Ashton-Potter Limited (Plaintiff)
v.
White Rose Nurseries Limited (Defendant)
Trial Division, Kerr J.—Toronto, June 5;
Ottawa, June 13, 1972.
Copyright—Practice—Licence from foreign licensor to
reproduce photographs in Canada—Sufficiency of statement
of claim—Licensor's rights in photographs not alleged—
Licensee entitled to sue in own name—Copyright Act, R.S.C.
1970, c. C-30, secs. 20(3) and (5), 36(2).
Plaintiff sued defendant for infringement of copyright in
certain photographs of flowers, alleging in its statement of
claim a licence from foreign licensors to reproduce the
photographs in Canada under an agreement registered in the
Copyright Office, Ottawa.
Held: (1) The statement of claim should not be struck out
for failing to show what copyright the licensors had in the
photographs or how they acquired such copyright. Circle
Film Enterprises Inc. v. C.B.C. [1959] S.C.R. 602, applied.
(2) Plaintiff as licensee was entitled under section 20(5)
of the Copyright Act to sue for infringement in its own
name. Bouchet v. Kyriacopoulos, 45 C.P.R. 265, referred
to.
MOTION.
C. D. Macdonald for plaintiff.
R. T. Hughes for defendant.
KERR J.—This is a motion on behalf of the
defendant to strike out the plaintiff's statement
of claim, on the ground that it fails to disclose a
reasonable cause of action. Rule 419(1)(a).
The subject-matter of the action is a 1972
nurseries catalogue published and distributed by
the defendant, which contains coloured prints
of a peony flower, an aster flower, a rhubarb
plant, a Japanese maple tree and a hydrangea
flower. The plaintiff claims that it has the exclu
sive right to reproduce these five prints in
Canada and that the defendant has infringed
that right. A motion by the plaintiff for an
interlocutory injunction against the defendant is
pending in the action.
The plaintiff and defendant are companies
incorporated under the laws of the Province of
Ontario and they carry on business in Ontario.
In Dow Chemical Co. v. Kayson Plastics &
Chemicals Ltd.', Jackett P., as he then was,
made a comment concerning pleadings, on
pages 80, 81 as follows:
In general, under our system of pleading, a Statement of
Claim for an infringement of a right should clearly show
(a) facts by virtue of which the law recognizes a defined
right as belonging to the plaintiff, and
(b) facts that constitute an encroachment by the defend
ant on that defined right of the plaintiff.
If the Statement of Claim does not disclose those two
elements of the plaintiff's cause of action, it does not
disclose a cause of action and may be disposed of
summarily.
Paragraph 4 of the statement of claim alleges
that pursuant to a licence agreement between
the plaintiff, as licensee, and Stahle & Friedel
GmbH, and Hallwag Ltd., both of Switzerland,
as licensors, a copy of which is annexed to the
statement of claim, the plaintiff acquired from
the licensors the right to reproduce in Canada
certain coloured prints which include the five
prints above referred to.
Paragraph 5 states that the plaintiff registered
the licence agreement at the Copyright Office,
Ottawa, on May 12, 1972, and a copy of the
certificate of registration is attached to the
statement of claim.
Paragraph 6 states that the licence agreement
may be terminated on 6 months' notice, and
that no such notice has been given. 2
Paragraph 7 states that by reason of the
aforesaid facts (i.e. the facts stated in paras. 4,
5 and 6), the plaintiff has acquired from the
licensors the exclusive right to reproduce the
five coloured prints in Canada.
Paragraphs 10, 11, 12 and 13 are as follows:
10. The Defendant executed an agreement of settlement
and release dated October 21, 1968, with the Plaintiff and
Stahle & Friedel GmbH, wherein the Defendant acknowl
edged the copyright of Stahle & Friedel and the exclusive
license rights of the Plaintiff to the 26 coloured prints,
which coloured prints included the peony flower referred to
in paragraph 4 hereof.
11. The Defendant, for its own use and benefit, has
caused to be reproduced in its 1972 nurseries catalogue,
copies of the five coloured prints which includes the print
of the peony flower referred to in paragraphs 4 and 10
hereof, and the Defendant has distributed such nursery
catalogues to the public, all without the consent or authority
of either the Plaintiff or the licensors.
12. The Plaintiff alleges by reason of its license agree
ment with the owners of the copyright in the five coloured
prints, that it has the sole right to reproduce such coloured
prints, and the Defendant therefore infringes the Plaintiff's
license rights in the five coloured prints with knowledge of
the Plaintiff's right thereto; and in the case of the peony
flower, having acknowledged in writing the Plaintiff's rights
thereto, and the Defendant will continue to infringe the
Plaintiff's rights in such five coloured prints and thereby the
Plaintiff will sustain substantial damage unless the Defend
ant is restrained.
13. By reason of the aforesaid acts of the Defendant
(a) the Plaintiff will be unable to print and reproduce
the five coloured prints on behalf of the customers of
the Plaintiff to their full advantage, and therefore the
Plaintiff will suffer loss and damage.
(b) the Defendant, by the use of the five coloured prints
in its 1972 nurseries catalogue, has received a benefit
without payment to the Plaintiff.
(c) the Defendant, by the use of the five coloured prints
in its 1972 nurseries catalogue, has increased its sales
of its wares and services and has thereby made
increased profit.
The licensing agreement recites that it is
made
Between
Stahle & Friedel GmbH, Zug/Switzerland
and
Hallwag Ltd., Nordring 4, Berne/Switzerland both
represented jointly by their duly authorized Economic
Counseller W. Sulzberger, Berne/Switzerland
— hereinafter called
"Licensor"—
and
Messrs. Ashton-Potter Limited, Toronto 3, Ontario,
Canada
— hereinafter called
"Licensee"—
Paragraphs 1, 2, 3 and 4 read as follows:
1. The licensor hereby grants to the licensee the right to
reproduce the printing material furnished by the licensor for
printing processes and to distribute coloured seed bags,
labels, catalogues and sales promotion material made by the
use of such reproduced originals. The copyright shall
remain property of the licensor.
2. Upon request by the licensee the licensor shall furnish
the licensee with four-colour positive screen films required
for reproduction. Such film material shall remain property
of the licensor.
3. The licensor hereby undertakes not to grant any licen
see for his designs to any other company within the country
of Canada.
4. The licensor undertakes not to send, during the term of
this agreement, any empty seed bags, printed with Ms
designs, into the country of Canada.
The plaintiff's claim is based upon such right
as it acquired under the licensing agreement. A
copy of the agreement is attached to the state
ment of claim, and it speaks for itself. The
statement of claim refers to the licensors as
owners of a copyright in the said prints. I take
that reference as an allegation of such owner
ship. The statement of claim also alleges that
the plaintiff registered the agreement at the
Copyright Office, and a copy of the registration
certificate is attached to the statement of claim.
Section 36(2) of the Copyright Act, R.S.C.
1970, c. C-30, states that a certificate of regis
tration of copyright in a work is evidence that
copyright subsists in the work and that the
person registered is the owner of such copy
right. Section 20(3) reads as follows:
20. (3) In any action for infringement of copyright in any
work, in which the defendant puts in issue either the exist
ence of the copyright, or the title of the plaintiff thereto,
then, in any such case,
(a) the work shall, unless the contrary is proved, be
presumed to be a work in which copyright subsists; and
(b) the author of the work shall, unless the contrary is
proved, be presumed to be the owner of the copyright;
Those provisions of the Copyright Act, as
they read prior to the Revised Statutes of 1970,
were considered by the Supreme Court of
Canada in Circle Film Enterprises Inc. v. C.B.C.
[1959] S.C.R. 602, in which Judson J., deliver
ing the judgment of the Court, said at page 605:
A plaintiff, if it is an assignee, may meet the presumption by
proving its chain of title but where, as in this case, the
plaintiff claims through a number of mesne assignments,
most of which were executed in a foreign country, the
burden of proof may become intolerably heavy. The impor
tant question is whether it can meet that presumption by the
production of a certificate of registration under s. 36(2), ...
and at page 607:
A plaintiff who produces this certificate has adduced some
evidence in support of his case, sufficient to compel the
tribunal of fact to act in his favour in the absence of any
evidence to contradict it.
In my opinion, therefore, by the production of this certifi
cate and in the absence of any evidence to the contrary, the
plaintiff in this case has satisfied the burden of proof, both
the primary burden—that which rests upon a plaintiff as a
matter of substantive law and is sometimes referred to as
the risk of non-persuasion—and also the secondary burden,
that of adducing evidence; Smith v. Nevins ([1925] S.C.R.
619 at 638, [1924] 2 D.L.R. 865) and Ontario Equitable v.
Baker ([1926] S.C.R. 297 at 308, 2 D.L.R. 289). On this
ground the dismissal of the action should be set aside and
judgment entered for the plaintiff.
Counsel for the defendant submitted that the
- statement of claim fails to show an arguable
cause of action for infringement of copyright,
particularly because it does not show what
copyright the licensors had in the prints or how
or when they acquired such copyright, or by
whom and when the photos were taken. How
ever, I do not think that the statement of claim
fails by reason of omission of such particulars.
If the defendant disputes the existence of the
right claimed by the plaintiff, the defendant
may offer evidence in support of its title and
claim.
It is my conclusion that the statement of
claim, read as a whole, does not fail to allege
facts necessary to show an arguable cause of
action for infringement of copyright.
Counsel for the defendant also argued that
the plaintiff, as a licensee under the agreement,
does not have a right to bring this action in its
own name for infringement of copyright.
Relevant portions of section 12(4) and of
section 20(1), (4) and (5) of the Copyright Act,
read as follows:
12. (4) The owner of the copyright in any work may
assign the right, either wholly or partially, and either gener
ally or subject to territorial limitations, and either for the
whole term of the copyright or for any other part thereof,
and may grant any interest in the right by licence, but no
such assignment or grant is valid unless it is in writing
signed by the owner of the right in respect of which the
assignment or grant is made, or by his duly authorized
agent.
20. (1) Where copyright in any work has been infringed,
the owner of the copyright is, except as otherwise provided
by this Act, entitled to all such remedies by way of injunc
tion, damages, accounts, and otherwise, as are or may be
conferred by law for the infringement of a right.
(4) Where any person infringes the copyright in any work
that is protected under this Act, such person is liable to pay
such damages to the owner of the right infringed as he may
have suffered due to the infringement, and in addition
thereto such part of the profits that the infringer has made
from such infringement as the court may decide to be just
and proper; .. .
(5) The author or other owner of any copyright or any
person or persons deriving any right, title or interest by
assignment or grant in writing from any author or other
owner as aforesaid, may each, individually for himself, in
his own name as party to a suit, action, or proceeding,
protect and enforce such rights as he may hold, and to the
extent of his right, title, and interest is entitled to the
remedies provided by this Act.
Counsel for the defendant submitted that the
plaintiff does not have an "assignment or grant"
within the meaning of section 20(5) and also
that an assignee or grantee who is entitled under
that subsection to protect and enforce his rights
may do so not by commencing an action in his
own name but only by becoming a party to an
existing action by the author or other owner of
the copyright.
Bouchet v. Kyriacopoulos 45 C.P.R. 265, was
cited. It was an infringement action based on a
contract entered into in France between the
plaintiff (a vendor of paintings in Montreal) and
one Vidal (an artist from France) under which
Vidal gave the plaintiff the exclusive world
rights to display and sell his entire artistic
output for a period of 10 years. The plaintiff
brought action against the defendant, who had
caused a painter to copy one of the paintings,
for an injunction and damages. Kearney J. held,
inter alia, that Vidal's paintings were protected
by the Copyright Act, that Vidal had by the
agreement assigned the exclusive right to
present his works, publicize them, hold show
ings and sell them, and the right to reproduce
them, and that the plaintiff had acquired a limit-
ed copyright which conferred upon him the
right, in his own name, to protect the right of
reproduction by virtue of section 20(5); and he
granted an injunction and awarded damages. An
appeal from that decision was dismissed by the
Supreme Court of Canada (Taschereau, C.J.C.,
Fauteux, Abbott, Ritchie and Hall JJ.). The
Chief Justice delivered the following oral judg
ment (p. 281):
We are unanimously of the opinion that there was no
error in the conclusion reached by Mr. Justice Kearney. The
appeal is therefore dismissed with costs.
Reference was also made to the very recent
decision of the Federal Court of Appeal in
American Cyanamid Company v. Novopharm
Limited, a patent infringement action in which
the status of a licensee of a patent to sue for
infringement was considered.
The position and status of a licensee under
the English 1911 Copyright Act was somewhat
doubtful. The question was left open in British
Actors Film Co. Ltd. v. Glover [1918] 1 K.B.
299.
While the point is not free from doubt, I think
that section 20(5) of our Act is broad enough to
include a right and interest in a copyright
acquired by a licensee by an agreement such as
the licensing agreement here under considera
tion, assuming that it covers a copyright and is
given by the author or other owner of the
copyright, and that the licensee may protect and
enforce such rights as he may hold thereunder
for himself and in his own name without joining
the grantors of the rights.
Therefore, the motion to strike out the state
ment of claim is dismissed, with costs in any
event of the cause to the plaintiff.
1 [1967] 1 Ex.C.R. 71. See also in like tenor Precision
Metalsmiths Inc. v. Cercast Inc. [1967] 1 Ex.C.R. 214 and
Union Carbide Canada Ltd. v. Canadian Industries Ltd.
[1969] 2 Ex.C.R. 422.
2 The agreement has other provisions also for termination
where there is breach of the agreement.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.