. of George Jewell, Q.'s 394-395 and 384-387, Responding
Motion Record, Tab 3
22. It
is readily admitted by the defendants, that a fraction of the Toronto2
web site contains a list of places to go and things to see within the City
of Toronto. This was included in Toronto2 not as a primary attraction,
but because it could be of ancillary interest to people visiting the web
site for its other, primary services. In any event, the plaintiff is not
claiming the exclusive right to operate a guide and directory to the City
of Toronto.
Responding
Affidavit of Ritchie Sinclair, Paras. 6-13 and Exhibit "D" thereto,
Cross-exam.
of George Jewell, Q.'s 253-255, Responding Motion Record, Tab 3
23. There
are many web sites that are primarily in the nature of a guide and
directory to the City of Toronto and most of these web sites use the word
"Toronto" both in their Internet address and in their name, itself. One
of these web sites is called "4Toronto", and is located at http://www.4Toronto.com.
According to the plaintiff, "4Toronto" is sufficiently different from toronto.com.
Responding
Affidavit of Ritchie Sinclair, Paras. 43--52 and Exhibit "J"-"R" thereto
Cross-exam.
of George Jewell, Q.'s 226-229 and 340-342,
Responding
Motion Record, Tab 3
Reply
Affidavit of George Jewell, Para. 29, Motion Record Vol. II, Tab
2
24. There
are at least one-thousand and eighteen (1018) registered Internet addresses
that all feature the word, "Toronto".
Responding
Affidavit of Ritchie Sinclair, Paras. 39 and Exhibit "G" and "H" thereto
25. There
are no visual or graphical similarities between toronto.com and Toronto2.
Responding
Affidavit of Ritchie Sinclair, Exhibits "B" and "D" thereto,
Cross-exam.
of Jeff MacPherson, Q. 44-47, Responding Motion Record, Tab 2
26. Aside
from the very different content and get-up of the two respective web sites,
there also exists a significant difference in their respective natures
and purposes. The plaintiff's web site is a strictly commercial enterprise
which intends to make a profit, whereas the defendants' web site is intended
to be a not-for-profit enterprise and is more concerned with community
service.
Responding
Affidavit of Ritchie Sinclair, Paras. 31-33, and Exhibits "D" and "E" thereto
Cross-exam.
of Ritchie Sinclair, Q. 's 399 and 476 , Motion Record, Vol. III, Tab 2
Cross-exam. of George Jewell, Q.'s 390, Responding Motion Record, Tab
3
27. The
entirety of the Toronto2 site has not yet been fully implemented, in part
as a result of the within action consuming the defendants' time.
Responding
Affidavit of Ritchie Sinclair, Paras. 18, 25-28, 69
Cross-exam.
of Ritchie Sinclair, Q. 's 394-413, 457, 484, Motion Record, Vol. III,
Tab 2
28. The
defendants have not engaged in advertising or promotion in respect of their
web site, nor have they otherwise directed public attention to their web
site other than by existing on the Internet.
Responding
Affidavit of Ritchie Sinclair, Paras. 18
Cross-exam.
of George Jewell, Q.'s 275-278, Responding Motion Record, Tab 3
29. The
plaintiff has no evidence of any of its advertising customers being confused
between toronto.com and Toronto2. The plaintiff has no evidence of losing
a single advertiser as a result of any confusion between toronto.com and
Toronto.
Cross-exam.
of George Jewell, Q.'s 230-232 and 287-289, Responding Motion Record, Tab
3
30. The
plaintiff has no evidence of losing any consumers of its web site as a
result of any confusion between toronto.com and Toronto2.
Cross-exam.
of George Jewell, Q.'s 285-287, Responding Motion Record, Tab 3
31. The
plaintiff has not had to lower its advertising rates nor has suffered any
loss of revenue as a result of any confusion between toronto.com and Toronto2.
Cross-exam.
of George Jewell, Q. 291, Responding Motion Record, Tab 3
32. The
plaintiff has no evidence of the defendants actions, either directly or
indirectly, serving to encourage others to offer variations of the plaintiff's
"brand" or service.
Cross-exam.
of George Jewell, Q.'s 293-294, Responding Motion Record, Tab 3
33. All
of the plaintiff's allegations regarding the likelihood of confusion and
resulting harm are pure speculation.
Cross-exam.
of George Jewell, Q.'s 294-295, 325, Responding Motion Record, Tab 3
34. The
plaintiff has alleged that it has acquired a valuable reputation and goodwill
in association with its "trade-marks" in Canada and further alleges that
by the defendants' actions, they have caused confusion in Canada.
Statement
of Claim, Para. 11, 19, Motion Record Vol. I, Tab 4
Affidavit
of George Jewell, Paras. 37-38, Motion Record Vol. I, Tab 1
35. The
fact is that the entirety of the plaintiff's reputation, if any, is limited
to the Toronto area, and does not exist in the rest of Canada.
Affidavit
of George Jewell, Para. 19, Motion Record Vol. I, Tab 1
Cross-exam.
of George Jewell, Q. 166-173, Responding Motion Record, Tab 3
36. The
plaintiff applied for registration of "TORONTO.COM" and "TORONTO.COM ALLYOU
NEED TO KNOW ABOUT T.O." (in upper case) as trademarks with the Canadian
Intellectual Property Office on or about October 14, 1998. Pursuant to
the Examiner's Reports received by the plaintiff, on or about June 1, 1999,
the aforementioned marks were "likely not registrable" as trademarks due,
at least in part, to their descriptive nature.
Responding
Affidavit of Ritchie Sinclair, Paras. 55-57 and Exhibit "S" thereto,
37. The
plaintiff has refused to advise whether they have responded to the Examiner's
Reports and may have very well abandoned their Applications, realizing
that their marks are not trade-marks.
Cross-Exam.
of George Jewell, Q.'s 356-357, Responding Motion Record, Tab 3
38. The
plaintiff commenced the within proceedings against the defendants on or
about June 24, 1999. The plaintiff in part, sought a Declaration as
to its ownership of its "trade-marks".
Responding
Affidavit of Ritchie Sinclair, Paras. 57
39. The
plaintiff did not allege in its Statement of Claim, that the words toronto.com,
had acquired a secondary meaning. Prodded by the Defendant's Amended Statement
of Defense, the plaintiff did eventually allege this. Nevertheless, no
evidence has been filed to substantiate this allegation.
Statement
of Claim, Motion Record Vol. I, Tab 4
Amended
Statement of Defense, Responding Motion Record, Tab 6
Reply
to Amended Statement of Defense, Responding Motion Record, Tab 6
Cross-exam.
of George Jewell, Q. 336-337
The
Allegation of "Copyright Infringement"
40.
The plaintiff has alleged that the defendants reproduced portions of their
web site without the plaintiff's permission and further alleges that this
constitutes a violation of the Copyright Act.
Statement
of Claim, Paras.1(b) and (d), 21-24, Motion Record Vol. I, Tab 4
Notice
of Motion, Paras. 7, 9, and 12, Motion Record Vol. I, Tab 1
41.
This alleged "infringement" is limited to three (3) so-called "links" and
(3) so-called "frames" which existed in a section of the defendants' web
site. The links are not particularized by the plaintiff, but the "frames"
are of pages that relate to Casa Loma, the Bata Shoe Museum, and the Eaton
Centre. These attractions may not even be aware that the plaintiff has
a web site about them.
Statement
of Claim, Motion Record Vol. I, Tab 4
Affidavit
of George Jewell, Para. 20-26, thereto, Motion Record Vol. I, Tab 2
Cross-exam.
of George Jewell, Q.'s 155-156, Responding Motion Record Tab 3
42. The
plaintiff has alleged that they own the copyright to these pages as a result
of an assignment by their employees and also by independent contractors.
Statement
of Claim, Para. 12, Motion Record Vol. I, Tab 4
43. The
plaintiff has not provided evidence of any written assignments of copyright
in respect of these pages, and has in fact refused to do so.
Cross-exam.
of George Jewell, Q.'s 157 and 407, Responding Motion Record, Tab 3
44. Despite
its allegation of "reproduction", the plaintiff now admits that it doesn't
know if the defendants in fact reproduced the web pages.
Cross-exam.
of George Jewell, Q. 250, Responding Motion Record, Tab 3
45.
The defendant, Ritchie Sinclair admits that he "linked" and "framed" to
a total of six (6) of the defendant's web pages, but swears that it was
done in the belief that this was a most common practice on the Internet
and without knowledge of the plaintiff's purported copyright notice.
Responding
Affidavit of Ritchie Sinclair, Paras. 6-11
46.
Even if Ritchie Sinclair had seen the plaintiff's purported copyright notice,
this notice does not even mention "linking" or "framing".
Responding
Affidavit of Ritchie Sinclair, Paras. 6-11 and Exhibit " B" thereto
Cross-exam.
of George Jewell, Q. 's 208-211, Responding Motion Record, Tab 3
47. In
any event, the plaintiff notified the defendants of its objection to the
"linking" and "framing" on May 21, 1999, and the defendants removed them
on May 22, 1999. At this time the site was still under construction, wasn't
even open to the public and only a handful of people had ever seen it.
Responding
Affidavit of Ritchie Sinclair, Paras. 13-15
48. The
within action was commenced on June 24, 1999, with the plaintiff's full
knowledge that the "frames" and "links" had already been removed.
Cross-exam.
of George Jewell, Q. 's 130-135, Responding Motion Record, Tab 3
49. Ritchie
Sinclair, on behalf of the defendants, has sworn to never replace
these "links" and frames" on his web page.
Responding
Affidavit of Ritchie Sinclair, Para. 13
Harm
to the Defendants if an Injunction is Granted
50.
It is the defendants' evidence that if the interlocutory injunction were
to be granted, it would effectively put an end to the Toronto2 web site.
One of the reasons for this, is that if the address is not permitted to
be displayed (as the plaintiff have requested), then the web site no longer
exists.
Cross-exam.
of Ritchie Sinclair, Q.'s 159-160, Motion Record Vol. III, Tab 2
51. It
is the defendants' evidence that even if the defendants were to select
another Internet address and name that met with the plaintiff's satisfaction,
a very serious problem would arise that would make it worthless for the
defendants to proceed to trial: How does one build up a business under
a temporary name and then transfer the accumulated goodwill to the original
name (Toronto2) if the Court ultimately decides that the defendants were
entitled to its use in the first place.
Responding
Affidavit of Ritchie Sinclair, Paras. 59-67
Undertaking
to Pay Damages
52.
The plaintiff has sworn that it is a "multimillion dollar company" that
has sufficient assets to pay an award of damages if it loses, but on cross-examination
refused to substantiate this claim.
Affidavit
of George Jewell, Motion Record Vol. I Tab 2, Paras. 4 and 45.
Cross-exam.
of George Jewell, Q.203-203, Responding Motion Record, Tab 3
53. The
defendants have admitted that they are not in a position, at this time,
to pay damages to the Plaintiff if they are permitted to carry on without
an injunction.
Cross-exam.
of Ritchie Sinclair, Q.'s 789-798, Motion Record Vol. III
Other
Undertakings Made by the Defendants
54.
The defendants have undertaken to include a notice on their web site indicating
their non-affiliation with the plaintiff.
Responding
Motion Record, Tab 5
55.
The defendants have undertaken to keep an account of all revenues, profits,
and activities in connection with their web site.
Responding
Motion Record, Tab 5
PART
II - POINTS IN ISSUE
56.
Is the Plaintiff entitled to an interlocutory injunction?
i)
Is there a serious issue to be tried?
ii)
Will the plaintiff suffer irreparable harm if the interlocutory injunction
is not granted?
iii)
Does the balance of convenience favour the plaintiff?
PART
III - SUBMISSIONS
Interlocutory
Injunctions - General Principles
57.
The interlocutory injunction is an exceptional relief and should
only be granted with the greatest of caution since it pronounces judgment
in very substantial matters without the opportunity for a full and comprehensive
trial.
Frank
Brunckhorst Co. v. Gainers Inc. (1993),
46
C.P.R. (3d) 421 (Fed. T.D.) Responding Book of Authorities,
Tab 1
58. Injunctions
should be confined to cases where the merits are clear and the risk of
harm to the grieving party is great and imminent. Here, the Court refused
an injunction where the trade names were very similar but the parties were
not competitors. It is respectfully submitted that the plaintiff and defendants
are not competitors in any meaningful sense, given their disparity in size,
resources, and given the difference in their content.
Astra
Ab v. Aastra Corp. (1995), 63 C.P.R. (3d) 357, 99 F.T.R. 215 (T.D.).
Responding
Book of Authorities, Tab 2
59. The
Test for Issuing an Interlocutory Injunction
The
three-part test for an interlocutory injunction is the test set out by
the Federal Court of Appeal:
A)
the plaintiff must show that it has a serious issue to be tried, and its
action is not frivolous or vexatious;
B)
the plaintiff must satisfy the Court that it will suffer irreparable harm
if an injunction does not issue; and
C)
the balance of inconvenience must favour the injunction.
Turbo
Resources Ltd. v. Petro-Canada Inc. (1989),
24
C.P.R. (3d) 1 (Fed. C.A.)
Responding
Book of Authorities, Tab 3
Serious
Issue to be Tried
60.
If the result of an interlocutory injunction will impose such hardship
on the defendant as to remove any potential benefit from proceeding to
trial, the Court should engage in an extensive review of the merits. It
is respectfully submitted that if an injunction is granted, it will amount
to a final determination as far as the defendants are concerned.
RJR-MacDonald
Inc. v. Canada (Attorney General)
(1994),
54 C.P.R. (3d) 114 (SCC)
Plaintiff's
Authorities, Tab 4
Is
there a serious Issue to be tried regarding Trade-mark and Passing Off?
61.
To be in violation of section 7(b) of the Trade-marks Act, the defendant
must have directed public attention to his wares, services or business
in such a way as to cause or be likely to cause confusion in Canada….
This section is the statutory statement of the common law of passing off.
Section
7(b), Trade-marks Act, Plaintiff's Authorities, Tab 2
Centre
Ice Ltd. v. National Hockey League (1994),
53
C.P.R. (3d) 200, 21 F.T.R. 240 (note) (Fed. C.A.).
Responding
Book of Authorities, Tab 4
62. It
is submitted that there is no evidence of the defendants directing public
attention to their web site, other than by existing on the Internet. Accordingly,
it is submitted that prima facie, there is no serious issue to be tried
in respect of the plaintiff's allegation concerning section 7(b) of the
Trade-marks Act.
63.
Section 7(c) of the Trade-marks Act prohibits the passing off
of a defendant's wares or services for those ordered or requested. The
Federal Court has jurisdiction in connection with relief based upon section
7 of the Trade Marks Act. The Court however, has no jurisdiction
in respect of a passing off action where that action is not connected to
any trade mark.
Dumont
Vins & Spiritueux Inc. v. Celliers du Monde Inc.,
[1992]
F.C.J. No. 126, DRS 94-15004, Appeal No. A-1094-90 (F.C.A.).
Responding
Book of Authorities, Tab 5
Section
7(c), Trade-marks Act, Plaintiff's Authorities, Tab 2
64. It
is submitted that the only element of the defendants' web site that could
even arguably constitute passing off is the apparent similarity
between toronto.com and "Toronto2(.com)".
65.
Pursuant to the Trade-marks Office's Practice Notice, the suffix, ".com"
is descriptive of a commercial entity.
Practice
Notice, Trade-marks Journal, Vol. 46, No. 2340
Responding
Book of Authorities, Tab 6
66.
It is submitted that the plaintiff cannot prevent the defendant nor anyone
else from using the suffix, ".com", as it is clearly descriptive and is
common.
67.
A company cannot prevent every other person from using a word that is descriptive
of his trade. It is obvious that such a claim cannot be maintained; it
would establish a monopoly of the use of words such as ‘Home’ or ‘Colonial’.
It is entirely permissible to have the ‘Times’ and the ‘Hereford Times’,
and no one would ever suppose that the Times could apply for an injunction.
It is respectfully submitted that the words that the plaintiff is attempting
to protect are in a much more precarious situation than the words in this
case. The plaintiff is attempting to protect a 'root' word, all by itself;
"Toronto".
The
Colonial Life Assurance Company v. The Home
and
Colonial Assurance Company, Ltd. (1864), 33 Beav. 548.
Responding
Book of Authorities, Tab 7
68.
In determining whether an injunction should be ordered to restrain use
of the words "London & Provincial", the Court will always have regard
to whether there exists such an exclusive right to a name on the
part of the plaintiffs as to justify the Court in interfering in a summary
way against the defendants.
London
& Provincial Law Assurance Society v. London
&
Provincial Joint Stock Life Assurance Company, 17 L.J. Ch. 37.
Responding
Book of Authorities, Tab 8
69.
"The ban on marks clearly descriptive of the place of origin of their associated
goods or services prima facie bars geographic names and their variants:
for example, TORONTO, TORONTONIAN, TORONTO’S." It is respectfully submitted
that it is no less than a first principle of intellectual property
law, that a plaintiff cannot prevent a defendant from also using a word
as fundamentally descriptive as "Toronto".
Vaver,
David, Intellectual Property Law,
Irwin
Law, Toronto, 1997, page 202.
Responding
Book of Authorities, Tab 9
70. Names
of well known cities such as Liverpool, are part of a class of geographical
names which are of such commercial importance that the names ought
not to be registered to any one trader. Marks of this class are by their
very nature incapable of becoming distinctive. It is submitted that
a trade-mark, even a common law one, must be distinctive - by definition.
Liverpool
Electric Cable Company’s Application (1929), 46 R.P.C. 99.
Responding
Book of Authorities, Tab 10
71. It
is submitted that the word, "Toronto" or "toronto" is clearly descriptive
of the plaintiff's web site. It is further submitted that this word is
part of a well established class of words that are of such commercial importance
that they are incapable of being distinctive of the plaintiff's web site.
72.
If nothing distinctive remains after non-distinctive words are disclaimed
from a trademark, nothing is left to be registered. For example, CANADIAN
JEWISH REVIEW was denied registration as after the words were disclaimed,
nothing remained.
Canada
Jewish Review Ltd. v. Canada
(Registrar
of Trademarks) (1961), 37 C.P.R. 89 (Ex. Ct.)
Responding
Book of Authorities, Tab 11
73. It
is submitted that once "toronto" and ".com" are disclaimed from the plaintiff's
trade-mark, nothing remains. It is further submitted that this combination
of two clearly descriptive words does not equal a single descriptive mark.
Secondary
Meaning
74.
Where the plaintiff has no right to a monopoly in a word forming part of
the common stock of language, such as descriptive or geographical words,
he must, to establish a cause of action, prove two things:
1.
that the word in question, if used by the defendant, designates goods manufactured
or sold by the plaintiff (a secondary meaning); and
2.
that by what the defendant does, he passes off his goods for the goods
of the plaintiff to his injury.
Magnolia
Metal Co. v. Tandem Smelting Syndicate Ltd.
(1898),
15 R.P.C. at 716. Responding Book of Authorities, Tab 12
Steinberg
v. Belgium Glove & Hosiery Co. (1953) Carswell Nat 8, 14 Fox Pat.
C. 1, 19 C.P.R. 56 (Exchequer Court of Canada)
Responding
Book of Authorities, Tab 13
75. It
is respectfully submitted that if the plaintiff purports to have exclusive
use or a monopoly over its marks, it is required to show that these marks
have acquired a secondary meaning. Since the plaintiff has tendered
no such evidence, his action for passing off must fail.
76.
It is respectfully submitted that there must be evidence to support the
allegation that "Toronto" has lost its primary geographical meaning and
has come to mean, in the minds of the purchasing public, the goods of the
plaintiff.
Steinberg
v. Belgium Glove & Hosiery Co., supra Tab 13
77. The
gist of a secondary meaning is that you take out of the dictionary
of the English language, for the purposes of a particular trade, a word
which bears a primary signification, and you attach to that word in the
dictionary, a secondary signification. To say that this can be done at
all is a very great step. The determination of a secondary meaning
is a result of a finding of fact.
Reddaway
v. Banham, [1896] A.C. 199.
Responding
Book of Authorities, Tab 14
78. The
plaintiff must establish through evidence, the existence of the secondary
meaning throughout Canada, not just locally. If there was any substance
to the plaintiff’s allegation that the words had gained a secondary significance,
there should be no difficulty whatsoever in establishing that fact by abundant
evidence. Where the plaintiff has failed to establish a secondary meaning
in respect of descriptive words, the plaintiff is not entitled to
an injunction.
S.
Chivers & Sons v. S. Chivers & Co., [1900] 17 Cut. P.C. 420.
Responding
Book of Authorities, Tab 15
Hurlbut
Co. v. Hurlburt Shoe Co., [1925] S.C.R.
141,
[1925] 2 D.L.R. 121 (S.C.C.)
Responding
Book of Authorities, Tab 16
79. The
rule against passing off does not extend to prevent the defendant
honestly describing the place of origin of his goods. A plaintiff who takes
it upon itself to prove that words which are merely descriptive, have acquired
a secondary meaning (i.e. have become significant of the plaintiff’s
goods as distinguished from those of other manufacturers) assumes a great
burden.
Mickelson
Shapiro Co. v. Mickelson Drug & Chemical Co.
(1916),
10 W.W.R. 261, 34 W.L.R. 155, 28 D.L.R. 307.
Responding
Book of Authorities, Tab 17
80. An
injunction is not available to the Canadian Railway Co. in respect of the
use of the word ‘Canadian’ merely because it has adopted that word long
before the Canadian National Railway, doing a similar business, came into
existence.
Anglo-Canadian
Fire Agencies Ltd. v. Anglo-Canadian
Underwriters
Ltd. 1942 CarswellNB 1, 2 Fox Pat. C. 86,
16
M.P.R. 198, 2 C.P.R. 10, [1942] 1 D.L.R. 550.
Responding
Book of Authorities, Tab 18
81. It
is respectfully submitted that the defendant honestly described the origin
and nature of its web site by selecting the name, Toronto2.
82.
Where the plaintiff has failed to establish that the geographical
name when used by the defendant, designates goods sold by the plaintiff,
the action for passing off must fail.
Steinberg
v. Belgium Glove & Hosiery Co., supra Tab 13
83. It
is respectfully submitted that the plaintiff has failed to establish a
secondary meaning notwithstanding that it was required to, and in fact
pleaded one in its Reply.
84.
It is respectfully submitted that there cannot be a serious issue to be
tried in respect of an allegation that fails to be substantiated by material
facts.
Confusion
85. In
order to obtain an interlocutory injunction in passing off action, the
plaintiffs must tender affidavit evidence to establish the likelihood of
confusion. This evidence must be more than a mere assertion of the likelihood
of confusion by the affiant.
775490
Manitoba Ltd. v. Meditables Inc. [1989] F.C.J. No. 1041,
Action
No. T-1816-89 (F.C.C.).
Responding
Book of Authorities, Tab 19
86. It
is respectfully submitted that the plaintiff has merely asserted the likelihood
of confusion without any corroborating evidence.
87.
The Court cannot infer from the existence of confusion, the existence of
a loss of goodwill or reputation. Actual evidence of a loss of goodwill
or reputation is necessary.
Caterpillar
Inc. v. Chaussures Mario Moda Inc. (1995),
62
C.P.R. (3d) 338, 99 F.T.R. 299 (Fed. T.D.).
Responding
Book of Authorities, Tab 20
Centre
Ice Ltd. v. National Hockey League (1994), 53 C.P.R. (3d) 200,
21
F.T.R. 240 (note) (Fed. C.A.), supra Tab 4
88. It
is respectfully submitted that the plaintiff has tendered no actual evidence
of a loss of good will or reputation.
89.
In order that confusion be caused or be likely to be caused in Canada,
the plaintiff’s name and unregistered trademark must be well known in
Canada "by reason of such distribution and advertising" as referred
to in section 5 of the Trademarks Act. It is not well known in Canada
unless knowledge of it pervades the country to a substantial extent. A
trade mark can not be regarded as "well known in Canada" when knowledge
is restricted to a local area in Canada. It must be well known across
Canada.
Huk-A-Poo
Sportswear, Inc. v. Destro Enterprises
Ltd.
[1974] F.C.J. No. 1107, Court File No. AT-3880-74 (F.C.C.).
Responding
Book of Authorities, Tab 21
Robert
C. Wian Enterprises, Inc. v. David Mady and Al.
(1965),
(2) Ex. C.R. 3 at p.28.
Responding
Book of Authorities, Tab 22
90. It
is respectfully submitted that the plaintiff's web site is only known,
if at all, in and about the City of Toronto, and therefore cannot be said
to be well known in Canada, as alleged by the plaintiff.
91.
If some confusion and inconvenience occurs as a result of contemporaneous
use, by both the plaintiff and defendant, of the same geographical name,
this is occasioned by the fact that the plaintiff chose to adopt a name
or mark in which, under the circumstances, she could not acquire a monopoly.
Steinberg
v. Belgium Glove & Hosiery Co. , supra Tab 13
92. It
is respectfully submitted that the plaintiff selected then name "toronto.com"
on their own volition, and knew or ought to have known, that such a name
can never be monopolized unless, it has come to acquire a secondary meaning.
Any confusion that has occurred or is likely to occur is a result of the
plaintiff selecting such a generic, descriptive, and non-distinctive mark.
93.
Where a plaintiff has engaged in massive advertising in respect of its
mark, confusion is not likely to occur.
Westfair
Foods Ltd. v. Jim Pattison Industries Ltd. (1990),
45
B.C.L.R. (2d) 253, 68 D.L.R. (4th) 481, 30 C.P.R. (3d) 174,
[1990]
5 W.W.R. 482 (B.C.C.A.).
Responding
Book of Authorities, Tab 23
Irreparable
Harm
94. Evidence
of irreparable harm must be clear and not speculative.
Syntex
Inc. v. Novopharm Ltd. (1991), 36 C.P.R. (3d)
129,
126 N.R. 114 (sub nom. Syntex Inc. v. Novopharm Ltd.
(No.
2) 41 F.T.R. 299 (note) (Fed. C.A.)
Responding
Book of Authorities, Tab 24
95. Where
a defendant disputes the validity of the plaintiff's mark at the interlocutory
stage, the Court may not conclude that irreparable harm will result from
the defendant's interim use of that mark. This would be contradictory since
it is the very "proprietary right" which is at issue. If a court were to
decide via an interlocutory injunction that an aggrieved party has "proprietary
rights in a trade mark", that court is deciding the very issue which
is to be determined at trial.
Syntex
Inc. v. Novopharm Ltd. , supra Tab 24
96. Such
a determination should not be made at an interlocutory stage where,
as in this case, the question of validity is strenuously addressed by the
parties.
Syntex
Inc. v. Novopharm Ltd. supra Tab 24
97. Mere
infringement of a proprietary right in a trade mark, does not, of itself,
constitute irreparable harm where the validity of the trade mark is contested.
Syntex
Inc. v. Novopharm Ltd. , supra Tab 24
98. It
is an error to conclude that irreparable harm will occur if the alleged
infringing practice continues, as the very existence of the proprietary
right is in issue.
Syntex
Inc. v. Novopharm Ltd. , supra Tab 24
99. The
existence of some evidence of confusion does not necessarily lead to the
conclusion that the plaintiff will suffer irreparable harm. A contested
mark cannot be assumed to be valid for the purposes of determining irreparable
harm. A loss of distinctiveness (as a result of unchecked confusion) can
only result from the infringement of a valid mark. A motions judge errs
in assuming the validity of a trade mark where the validity had been put
in issue by the defendant.
Nature
Co. v. Sci-Tech Educational Inc. (1992), 141 N.R.
363,
54 F.T.R. 240 (note), 42 C.P.R. (3d) 359 (Fed. C.A.).
Responding
Book of Authorities, Tab 25
100. A
plaintiff must tender evidence of irreparable harm that is clear and not
speculative. The evidence must support a finding that the applicant would
suffer irreparable harm, not merely that irreparable harm is likely.
Centre
Ice Ltd. v. National Hockey League, supra Tab 4
101. Irreparable
harm refers to the nature of the harm suffered rather than its magnitude.
Evidence of irreparable harm must be clear and not speculative. A finding
of confusion does not necessarily establish a loss of goodwill, and a loss
of goodwill is not necessarily irreparable harm.
Ault
Foods Ltd. v. George Weston Ltd. (1996),
68
C.P.R. (3d) 461, 116 F.T.R. 99 (T.D.).
Responding
Book of Authorities, Tab 26
102.
Where there are difficult questions of law which call for detailed argument
and mature considerations, an interlocutory injunction should not be granted.
Searle
Canada Inc. v. Novopharm Ltd., [1994]
3
F.C. 603, 56 C.P.R. (3d) 213, 171 N.R. 48, 81 F.T.R. 320.
Responding
Book of Authorities, Tab 27
103. It
is submitted that in the within action, the merits are far from clear.
The defendants have raised serious doubts as to the existence and validity
of the plaintiff's rights to its marks and as to its ownership of its purported
copyrights.
104.
It is submitted that the issues of law are simple and demonstrate that
no interlocutory injunction ought to be ordered as no serious issues for
trial exist. In the alternative, it is submitted that if the issues are
not simple, but complex, an injunction should not be ordered.
105.
Where the evidence shows that the disputed words are commonly registered
in business names and trade marks in Canada, it is far from clear whether
the plaintiff's right in the trade mark will entitle him to enjoin the
defendant from using a similar but not identical word. Accordingly, in
such a case an injunction should not be ordered.
Astra
Ab v. Aastra Corp. (1995), 63 C.P.R.
(3d)
357, 99 F.T.R. 215 (T.D.).
Responding
Book of Authorities, Tab 28
106.
It is submitted that the evidence shows many Internet addresses and web
sites that feature the word, Toronto, and therefore it is far from clear
that the plaintiff's has a right to enjoin the defendants.
107.
Where a defendant has offered to amend their advertising, circulars, and
trade mark for the purpose of distinguishing themselves from the plaintiff
in almost every reasonable way short of abandoning the use of their
own name, it lends real corroboration to the contention that the defendants'
intent has been to manufacture a superior class of goods, to sell them
under their own name, and to get a reputation and a trade in that way.
Hurlbut
Co. v. Hurlburt Shoe Co., supra Tab 16
108. It
is submitted that the fact that the defendants have undertaken to modify
their web site to include a disclaimer advising of the non-affiliation
with the plaintiff, is demonstrative of the defendants' intention to gain
its own reputation in respect of its own distinctive services.
Can
A Declaration for ownership of an unregistered trade-mark?
109.
A Court will not make a Declaration as to ownership of an unregistered
trade mark in the context of a passing off action, where the plaintiff
has an application for registration pending. The effect of making such
a Declaration would be a direction to the Registrar to make a finding of
fact consistent with the Court’s Declaration. Further the plaintiff is
in effect seeking to fetter the discretion of the Registrar in determining
the registrability of the trade mark.
Copperhead
Brewing Co. v. John Labbatt
Ltd.
(1995), 61 C.P.R. (3d) 317 (Fed. T.D.).
Responding
Book of Authorities, Tab 29
Enterprise
Rent-A-Car Co. v. Singer (1996),
109
F.T.R. 185, 66 C.P.R. (3d) 453, [1996] 2 F.C. 694.
Responding
Book of Authorities, Tab 30
110. A
Declaration as to ownership in the context of a passing off action would
not be useful in resolving the passing-off action. It is submitted however,
that such a Declaration will be helpful to the plaintiff in its application
for trade-mark registration.
Enterprise
Rent-A-Car Co. v. Singer , supra Tab 30
111. It
is respectfully submitted that if the part of the plaintiff's claim that
requests a Declaration as to ownership of its "trade-marks" does not raise
a serious issue. Granting such a Declaration would hamper the discretion
and processes of the Registrar of Trade-marks, as it would amount to a
direction to make a finding that the plaintiff's marks are in fact trade-marks,
when the Application process has not yet been completed, or has even been
abandoned.
Evidence
112.
Opinion evidence by a deponent not established as an expert witness will
be given little weight and may be inadmissible.
Apple
Computer Inc. v. Macintosh Computers Ltd.
(1985),
3 C.I.P.R. 133, 3 C.P.R. (3d) 34 (Fed.T.D.).
Responding
Book of Authorities, Tab 31
113. It
is respectfully submitted that without any expert evidence respecting the
workings of the Internet or respecting the degree that the plaintiff's
marks have become well known, the plaintiff's motion must fail.
Undertakings
114.
Where the defendant undertakes:
(a)
to clearly indicate on its web page, that its web site has no affiliation
with the plaintiff's web site;
(b)
to offer a link to the plaintiff's web site; and
(c)
to maintain accounts of its revenues and its customers, if any, until trial,
it
will constitute an additional valid reason to deny an interlocutory injunction.
ITV
Technologies Inc. v. WIC Television Ltd.
(1997),
77 C.P.R. (3d) 495, 140 F.T.R. 302.
Responding
Book of Authorities, Tab 32
115. It
is respectfully submitted that the fact that the defendants have made every
reasonable effort to distinguish themselves from the plaintiff provides
real corroboration to the defendants submission that they are not attempting
to pass themselves off as the plaintiff and in fact are trying to offer
a different and superior service.
Copyright
116.
Where
the defendant in a copyright infringement action undertakes to rectify
the words which are complained of pending a final determination, an interlocutory
injunction may not be ordered.
Aca
Joe International v. 147255 Canada Inc., [1986] F.C.J. No. 427, Action
No. T-875-86 (F.C.T.).
Responding
Book of Authorities, Tab 33
117.
It is submitted that the fact that the defendants immediately rectified
the few minor alleged copyright infringements and further undertook to
not do it again, removes any serious issue to be tried and further denies
the need for an interlocutory injunction.
118.
Pursuant to section 36 of the Copyright Act, a person relying on
an assignment of copyrights must have been assigned those rights in writing.
Section
36, Copyright Act, Plaintiff's Authorities, Tab 3
119.
It is submitted that the plaintiff has pleaded an assignment, but not an
assignment in writing. It is further submitted that the plaintiff
has refused to produce any evidence or particulars of this assignment.
Accordingly, it is submitted that on this ground alone, the plaintiff does
not raise a serious issue for trial and must fail in its motion.
Frank
Brunckhorst Co. v. Gainers Inc. , supra Tab 1
Balance
of Convenience
120.
It is respectfully submitted the Court should only consider whether the
defendant has the ability to pay damages if the plaintiff has passed the
threshold for both a serious issue to be tried and for irreparable harm.
Turbo
Resources Ltd. v. Petro-Canada Inc., supra Tab 3
121. It
is respectfully submitted that the fact that the defendant is unable to
pay damages is likely a result of the plaintiff commencing an action against
them at the very beginning of their enterprise.
122.
It is respectfully submitted that the plaintiff's claim that it is able
to pay damages has not been substantiated by evidence. It is further submitted
that even if the plaintiff is able to pay, damages cannot adequately compensate
the defendants. The reason for this is that the defendants' enterprise
is not entirely a profit oriented and ordinary business - there is an element
of altruism to it that is impossible to quantify.
123.
It is respectfully submitted that no great and imminent harm will be visited
upon the plaintiff by the fledgling and relatively smaller defendant web
site, if the web site were allowed to continue and flourish.
124.
It is respectfully submitted that the defendant will suffer more inconvenience
if an injunction is granted. The defendants will be dealt a determinative
blow, whereas the plaintiff will surely carry on unhindered and without
more than the speculative prospect of some harm at some point in the future.
ORDER
REQUESTED
125.
It is respectfully requested that the plaintiff's motion for an interlocutory
injunction be dismissed with costs fixed and payable forthwith on a solicitor
and client basis.
126.
It is further respectfully requested that the Court order that the trial
of this matter proceed by way of expedited hearing.
ALL
OF WHICH IS RESPECTFULLY SUBMITTED
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