T-5283-78
Wic Inc. (Plaintiff)
v.
La Machinerie Idéale Cie Ltée and Rovibec Inc.
(Defendants)
Trial Division, Walsh J.—Montreal, March 3;
Ottawa, March 6, 1980.
Practice — Costs — In an action where plaintiff sought
injunction and damages for infringement of Canadian patent
and where defendants denied infringement and brought cross-
demands attacking plaintiffs patent, motion brought for secu
rity for costs from each defendant pursuant to Rule 700(3) —
Whether plaintiff in cross-demand should be considered as a
plaintiff in an action for impeachment of patent and be
required to provide security or whether cross-plaintiffs were
merely defendants in action for infringement of a patent and
entitled to obtain a declaration without furnishing security —
Motion for security for costs granted — Patent Act, R.S.C.
1970, c. P-4, s. 62(1).(3) — Federal Court Rules 700(3),
1718(1).
APPLICATION.
COUNSEL:
W. C. Décarie and R. Trudeau for plaintiff.
F. Grenier for defendants.
SOLICITORS:
Martineau, Walker, Allison, Beaulieu,
MacKell & Clermont, Montreal, for plaintiff.
Leger, Robic & Richard, Montreal, for
defendants.
The following are the reasons for judgment
rendered in English by
WALSH J.: A motion for security for costs seek
ing same in the amount of $2,000 from each of the
defendants pursuant to Rule 700(3) of the Rules
of this Court was presented at the same time as an
identical motion in the case bearing No. T-5284-
78 Wic Inc. v. Norcotech Ltée and Proulx Farm
Equipments Ltd. in which $2,000 is sought as
security from defendant Proulx Farm Equipments
Ltd. Both motions were argued simultaneously and
the decision herein will apply to both. In each case
plaintiff sought an injunction and damages for
infringement of its Canadian Patent No.
1,037,839. In each case defendants in addition to
denying the infringement brought cross-demands
attacking plaintiff's said patent. The demand for
security for costs is based on Rule 700(3) of the
Rules of this Court which reads as follows:
Rule 700. .. .
(3) In an action to impeach a patent of invention, the Court
may at any time, in its discretion, order that the plaintiff,
unless he is one of Her Majesty's attorney generals or a deputy
thereof, give security for costs before taking any further step.
In opposing the application plaintiffs rely on sec
tion 62(1) and (3) of the Patent Act, R.S.C. 1970,
c. P-4 as amended by S.C. 1970-71-72, c. 1, s.
64(2), which reads as follows:
62. (1) A patent or any claim in a patent may be declared
invalid or void by the Federal Court at the instance of the
Attorney General of Canada or at the instance of any interest
ed person.
(3) With the exception of the Attorney General of Canada
or the attorney general of a province of Canada, the plaintiff in
any action under this section shall, before proceeding therein,
give security for the costs of the patentee in such sum as the
Court may direct, but a defendant in any action for the
infringement of a patent is entitled to obtain a declaration
under this section without being required to furnish any
security.
Plaintiff contends that a cross-demand is similar to
a separate action referring to Rule 1718(1) which
reads:
Rule 1718. (1) A counterclaim or cross-demand may be pro
ceeded with notwithstanding that judgment is given for the
plaintiff in the action or that the action is stayed, discontinued
or dismissed.
It is necessary to read Rule 700(3) in the light
of section 62(3) of the Patent Act. If the plaintiff
in the cross-demand is considered as a plaintiff in
an action for impeachment of a patent, security is
required under the provisions of section 62(3), but
if the said cross-plaintiffs were merely defendants
in actions for infringement of a patent and if
section 62(3) is read by itself, then as such defend-
ants they are entitled to obtain a declaration with
out being required to furnish any security. Plaintiff
contends however that this is only applicable if
they seek to have the patent they are accused of
infringing impeached in their defence in which
case the judgment would only take effect between
the parties, but that it does not apply if by cross-
demand they seek as plaintiffs to impeach the
patent and therefore to have it declared invalid
with respect to the whole world.
Reading this section of the Patents Act in the
light of Rule 700(3) of this Court it would appear
that cross-plaintiffs can be required to give secu
rity in the present proceedings in the same manner
as if they had taken a separate action.
An affidavit filed at the hearing of the motion
indicates that both La Machinerie Idéale Cie Ltée
and Rovibec Inc. are substantial companies
employing a large number of persons and with
considerable assets so that whereas on the one
hand furnishing of security for costs by them
would seem to be unnecessary, it can be said on
the other hand that the requirement to furnish
such security will not cause any hardship. No
similar affidavit was submitted in connection with
defendant Proulx Farm Equipments Ltd. in the
other action, but as this is not a principal consider
ation in deciding whether security should be
ordered or not I do not propose to make any
distinction between the two cases. What is clear
however is that although the principal actions may
be based on different facts and could, unless
defendants are successful in having plaintiffs
patent impeached, require different evidence and
lead to different results, the evidence in the
impeachment proceedings resulting from the cross-
demands will be identical in both cases. A total
sum of $2,000 therefore will be sufficient, with
permission to re-apply for an increase when and if
circumstances indicate that this has become insuf
ficient. Defendants La Machinerie Idéale Cie Ltée
and Rovibec Inc. are therefore required to furnish
the sum off $500 each for costs, and in action
bearing Court No. T-5284-78 Proulx Farm Equip-
ments Ltd. is required to furnish security in the
amount of $1,000; costs in the event.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.