T-3363-79
Windsurfing International, Inc., and Windsurfing
Sailboards Inc. (Plaintiffs)
v.
Meriah Surf Products Limited, Robert M. Lorri-
man and James G. Lorriman (Defendants)
Trial Division, Jerome A.C.J.—Ottawa, May 13
and 20, 1980.
Patents — Practice — Application to strike out paragraph
in statement of defence — Application to strike out counter
claim because of failure by plaintiffs by counterclaim to give
security for costs — First application dismissed — Order for
security for costs granted — Defendants in statement of claim
become plaintiffs in the counterclaim — Residency not the sole
or even primary concern — Patent Act, R.S.C. 1970, c. P-4, s.
62 — Federal Court Rule 415(1)(b).
Wic Inc. v. La Machinerie Idéale Cie Ltée [1980] 2 F.C.
241, followed. Apotex Inc. v. Hoffman-La Roche Ltd.
[1980] 2 F.C. 586, followed.
MOTION.
COUNSEL:
R. MacFarlane for plaintiffs.
R. Dimock for defendants.
SOLICITORS:
Fitzsimmons MacFarlane & Johnson,
Toronto, for plaintiffs.
Donald F. Sim, Q.C., Toronto, for defend
ants.
The following are the reasons for order ren
dered in English by
JEROME A.C.J.: This is an application for an
order striking out paragraph 11 of the statement of
defence, or in the alternative, for particulars of
facts on which the defendant relies in its allegation
of the condition of the mind of the plaintiffs, as
required under Rule 415(1)(b) of the Federal
Court Rules and for an order striking out the
counterclaim on the ground that the plaintiffs by
counterclaim have not provided the security pro
vided under section 62(3) of the Patent Act,
R.S.C. 1970, c. P-4, or in the alternative, for an
order that the plaintiffs by counterclaim provide
security for costs in the amount of two thousand
dollars ($2,000).
Paragraph 11 of the statement of defence reads
as follows:
11. Prior to the commencement of this action, the Plaintiffs
knew that the said Darby Sailboard device had been designed
and built before the date on which the named inventors alleged
ly made the invention and that the said invention had been
made available to the public before the date of application for
the Patent and thereby knew the Patent and each and every
claim thereof was invalid and yet the Plaintiffs failed to
disclaim the exclusive rights in and to the Patent. The Plaintiffs
therefore recklessly and unjustly commenced this action against
the Defendants, wherefore the Defendants pray that this action
be dismissed as against each of them with costs on a solicitor
and client scale.
At the time of service of notice of this motion,
the plaintiffs also served a demand for particulars
of the facts relied upon by the defendants in
support of this paragraph and just prior to the
hearing of this motion, the defendants delivered
the required reply, so I will not deal with that
aspect of the matter.
During argument, counsel for the plaintiffs
conceded that the first sentence could have rele
vance to the injunctive relief claimed, and there
fore the application to strike out this sentence
must fail. The second sentence deals only with
costs which are, of course, entirely in the discretion
of the Trial Judge and while it may be novel to
attempt in a pleading to establish a claim for
solicitor and client costs, I know of no authority
which prohibits the defendant from doing so and in
the absence of such authority, the application to
strike out the second sentence of paragraph 11
must also fail.
The application for security for costs is some
what unusual in that it relates to the position of
the defendants in the capacity of plaintiffs by
counterclaim. I have some reservations whether a
counterclaim standing alone as an independent
pleading fulfills the procedural requirements of a
statement of claim in an action to impeach a
patent and my acceptance of the position of the
parties in this matter ought not be construed as a
resolution of that broader and more interesting
problem. For the purposes of this motion, however,
the position of the defendants as plaintiffs by
counterclaim is not under attack and it is accepted
that the declaration of invalidity sought in the
statement of defence is one between the parties
only, while the one sought in the counterclaim is a
declaration against the world flowing from
impeachment. This precise situation was con
sidered by Walsh J. in Wic Inc. v. La Machinerie
Idéale Cie Ltée' and I have no reason to disagree
with his conclusion that the defendants in the
statement of claim become plaintiffs in the coun
terclaim. In the matter of security for costs, since
this action falls within the terms of section 62 of
the Patent Act, residency is not the sole or even the
primary concern. The situation has been clearly
described by Cattanach J. in Apotex Inc. v. Hoff-
man-La Roche Limited 2 , in the following two
excerpts:
The practice of compelling the deposit for costs is of ancient
origin predicated upon a plaintiff being resident out of the
jurisdiction and without property liable to be taken in execution
within the jurisdiction to secure the defendant for such costs
incurred and for which the plaintiff was liable ....
These considerations were not present in the enactment of
subsection 62(3) of the Patent Act and accordingly the legisla
tive intention must have been to deter irresponsible actions for
impeachment of patents of invention.
and
Under subsection 62(3) the plaintiff in an impeachment
action shall, before proceeding therein, give security for the
costs of the patentee in such sum as the Court may direct. I do
not think that language is susceptible of the interpretation that
the Court may direct that no costs shall be deposited.
Consistent with that reasoning, I find this a
proper case for an order for security for costs by
the defendants/plaintiffs by counterclaim.
IT IS THEREFORE ORDERED that the application
for an order striking out paragraph 11 of the
statement of defence is dismissed.
AND IT IS FURTHER ORDERED that the defend-
ants/plaintiffs by counterclaim deposit into Court
within thirty days (30) from the date of this order,
the sum of two thousand dollars ($2,000) as secu-
' [1980] 2 F.C. 241.
2 [1980] 2 F.C. 586, at pp. 590 and 587 respectively.
rity for the plaintiffs/defendants by counterclaim's
costs herein.
AND IT IS FURTHER ORDERED that this action
be stayed pending compliance with this order.
AND IT IS FURTHER ORDERED that the plain-
tiffs/defendants by counterclaim are to have costs
of this motion in any event of the cause.
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.