Date: 19980311
Docket: T-948-97
BETWEEN:
COOPER INDUSTRIES INC.,
Plaintiff,
- and -
CAPLAN INDUSTRIES INC.,
Defendant.
REASONS FOR ORDER
MR. JOHN A. HARGRAVE, PROTHONOTARY
[1] The Defendant seeks either cross-examination on the Plaintiff's Affidavit of Documents, or in the alternative, a better affidavit of documents to include documents relating to the Plaintiff's damage claim and dealing with prior art which reasonably pertain to the validity of the patent in question, being a locking device for a carpenter's tape measure. Production of financial material related to damages is now said by the Plaintiff to be irrelevant as the Plaintiff has elected to seek an accounting.
BACKGROUND
[2] The American Plaintiff, which holds a fairly recent patent, in Canada and in the United States, for a toggle activated blade-locking device for a spring-loaded retractable carpenter's tape measure, alleges infringement and seeks, among other things, injunctive relief and an accounting. The Statement of Claim, filed 9 May 1997, refers to the Canadian patent, a copy of which was filed, with the Court pursuant to Rule 700 (2), that same day. This was followed, 11 July 1997, by an Amended Statement of Claim. The Defence and Counterclaim of 25 July 1997 alleges invalidity and refers to eight prior patents disclosing the mechanism claimed by the Plaintiff.
[3] The Plaintiff's Affidavit of Documents of 26 November 1997 discloses the Canadian patent and the American patent, together with five other documents consisting of agreements, letters and a memorandum, which the Plaintiff believes are relevant.
[4] The Defendant has not yet separately filed its Affidavit of Documents, but the Affidavit has been sworn and is filed as an exhibit to an affidavit in support of the present motion. This Affidavit of Documents discloses 111 documents and bundles of documents, including some 80 patents and drawings of patents.
[5] The Defendant believes the Plaintiff's modest disclosure of documents is merely pro forma disclosure. The Defendant asks for the Plaintiff's documents relating to prior art and general knowledge of prior art, which the Defendant submits the Plaintiff must have if only because of the prosecution of its Canadian and American patent applications. Such material, including that contained on patent file wrappers, domestic or foreign, may be relevant: Heffco v. Dreco Energy Services Ltd. (1995) 62 C.P.R. (3d) 81 at 85 (F.C.). The Defendant also seeks material from the Plaintiff identifying its product and relating to the sales of its tape measures.
CONSIDERATION
[6] The Plaintiff says production of documents is complete for, the invention being novel and its patents valid, there is no prior relevant art. The Plaintiff says this is so even though it may have supplied prior art documents to the American patent office as confirmed by the Defendant's affidavit material: the fact that the examiners' office allowed the Plaintiff's patent means, according to the Plaintiff, that such documents are irrelevant. On this line of reasoning the American patent office examiner would seem to have taken over the role of the Court as the final arbiter of the relevancy of a document. The Plaintiff also submits that most of the prior art documents, which are listed on the cover page of the U.S. patent, are included in the Defendant's affidavit of documents and thus need not be produced by the Plaintiff. Alternatively, the Plaintiff argues that prior art must be in the public domain and therefore are neither in the power nor under the control of the Plaintiff.
[7] The Plaintiff's approach to production of documents overlooks the basic concept that disclosure of documents is a matter of relevance, not discretion: this is clearly required by Rule 448(2)(a) which provides that an affidavit of documents must contain various lists "... of all documents relevant to any matter in issue ..." which a party possesses or has power or control over. A litigant is obliged to list every relevant document in its possession, even those documents which do not have to be produced: see for example Skoye v. Bailey et al. [1971] 1 W.W.R. 144 at 145 (Alta. C.A.) and Re/Max Real Estate (Edmonton) Ltd. v. Border Credit Union Ltd. [1988] 6 W.W.R. 146, a well written and comprehensive decision of Master Funduk of the Alberta Queen's Bench. Turning from listing to production of documents, to say a document need not be produced because the other side already has it, from another source, is an inappropriate answer: see for example Canada Southern Petroleum Ltd. v. Amoco Canada Petroleum Co. Ltd. [1995] 5 W.W.R. 720 at 723 (Alta. Q.B.)
[8] Touching briefly on the issue of production of documents dealing with damages, the Plaintiff has now elected not to pursue damages as a remedy. The Plaintiff has offered to reamend its Statement of Claim to delete its prayer for relief, in the nature of damages, in paragraph 16 (c). The Defendant is concerned that there would still be reference in the body of the Statement of Claim to damages. I expect that, as an alternative to producing what the Plaintiff refers to as "thousands of financial documents", the Plaintiff ought to have no difficulty in reamending the Statement of Claim to delete all reference to damages. This would leave, as pointed out in correspondence, from counsel for the Plaintiff to counsel for the Defendant, a remedy by way either of an accounting of profits or of a reasonable rate of royalty.
[9] When a party seeks further production of documents there must be persuasive evidence that such are available, but have not been produced: see for example Liebmann v. Canada (1995) 87 F.T.R. 154 at 157. In the present instance there is no doubt that the Plaintiff either has or did have documents dealing with prior art which it assembled both in the United States and in Canada and likely has material bearing on general knowledge of prior art. It is not likely that the Plaintiff would have documents dealing with the issue of the profit of Caplan Industries Inc., however the Plaintiff could well have material, on which it will have to rely, in order to establish a reasonable royalty. The Plaintiff might well also have documents dealing with apportionment, for in the case of an accounting of profits the Plaintiff would be entitled to compensation measured by the benefit accruing to the Defendant by reason of the infringement, compared to the benefit which would have accrued had the Defendant marketed a tape measure without a supposedly infringing locking device. Clearly some documents, which exist or did exist, have not been declared by the Plaintiff and other documents, which likely or could well exist, may have been withheld. The Defendant is entitled to a remedy.
[10] It is clear what categories of documents have not been produced, including documents dealing with prior art, which the Defendant does not deny it has or did have. Thus cross-examination on the existing Affidavit of Documents would be an ineffective remedy. A more complete affidavit of documents is in order.
CONCLUSION
[11] The Plaintiff need not produce documents going strictly to damages, so as long as the Statement of Claim is amended within 30 days to delete all reference to damages.
[12] The Plaintiff shall file a further and better affidavit of documents, to include prior Canadian and American art, any general knowledge material going to prior art, any relevant royalty material and any relevant material going to apportionment of profits resulting from the alleged addition of the Plaintiff's locking device to the Defendant's tape measure. The affidavit shall be filed within 30 days. The Plaintiff should take proper notice of the full text and intent of the Court's Rules for production of documents, including the requirements to disclose documents which the Plaintiff no longer has, describing how each was lost and giving its current location and relevant documents in the possession, power or control of other persons who are not parties to the action, all as is required in the Schedules to the prescribed form for an affidavit of documents.
[13] This further production of documents is, of course, without prejudice to the Defendant making a future application for cross-examination on the affidavit should it be demonstrably deficient.
[14] The Defendant shall have its costs of the motion in any event.
(Sgd.) "John A. Hargrave"
Prothonotary
Vancouver, British Columbia
11 March 1998
NAMES OF COUNSEL AND SOLICITORS OF RECORD
COURT NO.: T-948-97
STYLE OF CAUSE: COOPER INDUSTRIES INC.,
Plaintiff,
- and -
| CAPLAN INDUSTRIES INC., |
Defendant.
PLACE OF HEARING: Vancouver, BC
DATE OF HEARING: January 26, 1998
REASONS FOR ORDER OF THE COURT BY:
MR. JOHN A. HARGRAVE, PROTHONOTARY
DATED: March 11, 1998
APPEARANCES:
Mr. Bruce Green for Plaintiff
Mr. Paul Smith for Defendant
SOLICITORS OF RECORD:
Mr. Bruce Green for Plaintiff
| Oyen, Wiggs |
| Mr. Paul Smith for Defendant |
Barrister & Solicitor