Ottawa, Ontario, June 22, 2006
PRESENT: The Honourable Madam Justice Mactavish
BETWEEN:
ADVANCED EMISSIONS TECHNOLOGIES LTD.,
CAR-BER INVESTMENTS INC.,
CAR-BER TESTING SERVICES INC., and,
CAR-BER TESTING ALBERTA INC.
and
DUFORT TESTING SERVICES LIMITED and
MARIO DUFORT
REASONS FOR ORDER AND ORDER
[1] This is an appeal from the decision of a prothonotary refusing to stay this action, pending the conclusion of an action now pending in the Superior Court of Ontario. The appeal of the prothonotary's decision refusing to strike the statement of claim was abandoned at the hearing of this appeal.
The Request to File New Evidence on the Appeal
[2] The defendants (the "Dufort parties") seek leave to file new evidence on this appeal. As a general rule, appeals from orders of prothonotaries are to be decided on the basis of the material that was before the prothonotary: James River Corp. of Virginia v. Hallmark Cards, Inc. et al., [1997] F.C.J. No. 152, 72 C.P.R. (3d) 157, at 168, see also Vogo Inc. v. Acme Window Hardware Ltd. et al., [2004] F.C.J. No. 1042, 2004 FC 851, at & 63.
[3] Additional evidence may be relied upon on an appeal where that evidence could not have been adduced in the first instance, by the exercise of reasonable diligence. Other factors to be taken into account include whether the admission of the new evidence serves the interests of justice and whether it will assist the Court: Mazhero v. Canada(Industrial Relations Board), [2002] F.C.J. No. 1112, 2002 FCA 295, at ¶ 5.
[4] Having carefully examined the new evidence sought to be adduced on this appeal, I am not persuaded that this evidence should be admitted. Some evidence, such as that relating to the identity of the officers and directors of the various plaintiff companies (the "Car-Ber parties"), could have been obtained prior to the hearing before the prothonotary through the exercise of reasonable diligence. Other evidence, such as that relating to the Business Development Bank financing and the confirmatory assignments, appears to have limited probative value in relation to the issues raised on this appeal, and thus would be of limited assistance to the Court.
[5] Finally, insofar as the evidence relates to the current status of the Ontario action, there is no dispute between the parties that the action has advanced since the motion for a stay was heard by the prothonotary, and that steps are being taken to reduce the risk of duplication and unnecessary expense by having the Federal Court and Superior Court actions jointly case-managed by a prothonotary and a Master of the Superior Court, with one set of documentary productions and one set of discoveries. The result of this is that both actions have progressed, and are now at approximately the same stage.
Standard of Review
[6] The granting or refusal of a stay is a discretionary decision, which does not raise questions vital to the final issue of the case: Vogo Inc., above, at ¶ 58, see also section 50(1) of the Federal Courts Rules. As a consequence, such an order ought not be disturbed on appeal unless the order is clearly wrong, in the sense that the exercise of discretion by the prothonotary was based upon a wrong principle or upon a misapprehension of the facts: Merck & Co. Inc, v. Apotex, [2003] F.C.J. No. 1925, 2003 FCA 488, at ¶ 19.
Analysis
[7] I am not persuaded that the decision of the prothonotary in this matter was based upon either a misapprehension of the facts or a wrong principle, and, as a result, I see no basis for interfering with that decision.
[8] The power to grant a stay is to be exercised sparingly, and only in the clearest of cases: Varnam v. Canada(Minister of National Health and Welfare), [1987] F.C.J. No. 511, 12 F.T.R. 34, at ¶ 7.
[9] In an order to justify a stay of proceedings two conditions must be met. That is, the Dufort parties must satisfy the Court that the continuance of the Federal Court action would work an injustice because it would be oppressive or vexatious to them, or would be an abuse of the process of the Court in some other way. In addition, the stay must not cause an injustice to the Car-Ber parties. Expense and inconvenience to a party are not, in and of themselves, sufficient special circumstances for the granting of a stay: Varnam, above.
[10] The jurisprudence of this Court also establishes that where related actions are proceeding in two different fora, a stay will not be granted where the parties to the two actions are not identical, where the jurisdiction of the two Courts are different, and where the causes of action being asserted in each court are also different: see, for example, 94272 Canada Ltd. v. Moffatt, [1990] F.C.J. No. 1013, at ¶ 4.
[11] I do not read the decision of the Federal Court of Appeal in Apotex Inc. v. AstraZeneca Canada Inc., [2003] F.C.J. No. 838, 2003 FCA 235 relied upon by the Dufort parties to have changed the law in this regard.
[12] In this case, the prothonotary properly understood that the parties to the Federal and Superior Court proceedings are not identical. That is, Philip Mitches is a party to the Superior Court action and not to the action in this Court. By the same token, Car-Ber Testing Alberta Inc. is a plaintiff in the Federal Court action, but is not named in the Superior Court action. Although Car-Ber Testing Alberta Inc. may have common officers and directors with the other Car-Ber parties, it is nonetheless a distinct legal person.
[13] Moreover, the causes of action asserted in the two proceedings are different. The claim asserted in the Federal Court is one for patent infringement. While the Car-Ber parties initially brought a counter-claim for patent infringement in the Ontario action, that counter-claim has been discontinued, subject only to the determination of the question of costs. In contrast, the claim being pursued in the Superior Court relates only to allegations of misappropriation of proprietary information, breach of trust and unjust enrichment. While there are undoubtedly common factual issues to be resolved in each case, it cannot be said that the claims are the same.
[14] With respect to the desire of the Dufort parties to have their claims decided by a jury, it remains open to them to pursue that option in the Superior Court, to the extent that such an option is available to them under the provisions of the Courts of Justice Act and the OntarioRules of Civil Procedure.
[15] Finally, the Car-Ber parties are entitled to select the forum in which they wish to pursue their claim of patent infringement. There are legitimate reasons why the Car-Ber parties wish to proceed with their claims in this Court, including the recognized expertise of this Court in intellectual property matters and the fact that orders of this Court are enforceable throughout Canada: see Biologische Heilmittel Heel GmbH v. Acti-Form Ltd., [1995] F.C.J. No. 1503, 64 C.P.R. (3d) 198 at 203.
[16] In this regard, it bears noting that the Car-Ber parties have pleaded acts of infringement by the Dufort parties in several locations across Canada.
Conclusion
[17] Given that the decision of the prothonotary was based upon neither a misapprehension of the facts nor a wrong principle, there is no basis for interfering with that decision, and the appeal is accordingly dismissed, with costs.
ORDER
THIS COURT ORDERS that this appeal is dismissed with costs.
FEDERAL COURT
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: T-666-05
STYLE OF CAUSE: ADVANCED EMISSIONS TECHNOLOGIES LTD.
ET AL. v.
DUFORT TESTING SERVICES LIMITED ET AL.
PLACE OF HEARING: Ottawa, Ontario
DATE OF HEARING: June 20, 2006
REASONS FOR ORDER
AND ORDER BY: Mactavish J.
APPEARANCES BY:
Mr. Anthony M. Prenol FOR THE PLAINTIFFS
Mr. Gordon S. Clarke FOR THE DEFENDANTS
SOLICITORS OF RECORD:
Blake, Cassels & Graydon LLP
Barristers and Solicitors
Toronto, Ontario FOR THE PLAINTIFFS
Gordon S. Clarke
Barrister and solicitor
Collingwood, Ontario FOR THE DEFENDANTS