Category Archives: Canada

Ontario Federal Court rejects “automatic” presumption of irreperable harm in motion for preliminary injunction

0
Shourin Sen - 27 August 2009 – 9:00 am
Filed under Canada, Preliminary Injunction

Western Steel and Tube Ltd. v. Erickson Manufacturing Ltd. 2009 FC 791 (July 31, 2009)

There were a slew of copyright cases uploaded to the Canadian Federal Courts website today. Of note, the Honourable Madam Justice Snider of the Federal Court in Ontario addressed the question of whether a court may presume irreperable harm in a motion for an interlocutory injunction. An interlocutory injunction is referred to as a preliminary injunction in the United States.

Western Steel and Tube brought suit against two rival manufacturing companies alleging that the companies were selling “knock offs” of its utility ramps. Western Steel claimed that the rivals, among other things, infringed its copyright in its packaging and instructions. The Court applied the three-pronged test used by the Supreme Court of Canada in RJR-MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311:

1.     Is there a serious question to be tried?

2.     Will the Plaintiff suffer irreparable harm if the injunctive relief is not granted?

3.     Does the balance of convenience favour the Plaintiff?

On the question of (1) whether there is a serious question to be tried, the Court found that the plaintiff’s claim met the “very low threshold” of not being “vexatious” or “frivolous.”

Irreperable Harm

The plaintiff in the action cited to a line of cases that it contended stood for the proposition that a plaintiff need not show irreperable harm to obtain an interlocutory injunction. See, e.g., Diamant Toys v. Jouets Bo-Jeux Toys, 2002 FCT 384, 218 F.T.R. 245 (“I agree with the plaintiffs that they need not establish that they will suffer irreparable harm in order to obtain an injunction. . . [I]n copyright infringement cases it seems to me, when the copying is blatant, it is appropriate to consider a less stringent test of potential damage, than would otherwise be the case.”); and Gianni Versace SPA v. 1154970 Ontario Ltd. 2003 FC 1015 (August 29, 2003) (“Turning to the issue of irreparable harm, I agree, based on the reasoning of Nadon, J. in Diamant, that the Plaintiffs need not establish that they will suffer irreparable harm in order to obtain an injunction.”)

The Court distinguished the line of cases on the grounds that in each of these cases the arbiter “made a specific finding that there was an infringement.” The Court concluded that “there is no automatic conclusion that irreparable harm exists merely because the foundation of an action is an infringement of copyright or trademark or the alleged tort of passing off.”

Adoption of the standard sometimes applied in the S.D.N.Y.?

The Court delved into the merits of the claim and found that while there were “clear similarities” between the two products there were also “significant differences.” The Court completed this analysis ostensibly on the grounds that Canadian precedent could be read as creating two tests for a preliminary injunction in infringement cases: the first, as outlined above, where a plaintiff must bring a non-frivolous claim and show irreperable harm; and the second, similar to the standard sometimes associated with the Southern District of New York (but currently up for appeal in Salinger v. Colting), where a plaintiff must show a likelihood of success on the merits, but irreperable harm is presumed.

[E]ven if there is precedent to support the proposition that irreparable harm is satisfied by a demonstration that the defendant’s product is substantially the same as that of the plaintiff, the evidence before me is inadequate to make that determination.

The Court ultimately denied the motion for an interlocutory injunction finding that the plaintiff had not presented any evidence beyond assertions to show irreperable harm or that damages were not an acceptable remedy.

Los Angeles adult movie producer’s suit survives summary judgment in Ontario

0
Shourin Sen - 11 June 2009 – 6:53 pm
Filed under Canada, Registration

Jules Jordan Video Inc. v. Elmaleh, [2009] FC 488.

I thought we’d expand our reach and take a look at a rather fun judgment issued on May 11 by the Honourable Mr. Justice Harrington of the Federal Court in Ottawa, Ontario. The plaintiffs were a Los Angeles corporation that wrote, produced, directed (and performed) adult movies, and the sole shareholder/employee of the company. The plaintiffs alleged copyright infringement in thirteen works, which were registered in both the United States and Canada. The plaintiffs filed two suits, one in Canada and the other in California, seeking damages in the U.S. and an injunction in Canada.

The defendant was found liable for violating the plaintiff’s right of publicity in the California action, but the copyright claim was dismissed. The plaintiff had registered the works in his personal name, instead of his company’s, and the federal district court in California found that the registration was invalid. In the U.S. registration is considered either a case process rule or jurisdictional (see Reed Elsevier v. Muchnick); a plaintiff can file suit in Canada without registration, but can only seek an injunction against an innocent infringer. See Canadian Copyright Act Section 39.

The Defendants in Jules Jordan Vide, Inc. v. Elmaleh filed a motion for summary judgment, arguing that one of the two parties, either the individual or the company didn’t have standing. The Court denied and found with that while only one of either the individual or the company owned the copyrights, the motion was best handled at trial.

[The individual]’s “admission” that he owns the copyright is of little value. According to Phipson on Evidence: “Admissions are receivable to prove matters of law…though…these are generally of little weight, being necessarily founded on mere opinion (section 4-11, p. 78)”. The fact that Mr. Gasper is shown on the Canadian Register as owner merely creates a rebuttable presumption in his favour (David Vaver, Copyright Law (Toronto: Irwin Law, 2000) at 247). [Ed: similar to the U.S.]

There are any number of ways in which the relationship between Mr. Gasper and his company could be characterized in law. There is not enough material in the record to allow me to come to any conclusion. For instance, Jules Jordan, as employer, may be the owner pursuant to s. 13 of the Copyright Act, should the necessary conditions have been fulfilled.

Their relationship may be a joint venture, principal and agent, assignor and assignee, or licensor or licensee, be it on an exclusive or non-exclusive basis. Section 36 of the Copyright Act contemplates that an assignor may be named as a co-plaintiff. One might also have to consider the distinction between legal ownership on the one hand, and beneficial ownership on the other. See F.C. Yachts Ltd. v. Splash Holdings Ltd., 2007 FC 1257.

The financial arrangement between the plaintiffs was not probed. How was income treated? Did it all go to Jules Jordan, except for Gasper’s salary? Standing to sue is not a question to be answered simply by looking at the Copyright Register.