Increased Use Of Summary Disposition In The Federal Court: An Efficient And Cost-Effective Tool To Resolve Trademark Cases

For many years, summary disposition was essentially unavailable in intellectual property cases in the Federal Court of Canada, unless a claim or defence was plainly devoid of merit. For some parties, this presented a disincentive to advance meritorious claims where the costs of litigation would exceed what was likely to be recovered.

In recent years, there has been a clear trend towards using the Federal Court's summary judgment and summary trial rules1 to efficiently resolve trademark proceedings, particularly where the defendant was in default. Two recent decisions from the Federal Court have demonstrated that summary disposition is not limited to default proceedings, and can be a valuable tool for determining contested trademark infringement and validity claims.

Summary Judgment/Summary Trial

Historically, the Federal Court was very reluctant to resolve a contested intellectual property case without a full trial. Any issue of credibility, competing expert testimony or conflicting facts was usually enough to have a summary judgment motion dismissed. In trademark cases, issues surrounding the validity of the trademark registration, whether one mark was confusing with another, and whether a trademark was functional in nature were all considered too complex for summary determination, and required full consideration at a trial.2 This presented a challenge to litigants where damages awards would be modest; the time and expense required to go through discovery and trial were often disproportionate to the damages and costs that would be awarded.

The Federal Court introduced rules for a summary trial procedure in 2009. These new Rules, among other things, permitted cross-examination on affidavits before the motions judge. This was intended to assist the Court in resolving issues of credibility, which is difficult to determine on a paper record, and make summary determination of issues more available to litigants.

While summary judgment and summary trial are quite similar, there are differences. In a summary judgment motion, the Court makes a determination as to whether there is a genuine issue for trial. In a summary trial, the Court actually tries the issues raised by the pleadings and weighs the evidence contained in the affidavits to determine if judgment can be given on all or some of the issues.3

Since the summary trial rules were introduced, the Court has used this procedure to dispose of a number of trademark cases involving counterfeits.4...