Date: 20160209
Docket: A-402-14
Citation: 2016 FCA 44
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CORAM: |
NADON J.A. PELLETIER J.A. GAUTHIER J.A. |
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BETWEEN: |
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SPORT MASKA INC. dba REEBOK-CCM HOCKEY |
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Appellant |
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and |
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BAUER HOCKEY CORP. |
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Respondent |
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and |
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EASTON SPORTS CANADA INC. |
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Respondent |
Heard at Montreal, on September 15, 2015.
Judgment delivered at Ottawa, Ontario, on February 9, 2016.
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REASONS FOR JUDGMENT BY: |
NADON J.A. |
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CONCURRED IN BY: |
PELLETIER J.A. GAUTHIER J.A. |
Date: 20160209
Docket: A-402-14
Citation: 2016 FCA 44
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CORAM: |
NADON J.A. PELLETIER J.A. GAUTHIER J.A.
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BETWEEN: |
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SPORT MASKA INC. dba REEBOK-CCM HOCKEY |
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Appellant |
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and |
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BAUER HOCKEY CORP. |
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Respondent |
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and |
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EASTON SPORTS CANADA INC. |
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Respondent |
REASONS FOR JUDGMENT
NADON J.A.
I. Introduction
[1] In this appeal, Sports Maska Inc. dba Reebok-CCM Hockey (“CCM”) challenges the judgment (2014 FC 853) of Harrington J. (the “Judge”) of the Federal Court dated September 8, 2014 pursuant to which he dismissed CCM’s motion which sought to overturn the June 20, 2014 order (2014 FC 594) of Prothonotary Morneau (the “Prothonotary”) denying CCM’s motion for leave to intervene in proceedings commenced by the respondent Bauer Hockey Corp. (“Bauer”) in Federal Court File T-1036-13.
[2] For the reasons that follow, I would dismiss the appeal.
II. Facts
[3] CCM, Bauer and Easton Sports Canada Inc. (“Easton”) are competitors in the hockey equipment industry. Bauer is the current owner of the trade-mark referred to as the “SKATES EYESTAY Design” registered under number TMA361,722 (the “ ‘722 registration”, the “trade-mark” or the “mark”).
[4] On January 11, 2010, pursuant to a request made by Easton, the Registrar of Trade-marks (the "Registrar") issued a notice under section 45 of the Trade-marks Act, R.S.C. 1985 c. T-13 (the “Act”) requiring Bauer to furnish evidence of use of the SKATES EYESTAY Design during the three year period preceding the date of the notice.
[5] On January 12, 2011, Bauer brought an action against Easton, inter alia, for infringement of the ‘722 registration (in Federal Court File: T-51-11). On December 21, 2012, Bauer launched a similar action against CCM (in Federal Court File: T-311-12).
[6] On April 5, 2013, the Registrar ordered that the ‘722 registration be expunged from the Register because of her finding that the mark had not been used, as registered, in the relevant time frame. On June 11, 2013, Bauer filed, pursuant to section 56 of the Act, a notice of application appealing the Registrar’s decision in which Easton was named as a respondent (in Federal Court File: T-1036-13) (“Bauer’s application”).
[7] On February 13, 2014, Bauer and Easton reached an agreement pursuant to which Bauer agreed to discontinue its infringement action against Easton and the latter agreed to abandon its contestation of Bauer’s application of the Registrar’s decision.
[8] On April 7, 2014, CCM filed a motion in the Federal Court seeking leave to intervene in Bauer’s application.
[9] On April 9, 2014, CCM filed its statement of defence and counterclaim in Federal Court File: T-311-12.
[10] On April 30, 2014, Bauer filed its reply and defence to CCM’s counterclaim arguing, inter alia, that CCM was barred from attacking its trade-mark by reason of an agreement concluded on February 21, 1989 between CCM and Bauer’s predecessors in title. More particularly, CCM and Canstar Sports Group and Canstar Sports Inc. (“Canstar”), predecessors in title to Bauer, reached an agreement pursuant to which CCM undertook to withdraw its opposition to trade-mark application 548,351, filed on September 9, 1985 by Warrington Inc. (to whom Canstar succeeded in title), which led to the ‘722 registration on November 3, 1989. In a letter dated February 24, 1989, counsel for CCM wrote to the Registrar to advise that its client, the opponent, would not object to the use and registration of the trade-mark in association with the wares identified in the trade-mark application.
III. Decisions Below
A. The Prothonotary’s Decision
[11] In his decision of June 20, 2014, the Prothonotary, who was the case management judge assigned to Bauer's application and the related actions brought by Bauer against Easton and CCM for infringement of the trade-mark, dismissed CCM's motion, brought under Rule 109 of the Federal Courts Rules, SOR/98-106 (the “Rules”), for leave to intervene in Bauer’s application.
[12] The Prothonotary began his analysis by pointing out that the effect of granting leave to CCM would be to substitute CCM as a respondent for the absent Easton. This was not, according to the Prothonotary, how Rule 109 should be used. In so saying, the Prothonotary referred to this Court’s decision in Canada (Attorney General) v. Siemens Enterprises Communications Inc., 2011 FCA 250, 423 N.R. 248 (“Siemens”) where, in his view, this Court held that Rule 109 was not meant to be used so as to allow an intervener to substitute itself as a respondent.
[13] The Prothonotary then addressed CCM’s argument that the interests of justice militated in favour of granting it leave to intervene so as to provide the Court with a different view of the case. The Prothonotary dealt with CCM’s argument by referring, with approval, to Madam Prothonotary Tabib’s decision in Genencor International Inc. v. Canada (Commissioner of Patents), 2007 FC 376, 55 C.P.R. (4th) 395 (“Genencor”) where she made the point that even if it was useful for the Court to have an opponent in a patent proceeding, the Court could nevertheless carry out its duties without an opposing side.
[14] The Prothonotary then turned to Bauer’s argument that its agreement with Easton should be respected, and that it not be jeopardized by allowing CCM to substitute itself as a respondent in lieu of Easton. The Prothonotary indicated that he fully agreed with that argument.
[15] The Prothonotary then addressed CCM’s argument that there was a public interest component in section 45 proceedings. He rejected this argument and again referred to Prothonotary Tabib’s decision in Genencor where the learned Prothonotary, albeit on a question of registration of intellectual property and not section 45 proceedings, held that there was no public interest involved in allowing an intervention so as to ensure that untenable or invalid intellectual property registrations not be maintained.
[16] Finally, the Prothonotary turned to Bauer’s submission that because CCM in its counterclaim to the infringement action in Federal Court File T-311-12 had raised the invalidity of the ‘722 registration on the same grounds as those relied on by the Registrar in expunging the mark at issue, it had raised in its defence to CCM’s counterclaim the fact that CCM was barred, by reason of its 1989 agreement with Bauer, from attacking the ‘722 registration. This led the Prothonotary to make the comment that “[i]t would appear that said argument by Bauer would not be possible to make against CCM in the Appeal should the latter be granted intervener status” (paragraph 13 of the Prothonotary’s decision).
[17] The Prothonotary then referred to my colleague Stratas J.A.’s reasons in Canada (Attorney General) v. Pictou Landing First Nation, 2014 FCA 21, [2015] 2 F.C.R. 253 (“Pictou Landing”) where, at paragraph 11, he sets forth those factors which he considers relevant in determining whether intervention should be granted to a proposed intervener. In light of the factors set out in Pictou Landing, the Prothonotary concluded that by reason of what he referred to as the “full debate already ongoing in File T-311-12”, the first two factors were met but that factors III, IV and V were not met.
[18] This led the Prothonotary to opine that, on balance, CCM should not be allowed to intervene in the section 45 proceedings which were “well under way” (paragraph 16 of the Prothonotary’s reasons). Consequently, he dismissed CCM’s motion to intervene with costs.
B. The Federal Court’s Decision
[19] The Judge began by addressing the standard of review which should be applied in reviewing the Prothonotary’s decision. In his view, because the questions on a motion to intervene were not vital to the final issue of the case, the Prothonotary’s decision should be reviewed in accordance with the principles set out by this Court in Merck & Co. v. Apotex Inc., 2003 FCA 488, 2 F.C.R. 459, at paragraph 19. Thus, it was his task to determine whether the Prothonotary had exercised his discretion based upon a wrong principle or upon a misapprehension of the facts.
[20] The Judge then briefly reviewed the facts and turned to the factors which were to guide him in determining whether leave should be granted. In that regard, he referred to this Court’s decision in Rothmans, Benson & Hedges Inc. v. Canada (Attorney General), [1990] 1 F.C. 90, [1989] F.C.J. No. 707 (“Rothmans, Benson & Hedges”) where the Court, in allowing the appeals before it, affirmed the correctness of the factors, i.e. six factors relevant to the determination of a leave to intervene application, enunciated by the trial judge, Rouleau J. of the Federal Court ([1990] 1 F.C. 74, 29 F.T.R. 267, at paragraph 12).
[21] After setting out Rouleau J.’s six factors, the Judge turned to Stratas J.A.’s reasons in Pictou Landing and cited paragraph 11 thereof where my colleague sets forth the factors which, in his view, are relevant to present day litigation. The Judge then remarked that the relevant factors, as set out in Rothmans, Benson & Hedges and in Pictou Landing, were not to be taken, in his words, au pied de la lettre. He also indicated that this Court’s decision in Siemens was not to be taken as an absolute bar to a motion to intervene, adding that he did not feel that it was necessary to carry out a detailed analysis based on the factors of Rothmans, Benson & Hedges and Pictou Landing. He then pointed out that Stratas J.A.’s reasons in Pictou Landing were those of a single motions judge and thus not binding on this Court, adding that this Court was reluctant to reverse itself, citing for that proposition our decision in Miller v. Canada (Attorney General), 2002 FCA 370, [2002] F.C.J. No. 1375 (“Miller”), at paragraph 8.
[22] The Judge then turned to the merits of the motion before him. In his view, there could be no doubt that CCM had an interest in Bauer’s application for judicial review of the Registrar’s decision and that CCM’s intervention would be useful to the Court in that no one was opposing Bauer in the proceedings. He then stated that the Prothonotary was clearly wrong in considering the settlement agreement between Bauer and Easton.
[23] He then turned his attention to the question of whether the Prothonotary had downplayed the public interest aspect of the Register. He pointed to a number of decisions, both of this Court and of the Federal Court, to make the point that there was a public interest aspect in proceedings arising under section 45 of the Act. However, in his view, the public interest aspect of these proceedings did not rank as high as the public interest aspect of cases, for example, where constitutional issues were raised. On this point, the Judge concluded that the Court “might well benefit from CCM’s intervention as it would give a different perspective, in the sense that Easton is giving no perspective at all” (paragraph 29 of the Judge’s reasons).
[24] All of this led the Judge to conclude that although the Prothonotary had been wrong to consider the agreement between Bauer and Easton, that error was not fatal as he was satisfied that the Prothonotary would, in any event, have come to the same conclusion. The Judge then made the point that the better forum in which CCM could advance its arguments was in the action for infringement between it and Bauer. Thus, in the Judge’s view, the Prothonotary had not wrongly exercised his discretion upon a wrong principle or upon a misapprehension of facts. Hence, he dismissed CCM’s appeal.
IV. Issues and Standard of Review
[25] In my opinion, there are two issues raised in this appeal:
(1) What are the applicable criteria to decide whether to grant intervener status to CCM?
(2) Was the Judge wrong in not interfering with the Prothonotary's decision?
[26] There is no dispute between the parties that a prothonotary’s decision ought to be disturbed by a judge only where it is clearly wrong, in the sense that the exercise of discretion was based upon a wrong principle or a misapprehension of the facts. Consequently, in the present matter, we should not interfere with the Judge’s decision unless there were grounds justifying his intervention, or if he arrived at his decision on a wrong basis or was plainly wrong (Z.I. Pompey Industrie v. Ecu-Line N.V., 2003 SCC 27, [2003] 1 S.C.R. 450, at paragraph 18).
V. Parties Submissions
A. CCM’s Submissions
[27] CCM argues that the Prothonotary's decision was based upon wrong principles and a misapprehension of the facts thus constituting grounds for the Judge to set his order aside. CCM finds numerous errors in the Prothonotary's decision that can be divided into the following three categories:
(1) Misapplying this Court’s decision in Siemens
[28] In applying the Pictou Landing criteria, the Prothonotary concluded that criteria III, IV and V had not been met. Criteria III relates to the different and valuable perspective that an intervener should advance. The Prothonotary held that CCM would only be replacing Easton as a respondent and for that finding, relied on this Court’s decision in Siemens. CCM argues, however, that the rule put forward in Siemens was only "directed to the particular mischief of duplication" (CCM’s memorandum of fact and law, paragraph 32). In CCM’s view, there would be no duplication in this case given that Easton undertook not to participate in the judicial review.
(2) Finding no public interest in section 45 proceedings / Failing to appreciate that it is in the interests of justice that the Court hear both sides of the issue / Finding intervention inconsistent with Rule 3
[29] The Pictou Landing criteria IV and V purport to ensure that the intervention is in the interests of justice and that it would advance the imperatives set forth in Rule 3 which provides that the Rules are to be interpreted and applied so as to secure “the just, most expeditious and least expensive determination of every proceeding on its merits”. CCM argues that there is a public interest in ensuring the accuracy of the Register as a public record of trade-marks: “[t]he fact that an applicant under s. 45 is not even required to have an interest in the matter (…) speaks eloquently to the public nature of the concerns the section is designed to protect” (CCM’s memorandum of fact and law, paragraph 39, quoting Meredith & Finlayson v. Canada (Registrar of Trade-marks), [1991] F.C.J. No. 1318, 40 C.P.R. (3d) 409 (F.C.A.) (“Meredith”)).
[30] CCM asserts that it was an error on the part of the Prothonotary to refuse to grant it leave to intervene on the basis that there was a "full debate already ongoing" between itself and Bauer because of the different questions at issue in the section 45 proceedings and in the infringement action. Moreover, the existence of another efficient means to submit a question to the Court was held to be irrelevant in Pictou Landing.
(3) Giving credence to Bauer's settlement with Easton
[31] This private agreement plays no role in considering whether CCM should be given the right to intervene. The Judge agreed with CCM on this point and found that the Prothonotary was clearly wrong in taking the settlement into account.
[32] CCM submits that the Judge identified a number of "errors" in the Prothonotary's decision: the settlement should not have been taken into account, there is a public aspect to the Trade-marks Register, Siemens is not an absolute bar to intervention and the Court would be better served if someone were present to defend the expungement decision (CCM’s memorandum of fact and law, paragraph 21). In addition, CCM says that the Judge "erred in implying that the decision in Pictou Landing reverses the Federal Court of Appeal decision in Rothmans" (CCM’s memorandum of fact and law, paragraph 71). CCM says that Pictou Landing simply updates and evolves the Rothmans, Benson & Hedges factors. Accordingly, the Judge's decision was plainly wrong.
B. Respondent's Submissions
[33] Bauer argues that the Judge's decision not to intervene is not fundamentally wrong given that the Prothonotary turned his mind to the applicable factors and did not misapprehend the facts. The sole error found by the Judge was the effect to be given to the settlement between it and Easton, and he was not satisfied that "without referring to that settlement, [the Prothonotary] would have come to a different conclusion" (Bauer’s memorandum of fact and law, paragraph 48, quoting the Judge’s decision at paragraph 30).
[34] Contrary to what is suggested by CCM, the Judge’s decision was not based upon a finding that the infringement action would be a forum more appropriate for CCM's case, but rather on a rightful application of the standard of review. Bauer further argues that even greater deference should be given to the Prothonotary's decision for he was the Case Management Judge and was "intimately familiar" with the history and details of the matter. In Bauer’s view, "CCM must demonstrate that the Judge ‘erred in a fundamental way’ in refusing to disturb the Prothonotary's decision, in that the latter was the ‘clearest case of misuse of judicial discretion’" (Bauer’s memorandum of fact and law, paragraph 42).
[35] Bauer further says that the list of factors to consider in a motion for intervention were "originally developed in Rothmans some 25 years ago and has since then been reiterated on several occasions" (Bauer’s memorandum of fact and law, paragraph 53). Bauer argues that the new test set out in Pictou Landing must not be applied to this case because it was created by a judge alone and is therefore not binding. Bauer points out that the "traditional" Rothmans, Benson & Hedges factors were applied by the Federal Court in a trade-mark expungement case posterior to Pictou Landing (Coors Brewing Co. v. Anheuser-Busch, LLC, 2014 FC 318, 123 C.P.R. (4th) 340).
[36] Bauer also stresses that the motion to intervene is late (CCM only launched it after it learned that Bauer and Easton had reached an agreement), that there is no public interest in a section 45 proceeding, that unopposed cases of this kind are commonplace in the Federal Court, and that CCM is already attacking the validity of the ‘722 registration in the infringement action. Finally, Bauer argues that CCM undertook, in an agreement signed in 1989, not to object to the use or registration of the ‘722 registration. It is thus arguably breaching this agreement.
VI. Analysis
A. What are the applicable criteria to decide whether to grant CCM leave to intervene?
[37] I begin by noting that there appears to be a certain amount of confusion as to the governing jurisprudence on the question of motions for leave to intervene since the decision of my colleague Stratas J.A. in Pictou Landing. It is my view, which I do not believe is contentious, that the decision of a panel of this Court has precedence over that of a single judge of the Court sitting as a motions judge. My colleague recognized as much in his reasons: see Pictou Landing at paragraph 8. This means that the governing case is Rothmans, Benson & Hedges.
[38] That said, I wish to make it clear that this panel, or for that matter any other panel of the Court, cannot prevent a single motions judge from expressing his view of the law if he is so inclined. In my view, parties may use a single motions judge’s reasoning, if they wish, and make it part of their argument in order to convince the Court that it should change or modify its case law. But all should be aware that a single judge’s opinion does not change the law until it is adopted by a panel of the Court.
[39] A comparison of Rothmans, Benson & Hedges factors and Pictou Landing shows that the main differences between the two are the removal of the “lack of any other reasonable means” factor (Rothmans, Benson & Hedges third factor) and of the “ability of the Court to hear the case without the intervener” factor (Rothmans, Benson & Hedges sixth factor), as well as the addition of the “compliance with procedural requirements” factor (Pictou Landing first factor), and the “consistency with Rule 3” factor (Pictou Landing fifth factor). These differences are not, in my respectful view, of any substance. In effect, “compliance with procedural requirements” will generally always be a relevant consideration and the “consistency with Rule 3” factor can always be considered under the “interests of justice” factor (Rothmans, Benson & Hedges fifth factor).
[40] I do not disagree with Stratas J.A.’s comments in Pictou Landing that the existence of another appropriate forum is not necessarily a reason to refuse a proposed intervention that can be helpful to the Court. It obviously depends on the relevant circumstances. It is also undeniable that the Court, in most cases, is able to hear and decide a case without an intervener and that the “more salient question is whether the intervener will bring further, different and valuable insights and perspectives that will assist the Court in determining the matter” (Pictou Landing, paragraph 9, last bullet). This requirement is, in essence, what Rule 109(2)(b) requires. In any event, as Stratas J.A. recognized at paragraph 7 of his reasons, he could have reached the same result by applying the Rothmans, Benson & Hedges factors and ascribing little weight to the factors which he did not find relevant.
[41] In my opinion, the minor differences between the Rothmans, Benson & Hedges factors and those of Pictou Landing do not warrant that we change or modify the factors held to be relevant in Rothmans, Benson & Hedges. As the Rothmans, Benson & Hedges factors are not meant to be exhaustive, they allow the Court, in any given case, to ascribe the weight that the Court wishes to give to any individual factor.
[42] The criteria for allowing or not allowing an intervention must remain flexible because every intervention application is different, i.e. different facts, different legal issues and different contexts. In other words, flexibility is the operative word in dealing with motions to intervene. In the end, we must decide if, in a given case, the interests of justice require that we grant or refuse intervention. Nothing is gained by adding factors to respond to every novel situation which motions to intervene bring forward. In my view, the Rothmans, Benson & Hedges factors are well tailored for the task at hand. More particularly, the fifth factor, i.e. “[a]re the interests of justice better served by the intervention of the proposed third party?” is such that it allows the Court to address the particular facts and circumstances of the case in respect of which intervention is sought. In my view, the Pictou Landing factors are simply an example of the flexibility which the Rothmans, Benson & Hedges factors give to a judge in determining whether or not, in a given case, a proposed intervention should be allowed.
[43] To conclude on this point, I would say that the concept of the “interests of justice” is a broad concept which not only allows the Court to consider the interests of the Court but also those of the parties involved in the litigation.
B. Was the Judge wrong in not interfering with the Prothonotary's decision?
[44] In determining the second question before us, it must be kept in mind that our task is not to decide whether we believe that CCM meets the relevant factors for intervention and thus that leave should have been granted, but whether the Judge was wrong in refusing to interfere with the Prothonotary’s decision. To that task I now turn.
[45] So the question is: should the Judge have interfered with the Prothonotary’s order? CCM says that the Prothonotary made a number of errors which should have justified his intervention. First, it says that the Prothonotary misapplied Siemens.
[46] I begin by saying that CCM’s motion is not, in reality, a motion for leave to intervene. It is, in effect, a motion which seeks to allow CCM to become the respondent, in lieu of Easton, in Bauer’s application. In that respect, CCM’s motion is similar to that made by West Atlantic Systems (“WAS”) in Siemens where WAS sought to intervene in an application for judicial review filed by the Attorney General following a decision of the Canadian International Trade Tribunal (the “CITT”) which was unfavourable to the Department of Public Works and Government Services. More particularly, the CITT determined that the procurements at issue were deficient and failed to comply with Article 1007(1) of the North American Free Trade Agreement.
[47] Siemens Enterprises Communications Inc. (“Siemens”), which had filed a number of complaints with the CITT and which had fully participated in the proceedings before that tribunal, chose not to participate in the Attorney General’s judicial review application. WAS, which had unsuccessfully attempted to participate in the proceedings before the CITT, sought to obtain leave from this Court to intervene in the judicial review proceedings. In denying WAS’ motion, Mainville J.A., writing for the Court, made the following comments at paragraph 4 of his reasons.
By its motion, WAS is attempting to substitute itself for Siemens as the respondent in this judicial review application. WAS seeks to challenge the application under a proposed order of the Court which would, for all intents and purposes, grant it a status equivalent to that of a respondent in these proceedings. The rules permitting interventions are intended to provide a means by which persons who are not parties to the proceedings may nevertheless assist the Court in the determination of a factual or legal issue related to the proceedings (Rule 109(2)b) of the Federal Courts Rules). These rules are not to be used in order to replace a respondent by an intervener, nor are they a mechanism which allows a person to correct its failure to protect its own position in a timely basis.
[emphasis added]
[48] CCM argues that the Prothonotary erred in relying on Siemens because our decision in that case “should be understood to be directed to the particular mischief of duplication” (paragraph 32 of CCM’s memorandum of fact and law). In my respectful view, this argument is without merit as there was no question of duplication in Siemens since there was no respondent in the judicial review proceedings as Siemens had decided not to participate.
[49] Considering that our Court in Siemens held that Rule 109 should not be used to substitute a new respondent in the proceedings, it cannot be said, in my view, that the Prothonotary was wrong to consider, as a relevant factor, that the purpose of CCM’s motion was to substitute itself as a respondent in lieu of Easton. However, I agree with the Judge that Siemens does not, per se, constitute an absolute bar to a motion to intervene.
[50] Second, CCM says that the Prothonotary was in error in holding that there was no public interest in section 45 proceedings sufficient to support its intervention in Bauer’s application. More particularly, it says that the Prothonotary was wrong to rely on Prothonotary Tabib’s decision in Genencor which dealt with an entirely different matter, adding that “[t]here is a public interest in ensuring the accuracy of the Register as a public record of trade-marks” (CCM’s memorandum of fact and law, paragraph 41).
[51] CCM also says that the Prothonotary erred in holding that Bauer’s judicial review proceedings could be disposed of without its participation, adding that the Prothonotary again erred in relying on Genencor. CCM says that both the Rules and section 45 of the Act envisage the participation of the requesting party in section 45 proceedings and any appeal taken therefrom. In CCM’s view, it can be said that there is an expectation that in any appeal from a section 45 decision, the Court will have the benefit of an appellant and a respondent. Thus, CCM says that the Judge ought to have intervened in that the Prothonotary was wrong to find that there was no public interest in section 45 proceedings and that the matter could be heard without its participation.
[52] Before determining whether the Prothonotary erred, as argued by CCM, it is important to have a brief look at section 45 and the proceedings which arise from it. Pursuant to section 45, the Registrar may at any time and at the written request of any person, give notice to the registered owner of a trade-mark requiring it to show, by way of an affidavit or a statutory declaration, that the mark was used in Canada during the three years preceding the notice.
[53] In making a determination as to whether or not the mark was used in the time frame provided by section 45, the only evidence admissible before the Registrar is the aforementioned affidavit or statutory declaration. It is on the basis of that evidence and the parties’ representations that the Registrar must decide whether or not there has been use of the mark as required by section 45.
[54] Following the Registrar’s decision, an appeal may be taken before the Federal Court pursuant to section 56 of the Act and new evidence may be submitted to the Court in addition to the evidence already adduced before the Registrar. If the new evidence could have materially affected the Registrar’s decision, then the Court must consider the matter de novo and reach its own conclusion on the issues to which the new evidence pertains.
[55] The purpose of section 45 proceedings is to remove registrations which have fallen into disuse. The burden of proof on the registered owner is not a heavy one. In Locke v. Osler, Hoskin & Harcourt LLP, 2011 FC 1390, 98 C.P.R. (4th) 357, O’Keefe J. stated at paragraph 23 that “[t]he threshold to establish use is relatively low and it is sufficient if the applicant establishes a prima facie case of use”. It has also been said that the purpose of section 45 of the Act is to remove deadwood from the Register (see Eclipse International Fashions Canada Inc. v. Shapiro Cohen, 2005 FCA 64, 348 N.R. 86, at paragraph 6). In Dart Industries Inc. v. Baker & Mckenzie LLP, 2013 FC 97, 426 F.T.R. 98, at paragraph 13, O’Keefe J. commented that “[p]roceedings under section 45 of the Act are summary and administrative in nature”. Finally, in Meredith, Huguessen J.A., writing for this Court, made these comments, at page 412, regarding section 45 proceedings:
Section 45 provides a simple and expeditious method of removing from the register marks which have fallen into disuse. It is not intended to provide an alternative to the usual inter partes attack on a trade mark envisaged by s. 57. The fact that an applicant under s. 45 is not even required to have an interest in the matter (the respondent herein is a law firm) speaks eloquently to the public nature of the concerns the section is designed to protect.
Subsection 45(2) is clear: the Registrar may only receive evidence tendered by or on behalf of the registered owner. Clearly it is not intended that there should be any trial of a contested issue of fact, but simply an opportunity for the registered owner to show, if he can, that his mark is in use or if not, why not.
An appeal to the Court, under s. 56 does not have the effect of enlarging the scope of the inquiry or, consequentially, of the evidence relevant thereto. We cannot improve on the words of Thurlow C.J., speaking for this Court, in Plough (Canada) Ltd. v. Aerosol Fillers Inc. (1980), 53 C.P.R. (2d) 62 at p. 69, [1981], 1 F.C. 679, 34 N.R. 39, quoting with approval the words of Jackett P. in Broderick & Bascom Rope Co. v. Registrar of Trade Marks, (1970), 62 C.P.R. 268.:
In my view, evidence submitted by the party at whose instance the s-s. 44(1) [now 45(1)] notice was sent is not receivable on the appeal from the Registrar any more than it would have been receivable before the Registrar. On this point, I would adopt the view expressed by Jackett P. in Broderick Bascom Rope Co. v. Registrar of Trade Marks, supra, when he said at p. 279:…
[emphasis added]
[56] In my view, the Prothonotary ought to have considered that there was a public interest component in section 45 proceedings. In concluding as he did, the Prothonotary relied on Genencor for support. However, I note from paragraphs 3 and 7 of Genencor that Prothonotary Tabib made a clear distinction between the nature of the proceedings before her and those which arise under section 45 of the Act. More particularly, in refusing to grant intervener status to the proposed intervener, she pointed out that the provisions at issue before her, namely sections 48.1 to 48.5 of the Patent Act, R.S.C., 1985, c. P-4 were not similar to those arising under section 45 in that they did not give third parties the right to challenge patents by way of a summary process in the way that section 45 allowed third parties to challenge trade-marks.
[57] Section 45 proceedings contemplate the participation of persons with no interest whatsoever in the existence of a given trade-mark. The provision allows anyone to initiate a section 45 notice, to submit representations to the Registrar and in the case of an appeal, to either launch the appeal or to participate as a respondent in that appeal. As this Court said at page 412 in Meredith, this “speaks eloquently to the public nature of the concerns the section is designed to protect”, i.e. removing from the Registrar marks which have fallen into disuse. Thus, it necessarily follows, in my view, that the nature of the proceedings under section 45 is a relevant consideration in determining whether or not intervener status should be given to a third party, such as CCM in the present matter.
[58] In coming to that view, I am mindful of the arguments put forward by Bauer in response to CCM’s arguments on this issue. In particular, I am mindful of Bauer’s arguments that Genencor is relevant, that Meredith had to be understood in its proper context, i.e. that the public nature of section 45 had to do with the fact that any member of the public could initiate a section 45 notice, that, as in Genencor, there is no overriding public interest in ensuring that invalid trade-marks are not maintained on the public register, that proceedings arising under section 45 do not usually involve complicated legal questions but, to the contrary, usually pertain to simple well known legal principles resulting from an extensive body of jurisprudence and that proceedings under section 45 are commonplace in the Federal Court.
[59] However, the fact that there is a public aspect to section 45 proceedings does not elevate these proceedings to a level comparable to cases that, in the words of the Judge at paragraph 26 of his reasons, “affect large segments of the population or raise constitutional issues”. Thus, the public nature of section 45 proceedings must be balanced against other relevant considerations which, in my respectful view, must be considered in the present matter. As I will explain shortly, the existence of a public interest component in section 45 does not, in the present matter, outweigh other considerations which militate against granting intervention. In my view, when all of the relevant factors are considered, the public nature of section 45 proceedings does not tip the scale in CCM’s favour. In other words, a proper balancing of all the relevant factors leads me to conclude that the Prothonotary did not err in refusing to allow CCM to intervene.
[60] I now turn to these other considerations.
[61] The first consideration is the agreement entered into between Bauer and CCM wherein CCM undertook and agreed not to object to Bauer’s use or registration of the trade-mark at issue. On the basis of this agreement, Bauer asserts that CCM is contractually barred from attacking the validity of its trade-mark. It says that this argument can be put forward in its defence against CCM’s counterclaim in Federal Court File T-311-12 and will constitute one of the issues to be determined by the Federal Court in that file. However, Bauer says that if intervener status is given to CCM, it will be unable to raise the issue in the context of section 45 proceedings in that the Federal Court “will merely be reviewing the decision of the Registrar to expunge Bauer’s Trademark registration applying the appropriate standard of review” (Bauer’s memorandum of fact and law, paragraph 113).
[62] I should point out that the aforesaid agreement between CCM and Bauer was considered by our Court in Bauer Hockey Corp. v. Sports Maska, 2014 FCA 158 where it held that the judge below had erred in striking certain portions of Bauer’s amended statement of claim. More particularly, our Court was of the view that Bauer’s amended allegations, which relied in part on the aforesaid agreement, were such that it could not be said that its claim for punitive damages had no reasonable prospect of success. In other words, it was not plain and obvious, in the Court’s view, that the amended statement of claim disclosed no reasonable cause of action with respect to punitive damages.
[63] The Prothonotary, at paragraph 13 of his reasons, considered this point concluding that “it would appear that said argument by Bauer would not be possible to make against CCM in the appeal should the latter be granted intervener status”. It is clear, in my view, that this is one of the considerations which led the learned Prothonotary to conclude that intervention should not be granted to CCM. In considering Bauer’s contractual arrangements with CCM as relevant in the determination of whether intervener status should be granted, the Prothonotary did not err. I would go further and say that it would have been an error on his part not to give consideration to this matter.
[64] The other consideration which, in my view, militates against granting intervener status to CCM is the existence of litigation between Bauer and CCM in Federal Court File T-311-12. In that file, Bauer has instituted proceedings against CCM claiming that CCM has infringed its trade-mark and CCM has counter-claimed seeking a declaration that the trade-mark is invalid. In seeking the invalidity of the trade-mark, CCM says at paragraph 25 of its Statement of Defence and Counterclaim:
25 […] Bauer does not use the [Trademark] as a trade-mark; rather, the [Trademark] is merely a decorative border or surround on the skate to highlight the BAUER word mark. To the extent that the [Trademark] or the Floating Skate’s Eyestay Design have ever appeared on Bauer’s skates, they have always been in combination with the BAUER word mark. […]
[65] The above assertion by CCM is similar to paragraph 13 of the Registrar’s decision where she said:
[13] I find that the addition of the word element “BAUER” IS A DOMINANT ELEMENT OF THE [Trademark] as used. As such, the [Trademark] as used is no longer simply a design mark but is clearly composed of two elements – an eyestay design and the word BAUER. As for the use of BAUER within the design mark, I am not convinced that the public would likely perceive it as a separate trade-mark from the [Trademark] at issue. Such additional matter would detract from the public’s perception of the use of the trade-mark “SKATES’S EYESTAY DESIGN” per se
[66] Bauer says that its use of the trade-mark at the time that Easton requested that the Registrar send a section 45 notice is the same as that when it reached its agreement with CCM approximately 30 years ago. In its reply and defence to CCM’s counterclaim, Bauer also says, as I have just indicated , that CCM is contractually barred from challenging its trade-mark.
[67] The Prothonotary was of the view that the litigation in Court File T-311-12 was a factor which had to be considered in determining whether intervener status should be given to CCM. At paragraph 15 of his reasons, the Prothonotary referred to those proceedings by saying that there was a “full debate already ongoing in File T-311-12 - a dynamic not present in Pictou Landing”. The Judge shared the Prothonotary’s view and said at paragraph 31 of his reasons that “[t]he validity of the trade-mark is in issue in the litigation between Bauer and CCM in docket T-311-12. That is the forum in which CCM should make its case”.
[68] In my view, there was no error in so concluding on the part of the Prothonotary and the Judge. I agree with Bauer’s assertion that allowing CCM to intervene would not, in any event, necessarily simplify and expedite the ongoing dispute over Bauer’s trade-mark. However, I need not go into this in greater detail since both the Prothonotary and the Judge, exercising their respective discretions, were of the view that litigation in File T-311-12 was a relevant consideration in determining whether CCM should be allowed to intervene. I can see no basis on which I could conclude that it was wrong on their part to take the ongoing litigation between the parties as a relevant factor. Again, I am of the view that it would have been an error not to take such litigation into consideration.
[69] CCM further submits, as it did before the Judge, that the Prothonotary erred in considering Bauer’s settlement with Easton. As I indicated earlier, the Judge agreed with CCM but was satisfied that the Prothonotary’s error was inconsequential. I am also of that view. In any event, it is my opinion that Bauer’s agreement with CCM and the existence of litigation in Federal Court File T-311-12 clearly outweigh all other considerations in this file.
[70] Although I believe that this is sufficient to dispose of the appeal, I will nonetheless briefly examine the specific factors enunciated in Rothmans, Benson & Hedges in the light of the evidence before us.
[71] First, is CCM directly affected by the outcome of the section 45 proceedings? The answer is that it is affected, in a certain way. More particularly, if the Registrar’s decision is upheld, Bauer’s trade-mark will be expunged and that conclusion will be helpful to CCM in Bauer’s infringement action. However, it is clear to me, in the circumstances of this case, that the purpose of CCM’s attempt to intervene is to gain a tactical advantage. In so saying I do not intend to criticize CCM. I am simply making what I believe to be a realistic observation of what is going on in the file.
[72] As to the second factor, i.e. whether there exists a justiciable issue and a veritable public interest, I have already dealt with this in addressing CCM’s arguments concerning the public nature of section 45 proceedings.
[73] As to the third factor, i.e. whether there is a lack of any other reasonable or efficient means to submit the question at issue before the Court, the answer is no. The question raised in the section 45 proceedings is, albeit in a different setting, also raised in the litigation conducted by the parties in Federal Court File: T-311-12. Preventing CCM from intervening in the section 45 proceedings will not cause it any prejudice other than the loss of a tactical advantage. In any event, CCM can and could have requested the Registrar to give Bauer a section 45 notice at any time. It chose not to do so for reasons which are of no concern to us. Whether it did not request the Registrar to give such a notice because of its agreement with Bauer not to object to Bauer’s use or registration of the trade-mark is a question which I need not address.
[74] With regard to the fourth factor, i.e. whether the position of the proposed intervener can be adequately defended by one of the parties, the answer is no in that there is no party to the case other than Bauer. The position which CCM wishes to advance is that which Easton put forward, with success, before the Registrar and which it would have defended in the appeal before the Federal Court.
[75] As to the sixth factor, i.e. can the Court hear and decide the case on its merits without the proposed intervener, the answer is yes. The fact that there would be no respondent does not prevent the Federal Court from performing its task in the circumstances. There can be no doubt that a respondent would be helpful to the Court but, in the circumstances, this factor does not tip the scale in favour of CCM. In any event, that was the conclusion arrived at by the Prothonotary and I can see no basis to disturb it.
[76] To repeat myself, I am satisfied that when all of the relevant considerations are taken in, the interests of justice are better served by not allowing CCM to intervene.
VII. Conclusion
[77] For these reasons, I conclude that the Judge made no error in refusing to interfere with the Prothonotary’s decision. Consequently, I would dismiss the appeal but, in the circumstances, without costs.
"M Nadon"
J.A.
“I agree.
J.D. Denis Pelletier J.A.”
“I agree.
Johanne Gauthier J.A.”
FEDERAL COURT OF APPEAL
NAMES OF COUNSEL AND SOLICITORS OF RECORD
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Docket: |
A-402-14 |
(APPEAL FROM A JUDGMENT OF THE HONOURABLE MR. JUSTICE HARRINGTON DATED SEPTEMBER 8, 2014, DOCKET NUMBER T-1036-13)
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STYLE OF CAUSE: |
SPORT MASKA INC. dba REEBOK-CCM HOCKEY v. BAUER HOCKEY CORP. and EASTON SPORTS CANADA INC.
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PLACE OF HEARING: |
Montreal
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DATE OF HEARING: |
September 15, 2015
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REASONS FOR JUDGMENT BY: |
NADON J.A.
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CONCURRED IN BY: |
PELLETIER J.A. GAUTHIER J.A.
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DATED: |
february 9, 2016
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APPEARANCES:
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Christopher Van Barr
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For The Appellant
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François Guay Jean-Sébastien Dupont
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For The Respondent
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SOLICITORS OF RECORD:
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Gowling Lafleur Henderson LLP Ottawa, Ontario
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For The Appellant
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Smart & Biggar Montreal, Québec
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For The Respondent
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