Date: 20040302
Docket: T-1955-00
Citation: 2004 FC 307
Ottawa, Ontario, this 2nd day of March, 2004
PRESENT: THE HONOURABLE MR. JUSTICE JOHN A. O'KEEFE
BETWEEN:
OAKLEY, INC. and
OAKLEY CANADA INC.
Plaintiffs
- and -
SHOPPERS DRUG MART INC.
Defendant
REASONS FOR ORDER AND ORDER
O'KEEFE J.
[1] Oakley, Inc. and Oakley Canada Inc. (the "plaintiffs") commenced an action, claiming, in part, copyright and trademark infringement by the defendant. The is a motion by the plaintiffs for summary judgment against the defendant for copyright infringement. The plaintiffs claim that the defendant copied the Oakley Ellipse in creating its Shoppers OPTIMUM Design.
Order Sought
[2] The plaintiffs seek an order pursuant to Rule 213 of the Federal Court Rules, 1998, S.O.R./98-106, granting partial judgment to the plaintiffs, including:
1. A declaration that the plaintiff, Oakley, Inc. is the owner in Canada of the copyright in the artistic work which is the subject of Canadian copyright Registration No. 447,604, the Oakley Ellipse, and has the sole right to produce or reproduce the work or any substantial part thereof;
2. A declaration that the defendant has, through the adoption, use, production and reproduction of the Shoppers OPTIMUM Design infringed the copyright of the plaintiff, Oakley, Inc.;
3. A permanent injunction, restraining the defendant, its officers, directors, agents, servants, employees and all those over whom it exercises control from producing or reproducing, either directly or indirectly, the Shoppers OPTIMUM Design or any substantial part thereof;
4. An order requiring the defendant to deliver up, or destroy under oath, all labels, signs, advertising material, printed matter and all other material in the possession of the defendant or under its control bearing or reproducing the Shoppers OPTIMUM Design;
5. An order, pursuant to Rule 213, dismissing the defendant's defence in its entirety;
6. Directions, pursuant to Rule 107, for the procedures to be followed for proceedings to determine the damages sustained by the plaintiffs, and the profits made by the defendant as a result of its infringing acts, punitive and exemplary damages to which the plaintiffs are entitled and any interest thereon;
7. An order granting the plaintiffs their costs of this motion and the action as claimed.
[3] The defendant seeks an order, pursuant to Rule 216 of the Federal Court Rules, 1998, supra, for the following:
1. An order dismissing the plaintiffs' summary judgment motion herein with costs to the defendant on a solicitor-and-client basis; and
2. Summary judgment in favour of the defendant declaring that the defendant did not, through the creation and use of the Shoppers OPTIMUM Design, infringe the copyright of the plaintiff, Oakley, Inc., in the work which is the subject of copyright Registration No. 447,604, with costs to the defendant on the copyright infringement action on a solicitor-and-client basis.
[4] In the alternative, the defendant requests that this Court issue an order, pursuant to Rule 216 of the Federal Court Rules, 1998, supra, dismissing the plaintiffs' motion for summary judgment herein and granting the defendant its costs of this motion on a solicitor-and-client basis.
Background
Plaintiffs
[5] The plaintiff, Oakley, Inc., is the registered owner of the copyright in the artistic work, the "ELLIPSE DESIGN". It was registered in Canada on November 14, 1995 (Registration No. 447,604). The plaintiff, Oakley, Inc. also owns the trade-mark for the ellipse design. The plaintiffs manufacture eyewear (e.g. sunglasses, spectacles and goggles), clothing, bags, watches, footwear, and various other accessories. The Oakley Ellipse was first published in the United States on December 1, 1993.
The Oakley Ellipse
[6] The Oakley Ellipse is depicted below:
[7] The Oakley Ellipse is intended, in part, to be a stylized "O" for the word Oakley.
Defendant
[8] The defendant, Shoppers Drug Mart Inc., commenced a customer loyalty program. The logo for the program was created in December 1998 and the card layout where the logo was represented was created in early January 1999 (cross-examination of Frank Casera).
[9] In May 1999, a pilot program for the Shoppers OPTIMUM loyalty program was launched. In September 2000, the full launch of the program took place across Canada. The Shoppers OPTIMUM Design was used on the customer loyalty cards, as well as on a variety of promotional and advertising material.
Shoppers OPTIMUM Design
[10] The Shoppers OPTIMUM Design is depicted below:
The design includes: (i) a central ellipse being a stylized "O" for OPTIMUM; (ii) a water motif consisting of an overall stylistic representation of a water droplet striking water with ripples emanating from its center, using both chevrons placed on the side of the stylized "O" and background water ripples or swirls; and (iii) the word "OPTIMUM" placed below the stylized "O". The word "SHOPPERS" placed above the stylized "O" was added in one of the later revisions. Changes were also made to the background colour. The final version of the Shoppers OPTIMUM Design was completed by March 19, 1999.
Creator of the Shoppers OPTIMUM Design
[11] The creator of the Shoppers OPTIMUM Design, Frank Casera, worked for the defendant's advertising agency, TBWA/Chiat/Day ("Chiat/Day"). For a period of time after the Oakley Ellipse was first published in 1993, the plaintiffs state that Chiat/Day was also the advertising and creative agency of Oakley, Inc. The defendant submits that the plaintiffs only previous contact with Chiat/Day was limited to their Los Angeles office and individuals in that office.
September 2000
[12] In September 2000, the plaintiffs became aware of the Shoppers OPTIMUM Design and its use in association with its customer loyalty program. The plaintiffs complained to Shoppers Drug Mart Inc. that the Shoppers OPTIMUM Design was a copy of the ellipse design used by Oakley, Inc. The plaintiffs subsequently filed a Statement of Claim against the defendant.
Plaintiff's Submissions
[13] The plaintiffs claim that the defendant has infringed the copyright of the plaintiff, Oakley, Inc., by the adoption, use, production and reproduction of an artistic work which is a copy of, or the taking of a substantial part of, Oakley, Inc.'s copyrighted artistic work.
[14] The plaintiffs submit that the defendant knew that it was infringing its rights as early as January 25, 1999, prior to the launch and first commercial use of the logo by the defendant. It is submitted that the defendant, through its advertising and creative agency, first copied the Oakley Ellipse in early 2000. It is submitted that the defendant was aware of the Oakley Ellipse at the time of the adoption and prior to the use of the design in issue.
[15] The plaintiffs submit that summary judgment should be granted in this case.
Defendants' Submissions
[16] The defendant submits the single issue in dispute in this motion is whether the creator of the Shoppers OPTIMUM Design, copied the Oakley Ellipse. It is submitted that the relevant date for consideration is when the Shoppers OPTIMUM Design was created in December 1998.
[17] The defendant submits the plaintiffs have not provided any evidence that the defendant copied the Oakley Ellipse. It is submitted that the Shoppers OPTIMUM Design was created wholly independent of, and not copied from, the Oakley Ellipse.
[18] The defendant submits the evidence does not support the plaintiffs' allegation that the Oakley Ellipse is well known in Canada. It is submitted that the plaintiffs have not submitted any expert or empirical evidence as to the extent of the recognition of the Oakley Ellipse in Canada.
[19] The defendant submits it is a conventional and common design idea to use an ellipse or stylized "O". It is submitted that this is not unique to the Oakley Ellipse and the plaintiffs should not be permitted to assert a monopoly over such a common design element. It is submitted that a number of third party designs are very similar, if not identical, to the Oakley Ellipse.
[20] The defendant submits that the Court could only find in favour of the plaintiffs on this motion by concluding that the evidence of the creator of the Shoppers OPTIMUM Design was not credible. It is submitted that where such a serious issue of credibility is raised, the case should go to trial because the Court must have the opportunity of observing the witness during examination and cross-examination.
[21] The defendant submits there is no genuine issue for trial on the issue of copyright infringement. It is submitted that it is clear on the evidence that there was no copying and therefore the defendant did not infringe Oakley, Inc.'s copyright. Accordingly, it is submitted that the Court should grant summary judgment in favour of the defendant, and dismiss the plaintiffs' copyright action and their corresponding motion for summary judgment.
[22] If the Court does not grant summary judgment in favour of the defendant, then it is submitted that the copyright issue must be permitted to go to trial, given that the central issue becomes the credibility of the evidence of the creator of the Shoppers OPTIMUM Design and also, given the opinion evidence of the plaintiffs' three witnesses.
Issues
[23] The plaintiffs state the issues in this motion as follows:
1. By the adoption and use of the Shoppers OPTIMUM Design, has the defendant infringed the registered copyright of Oakley, Inc. in its artistic work for the Oakley Ellipse?
2. Is the Shoppers OPTIMUM Design a copy of the whole or a substantial part of the Oakley Ellipse?
3. Is this a proper case for summary judgment as to the copyright issues in this action?
[24] The defendant states the issues in this motion as follows:
1. At the date that the Shoppers OPTIMUM Design was created (December 1998), did the individual who created the design copy the Oakley Ellipse and thereby infringe Oakley, Inc.'s copyright?
2. Is the plaintiffs' evidence of copying so strong that there is no genuine issue for trial, or that even if there is a genuine issue as to whether or not the defendant infringed the plaintiffs' copyright, the defendant's evidence is so doubtful that the issue does not warrant consideration at trial?
3. Is the credibility of the defendant's witness in issue?
Relevant Statutory Provisions and Regulations
[25] The relevant sections of the Federal Court Rules, 1998, supra state:
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3. These Rules shall be interpreted and applied so as to secure the just, most expeditious and least expensive determination of every proceeding on its merits.
. . .
213. (1) A plaintiff may, after the defendant has filed a defence, or earlier with leave of the Court, and at any time before the time and place for trial are fixed, bring a motion for summary judgment on all or part of the claim set out in the statement of claim.
. . . |
3. Les présentes règles sont interprétées et appliquées de façon à permettre d'apporter une solution au litige qui soit juste et la plus expéditive et économique possible.
. . .
213. (1) Le demandeur peut, après le dépôt de la défense du défendeur - ou avant si la Cour l'autorise - et avant que l'heure, la date et le lieu de l'instruction soient fixés, présenter une requête pour obtenir un jugement sommaire sur tout ou partie de la réclamation contenue dans la déclaration.
. . . |
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214. (1) A party may bring a motion for summary judgment in an action by serving and filing a notice of motion and motion record at least 20 days before the day set out in the notice for the hearing of the motion.
(2) A party served with a motion for summary judgment shall serve and file a respondent's motion record not later than 10 days before the day set out in the notice of motion for the hearing of the motion.
215. A response to a motion for summary judgment shall not rest merely on allegations or denials of the pleadings of the moving party, but must set out specific facts showing that there is a genuine issue for trial.
216. (1) Where on a motion for summary judgment the Court is satisfied that there is no genuine issue for trial with respect to a claim or defence, the Court shall grant summary judgment accordingly.
(2) Where on a motion for summary judgment the Court is satisfied that the only genuine issue is
(a) the amount to which the moving party is entitled, the Court may order a trial of that issue or grant summary judgment with a reference under rule 153 to determine the amount; or
(b) a question of law, the Court may determine the question and grant summary judgment accordingly. |
214. (1) Toute partie peut présenter une requête pour obtenir un jugement sommaire dans une action en signifiant et en déposant un avis de requête et un dossier de requête au moins 20 jours avant la date de l'audition de la requête indiquée dans l'avis.
(2) La partie qui reçoit signification d'une requête en jugement sommaire signifie et dépose un dossier de réponse au moins 10 jours avant la date de l'audition de la requête indiquée dans l'avis de requête.
215. La réponse à une requête en jugement sommaire ne peut être fondée uniquement sur les allégations ou les dénégations contenues dans les actes de procédure déposés par le requérant. Elle doit plutôt énoncer les faits précis démontrant l'existence d'une véritable question litigieuse.
216. (1) Lorsque, par suite d'une requête en jugement sommaire, la Cour est convaincue qu'il n'existe pas de véritable question litigieuse quant à une déclaration ou à une défense, elle rend un jugement sommaire en conséquence.
(2) Lorsque, par suite d'une requête en jugement sommaire, la Cour est convaincue que la seule véritable question litigieuse est:
a) le montant auquel le requérant a droit, elle peut ordonner l'instruction de la question ou rendre un jugement sommaire assorti d'un renvoi pour détermination du montant conformément à la règle 153;
b) un point de droit, elle peut statuer sur celui-ci et rendre un jugement sommaire en conséquence. |
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(3) Where on a motion for summary judgment the Court decides that there is a genuine issue with respect to a claim or defence, the Court may nevertheless grant summary judgment in favour of any party, either on an issue or generally, if the Court is able on the whole of the evidence to find the facts necessary to decide the questions of fact and law.
(4) Where a motion for summary judgment is dismissed in whole or in part, the Court may order the action, or the issues in the action not disposed of by summary judgment, to proceed to trial in the usual way or order that the action be conducted as a specially managed proceeding.
217. A plaintiff who obtains summary judgment under these Rules may proceed against the same defendant for any other relief and against any other defendant for the same or any other relief.
218. Where summary judgment is refused or is granted only in part, the Court may make an order specifying which material facts are not in dispute and defining the issues to be tried, including an order
(a) for payment into court of all or part of the claim;
(b) for security for costs; or |
(3) Lorsque, par suite d'une requête en jugement sommaire, la Cour conclut qu'il existe une véritable question litigieuse à l'égard d'une déclaration ou d'une défense, elle peut néanmoins rendre un jugement sommaire en faveur d'une partie, soit sur une question particulière, soit de façon générale, si elle parvient à partir de l'ensemble de la preuve à dégager les faits nécessaires pour trancher les questions de fait et de droit.
(4) Lorsque la requête en jugement sommaire est rejetée en tout ou en partie, la Cour peut ordonner que l'action ou les questions litigieuses qui ne sont pas tranchées par le jugement sommaire soient instruites de la manière habituelle ou elle peut ordonner la tenue d'une instance à gestion spéciale.
217. Le demandeur qui obtient un jugement sommaire aux termes des présentes règles peut poursuivre le même défendeur pour une autre réparation ou poursuivre tout autre défendeur pour la même ou une autre réparation.
218. Lorsqu'un jugement sommaire est refusé ou n'est accordé qu'en partie, la Cour peut, par ordonnance, préciser les faits substantiels qui ne sont pas en litige et déterminer les questions qui doivent être instruites, ainsi que:
a) ordonner la consignation à la Cour d'une somme d'argent représentant la totalité ou une partie de la réclamation;
b) ordonner la remise d'un cautionnement pour dépens; |
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(c) limiting the nature and scope of the examination for discovery to matters not covered by the affidavits filed on the motion for summary judgment or by any cross-examination on them and providing for their use at trial in the same manner as an examination for discovery.
219. In making an order for summary judgment, the Court may order that enforcement of the summary judgment be stayed pending the determination of any other issue in the action or in a counterclaim or third party claim. |
c) limiter la nature et l'étendue de l'interrogatoire préalable aux questions non visées par les affidavits déposés à l'appui de la requête en jugement sommaire, ou limiter la nature et l'étendue de tout contre-interrogatoire s'y rapportant, et permettre l'utilisation de ces affidavits lors de l'interrogatoire à l'instruction de la même manière qu'à l'interrogatoire préalable.
219. Lorsqu'elle rend un jugement sommaire, la Cour peut surseoir à l'exécution forcée de ce jugement jusqu'à la détermination d'une autre question soulevée dans l'action ou dans une demande reconventionnelle ou une mise en cause. |
[26] The relevant sections of the Copyright Act, supra state:
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3. (1) For the purposes of this Act, "copyright", in relation to a work, means the sole right to produce or reproduce the work or any substantial part thereof in any material form whatever, to perform the work or any substantial part thereof in public or, if the work is unpublished, to publish the work or any substantial part thereof, and includes the sole right
. . .
and to authorize any such acts.
. . .
27. (1) It is an infringement of copyright for any person to do, without the consent of the owner of the copyright, anything that by this Act only the owner of the copyright has the right to do. |
3. (1) Le droit d'auteur sur l'oeuvre comporte le droit exclusif de produire ou reproduire la totalité ou une partie importante de l'oeuvre, sous une forme matérielle quelconque, d'en exécuter ou d'en représenter la totalité ou une partie importante en public et, si l'oeuvre n'est pas publiée, d'en publier la totalité ou une partie importante; ce droit comporte, en outre, le droit exclusif:
. . .
Est inclus dans la présente définition le droit exclusif d'autoriser ces actes.
. . .
27. (1) Constitue une violation du droit d'auteur l'accomplissement, sans le consentement du titulaire de ce droit, d'un acte qu'en vertu de la présente loi seul ce titulaire a la faculté d'accomplir. |
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34. (1) Where copyright has been infringed, the owner of the copyright is, subject to this Act, entitled to all remedies by way of injunction, damages, accounts, delivery up and otherwise that are or may be conferred by law for the infringement of a right.
34.1 (1) In any proceedings for infringement of copyright in which the defendant puts in issue either the existence of the copyright or the title of the plaintiff thereto,
(a) copyright shall be presumed, unless the contrary is proved, to subsist in the work, performer's performance, sound recording or communication signal, as the case may be; and
(b) the author, performer, maker or broadcaster, as the case may be, shall, unless the contrary is proved, be presumed to be the owner of the copyright.
35. (1) Where a person infringes copyright, the person is liable to pay such damages to the owner of the copyright as the owner has suffered due to the infringement and, in addition to those damages, such part of the profits that the infringer has made from the infringement and that were not taken into account in calculating the damages as the court considers just.
. . .
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34. (1) En cas de violation d'un droit d'auteur, le titulaire du droit est admis, sous réserve des autres dispositions de la présente loi, à exercer tous les recours - en vue notamment d'une injonction, de dommages-intérêts, d'une reddition de compte ou d'une remise - que la loi accorde ou peut accorder pour la violation d'un droit.
34.1 (1) Dans toute procédure pour violation du droit d'auteur, si le défendeur conteste l'existence du droit d'auteur ou la qualité du demandeur:
a) l'oeuvre, la prestation, l'enregistrement sonore ou le signal de communication, selon le cas, est, jusqu'à preuve contraire, présumé être protégé par le droit d'auteur;
b) l'auteur, l'artiste-interprète, le producteur ou le radiodiffuseur, selon le cas, est, jusqu'à preuve contraire, réputé être titulaire de ce droit d'auteur.
35. (1) Quiconque viole le droit d'auteur est passible de payer, au titulaire du droit qui a été violé, des dommages-intérêts et, en sus, la proportion, que le tribunal peut juger équitable, des profits qu'il a réalisés en commettant cette violation et qui n'ont pas été pris en compte pour la fixation des dommages-intérêts.
. . .
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39. (1) Subject to subsection (2), in any proceedings for infringement of copyright, the plaintiff is not entitled to any remedy other than an injunction in respect of the infringement if the defendant proves that, at the date of the infringement, the defendant was not aware and had no reasonable ground for suspecting that copyright subsisted in the work or other subject-matter in question.
(2) Subsection (1) does not apply if, at the date of the infringement, the copyright was duly registered under this Act.
. . .
53. (1) The Register of Copyrights is evidence of the particulars entered in it, and a copy of an entry in the Register is evidence of the particulars of the entry if it is certified by the Commissioner of Patents, the Registrar of Copyrights or an officer, clerk or employee of the Copyright Office as a true copy.
(2) A certificate of registration of copyright is evidence that the copyright subsists and that the person registered is the owner of the copyright. |
39. (1) Sous réserve du paragraphe (2), dans le cas de procédures engagées pour violation du droit d'auteur, le demandeur ne peut obtenir qu'une injonction à l'égard de cette violation si le défendeur prouve que, au moment de la commettre, il ne savait pas et n'avait aucun motif raisonnable de soupçonner que l'oeuvre ou tout autre objet du droit d'auteur était protégé par la présente loi.
(2) Le paragraphe (1) ne s'applique pas si, à la date de la violation, le droit d'auteur était dûment enregistré sous le régime de la présente loi.
. . .
53. (1) Le registre des droits d'auteur, de même que la copie d'inscriptions faites dans ce registre, certifiée conforme par le commissaire aux brevets, le registraire des droits d'auteur ou tout membre du personnel du Bureau du droit d'auteur, fait foi de son contenu.
(2) Le certificat d'enregistrement du droit d'auteur constitue la preuve de l'existence du droit d'auteur et du fait que la personne figurant à l'enregistrement en est le titulaire. |
Issue
[27] Should summary judgment issue?
Analysis and Decision
[28] This Court in Granville Shipping co. v. Pegasus Lines Ltd., [1996] 2 F.C. 853 (T.D.) at paragraph 8, set out the following general principles with respect to summary judgment:
1. the purpose of the provisions is to allow the Court to summarily dispense with cases which ought not proceed to trial because there is no genuine issue to be tried (Old Fish Market Restaurants Ltd. v. 1000357 Ontario Inc. et al);
2. there is no determinative test (Feoso Oil Ltd. v. Sarla (The)) but Stone J.A. seems to have adopted the reasons of Henry J. in Pizza Pizza Ltd. v. Gillespie. It is not whether a party cannot possibly succeed at trial, it is whether the case is so doubtful that it does not deserve consideration by the trier of fact at a future trial;
3. each case should be interpreted in reference to its own contextual framework (Blyth and Feoso);
4. provincial practice rules (especially Rule 20 of the Ontario Rules of Civil Procedure, [R.R.O. 1990, Reg. 194]) can aid in interpretation (Feoso and Collie);
5. this Court may determine questions of fact and law on the motion for summary judgment if this can be done on the material before the Court (this is broader than Rule 20 of the Ontario Rules of Civil Procedure) (Patrick);
6. on the whole of the evidence, summary judgment cannot be granted if the necessary facts cannot be found or if it would be unjust to do so (Pallman and Sears);
7. in the case of a serious issue with respect to credibility, the case should go to trial because the parties should be cross-examined before the trial judge (Forde and Sears). The mere existence of apparent conflict in the evidence does not preclude summary judgment; the court should take a "hard look" at the merits and decide if there are issues of credibility to be resolved (Stokes).
[29] With respect to summary judgment, I stated in Inhesion Industrial Co. v. Anglo Canadian Mercantile Co., [2000] F.C.J. No. 491 (QL) (T.D.) at paragraph 19:
Upon a motion for summary judgment, both parties must file their best evidence. The moving party must of course lead evidence which it believes will convince the Court that it is appropriate to grant summary judgment in its favour. The responding party must however also put its best evidence forward. This issue was discussed by Justice Evans in F. von Langsdorff Licensing Limited v. S.F. Concrete Technology, Inc., [1999] F.C.J. No. 526, (8 April 1999), Court File No. T-335-97 (F.C.T.D.):
Accordingly, the respondent has an evidential burden to discharge in showing that there is a genuine issue for trial: Feoso Oil Ltd. v. Sarla (The), [1995] 3 F.C. 68, 81-82 (F.C.A.). However, this does not detract from the principle that the moving party has the legal onus of establishing the facts necessary to obtain summary judgment: Ruhl Estate v. Mannesmann Kienzle GmbH (1997), 80 C.P.R. (3d) 190, 200 (F.C.T.D.); Kirkbi AG v. Ritvik Holdings Inc., [1998] F.C.J. No. 912, (F.C.T.D.; T-2799-96; June 23, 1998). Thus, both parties are required to "put their best foot forward" so that the motions judge can determine whether there is an issue that should go to trial: Pizza Pizza Ltd. v. Gillespie (1990), 33 C.P.R. (3d) 515, 529-530 (Ont. Ct. Gen. Div.).
[30] Rules 216(2) and 216(3) of the Federal Court Rules, 1998, supra state:
216.(2) [Genuine issue of amount or question of law] Where on a motion for summary judgment the Court is satisfied that the only genuine issue is
(a) the amount to which the moving party is entitled, the Court may order a trial of that issue or grant summary judgement with a reference under rule 153 to determine the amount; or
(b) a question of law, the Court may determine the question and grant summary judgment accordingly.
216.(3) [Summary judgment] Where on a motion for summary judgment the Court decides that there is a genuine issue with respect to a claim or defence, the Court may nevertheless grant summary judgment in favour of any party, either on an issue or generally, if the Court is able on the whole of the evidence to find the facts necessary to decide the questions of fact and law.
[31] In J.H.C. v. Canada (Minister of Citizenship & Immigration), 2001 FCT 263, F.C.J. No. 566 (T.D.), it was held that the Federal Court Rules, 1998, supra allow summary judgment based on contested facts. However, in Warner-Lambert v. Concord Confections Inc., 2001 FCT 139, F.C.J. No. 287 (T.D.), it was held that the Court should not grant summary judgment where serious factual or legal issues remain to be resolved.
[32] It is against this background that the present motion must be considered.
Copyright
Introduction
[33] Subsection 3(1) of the Copyright Act, supra states:
3.(1)[Copyright in works] For the purposes of this Act, "copyright", in relation to a work, means the sole right to produce or reproduce the work or any substantial part thereof in any material form whatever, to perform the work or any substantial part thereof in public or, if the work is unpublished, to publish the work or any substantial part thereof, and includes the sole right
(a) . . .
. . .
and to authorize such acts.
Subsection 27.(1) of the Copyright Act, supra states:
27.(1) [Infringement generally] It is an infringement of copyright for any person to do, without the consent of the owner of the copyright, anything that by this Act only the owner of the copyright has the right to do.
Registration of Oakley, Inc.'s "ELLIPSE DESIGN"
[34] Oakley, Inc. has the registered copyright in the artistic work entitled the "ELLIPSE DESIGN" (Registration No. 447,604). Registered on November 14, 1995, the author of the work is James Jannard. Mr. Jannard is the founder, Chief Executive Officer and Chairman of the Board of Oakley, Inc.
[35] Accordingly, Oakley, Inc. has the "sole right to produce or reproduce the [ellipse design] or any substantial part thereof in any material form whatever". Oakley also has the right "to authorize any such acts".
[36] The defendant submits that its Shoppers "Optimum" Design was created in December 1998 or early January 1999 by Frank Casera who was working with Chiat/Day's Toronto office. Shopper's Drug Mart Inc. ("Shoppers") had chosen the name "optimum" for its customer loyalty program and then asked Chiat/Day to develop a logo that could be used in combination with the word "optimum".
[37] The following excerpt is from Mr. Casera's affidavit at paragraph 8:
. . . Between late December 1998 and early January 1999, and following discussions with other members of TBWA/Chiat/Day and SDM [Shoppers Drug Mart, Inc.], it was decided to adopt a logo which I created, consisting of a central ellipse flanked by two sets of chevrons with the name OPTIMUM placed below the ellipse.
Mr. Casera made a presentation to Shoppers, he thinks was sometime in early January 1999. On January 21, 1999 a fax was sent from Shoppers' legal department enclosing the Chiat/Day original logo design. Further revisions were made to the logo.
[38] Mr. Casera explains the elements of logo design at paragraph 13 of his affidavit, which reads in part as follows:
. . .
(i) a central ellipse being a stylized "O" for the name OPTIMUM; and
(ii) an overall stylistic representation of a water droplet striking water with ripples emanating from its center. This was accomplished through the use of the stylized "O", the chevrons and, as seen on the various card layouts, background water ripples. The use of water was symbolic of nature and life, with the chevrons being representative of the all inclusiveness of the loyalty program encompassing the SDM [Shoppers Drug Mart Inc.] customer with the full line of SDM products and services.
[39] At paragraph 14 of his affidavit, Mr. Casera explains how he created the Shoppers logo:
In terms of creation of the actual OPTIMUM logo design, I first started by drawing initial design concepts in free hand. Once the design had progressed to a certain point, I moved to a computer where I further worked on the design using a popular, commercially available computer graphics software package called ILLUSTRATOR. In ILLUSTRATOR I started with a circle design that comes with the package and manipulated it until I had the central ellipse that is present in the OPTIMUM logo design. I then added the chevrons and background water ripples as seen in the various sample card layouts attached to my affidavit.
[40] Mr. Casera swears that he had no recollection of even being aware of the existence of the Oakley Ellipse when he created the original Shoppers OPTIMUM Design and did not refer to it or have it in mind while in the process of creating the design. Mr. Casera also states that the "suggestion that [he] copied the Oakley ellipse, directly or indirectly, is simply untrue".
[41] Stanley Thomas, a past member of Shoppers Drug Mart Inc.'s Executive Committee, the body primarily responsible for approving all major corporate decisions including all facets of the OPTIMUM Program, and Richard Schenker, the Director of the OPTIMUM Program, stated in their affidavits that they were also unaware of the Oakley Ellipse at the time of creation of the Shoppers OPTIMUM Design, and that they do not recall reference to the Oakley Ellipse up until this time.
[42] The plaintiffs placed considerable importance on the following e-mail which was either directly mailed to Mr. Casera or he was copied with it. The e-mail reads as follows:
Printed By: Gloria Florio Page: 1 1/25/99 10:11 AM
From: Melanie Schmarje (1/25/99)
To: Sally Benson, Duncan Bruce, Frank Casera, Gloria Florio
CC: Norris Blaxall, Wells Davis, Richard Fisher, Christina Hill, Nancy Karpus, Jeff Norton
Re: Loyalty logos . . . 1/25/99
You can see the oakley logo at www.oakley.com - It is almost exactly the same as the "O" part of the logo - without the brackets.
I think we will need to talk with their legal dept to find out if our logo is different enough.
There are a lot of logos with an "O" or loop theme, hopefully it will not be an issue.
Gloria Florio wrote:
Neil has requested another version. . .one with "Shoppers Drug Mart" typed in the same font as the word "Optimum".
Frank, we need to get this out as soon as possible since they are trying to trademark all versions.
Also, fyi - Neil has also asked us to check out the "Oakley" sunglasses logo - apparently the "O" is very similar to our layout.
Let's chat Monday. . .
thanks,
Gloria
The date of this e-mail is subsequent to the date when Mr. Casera created the Shoppers logo.
[43] The plaintiffs led the affidavit evidence of James H. Jannard, the Chief Executive Officer of Oakley, Inc., who created the Oakley Ellipse. In addition, the plaintiffs led the evidence of Martin Bell, an optician from Waterloo, Ontario who retails and is very familiar with Oakley eyewear and Grant McLean who is a buyer for a local Toronto sports store. He purchases Oakley products which are sold by the store. The evidence of these witnesses deals with how well known the Oakley design was in Canada or in other words, its level of notoriety amongst the Canadian public.
[44] In addition, Frank Casera and Richard Alderson, witnesses for Shoppers stated they were not aware of the Oakley Design.
[45] The plaintiffs also raised the argument with respect to the interpretation of section 39 of the Copyright Act, supra, stating that the section deals with damages and the issue of entitlement to damages and also with the issue of deemed knowledge of the defendant at the time of the creation of the design. The defendant states that this section only relates to remedies, whereas the plaintiffs state that because of subsection 39(2) of the Act, even if you independently created your work, you would still be liable for copyright infringement.
[46] In order to grant summary judgment with respect to Mr. Casera's work, I must find Mr. Casera to be not credible. Mr. Casera has sworn in his affidavit that he did not copy the Oakley design directly or indirectly. He states as follows in in paragraphs 16, 18 and 19 of his affidavit:
I have no recollection of even being aware of the existence of the Oakley elliptical design at the time that I created the original Shoppers OPTIMUM logo design in late December 1998/early January 1999. At no time while I was in the process of creating the OPTIMUM logo design did I refer to the OAKLEY elliptical design or have it in mind. Additionally, no one at TBWA/Chiat/Day or SDM ever referred to or mentioned the Oakley elliptical design to me at this time.
Overall, I created the OPTIMUM design by referring to my experience with SDM's HEALTHWATCH program, the goals and objectives of the SDM OPTIMUM Program, and most importantly, the original creative strategy and concepts described above.
This suggestion that I copied the Oakley ellipse, directly or indirectly, is simply untrue. An Art Designer's reputation is of paramount importance in the advertising business and is the only equity an Art Designer has in the marketplace. No legitimate Designer would attempt to copy another person's work. We are hired by clients because we are artists who are able to develop creative, original designs and artwork that will effectively communicate to consumers the messages that clients wish to deliver.
[47] As I stated in paragraph 20 of Inhesion, supra:
It is accepted that the rules respecting summary judgment have been interpreted liberally by this Court. The respondent has an evidential burden to discharge in showing that there is a genuine issue for trial and the applicant has the legal onus of establishing the facts necessary to obtain summary judgment. If after considering all of the evidence, the necessary facts cannot be found, summary judgment cannot be ignored.
[48] In Granville Shipping Co. v. Pegasus Lines Ltd., supra, this Court stated at paragraph 8:
7. in the case of a serious issue with respect to credibility, the case should go to trial because the parties should be cross-examined before the trial judge (Forde and Sears). The mere existence of apparent conflict in the evidence does not preclude summary judgment; the court should take a "hard look" at the merits and decide if there are issues of credibility to be resolved (Stokes).
[49] I am of the opinion that there is a serious issue with respect to the credibility of the testimony of Mr. Casera. As a result, this matter should go to trial because the witness should be cross-examined before the trial judge. Mr. Casera's evidence is central to the issue of copyright infringement.
[50] With respect to the alleged infringement by the other two works or designs, there is insufficient evidence before me to make a determination in summary judgment proceedings and in any event, these are intertwined with the other alleged infringement.
[51] The issue of the application of section 39 of the Copyright Act, supra, is a complicated issue of law and should not be dealt with on a motion for summary judgment. It can be better dealt with at trial.
[52] The plaintiffs' application for summary judgment is dismissed as there is a serious issue for trial.
[53] The defendant proposed that I should enter summary judgment for the defendant. I am not prepared to enter summary judgment for the defendant.
[54] The defendant shall have its costs of the motion.
ORDER
[55] IT IS ORDERED that:
1. The plaintiffs' motion for summary judgment is dismissed.
2. The defendant shall have its costs of the motion.
"John A. O'Keefe"
J.F.C.
Ottawa, Ontario
March 2, 2004
FEDERAL COURT OF CANADA
TRIAL DIVISION
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: T-1955-00
STYLE OF CAUSE: OAKLEY, INC. and
OAKLEY CANADA INC.
- and -
SHOPPERS DRUG MART INC.
PLACE OF HEARING: Toronto, Ontario
DATE OF HEARING: Tuesday, September 2, 2003
REASONS FOR ORDER AND ORDER OF O'KEEFE J.
APPEARANCES:
Kenneth D. McKay
FOR PLAINTIFFS
Stephen B. Garland
FOR DEFENDANT
SOLICITORS OF RECORD:
Sim, Hughes, Ashton & McKay LLP
Toronto, Ontario
FOR PLAINTIFFS
Smart & Biggar
Ottawa, Ontario
FOR DEFENDANT