Court Grants Motion For Summary Judgment, Including Solicitor And Client Costs For 'Willful Blindness' In Ongoing Infringement (Intellectual Property Weekly Abstracts Bulletin: Week Of July 28th, 2014)

Edited by Chantal Saunders and Beverley Moore , Adrian Howard and Ryan Steeves TRADEMARK CASES

Court Grants Motion for Summary Judgment, including Solicitor and Client Costs for "Willful Blindness" in Ongoing Infringement

The Driving Alternative Inc. v. Keyz Thankz Inc., 2014 FC 559

This was a motion for summary judgment by the Plaintiff, who sought relief for trade-mark infringement, passing off, depreciation of goodwill, and likelihood of confusion. The Defendants filed no material in response to this motion.

The Plaintiff owned two registered trade-marks, KEYS PLEASE and THE DRIVING ALTERNATIVE, for use in association with (among other things) driving services. The Plaintiff has operated business out of Alberta, British Columbia, Saskatchewan, Manitoba and Ontario. For a brief time, the Defendants were licensed to operate a franchise using the Plaintiff's trade-marks in Ontario. The license was terminated by the Plaintiff for non-payment of royalties. However, subsequent to the termination of the license, the Defendants continued to operate a driving service under the mark KEYZ PLEAZE. The Plaintiff became aware of this, and demanded that the Defendants cease and desist using all confusing marks. In response, the Defendants signed an undertaking to "cease using... all use of any trademarks causing or potentially causing confusion" with the Plaintiff's trade-marks, as well as the marks KEYZ PLEAZE and KEYS PLEZE. However, after signing the undertaking, the Defendants incorporated the corporate Defendant KEYZ THANKZ and operated a driving service in Ontario under that name. The Plaintiff once again sent the Defendants a cease and desist letter, to which the Defendants refused to comply.

There was some dispute over the applicable limitation period: the Defendants argued it was 2 years (under the Limitations Act of Ontario), while the Plaintiff submitted it was 6 years (under the Federal Courts Act). The Court agreed with the Plaintiff, since the cause of action in this proceeding did not arise exclusively within the province of Ontario, and since the Defendants caused damage to the Plaintiff beyond Ontario. The Court stated that "it seems unjust to bar, by way of a provincial statute of limitations, national trade-marks rights of the Plaintiff."

The Court found that the Plaintiff established its cause of action under each claimed ground, including trade-mark infringement, likelihood of confusion, passing off and depreciation of goodwill...