Date: 19980619 Docket. T-393-98
BETWEEN:
A. LASSONDE INC.
Plaintiff
AND SUNPAC FOODS LIMITED
Defendant
REASONS FOR ORDER
RICHARD MORNEAU, PROTHONOTARY:
Introduction
[1] Through this motion, the plaintiff defendant to the counterclaim (the plaintiff) seeks, pursuant to Rule 221 of the Federal Court Rules, 1998 (the Rules), to have a series of paragraphs - 13 in total - struck from the statement of defence and counterclaim (the statement of defence) filed by Sun Pac Foods Limited (the defendant).
[2] In the alternative, should this relief not be granted, the plaintiff requests further and better particulars for most of these paragraphs pursuant to Rule 181.
Page: 2 [3] Finally, in any event, the plaintiff seeks an additional extension pursuant to Rule 8 to serve and file its reply and defence to counterclaim. The Court was also asked to make any other order it deems appropriate in the circumstances.
[4] The plaintiff comes before this Court believing that its exclusive rights in the trade-mark FRUITÉ have a specific scope. The defendant casts doubt on this scope in its statement of defence, and especially in the paragraphs challenged by the plaintiff.
[5] The scope of these rights must eventually be determined, but I am not convinced that this can be done by way of a motion to strike. It is a point of law which does not lend itself well to a motion like the plaintiff's motion.
[6] As this Court stated in Apotex Inc. et al. v. Wellcome Foundation Ltd. et al. (1996), 68
C.P.R. (3d) 23, at page 41 (F.C.T.D.):
In conclusion, I would like to reiterate that striking out pleadings is a draconian measure. The defendants may not have a strong case on some of the issues raised by the plaintiffs in their motion. However, the test in mv view is stringent: if there is a scintilla of success in a claim, a Court should not strike it down. As pointed out by counsel for the defendant Apotex, this is not a mini-trial or a summary judp~ment proceeding where I could have resolved some of the issues. The case law is clear that it has to be beyond doubt. Despite able argument by counsels for the plaintiff Wellcome, I have not been convinced that there is sufficient lack of substance to use this draconian measure, thereby depriving the defendants of their day in Court.
[Emphasis added]
Page: 3
Facts
[7] It is clear from the evidence that the two parties are direct competitors in the fruit juice and fruit drink business.
[8] The plaintiff obtained a certificate of registration under the Trade-marks Act, R.S.C., 1985, c. T-13 (the Act), for the trade-mark FRUITS.
[9] The defendant holds a certificate under the Act for the trade-mark FRUIT RHAPSODY.
[10] The conflict between the parties arises from the fact that the defendant uses the expression RHAPSODIE FRUITÉE (emphasis added) as the French equivalent for its trade-mark FRUIT RHAPSODY.
[11] In the plaintiffs opinion, the use of this word as a trade-mark is an infringement, within the meaning of section 20 of the Act, of its exclusive right to the use of FRUITÉ in association with fruit juices and fruit drinks. It alleges that this use depreciates the value of the goodwill attaching to the trade-mark (section 22 of the Act) and constitutes unfair competition (paragraphs 7(b) and 7(c) of the Act).
Page: 4
Tests for strikinaout pleadings and for particulars
[12] The possibility of seeking to have a pleading, or anything contained therein, struck out in the course of an action is now provided for in Rule 221. As this rule is the equivalent of Rule 419 of the Federal Court Rules, the case law developed in respect of Rule 419 applies to Rule 221.
[13] Thus, under paragraph 221(1)(a), it must be plain and obvious (see Canada (A.G.) 1'. Inuit Tapirisat, [1980] 2 S.C.R. 735, at page 740) that all or part of the defendant's statement of defence discloses no reasonable cause of defence.
[14] To apply the other paragraphs of Rule 221 in the instant case, the impugned pleadings
must be so intolerable and prejudicial that they must be struck in whole or in part. As Mr. Justice
Teitelbaum of this Court stated in Copperhead Brewing Co. Ltd. v. John Labatt Ltd. et al.
(1995), 61 C.P.R. (3 d) 317, at page 322:
the jurisprudence is consistent that under Rules 419(1)(b) through (nit must be established that the pleading is so clearly immaterial, frivolous, embarrassing or abusive that it is obviously forlorn and futile (Bit rnabyIlachine & Mill Equipment Ltd. v. Berglund Industrial Supply Co. Ltd. (1982), 64 C.P.R. (2d) 206 (F.C.T.D.)) and that the court will not strike mere surplus statements where no prejudice flows from them (Paler International Aartornotive Frarac{rising Inc. v. Mister Mechanic Inc. (1989) 28 C.P.R. (3d) 308, 27 C.I.P.R. 112, [1990] 1 F.C. 237 (T.D.)). As I am not entirely satisfied that the defendants will suffer prejudice if para. 9 is not struck, I will allow para. 9 and Sch. "A" to remain in the amended statement of claim.
[15] As for the tests concerning further particulars, the Court must consider whether one party
has enough information to be able to understand the adverse party's position and to prepare an
Page: 5
adequate response, whether a defence or a reply. (See Astra Aktiebolag v. Inflazyme Pharmaceuticals Inc. (1995), 61 C.P.R. (3d) 178 (F.C.T.D.), at page 184.)
[16] In Embee Electronic Agencies Ltd. v. Agence Sherwood Agencies Inc. et al. (1979), 43
C.P.R. (2d) 285 (F.C.T.D.), at page 287, Marceau J. explained the extent to which the
defendant is entitled to particulars of the plaintiff's evidence at the pleadings stage:
At that early stage, a defendant is entitled to be furnished all particulars which will enable him to better understand the position of the plaintiff, see the basis of the case made against him and appreciate the facts on which it is founded so that he may reply intelligently to the statement of claim and state properly the grounds of defence on which he himself relies, but he is not entitled to go any further and require more than that.
[No emphasis in original.]
Analysis
[17] It seems to me on reading the parties' pleadings and the other documents submitted in relation to this motion that the plaintiff now has enough information to be able to understand the defendant's position and to prepare an intelligent and adequate reply to the defendant's statement of defence.
[18] Obviously the plaintiff does not accept the defendant's narrow reading of its exclusive rights in the trade-mark FRUITÉ. In my view, however, this is not a reason to force the defendant to furnish particulars for and further justify a position that counsel for the plaintiff
Page: 6 seems to understand very well. Counsel for the plaintiff discusses and analyses this position in
great detail in the written submissions in support of his motion.
[19] There is accordingly no reason to make a general order that further particulars be furnished to the plaintiff.
[20] As for the requests to strike, it must be understood that all the impugned paragraphs of the statement of defence are based on the same premise.
[21] This premise is the defendant's submission that the plaintiffs certificate of registration is limited to the trade-mark FRUITÉ ET DESSIN and that the plaintiff cannot claim rights in the simple word "fruits" itself based on the history of the mark.
[22] Consequently, it submits that its use of RHAPSODIE FRUITÉE does not infringe the
trade-mark FRUITÉ ET DESSIN and that RHAPSODIE FRUITÉE is an authorized use pursuant
to subparagraph 20(1)(b)(ü) of the Act:
20. The right of the owner of a registered trade-mark to its exclusive use shall be deemed to be infringed by a person not entitled to its use under this Act who sells, distributes or advertises wares or services in association with a confusing trade-mark or trade-name, but no registration of a trade-mark prevents a person from making
(a) --
(b) any bona fide use, other than as a trade-mark, (i) --
(ii) of any accurate description of the character or quality of his wares or services,
in such a manner as is not likely to have the effect of depreciating the value of the goodwill attaching to the trade-mark.
Page: 7 [23] Counsel for the plaintiff argues forcefully that as no disclaimer with respect to the word "fruité" was required by the Registrar pursuant to section 35 of the Act, it follows that the plaintiff was granted the right to the exclusive use not only of the design of the trade-mark FRUITÉ but also of the word FRUITÉ itself.
[24] As mentioned supra, the scope of the plaintiff's exclusive use is the central issue of the case on the merits. I am accordingly of the view that the paragraphs of the statement of defence which challenge this scope in one way or another should not be struck. Therefore, paragraphs 4, 7, 10, 12, 19, 20(i)(a), 20(11) and 21(11) of the statement of defence may remain.
[25] The same result must apply to paragraph 9 of the statement of defence, as counsel for the plaintiff did not refer to it in written or oral argument.
[26] As for the impact of the licenses issued by the plaintiff, counsel for the plaintiff is very
familiar with his client's factual situation in this regard. He can easily respond to the defendant regarding any allegations concerning the reduction of the distinctiveness of his client's trade-mark.
It is theoretically possible that the defendant's allegations will be proven correct. Accordingly,
allegations 21(1) and (iii) of the statement of defence may remain.
[27] As for paragraph 20(i)(b), I consider that the dates mentioned in this paragraph, when it is read as a whole, are not wrong. This paragraph will not be struck out.
Page: 8 [28] Counsel for the plaintiff further submits that from an objective point of view, the defendant should have translated his trade-mark FRUIT RHAPSODY as RHAPSODIE DE FRUITS rather than RHAPSODIE FRUITÉE. In my opinion, that is a question of evidence, indeed of expert evidence. It cannot therefore be ordered at this time that paragraph 8 of the defence be struck out on this basis.
[29] Paragraph 8 -to which must be added paragraphs 11, 16 and 17- also appears to refer to the expression "bona fide" use as it is used in the Act. Once again, these paragraphs will not be struck out. Similarly, the determination of whether RHAPSODIE FRUITÉE is used as an accurate description of the character or quality of the beverages or as an adjective is also a question of evidence which should be left to the full hearing.
[30] However, the defendant refers in paragraph 7 -and possibly in paragraph 5- of its statement of defence to the use of RHAPSODIE FRUITÉE as a trade-mark. This statement is clearly contrary to paragraph 20(1)(b) of the Act.
[31] The defendant will accordingly be required to amend its statement of defence and counterclaim to eliminate any reference to the use of RHAPSODIE FRUITÉE as a trade-mark within thirty (30) days of the date of the order accompanying these reasons. I consider this order appropriate in the circumstances [see para. 3 , supra].
Page: 9 [32] The plaintiff will then have thirty (30) days from the date of service of the defendant's statement of defence and counterclaim to serve and file its reply and defence to counterclaim.
[33] Costs of this motion will be in the cause.
Richard Morneau
Prothonotary
MONTRÉAL, QUEBEC June 19, 1998
Certified true translation n
M. Iveson
FEDERAL COURT OF CANADA
NAMES OF COUNSEL AND SOLICITORS OF RECORD
COURT FILE NO.: T-393-98
STYLE OF CAUSE: A. LASSONDE INC.
Plaintiff
AND:
SUNPAC FOODS LIMITED
Defendant
PLACE OF HEARING: Montréal, Quebec
DATE OF HEARING: June 8, 1998
REASONS FOR ORDER OF THE COURT BY RICHARD MORNEAU, PROTHONOTARY
Dated: June 19, 1998
APPEARANCES:
Bruno Barrette for the plaintiff
Keri Johnston for the defendant
2- T-393-98
SOLICITORS OF RECORD:
Brouillette Charpentier Fortin for the plaintiff Montréal, Quebec
Malcom Johnston & Associates for the defendant Toronto, Ontario