Digests

Northwest Territories v. Sirius Diamonds Ltd.

T-822-00

2001 FCT 702, Hansen J.

26/6/01

41 pp.

Applicant seeking injunction restraining respondents from using particular mark, polar bear, pending trial--Plaintiff alleging defendants' activities amounting to copyright, trade-mark and official mark infringement, passing-off--Defendants in diamond business, importing polished stones, cutting, polishing and marketing diamonds mined in Northwest Territories (NWT)--In 1991, significant diamond reserves discovered in NWT--By 2004, NWT expected to produce 10 to 15% by value of world's diamonds--Government of Northwest Territories (GNWT) creating certification program in which GNWT attesting to origin and quality of each diamond mined and manufactured in NWT pursuant to certification program--Aim of program to enable consumers to purchase diamonds confident diamonds originated in NWT and mined, cut and polished in accordance with GNWT's environmental and labour laws--Program also seeking to differentiate NWT diamonds from "conflict diamonds" sold to fund violent and bloody guerilla wars--GNWT has adopted various depictions of polar bears as marks indicative of itself and has used depictions of polar bears in association with its ventures into diamond industry, and in association with certification program--Motion dismissed--Appropriate test herein tripartite test established in RJR-MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311 (serious question, irreparable harm, balance of convenience)--Review of evidence and case law has not uncovered sufficient basis on which to dispense with requirement that GNWT establish irreparable harm in respect of its copyright and trade-mark claims--For official mark, test for infringement not confusion, but resemblance: does defendant's design consist of or so closely resemble official mark that person would likely be deceived, confused or mistaken: Canadian Olympic Assn. v. Health Care Employees Union of Alberta (1992), 46 C.P.R. (3d) 12 (F.C.T.D.)--With respect to only relevant official mark, on evidence, marks differ significantly in important features such that test not met--Serious question: As Sirius has ceased use of old Sirius polar bear design, allegations of infringement with respect to particular mark have been rendered moot for purposes of issuing interlocutory injunction--With respect to new polar bear design only, serious issue raised--Irreparable harm: Applicant must establish it "would" suffer irreparable harm in absence of injunction, not "likely" suffer irreparable harm: Syntex Inc. v. Novopharm Ltd. (1991), 36 C.P.R. (3d) 129 (F.C.A.), standard confirmed in Centre Ice Ltd. v. National Hockey League et al. (1994), 53 C.P.R. (3d) 34 (F.C.A.)--To show irreparable harm, applicant must provide "clear and not speculative" evidence that irreparable harm "would" flow from respondent's actions should requested relief not issue--(1) Public interest of NWT--NWT hard hit by vocal anti-fur lobby in early nineties, effectively wiping out centuries-old industry--NWT therefore striving to optimize emergence of industry in Territories to complement new diamond mines, meaning enhanced revenues, skilled employment, and support for NWT and its Aboriginal communities--GNWT arguing Sirius' use of Sirius mark jeopardizing growth of secondary diamond industry in NWT, and so jeopardizing all of economic benefits people of NWT could expect from emergence of successful and profitable new industry--Potential harm irreparable in nature--Development of industry promising education, training, and skilled employment to population where such opportunities rare--Impossible to place dollar figure on cost of failure of this opportunity to people of NWT--However, GNWT has not provided Court with evidence this harm would occur should this Court decline to grant requested injunction--GNWT's evidence lacking in support of proposition that if Sirius permitted to continue using polar bear trade-mark pending trial, consumer confusion would inevitably compromise GNWT certification program--Evidentiary questions also remain as to effects of this consumer confusion on GNWT and on NWT's secondary diamond industry--(2) Irreparable harm to goodwill and reputation association with both GNWT and GNWT marks--In absence of independent, clear evidence of irreparable harm, Court cannot infer harmed goodwill from likelihood of consumer confusion, and further that such inferred harm irreparable in nature--As to balance of convenience, weighing in favour of NWT: significant public interest in general success of diamond industry in NWT--Successful industry to replace failed fur industry would promote economic vitality in Territory--Further, GNWT financially capable of compensating Sirius any losses Sirius might suffer, if in final analysis, Court concludes injunction should not have been awarded--In light of above conclusions, no interlocutory injunction will issue herein.