Constellation Brands Québec Inc. v. Smart & Biggar and Dallevigne S.P.A., 2016 FC 605

In a recently published decision, Constellation Brands (CBQ) appealed a Prothonotary's order granting status to Dallevigne as a party respondent, or in the alternative, allowing it to intervene in the proceeding. The motion was granted with respect to Dallevigne's party status, but dismissed with respect to their status as an intervener.

Smart & Biggar represents Casa Vinicola Botter Carlo & Co (Botter), who applied for the DIVINCI trademark. CBQ opposed the mark, relying on its previously registered DA VINCI mark. CBQ also commenced opposition proceedings against Dallevigne's application for the CANTINE LEONARDO DA VINCI mark (the CANTINE mark). Smart & Biggar started a s. 45 proceeding to expunge CBQ's DA VINCI mark for nonuse. Dallevigne filed a counterstatement to the opposition, and stated it could not move to expunge the DA VINCI mark because it was already the subject of such a proceeding.

The Registrar granted Smart & Biggar's request and expunged the DA VINCI mark. CBQ appealed, which is the subject of the underlying proceeding, and the DA VINCI mark remained on the Register. The Registrar denied CBQ's opposition and granted Botter's DIVINCI mark. This impacted Smart & Biggar's decision not to oppose CBQ's appeal of the expungement in this matter. Dallevigne's application to register the CANTINE mark was refused by the Trade-Marks Opposition Board (TMOB) on the basis it would create confusion with the DA VINCI mark. Dallevigne has appealed this decision.

On the same day as Smart & Biggar gave notice of its intention not to defend CBQ's appeal of the expungement of its DA VINCI mark, Dallevigne filed the within motion to be joined as a party. Dallevigne also filed a separate motion to stay the appeal of the TMOB refusal (discussed here).

The Court held that the Prothonotary was clearly wrong in misapplying the principles of what constitutes a party being directly affected by the order sought. The question to be asked is whether the relief sought in the application will affect a party's legal rights, impose legal obligations on it or prejudicially affect it in some direct way. The Court did not accept the argument that Dallevigne's only current obstacle to its trademark registrations is the DA VINCI mark left on the Register due to the pending appeal. It only directly affects other litigation that determines the rights of a party. Thus, there is no basis to add Dallevigne as a party. Furthermore, they are not a necessary party.

As the Prothonotary gave no reasons for the decision with respect to intervener status, the Court undertook a de novoreview. The Court considered the relevant factors and held that this was not a situation where Dallevigne is gaining a tactical advantage. Furthermore, Dallevigne is affected by the proceedings because of their impact on its appeal of the TMOB decision. The Court held that in the same proceeding, the same test cannot apply for adding a party as is used as a factor for intervention, as it would render intervention redundant. In addition, Dallevigne had no other means to protect its interest under s. 45 of the TradeMarks Act. The Court held that the interests of justice were better served by Dallevigne substituting for a successful absent respondent than having no respondent. Furthermore, the intervention is supported by the underlying intention of s. 45 proceedings.