Plaintiff and Ritchie Sinclair and Garth Cole doing business as
Court of Canada -- Trial Division
June 1, 2000
January 14, 2000
Counsel: Mr. Douglas N. Deeth
and Ms Diane M. LaCalamita, for Plaintiff.
Mr. Zak A.
Muscovitch, for Defendants.
Subject: Intellectual Property;
Property; Civil Practice and Procedure
Injunctions --- Availability of
injunctions -- Injunctions in specific contexts -- Intangible property rights
-- Trade marks -- Confusion
Plaintiff was limited partnership
operating Internet website since March 1998 which provided guide to services
and amenities offered in City of Toronto -- Plaintiff used, displayed, and
advertised trade-marks "toronto.com" and "toronto.com All you
need to know about T.O. & design" in association with its Internet
guide -- Defendants began operation of their website in April 1999 using
trade-mark "toronto2.com" -- Plaintiff alleged that defendants'
activities have caused it irreparable harm through loss of distinctiveness of
plaintiff's trade-mark and loss of goodwill attaching to plaintiff's
trade-mark -- Plaintiff brought motion for interlocutory injunction
restraining defendants from using, displaying, advertising or authorizing
others to do such acts in relation to trade-mark "toronto2.com" --
Motion dismissed -- Plaintiff failed to show irreparable harm -- Plaintiff
merely asserted likelihood of confusion without adducing actual evidence of
loss of goodwill or reputation -- Bare assertion was insufficient --
Plaintiff failed to prove that it has or
would lose reputation, brand name awareness, consumer loyalty, ability to
attract advertisers or that value of its goodwill was being diminished.
Cases considered by Heneghan J.:
Caterpillar Inc. v. Chaussures Mario Moda Inc.
(1995), 62 C.P.R. (3d) 338, 99 F.T.R. 299 (Fed.
T.D.) -- applied
Centre Ice Ltd. v. National Hockey League
(1994), 53 C.P.R. (3d) 34, 166 N.R. 44, 75 F.T.R. 240 (note) (Fed. C.A.) -- applied
Man & His Home Ltd. v. Mansoor Electronics Ltd.
(1996), 72 C.P.R. (3d) 239, 123 F.T.R. 310 (Fed.
T.D.) -- applied
Metropolitan Stores (MTS) Ltd. v. Manitoba Food & Commercial
Workers, Local 832 ,
(sub nom. Manitoba (Attorney General) v. Metropolitan Stores (M.T.S.) Ltd.) 38
D.L.R. (4th) 321, 73 N.R. 341, (sub nom. Manitoba (Attorney General) v.
Metropolitan Stores (M.T.S.) Ltd.)  3 W.W.R. 1, 46 Man. R. (2d) 241, (sub
nom. Manitoba (Attorney General) v. Metropolitan Stores (M.T.S.) Ltd.) 25
Admin. L.R. 20, (sub nom. Manitoba (Attorney General) v. Metropolitan Stores (M.T.S.)
Ltd.) 87 C.L.L.C. 14,015, 18 C.P.C. (2d) 273,  D.L.Q. 235, (sub nom.
Manitoba (Attorney General) v. Metropolitan Stores Ltd.)  1 S.C.R. 110 (S.C.C.) -- referred to
Nature Co. v. Sci-Tech Educational Inc.
(1992), 141 N.R. 363, 54 F.T.R. 240 (note), 41 C.P.R. (3d) 359 (Fed. C.A.) -- applied
RJR-MacDonald Inc. v. Canada (Attorney
54 C.P.R. (3d) 114, (sub nom. RJR-MacDonald Inc. c. Canada (Procureur général))
164 N.R. 1, (sub nom. RJR-MacDonald Inc. c. Canada (Procureur général)) 60
Q.A.C. 241, 111 D.L.R. (4th) 385,  1 S.C.R. 311 (S.C.C.) -- referred to
Syntex Inc. v. Novopharm Ltd.
(1991), 36 C.P.R. (3d) 129, 126 N.R. 114, (sub nom. Syntex Inc. v. Novopharm
Ltd. (No. 2)) 51 F.T.R. 299 (note) (Fed. C.A.) -- applied
Federal Court Rules, 1998,
R. 373 -- considered
R. 373(1) -- considered
R. 373(2) -- considered
R. 373(4) -- considered
MOTION by plaintiff for
interlocutory injunction restraining defendants from using, displaying,
advertising or authorizing others to use, display or advertise trade-mark
"toronto2.com" or any other similar words, names, domain names or
marks or doing any other act likely to have effect of depreciating goodwill
attaching to plaintiff's trade-marks, and restraining defendants from passing
off their wares, services or business as and for those of plaintiff's.
Reasons for Order
Applicant in this motion, Toronto.com (the "Plaintiff"), brought a
motion for an interlocutory injunction to restrain Ritchie Sinclair and Garth
Cole (the "Defendants") from:
(i) using, displaying, advertising or authorizing others to use,
display or advertise the trade-mark TORONTO2.com;
(ii) using, displaying, advertising or authorizing others to use,
display or advertise any other words, names, domain names or marks that are
similar to the trade-mark TORONTO2.com;
(iii) using, displaying or advertising the trade-mark
TORONTO2.COM, or authorizing others to use, display or advertise the trade-mark
TORONTO2.COM, in a manner which is likely to cause confusion with the
Plaintiff's trade-marks TORONTO.COM and TORONTO.COM ALL YOU NEED TO KNOW ABOUT
T.O. & design;
(iv) doing any other act likely to have the effect of depreciating
the goodwill attaching to the Plaintiff's Trade-marks;
(v) passing off their wares, services, or business as and for the
wares, services or business of the Plaintiff or otherwise directing public
attention to their wares, services or business in such a way as to cause or be
likely to cause confusion between their wares, services, or business and the
wares, services or business of the Plaintiff; and
(vi) copying, publishing, framing or linking content of the
Plaintiff's website at www.toronto.com;
(vii) otherwise infringing the Plaintiff's copyright in its www.toronto.com
order made on January 27, 2000, I dismissed the motion with reasons to follow.
These are my reasons.
Plaintiff is an organization called "Toronto.com". It is a limited
partnership consisting of Metroland Printing, Publishing and Distributing
Limited, Bell ActiMedia Inc. and City Search Canada Inc. Since March 30, 1998, the
Plaintiff has been operating a website called "toronto.com" which
provides a guide to the services and amenities offered in the city of Toronto.
Defendants, Respondents in this motion, are two individuals who carry on a
business under the name and style of "Friendship Enterprises". The
Defendants began operation of their website, under the domain name
"toronto2.com", in late April 1999. However, even as of January 14, 2000, the date
of the hearing of the Plaintiff's motion, the Defendant's website was incomplete.
5 It is
the existence of the Defendants' website which precipitated the Plaintiff to
bring an action against the Defendants and to seek an interlocutory injunction
enjoining the Defendants, Richie Sinclair and Garth Cole et al., from using,
displaying and advertising the trade-mark TORONTO2.COM.
Plaintiff claims that at its website it has used, displayed and advertised the
trade-marks TORONTO.COM and TORONTO.COM ALL YOU NEED TO KNOW ABOUT T.O. &
design in association with an internet guide and directory for the city of Toronto. The
Plaintiff alleges that it has and continues to sell advertising space on the
website to third parties.
Plaintiff claims that as a result of its extensive use in Canada of the
TORONTO.COM trade-mark, it has acquired substantial goodwill in the trade-mark
and is entitled by virtue of the common law to exclusive use of the trade-mark.
respect to the Plaintiff's copyright in the webpages, the Plaintiff submits
that it is the owner of the copyright in the webpages at www.toronto.com. The Plaintiff also
submits that it has the exclusive right to reproduce those webpages in any
material form and to authorize any such reproduction.
Plaintiff claims that the Defendants have: (i) "framed" several
webpages or portions of webpages published at www.toronto.com by the
Plaintiff, and displayed them on their website at www.toronto2.com; and (ii)
linked their website to some of the same websites to which the Plaintiff has
linked its website.
the time this motion was filed, searches performed by the Plaintiff confirmed
that the Defendants' website no longer appeared to frame content of the
Plaintiff's website. Nevertheless, the Plaintiff maintains that there is no
evidence that the framed portions of the Plaintiff's webpages will not reappear
on the Defendant's website.
Plaintiff maintains that the activities of the Defendants have caused the
Plaintiff to suffer irreparable harm through, inter alia, a loss of
distinctiveness of its TORONTO.COM trade-mark and a loss of goodwill attaching
to the trade-mark. The Plaintiff contends that this harm cannot be compensated
for in damages. Moreover, the Plaintiff submits that if an interlocutory injunction is not issued, the Plaintiff will
continue to suffer such harm.
373 of the Federal Court Rules, 1998 provides as follows:
373. (1) On motion, a judge may grant an interlocutory injunction.
(2) Unless a judge orders otherwise, a party bringing amotion for
an interlocutory injunction shall undertake to abide by any order concerning
damages caused by the granting or extension of the injunction.
(4) A judge may order that any evidence submitted at the hearing
of a motion for an interlocutory injunction shall be considered as evidence
submitted at the hearing of the proceeding.
373. (1) Un juge peut accorder une injonction interlocutoire sur
(2) Sauf ordonnance contraire du juge, la partie qui présente une
requête pour l'obtention d'une injonction interlocutoir s'engage à se conformer
à toute ordonnance concernant les dommages-intérêts découlant de la délivrance
ou de la prolongation de l'injonction.
(4) Le juge peut ordonner que la preuve présentée à l'audition de
la requête soit considérée comme une preuve présentée à l'instruction de
tri-partite test is applied to determine whether an interlocutory injunction
should be granted. This test considers whether there a serious issue to be
tried, whether an applicant will suffer irreparable harm if the relief is not
granted and finally, the balance of convenience is examined in assessing
whether to grant an interlocutory injunction. (See Metropolitan Stores (MTS)
Ltd. v. Manitoba Food & Commercial Workers, Local 832,
 1 S.C.R. 110 (S.C.C.) and RJR-MacDonald
Inc. v. Canada (Attorney General),
 1 S.C.R. 311 (S.C.C.)).
the present motion, it is unnecessary to address the question of whether the
Applicant has demonstrated a serious issue to be tried and the question of the
balance of convenience, as the Applicant has failed to show that it will suffer
15 In Syntex
Inc. v. Novopharm Ltd.[FN1], Nature
Co. v. Sci-Tech Educational
Ice Ltd. v. National Hockey League[FN3], the Federal Court
of Appeal clearly established that in order to be successful in a motion for an
interlocutory injunction, an applicant must show clear evidence that he or she
will suffer irreparable harm. This evidence cannot be speculative.
Ice Ltd., supra, requires that the evidence
show that an applicant will, in fact, suffer irreparable harm. It is
insufficient to show that irreparable harm is likely.
harm is harm which cannot be quantified in monetary terms, and hence, refers to
the nature of the harm and not its magnitude. (See: RJR-MacDonald
Inc. v. Canada (Attorney General))[FN4]
situations where the validity of the trade-mark is in issue, even if there is
an infringement of a trade-mark, this still may not constitute irreparable
harm. For example, in Syntex, supra, Justice Heald wrote:
In my view, a determination of the merits which involve extensive
evidence and contentious and disputed factors which address the vital question
of the validity of the mark should not be decided at the interlocutory
injunction stage. In such a situation a
conclusion that mere infringement of a proprietary right in a trade mark
constitutes, of itself, irreparable harm is somewhat contradictory since it is
the very "proprietary right" which is at issue. When a court decides
via an interlocutory injunction that an aggrieved party has "proprietary
rights in a trade mark", that court is deciding the very issue which is to
be determined at trial. In my view such a determination should not be made at
an interlocutory stage where, as in this case, the question of validity is
strenuously addressed by the parties.[FN5]
a court cannot infer, from a finding of confusion, the existence of a loss of
goodwill or reputation. In order to be granted an interlocutory injunction, the
moving party must produce concrete evidence of irreparable harm. For example,
Co., supra, Stone J.A. stated:
While, as the motions judge stated, there was in the present case
some evidence of actual confusion, that evidence did not go so far as to show,
in my view, that the confusion would cause irreparable harm to the respondent.
As I understand it, the learned judge was able to arrive at his conclusion from
what he viewed as loss of distinctiveness in the respondent's mark if this
confusion were allowed to go unchecked. This latter conclusion, it seems was in
turn dependent on the assumption that this contested mark should be taken to be
valid in determining the issue of irreparable
Justice Tremblay-Lamer in Caterpillar
Inc. v. Chaussures Mario Moda Inc.,[FN7] articulated the same principle as in Nature
Co., supra, when she clarified that Centre
Ice, supra, is to be interpreted as in the following way:
... the court cannot infer from the existence of confusion the
existence of a loss of goodwill or reputation. Actual evidence of irreparable
harm is necessary.[FN8]
Application to the Present
Defendants allege that the Plaintiff has merely asserted the likelihood of
confusion without adducing any evidence. The Defendants have also argued that
the Plaintiff has tendered no actual evidence of loss of goodwill or
agree with the Defendants. I am unable to locate in the materials any clear
evidence, which is not speculative in nature, that demonstrates the Plaintiff
will suffer irreparable harm.
only evidence tendered in support of the proposition that the Plaintiff will
suffer irreparable harm is the affidavit, including its attached exhibits, of
George Jewell. The relevant portions of his affidavit read:
40. By the activities complained of, the Defendants have caused
and will continue to cause, irreparable harm to the Plaintiff by, inter alia:
(a) jeopardizing the reputation, brand name awareness, and user or
consumer loyalty which the Plaintiff has developed, and continues to develop,
in connection with its Toronto.com web site and Trade-marks;
(b) jeopardizing the Plaintiff's ability to attract advertisers
who pay to have their products, services and businesses advertised on the
Plaintiff's web site in association with the mark Toronto.com;
(c) jeopardizing the commercial relationship between the Plaintiff
and its advertisers (because of (a), for example) such that the advertisers
will not advertise on the web site, or insist upon purchasing the advertising
space at a lower price;
(d) causing the Plaintiff's sole source of revenue, and the
significant value of its internet brand name, to be lost or diminished as a
result of (a) to (c);
(e) abetting others to provide internet services encroaching on
the Plaintiff's Trade-marks and pass off their own products, services and
businesses as and for those of the Plaintiff. Given the speed at which the
internet world is developing, it is reasonable for the Plaintiff to apprehend
that others will be tempted to follow the example of the Defendants if the
Defendants are not restrained from using the trade-mark and domain name
Toronto2.com and from copying and "framing" the Plaintiff's web site
(f) diminishing the value of the goodwill attaching to the
(g) diminishing the distinctive character of the Trade-marks; and
(h) encouraging others to engage in activities which attempt to
render common-place the distinctive Toronto.com trade-mark and domain name of
41. The loss of distinctiveness which the Plaintiff's Trade-marks
are suffering and will continue to suffer by the Defendants' use of
"Toronto2.com" cannot be adequately compensated by an award of
damages on the merits. The extent of loss is
not quantifiable because of the very nature of what is being lost, namely
42. The Plaintiff has invested tremendous time, money and effort
to create, operate and advertise its web site in association with its
Trade-marks in Canada. It has incurred significant operational costs, including the
initial costs to get the site up and running, and the continuing costs
associated with creating new web site pages and content and generally
maintaining the site.
43. The Plaintiff is not aware of any investment made by the
Defendants for the promotion of the Toronto2.com trade-mark on their web site
or elsewhere in Canada. The Defendants have been, and continue to be, unjustly enriched
by their improper and unlawful activities. They have, among other things,
avoided having to invest the time, effort and money that would have been
required to start-up, operate and maintain a web site with content or web pages
that they had themselves created or had licensed from others. They have also
avoided having to expend the time, effort and money they otherwise would have
had to expend to develop a valuable internet brand name, market their site to
potential advertisers and generate revenue through the sale of advertising
space to those advertisers. The Defendants are simply taking a free ride on the
Plaintiff's investments and goodwill.
44. The Plaintiff does not know whether or not the Defendants have
sufficient assets to satisfy any favourable judgment which this court may grant
to the Plaintiff inasmuch as damages and profits could be ascertained.
Jewell has simply not pointed to any clear evidence on which this Court could
conclude that irreparable harm will ensue if the interlocutory injunction is
not granted. The exhibits to Mr. Jewell's affidavit do not prove that www.toronto.com
has or will lose reputation, brand name awareness or consumer loyalty, nor do
the exhibits prove that www.toronto.com is losing the ability to attract
advertisers. Likewise, there is no proof that the value of its goodwill is
was noted in Man
& His Home Ltd. v. Mansoor Electronics Ltd.,
[FN9], by Madame Justice Tremblay-Lamer, "a bare allegation
on the part of the Plaintiff that the Defendant's activities have caused it to
suffer irreparable harm is, in my opinion, insufficient".[FN10]
an inability to ultimately pay damages can constitute irreparable harm, in the
present motion, the Plaintiff has failed to show, based on all the evidence
submitted, that it will suffer any irreparable harm. Without proof of harm, it is impossible for me
to conclude that the harm is irreparable solely on the basis that the
Defendants may be impecunious. Thus, there is no need to address the
adequacy of damages as the Plaintiff has failed to adduce clear and confirming
evidence that irreparable harm will ensue.
have already issued an Order dismissing the motion for the interlocutory
injunction and the foregoing constitute my reasons for that Order. However, at
this time I direct that the Defendants will maintain accounts in relation to
all activities in connection with their website pending the final disposition
of this matter at trial.
will be costs in the cause.
36 C.P.R. (3d) 129 (Fed. C.A.) at
41 C.P.R. (3d) 359 (Fed. C.A.) at
53 C.P.R. (3d) 34 (Fed. C.A.) at 52-54.
1 S.C.R. 311 (S.C.C.) at 315.
FN5. Ibid. at
FN6. Ibid. at
62 C.P.R. (3d) 338 (Fed. T.D.).
FN8. Ibid. at
72 C.P.R. (3d) 239 (Fed. T.D.), T-2097-96
(November 28, 1996).
FN10. Ibid. at