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T-999-76
Benjamin Weider and Weider Sports Equipment Co. Ltd. (Plaintiffs)
v.
Beco Industries Ltd., Sydney Pinchuk and Samuel Schwartz (Defendants)
Trial Division, Mahoney J.—Ottawa, May 20, 21, 1976.
Patents—Jurisdiction—Action for infringement—Motion to strike out parts of statement of claim—Jurisdiction of Court to deal with action for passing off based on section 7(b) of Trade Marks Act—Trade Marks Act, R.S.C. 1970, c. T-10, ss. 7, 53, 55.
This infringement action was based on the claim that defend ants proposed to import, offer for sale and sell an exercising device similar to plaintiffs' device. No prior infringement was alleged. Defendants sought to strike out parts of the statement of claim, which application called into question the jurisdiction of this Court, in the circumstances, to deal with an action for passing off founded on section 7(b) of the Trade Marks Act. Defendants claimed that those portions exclusively germane to passing off were "immaterial, prejudicial, embarrassing and dilatory of the fair trial of the action and an abuse of the process of the Court".
Held, the application is allowed. The only substantial basis for the application is the jurisdiction of the Court to entertain the passing off action. The question ensues logically upon the recent decision of the Supreme Court of Canada in MacDonald v. Vapor Canada. Parliament has, by sections 7, 53 and 55 of the Trade Marks Act, created a number of causes of action and vested this Court with jurisdiction to adjudicate them. Apply ing the Vapor Canada decision, it cannot be said that section 7(b) of the Trade Marks Act rounds out the regulatory scheme prescribed by Parliament in the exercise of its power to legislate in respect of patents. (British North America Act, s. 91(22).) The Patent Act provides causes of action and remedies for the enforcement and protection of rights. It is entirely unnecessary to the scheme of the Patent Act to go outside it, to section 7(b) of the Trade Marks Act for such a cause of action, or to section 53 for a remedy.
MacDonald v. Vapor Canada (1976) 22 C.P.R. (2d) 1, applied.
APPLICATION. COUNSEL:
G. A. Macklin for plaintiffs. R. Uditsky for defendants.
SOLICITORS:
Gowling and Henderson, Ottawa, for plaintiffs.
Greenblatt, Godinsky, Resin & Uditsky, Montreal, for defendants.
The following are the reasons for judgment rendered in English by
MAHONEY J.: The defendants' application to strike out portions of the statement of claim calls into question the jurisdiction of this Court, in the circumstances of this action, to deal with an action for passing off founded on section 7(b) of the Trade Marks Act'. The invention in question is an exercising device employing ropes with loops and pulleys to coordinate the arm and leg movements of a person using it in a combination in respect of which Canadian Patent 980,376 was issued, December 23, 1975, to the individual plaintiff on the basis of an application dated February 1, 1973. The corporate plaintiff is the exclusive licensee for the distribution and sale of the device in Canada. The action for infringement is based on the allega tion that the corporate defendant, of which the individual defendants are officers and sharehold ers, proposes to import into Canada and to distrib ute, offer for sale and sell here a similar exercising device. There is no allegation that the defendants had, in fact, prior to the commencement of the action, infringed the patent; only that they propose to do so. The application before me does not raise any question directly related to that cause of action.
The defendants did not, as they might, introduce evidence in support of the application and accord ingly I must deal with it entirely on the record on the basis that the allegations of fact contained in the statement of claim are true. The grounds upon which the order is sought are that the portions exclusively germane to passing off are "immateri- al, prejudicial, embarrassing and dilatory of the fair trial of the action and an abuse of the process of the Court". These grounds for striking out are set forth in paragraphs (b),(d) and (J) of Rule 419(1). Having heard the argument, I am satisfied
' R.S.C. 1970, c. T-10.
that the only substantial basis for the application is that initially stated: this Court's jurisdiction, in the circumstances, to entertain the passing off action at all.
It is apparent that the question ensues logically upon the recent decision of the Supreme Court of Canada in MacDonald v. Vapor Canada Ltd. 2 The portions of the statement of claim sought to be struck out are paragraphs 6, 7, 8, 10, 11, 12, 14, 15, 16, 17, 25, 26, 27, parts of 32 and 33 and subparagraphs (a) and (b) of 36. These are fully set out in the Appendix "A" hereto with the portions of paragraphs 32 and 33 sought to be struck out underlined and subparagraph (c) of 36 included by way of illustrating that subparagraphs (a) and (b) are clearly redundant in the context of the infringement action only. The relevant provi sions of the Trade Marks Act are sections 7, 53 and 55.
7. No person shall
(a) make a false or misleading statement tending to discredit the business, wares or services of a competitor;
(b) direct public attention to his wares, services or business in such a way as to cause or be likely to cause confusion in Canada, at the time he commenced so to direct attention to them, between his wares, services or business and the wares, services or business of another;
(c) pass off other wares or services as and for those ordered or requested;
(d) make use, in association with wares or services, of any description that is false in a material respect and likely to mislead the public as to
(i) the character, quality, quantity or composition,
(ii) the geographical origin, or
(iii) the mode of the manufacture, production or
performance
of such wares or services; or
(e) do any other act or adopt any other business practice contrary to honest industrial or commercial usage in Canada.
53. Where it is made to appear to a court of competent jurisdiction that any act has been done contrary to this Act, the court may make any such order as the circumstances require including provision for relief by way of injunction and the
2 (1976) 22 C.P.R. (2nd) 1.
recovery of damages or profits, and may give directions with respect to the disposition of any offending wares, packages, labels and advertising material and of any dies used in connec tion therewith.
55. The Federal Court of Canada has jurisdiction to enter tain any action or proceeding for the enforcement of any of the provisions of this Act or of any right or remedy conferred or defined thereby.
It is trite law that this Court has no jurisdiction except that which the Parliament of Canada, acting within its legislative competence, has given it. I take it also that there is no question that pleading a cause of action that is beyond the Court's jurisdiction to adjudicate is a clear abuse of its process. Parliament has, by sections 7, 53 and 55 of the Trade Marks Act, created a number of causes of action and vested this Court with the jurisdiction to adjudicate them. The question, then, is whether, given the facts alleged in the statement of claim, the cause of action created by section 7(b) is one on which Parliament is com petent to legislate. In the Vapor Canada case, at page 34, the Chief Justice, in a judgment in which a majority of the Court concurred, stated:
The position which I reach in this case is this. Neither s. 7 as a whole, nor s. 7(e), if either stood alone and in association only with s. 53, would be valid federal legislation in relation to the regulation of trade and commerce or in relation to any other head of federal legislative authority. There would, in such a situation, be a clear invasion of provincial legislative power. Section 7 is, however, nourished for federal legislative purposes in so far as it may be said to round out regulatory schemes prescribed by Parliament in the exercise of its legislative power in relation to patents, copyrights, trade marks and trade names. The subparagraphs of s. 7, if limited in this way, would be sustainable, and certainly, if s. 7(e) whose validity is alone in question here, could be so limited, I would be prepared to uphold it to that extent.
As applied to the facts alleged in the statement of claim, it cannot be said that section 7(b) of the Trade Marks Act rounds out the regulatory scheme prescribed by Parliament in the exercise of its power, under section 91(22) of the British North America Act, to legislate in respect of pat ents. The Patent Act 3 provides the plaintiffs with causes of action and remedies for the enforcement and protection of the rights granted them under it. It is entirely unnecessary to the scheme of the Patent Act for them to go outside it, to section
3 R.S.C. 1970, c. P-4.
7(b) of the Trade Marks Act for such a cause of action or to section 53 for a remedy.
ORDER
The application is allowed with costs to the defendants in any event of the cause.
APPENDIX "A"
6. The plaintiff, Ben Weider, has been engaged in the field of physical fitness and exercising and body building devices since the year 1937 when he and his brother, Joe Weider, com menced promoting physical fitness from their home in the City of Montreal, Quebec.
7. From 1937 to 1947, the plaintiff, Ben Weider and his brother Joe Weider, manufactured physical fitness and body building devices on a modest scale in the City of Montreal for sale in the Montreal area and elpewhere in Canada.
8. From the year 1947 to December 30, 1959, the plaintiff Ben Weider carried on business through the firm of Weider Sports Equipment Co. as a manufacturer and distributor of physical fitness and body building equipment.
10. The plaintiff, Ben Weider, since at least the year 1947, has been actively engaged in the promotion and encouragement of physical fitness and body building in Canada and throughout the world to the extent that the plaintiff, Ben Weider, and the name "Weider" are synonymous with physical fitness and body building generally.
11. Through the personal efforts of the plaintiff, Ben Weider, the plaintiff, Weider Sports, is recognized in Canada and throughout most of the world as the leading and most respected distributor of quality physical fitness and body building aids and devices and the product line of "Weider" physical fitness and body building aids and devices is sold by most major department stores and sports equipment retailers in Canada and approximately eighty other countries throughout the world.
12. The plaintiff's brother, Joe Weider, has achieved similar recognition in the United States of America where he has resided and carried on business for nearly thirty years.
14. The said exercising device, which is lightweight and port able, employs ropes with loops and pulleys to coordinate move ment between the legs and arms of a person while exercising, thus permitting a person to carry out a daily regimen of exercise without requiring elaborate and heavy exercising equipment.
15. Prior to and following the introduction of the "Total Body Shaper" exercising device into the marketplace, the plaintiff Weider Sports conducted or caused to be conducted, studies to test the effectiveness of the Total Body Shaper as a physical fitness and body development aid.
16. Upon and following the introduction of the Total Body Shaper into the marketplace, the plaintiff Weider Sports with a number of its major customers, engaged in an extensive publici ty and advertising campaign to acquaint the public with the
Total Body Shaper as a new "Weider" physical fitness and body development aid.
17. As a result of the efforts of the plaintiffs Ben Weider and Weider Sports, and the customers of Weider Sports, in promot ing the Total Body Shaper as a fitness and body development aid, the said Total Body Shaper exercising device has become identified in the minds of the buying public in Canada with the plaintiffs, Ben Weider and Weider Sports.
25. The exercising device proposed to be imported, distributed, offered for sale and sold by the defendant Beco in Canada is a colourable and inferior imitation of the plaintiffs' Total Body Shaper exercising device and the offering for sale and sale of the said device will cause confusion among members of the Canadian buying public between the plaintiffs' Total Body Shaper exercising device and the device proposed to be import ed by the defendant Beco.
26. The sale in Canada by the defendant Beco of a colourable and inferior imitation of the plaintiffs' Total Body Shaper exercising device will cause irreparable harm and damage to the goodwill and reputation of the plaintiffs in Canada includ ing its reputation for producing and selling high quality and reliable fitness and exercising products and devices.
27. The activities of the defendant Beco recited in paragraphs 25 and 26 hereof constitute illegal acts of unfair competition contrary to honest commercial practice and contrary to Section 7(b) of the Trade Marks Act.
32. The scheme so embarked upon by the defendant Beco at the express direction of the defendants Pinchuk and Schwartz has been done deliberately and recklessly by the defendants Pinchuk and Schwartz for the purpose of using the defendant Beco as a vehicle for infringing the rights of the plaintiffs in the Total Body Shaper exercising device and for the purpose of creating confusion among members of the Canadian buying public between the plaintiffs' Total Body Shaper exercising device and the device to be imported by the defendant Beco, and to trade on the goodwill and reputation of the plaintiffs in Canada, all for the purpose of making a profit from the sale of the said exercising devices in Canada at the expense of the plaintiffs.
33. By virtue of the activities of the defendants Pinchuk and Schwartz aforesaid, the defendants Pinchuk and Schwartz are liable for the actions of the defendant Beco in infringing the rights granted by Canadian patent 980,376 and for the acts of unfair competition of the defendant Beco referred to in para graphs 25, 26 and 27 hereof.
36. The plaintiffs therefore claim:
(a) an interim order enjoining the defendants or any of them from importing, advertising, offering for sale or selling in Canada, an exercising device of the type described in para graph 28 of this Statement of Claim, or equivalent thereof, until final Judgment of this Honourable Court;
(b) an interim order enjoining the defendants or any of them from importing, advertising, offering for sale or selling in
Canada, an exercising device which is the same as, or a colourable imitation of, the plaintiffs' Total Body Shaper exercising device;
(c) an interim order enjoining the defendants or any of them from infringing Canadian patent 980,376 or any claim there of by the importation, offering for sale or sale in Canada of an exercising device of the type described in paragraph 23 of this Statement of Claim, or equivalent thereof, until final Judgment of this Honourable Court;
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