Burberry Limited v. Ward

Burberry Limited v. Ward
Court (s) Database
Federal Court Decisions
Date
2023-09-19
Neutral citation
2023 FC 1257
File numbers
T-1553-22
Notes
Digest
Decision Content
Date: 20230919
Docket: T-1553-22
Citation: 2023 FC 1257
Ottawa, Ontario, September 19, 2023
PRESENT: Madam Justice Walker
BETWEEN:
BURBERRY LIMITED; BURBERRY CANADA INC.; CHANEL LIMITED; AND CHANEL ULC
Plaintiffs
and
JUVILYN BILLONES WARD, AKA JUVILYN WARD, AKA LYN WARD, AKA LHYN GUZMAN, AND ALSO HAVING USED THE NAMES RENIELEE CRUZ, JOSEPHINE HIPOLITO, TERESITA BADUA, RACHEL APOLINARIO, JENNIFER VALASACO, RACHEL CRUZ, ROWENA VILLOGA, JENNY ARPE, MARICEL CRUZ, KELLY SANTOS AND REMY CALUBAN; KEVIN WARD; EMELITA FRANCO, AKA EMELY FRANCO; SHEENA GALLARDO; SOMETIME DOING BUSINESS AS JK & B COLLECTIONS, JKB COLLECTIONS, JKB BOTIQUE AKA POCHETTE FAME, JKB LA APPAREL, VICTORIA ST. MATTHEW, VIKTORIA SAN MATTHEW, AND VICKY VICTORIA
Defendants
JUDGMENT AND REASONS
I. Overview [1] The Plaintiffs are very well-known manufacturers, distributers and sellers of luxury fashion goods in Canada and around the world. In April 2021, they became aware that an individual in Canada known as Juvilyn Billones Ward (J. Ward) was importing, offering for sale and selling counterfeit Burberry and Chanel clothing and fashion accessories. Despite J. Ward’s initial agreement to cease her activities and to relinquish the counterfeit goods then in her possession, she has continued to import and sell counterfeit Burberry and Chanel products through a changing and expanding online presence using multiple names, aliases and Facebook pages.
[2] The Plaintiffs filed a Statement of Claim against the Defendants on July 25, 2022 and an Amended Statement of Claim on February 9, 2023. They seek to enforce in this action their respective exclusive rights in and to the trademarks and copyrighted works listed in Schedules A, B and C to this judgment in reliance on the Trademarks Act, RSC 1985, c T-13, and the Copyright Act, RSC 1985, c C-42.
[3] The Defendants, J. Ward and Kevin Ward (K. Ward), were personally served with the Statement of Claim on July 28, 2022 and August 12, 2022 respectively but failed to file a Statement of Defence or seek an extension of time to do so. The Amended Statement of Claim was delivered to the residential address of the same Defendants. Again, they failed to respond.
[4] The Plaintiffs now bring an ex parte motion for default judgment against the Defendants J. Ward (also known as Juvilyn Ward, Lyn Ward, Lhyn Guzman, and also having used the names Renielee Cruz, Josephine Hipolito, Teresita Badua, Rachel Apolinario, Jennifer Valasaco, Rachel Cruz, Rowena Villoga, Jenny Arpe, Maricel Cruz, Kelly Santos, Remy Caluban, Bennyrose Pua, Liezl Soliven, Rosalia Ventura and Rhianne Vasquez) and K. Ward (K. Ward and J. Ward collectively, the Ward Defendants) pursuant to Rule 210(1) of the Federal Courts Rules, SOR/98-106 (the Rules).
[5] I am satisfied that the Ward Defendants are in default of their obligation to file a Statement of Defence under the Rules. I am also satisfied that the Plaintiffs have established trademark infringement, passing off and, in the case of the Burberry Plaintiffs, copyright infringement. Accordingly, I will grant the motion for default judgment and the relief substantially as requested by the Plaintiffs, subject to the specific terms of this judgment.
II. The Plaintiffs and their businesses [6] Burberry Limited (Burberry) is a United Kingdom corporation. Burberry Canada Inc. (Burberry Canada and, together with Burberry, the Burberry Plaintiffs) is a related Canadian corporation.
[7] Burberry is the owner of the trademarks listed in Schedule A to this judgment (the BURBERRY Trademarks) and has used the BURBERRY Trademarks to identify its products in Canada extensively and continuously since at least as early as the dates listed in Schedule A . The BURBERRY Trademarks have been registered in Canada for use in association with the goods and services set out in Schedule A and such registrations are valid and subsisting.
[8] Burberry and its authorized licensees are the only authorized manufacturers and distributors of genuine products bearing the BURBERRY Trademarks. Burberry Canada is an authorized distributor of BURBERRY products in Canada and Burberry controls all use of the BURBERRY Trademarks by Burberry Canada.
[9] Chanel Limited (Chanel) is a United Kingdom limited liability company. Chanel Canada ULC (Chanel Canada and, together with Chanel, the Chanel Plaintiffs) is a related Canadian company.
[10] Chanel is the owner of the trademarks listed in Schedule B to this judgment (the CHANEL Trademarks) and has used the CHANEL Trademarks to identify its products in Canada extensively and continuously since at least as early as the dates listed in Schedule B. The CHANEL Trademarks have been registered in Canada for use in association with the goods and services set out in Schedule B and such registrations are valid and subsisting.
[11] Chanel and its authorized licensees are the only authorized manufacturers and distributors of genuine products bearing the CHANEL Trademarks. Chanel Canada is an authorized distributor of CHANEL products in Canada and Chanel controls all use of the CHANEL Trademarks by Chanel Canada.
[12] Burberry is also the owner of copyright in Canada in association with different versions of its TB monogram and, specifically, owns copyright in the copyrighted works listed and shown in Schedule C to this judgment (the BURBERRY Copyrighted Works). Burberry has the exclusive right to produce or reproduce those works or any substantial part thereof, in any material form, including the exclusive right to authorize such acts by others.
[13] The affiant for each of the Burberry Plaintiffs, Ms. Jennifer Halter (Managing Counsel, Brand Protection for Burberry), and Chanel Plaintiffs, Ms. Lora Moffatt (Head of US Intellectual Property for Chanel, Inc. US), confirms that none of the Ward Defendants, or any of the business names connected to them, are or have ever been authorized by the Burberry Plaintiffs or the Chanel Plaintiffs, as the case may be, to manufacture, import, distribute, offer for sale or sell, or otherwise deal in products bearing the BURBERRY Trademarks, BURBERRY Copyrighted Works or CHANEL Trademarks.
[14] Burberry and Chanel are among the best known global manufacturers of high-end luxury fashion products. Ms. Halter and Ms. Moffatt speak to the enforcement by the two companies of strict quality control standards for their products and the sale of those products only through high-end retailers.
[15] As a result of many years of global advertising and product sales, merchandise bearing the BURBERRY or CHANEL Trademarks enjoy widely recognized reputation and goodwill in Canada and world-wide. The BURBERRY and CHANEL Trademarks signify the highest standards of luxury, design and workmanship and are of utmost value and importance to the Plaintiffs and their businesses.
III. The Ward Defendants and their business [16] The Ward Defendants carry on their online business of selling counterfeit merchandise using the names described in paragraph 4 and an evolving set of business names, including Viktoria St. Matthew, Viktoria San Matthew, Vicky Victoria, Victoria Vicky, JK & B Collections, JKB Collections, Jkb Botique aka Pochette Fame, JKB LA Apparel and Viktoria Izabhella. The Ward Defendants offer for sale and sell the counterfeit merchandise in Canada using changing Facebook pages and livestream broadcasts which are often streamed simultaneously on other third-party Facebook pages.
[17] The Ward Defendants conduct business from a residential address at 3620 17 Ave NW, Edmonton, AB T6L 2N6. J. Ward holds a business licence for a sole proprietorship in Alberta, operating under the trade name JKB COLLECTIONS (JKB Collections) using the same address. The licence for JKB Collections was issued as early as June 21, 2021, initially under the name Kevin Ward.
[18] As described in the next sections of this judgment, the Ward Defendants, primarily through J. Ward, import, advertise, offer for sale and sell in Canada clothing and fashion accessories, including handbags/purses, wallets, hats, sunglasses and cell phone cases (a) bearing one or more of the BURBERRY Trademarks and/or BURBERRY Copyrighted Works (the Counterfeit BURBERRY Merchandise) and (b) bearing one or more of the CHANEL Trademarks (the Counterfeit CHANEL Merchandise). I refer to the Counterfeit BURBERRY Merchandise and Counterfeit CHANEL Merchandise collectively in this judgment as the Counterfeit Merchandise.
IV. Issues [19] The Plaintiffs’ motion for default judgment raises the following issues:
Are the Ward Defendants in default for failure to file a statement of defence?
Have the Plaintiffs established that the Ward Defendants have engaged in trademark infringement contrary to sections 19, 20 and 22 and subsections 7(b), (c) and (d) of the Trademarks Act and/or copyright infringement contrary to sections 3 and 27 of the Copyright Act?
If so, what remedies are appropriate?
V. The Ward Defendants are in default [20] A plaintiff bringing a motion for default judgment under Rule 210(1) must first establish that the defendant was served with the statement of claim and has not filed a statement of defence within the deadline specified in Rule 204(a).
[21] The affidavits of service filed by the Plaintiffs establish that the Defendants J. Ward and K. Ward were personally served with the Statement of Claim on July 28, 2022 and August 12, 2022 respectively.
[22] No Statement of Defence or other response has been filed by the Defendants J. Ward and K. Ward and no other date or time for filing a Statement of Defence has been fixed by the Court.
[23] I am therefore satisfied that the Ward Defendants are in default and that the Plaintiffs are entitled to bring this motion for default judgment under Rule 210(1).
[24] Although this motion was brought ex parte, the Plaintiffs sent the original Notice of Motion dated March 22, 2023 to the Ward Defendants on July 7, 2023 to J. Ward’s email addresses: [email protected] and [email protected]. The Plaintiffs’ Motion Record, including the Amended Notice of Motion, was delivered to the Ward Defendants by courier on July 17, 2023 to the known mailing address for the Defendants, 3620 17 Ave NW, Edmonton, AB T6L 2N6.
[25] The Ward Defendants did not respond to the Plaintiffs’ Motion materials and took no part in the hearing.
VI. The Plaintiffs have established trademark and copyright infringement [26] Having established default, I now turn to the question of whether the Plaintiffs have established their claims of trademark and copyright infringement.
[27] On a motion for default judgment, every allegation in the statement of claim is deemed to be denied (Rule 184(1)). A plaintiff must file evidence to satisfy the Court that, on a balance of probabilities, they have established their causes of action within the meaning of the relevant statute, in this case the Trademarks Act and Copyright Act (Rule 210(3); Louis Vuitton Malletier SA v Yang, 2007 FC 1179 at para 4 (Yang)).
A. The Plaintiffs’ evidence (1) Background [28] The Plaintiffs were initially made aware of the Defendants’ activities on or about April 20, 2021 by two notifications from Canada Border Services Agency (CBSA) regarding shipments of BURBERRY and CHANEL Counterfeit Merchandise detained at the Canadian border.
[29] Plaintiffs’ counsel attempted unsuccessfully to contact J. Ward by phone on April 22 and 28, 2021 to discuss the goods imported. J. Ward did not answer the calls and counsel left a voicemail that was not returned. Plaintiffs’ counsel also attempted to contact J. Ward via text message on April 28, 2021. The text message was delivered but counsel received no response.
[30] On August 3, 2021, the Plaintiffs delivered cease and desist letters and Relinquishments of Detained Items (Relinquishments) on behalf of Burberry and Chanel to J. Ward at 3620 17 Ave NW, Edmonton, AB T6L 2N6. J. Ward signed the cease and desist letters and Relinquishments the same day in the presence of Mr. Mark Addy, an independent private investigator retained by the Plaintiffs.
[31] In response to two subsequent letters from Plaintiffs’ counsel, J. Ward contacted counsel by email on August 14, 2021. On August 16, 2021, she left a voicemail and sent a handwritten letter to counsel. J. Ward indicated she was aware of the Plaintiffs’ investigation regarding Counterfeit Merchandise, confirmed her agreement to abandon the Counterfeit Merchandise in her possession and stated she had received the goods as gifts from her suppliers.
[32] The Plaintiffs continued to receive notifications from CBSA through the remainder of 2021 (and thereafter) regarding the importation of Counterfeit Merchandise by J. Ward using her own name and names linked to her.
[33] On January 14, 2022, the Plaintiffs were notified by CBSA of a shipment importing BURBERRY and CHANEL branded goods in K. Ward’s name. On January 18 and 19, 2022, Plaintiff’s counsel attempted unsuccessfully to contact K. Ward by phone to discuss the importation.
[34] Despite the Plaintiffs’ clear notice to the Ward Defendants of their investigation, the Ward Defendants have continued to import, offer for sale and sell Counterfeit Merchandise in Canada. Attached to this judgment as Schedule D is a list by date of the known instances of importation, offer for sale and sale of Counterfeit Merchandise by the Ward Defendants.
[35] Each entry set out in Schedule D is supported with affidavit and documentary evidence filed by the Plaintiffs in their Motion record, including emails from CBSA notifying the Plaintiffs of the detention of Counterfeit Merchandise and providing photographs of the detained merchandise, together with the Plaintiffs’ confirmation that the detained merchandise is not genuine. The Plaintiffs have established to my satisfaction the nexus between the Ward Defendants and each of the importer/consignee names appearing in Schedule D.
(2) Use of additional names and addresses [36] The Ward Defendants pursue their importation and sale of Counterfeit Merchandise under a number of names, business names and Facebook pages. They also redirect shipments of Counterfeit Merchandise to different people and different addresses.
[37] Two individuals to whom shipments of Counterfeit Merchandise were directed by J. Ward swore affidavits in support of the Plaintiffs’ motion for default judgment. Ms. Emelita Franco, a named Defendant in this proceeding against whom Consent Judgment has issued, works with J. Ward. In her affidavit of March 15, 2023, Ms. Franco indicates that she is aware that J. Ward imports fake luxury branded merchandise and sells that merchandise online. Ms. Franco was served with two cease and desist letters by Mr. Addy in October 2021 requesting Relinquishment of Counterfeit BURBERRY and CHANEL Merchandise. Ms. Franco informed Mr. Addy she would not sign the requested Relinquishments because she had no knowledge of the goods referred to. Ms. Franco confirmed that she did not order the merchandise listed in the cease and desist letters and that she had neither been asked nor consented to J. Ward’s use of her name and address.
[38] Mr. Addy was also tasked with delivering cease and desist letters on the named Defendant, Sheena Gallardo, at the same address as that used for Ms. Franco. Ms. Franco informed Mr. Addy that she had no knowledge of a Sheena Gallardo.
[39] Ms. Rosemarie Roxas is an acquaintance of J. Ward who is familiar with J. Ward’s online business selling counterfeit luxury branded merchandise. In her affidavit of March 16, 2023, Ms. Roxas states that she received and signed cease and desist letters and Relinquishments in favour of Burberry and Chanel in June 2021, although she had not ordered or imported the Counterfeit BURBERRY and CHANEL Merchandise described in the letters. In fact, Ms. Roxas had refused to agree to a request by J. Ward to use her name for a shipment of goods. Ms. Roxas advised Mr. Addy that J. Ward had previously used her name and business address to import counterfeit merchandise for JKB Boutique or Pochette Fame. Ms. Roxas attaches to her affidavit a series of text conversations in which J. Ward discussed packages she had ordered under Ms. Roxas’ name using FedEx.
[40] Mr. Don Dela Peña is an operations supervisor for DHL Express (Canada) Ltd (DHL). On July 10, 2023, he signed an affidavit for use in this motion following receipt of a subpoena issued with leave of the Court.
[41] In January 2023, a DHL owner/operator in Alberta informed Mr. Dela Peña that several shipments destined for various addresses in Edmonton were consistently being redirected after clearing customs for delivery to one Edmonton address, namely the residential address of the Ward Defendants (3620 17 Avenue NW, Edmonton AB). While the names on the redirected shipments were different, the phone numbers and email address ([email protected]) were the same. The customer effected the redirections using DHL’s on demand delivery system (ODD) that allows changes to a delivery address once a package is ready for delivery.
[42] Using DHL’s ODD system, Mr. Dela Peña performed an online search of “Juvilyn Ward”, the name associated with the email address for the redirected shipments. The results of Mr. Dela Peña’s investigation were forwarded to CBSA, enabling CBSA to identify and detain several shipments of Counterfeit Merchandise imported by the Ward Defendants. In February 2023, Mr. Dela Peña updated his information at CBSA’s request and located additional shipments using the same phone number as the prior redirected shipments but with different names, emails and addresses. Mr. Dela Peña forwarded the new information to CBSA.
[43] In July 2023, at the request of Plaintiffs’ counsel, Mr. Dela Peña attempted another search of the ODD system to provide consolidated information on the redirected shipments and on additional waybills provided by counsel. Although the ODD system only retains data for three months, Mr. Dela Peña was able to assemble the requested information using other DHL systems. Of note is the fact that the search of the new waybills located additional shipment information that mirrored a post-customs redirection to the Ward Defendants’ address using the names Josephine Hipolito, Rachel Apolinario and Teresita Badua. Mr. Dela Peña attaches to his affidavit detailed shipment information for each delivery extracted directly from DHL’s records.
[44] In March 2023, Ms. Amy Jobson, a paralegal working with Plaintiffs’ counsel in this matter, was alerted by CBSA to shipments of suspected Counterfeit BURBERRY and CHANEL Merchandise under the importer names Shannon Alcantara and Abigail Pasco, both at 6314-37B Ave NW, Edmonton AB, and using the same phone number. CBSA sent a further notification to Ms. Jobson in April 2023 regarding a shipment of suspected Counterfeit BURBERRY and CHANEL Merchandise under the importer name Jhoanna Marquez at a different Edmonton address and phone number. All three shipments used the same exporter from the Philippines and CBSA believed they were connected to the Ward Defendants.
[45] CBSA informed Ms. Jobson that the shipping company used for the Marquez shipment was FedEx Express (FedEx). Ms. Jobson attempted to contact FedEx to obtain more information regarding the shipment but, as of the date of the hearing, had received no response and was unable to confirm the connection, if any, of the three shipments to the Ward Defendants.
(3) Online Activities [46] The Plaintiffs’ assembled evidence demonstrates the Ward Defendants’ sustained and intentional offering for sale and sale of Counterfeit Merchandise using numerous online names, business names, Facebook pages and live sale events, all as set out in Schedule D to this judgment. A live sale event is conducted by an individual or business who hosts a livestream broadcast on Facebook. The host shows items for sale and attendees are able to comment and place orders for the items on sale.
[47] Beginning in July 2021, and extending through 2022 to March 2023, Ms. Jobson observed Facebook pages and public live sale events under the names: Viktoria San Matthew, Vicky Victoria, Victoria Vicky, Jkb Botique (Pochette Fame) and JKB La Apparel. A number of the livestream broadcasts were shared or cross-posted simultaneously to other Facebook pages. Pricing information for the goods on sale appeared as digital notes during the sales events, which were held without warning or notification. Ms. Jobson monitored J. Ward’s Facebook pages periodically and could only identify events that occurred during those periods. Ms. Jobson includes with her affidavit numerous screen captures and recordings of the pages and livestream events that show a wide range of luxury branded goods, including those featuring the BURBERRY and CHANEL Trademarks. The goods are displayed in a room that has floor to ceiling shelving and racking. One individual appears in the screen captures and recordings. She is the individual identified by other affiants as the person known to them as Juvilyn Ward.
[48] Ms. Roxas states that she is familiar with J. Ward’s online sale of counterfeit merchandise through the following names and business, which have changed over time: JKB Boutique; Pochette Fame; Jkb Botique; JK & B Collection; Lhyn Guzman; Victoria St. Matthew; Viktoria San Matthew and Vicky Victoria. Ms. Roxas identifies J. Ward as the person who appeared to operate the Facebook pages Victoria St. Matthew and Vicky Victoria (the latter in August 2022). Ms. Roxas also speaks to a live sales event in January 2022 from the Victoria St. Matthew Facebook page selling, among other named brands, BURBERRY and CHANEL branded merchandise. The individual known to Ms. Roxas as Juvilyn Ward appears in screen shots from the event.
[49] Ms. Franco became aware of a Facebook page, Vicky Victoria, in or around December 2022 when a friend provided her screen shots of the page. Ms. Franco states that the individual known to her as Juvilyn Ward appeared to be in control of or operating the page. Ms. Franco also reviewed screen shots of a video recording by her niece of a live selling event that J. Ward held for the sale of counterfeit merchandise. The event was streamed from the Vicky Victoria Facebook page on or about December 30, 2022. The person appearing in the recording is known to Ms. Franco as Juvilyn Ward. Ms. Franco’s niece corroborates the information regarding the livestream event in an affidavit dated March 15, 2023.
[50] Mr. Richie Punla, a private investigator retained by the Plaintiffs, located the Facebook profile for “Viktoria San Marco” and attended a live sale event on February 28, 2022. A recording of the event is attached as an exhibit to Mr. Punla’s affidavit of March 20, 2023. The live sale event was open to the public and allowed participants to view, like or dislike, and purchase in real time items offered by the host. During the event, Mr. Punla messaged the host asking to purchase a Chanel bag for $85 and Burberry bags and jewelry for $200 (three Burberry bags, two Burberry wallets, and one bracelet). The host return messaged Mr. Punla and he was invoiced for the two sets of items. In amongst the text messages is a picture of J. Ward. Mr. Punla paid the invoice by e-transfer to recipient “JUVILYN BILLONES WARD (JK & B COLLECTIONS)” via [email protected]. The purchased items were delivered to Mr. Punla who includes photographs of the items and their packaging with his affidavit. The items purchased and their packaging all bear one or more of the BURBERRY Trademark(s) or CHANEL Trademark(s). The return address on the delivery is “JKB Boutique, 3620 17 Ave NW, Edmonton AB”, the address used by the Ward Defendants.
[51] On December 27, 2022, Mr. Punla located the Facebook profile for “Vicky Victoria” and exchanged text messages with the host, Vicky Victoria, with a request to purchase one Chanel and one Burberry bag. The host informed Mr. Punla that she had Burberry bags in inventory but did not have Chanel bags. The host sent a picture of the Burberry bag in stock and, on January 5, 2023, Mr. Punla paid for the bag by e-transfer to recipient “JUVILYN WARD” via the email [email protected]. Mr. Punla received the Burberry bag on January 11, 2023 and includes photographs of the bag and its packaging with his affidavit. The bag and its packaging are branded with one or more of the BURBERRY Trademarks. The delivery box again displays the return address as “JKB Boutique, 3620 17 Ave NW, Edmonton AB”.
[52] The Plaintiffs retained a second private investigator, Mr. Jasper Smith, who located the Facebook profile for “Viktoria Izabhella” on July 4, 2023, and attended a Facebook market live sale the same day. The live sale event was open to the public and was livestreamed on Facebook pages for:
-Filipino Canadian Small Business
-Edmonton / Black / Buy & Sell Items
-Kabayan in Edmonton Buy and Sell (Open to Public)
-Edmonton Pinoy Buy and Sell Group (Open to the Public)
-Pinoy’s Red Deer and Pinoy Tambayan - Calgary
-10 Filipino Community Pages in British Columbia, Alberta, Ontario and Southern California.
[53] Mr. Smith took screen captures and made a video recording of the Facebook event, all of which are attached to his affidavit dated July 6, 2023. He confirmed that BURBERRY and CHANEL branded merchandise was being offered for sale. Mr. Smith notes that the host of the event compared the sale price she was offering ($30-$35) to the $3,000 (approx.) charged for the equivalent “real items”.
(4) Counterfeit/infringing nature of the merchandise [54] Ms. Halter, Ms. Moffatt and other representatives of Burberry and Chanel trained to identify counterfeit merchandise examined the images of the BURBERRY and CHANEL branded items referred to in Schedule D to this judgment. They confirmed that the items are Counterfeit BURBERRY Merchandise and Counterfeit CHANEL Merchandise, respectively, with the exception of a minimal number of images in which the merchandise pictured was too far away from the camera for the representatives to provide definitive confirmation. Mr. Smith, the second private investigator, is also trained to identify counterfeit merchandise. He examined the BURBERRY and CHANEL branded merchandise displayed during the recent July 2023 live sale event from the Viktoria Izabhella Facebook page and confirmed that it too is Counterfeit Merchandise.
(5) Summary of the Plaintiffs’ evidence [55] The evidence outlined above and in Schedule D is comprehensive and unequivocally establishes the Ward Defendants’ knowing and deliberate importation, offering for sale and sale of Counterfeit BURBERRY Merchandise and Counterfeit CHANEL Merchandise since at least April 2021.
[56] The impugned activities have continued unabated under a series of names, addresses, aliases and Facebook pages designed to evade detection by the Plaintiffs. Representatives of the Plaintiffs, their investigators, CBSA and DHL have documented each known facet of the Ward Defendants’ activities from the importation of merchandise bearing the BURBERRY and CHANEL Trademarks and BURBERRY Copyrighted Works through to the delivery, marketing and sale of that merchandise. The evidence demonstrates the volume of merchandise flowing through the Ward Defendants’ business via images and video recordings.
[57] Confirmation that the merchandise identified in the evidence is counterfeit has been provided by trained representatives of Burberry and Chanel and by Mr. Smith, himself trained to identify counterfeit goods.
[58] J. Ward’s identity as the individual at the centre of the business has been confirmed by personal acquaintances and by a co-worker. The Plaintiffs’ evidence includes text exchanges and e-Transfers to email addresses linked to J. Ward regarding the purchase of Counterfeit Merchandise from Facebook pages associated with her. In addition, the purchased Counterfeit Merchandise was sent with a return address that is the address associated with and used by J. Ward and K. Ward.
(a) Trademark infringement [59] I am satisfied that the Plaintiffs have established trademark infringement and passing off by the Ward Defendants contrary to the Trademarks Act. In summary, the Plaintiffs have established that the business activities of the Ward Defendants described in the evidence are contrary to sections 19, 20 and 22 and subsections 7(b), (c) and (d) of the Trademarks Act.
[60] Section 19: Pursuant to section 19 of the Trademarks Act, the Plaintiffs have the exclusive right to use, respectively, the BURBERRY Trademarks and CHANEL Trademarks throughout Canada in association with the merchandise in respect of which they were registered. The Ward Defendants’ marketing, offers for sale and sales of clothing, handbags/purses, fashion accessories and other merchandise bearing or in association with the BURBERRY and CHANEL Trademarks constitutes use within the meaning of section 4 of the Trademarks Act. The Ward Defendants have therefore repeatedly infringed the respective exclusive rights of Burberry and Chanel in and to the BURBERRY Trademarks and CHANEL Trademarks contrary to section 19 since at least April 2021.
[61] Section 20: Section 20 of the Trademarks Act addresses the sale, distribution or advertisement by any unauthorised person of any goods in association with the BURBERRY or CHANEL Trademarks, or any trademarks, trade names, words or designs confusing with or likely to be confusing with the BURBERRY and CHANEL Trademarks. Confusion is assessed using the factors set out in subsection 6(5) of the Trademarks Act.
[62] The Counterfeit Merchandise sold by the Ward Defendants bears trademarks identical to the BURBERRY and CHANEL Trademarks and was intended to be confused with authentic Burberry and Chanel merchandise. I am satisfied that the public is likely to confuse the Counterfeit Merchandise offered for sale and sold by the Ward Defendants with genuine BURBERRY and CHANEL branded merchandise. As the Ward Defendants are not and have never been authorized by the Plaintiffs to use the BURBERRY or CHANEL Trademarks, I find that the Ward Defendants have repeatedly infringed the respective exclusive rights of Burberry and Chanel in and to the BURBERRY Trademarks and CHANEL Trademarks contrary to section 20 since at least April 2021.
[63] Section 22: Section 22 of the Trademarks Act prohibits the use of a registered trademark by a person other than its owner in a manner that is likely to depreciate the value of the goodwill attaching to the mark. Burberry and Chanel have for many years continuously designed, manufactured and sold luxury fashion merchandise bearing their distinctive trademarks. They advertise globally, using the BURBERRY and CHANEL Trademarks to market their goods to discerning consumers. The goodwill associated with each family of BURBERRY and CHANEL Trademarks is hugely valuable and is fundamental to the Plaintiffs’ respective businesses.
[64] The Plaintiffs have established that the Counterfeit Merchandise sold by the Ward Defendants bears trademarks identical to the BURBERRY and CHANEL Trademarks, with the result that the public is likely to believe that the Counterfeit Merchandise is authentic Burberry and Chanel merchandise. Purchasers of the Counterfeit Merchandise may well be disappointed with the inferior quality of the goods purchased. Conversely, Burberry and Chanel customers who do buy luxury goods complain regularly that the proliferation of counterfeit merchandise in the marketplace diminishes the cachet of their genuine BURBERRY and CHANEL branded products.
[65] I find that the unauthorized use by the Ward Defendants of the BURBERRY and CHANEL Trademarks in association with the Counterfeit Merchandise is likely to diminish the goodwill associated with the Trademarks, contrary to section 22 (Veuve Clicquot Ponsardin v Boutiques Cliquot Ltée, 2006 SCC 23 at para 46).
[66] Section 7: Finally, the Plaintiffs have the right to prevent third parties from directing public attention to their goods and services in a manner that causes or is likely to cause confusion in Canada between their goods and businesses and the goods and businesses of the Plaintiffs. The Plaintiffs are also entitled to prevent third parties from passing off their goods as those of the Plaintiffs and from describing their goods in a manner that is false in a material respect and likely to mislead the public as to the character, quality and/or composition of those goods. The Ward Defendants’ business is designed to sell Counterfeit Merchandise as genuine merchandise by using the BURBERRY and CHANEL Trademarks. Their attempts to pass off the Counterfeit Merchandise as genuine and of superior quality extends to the packaging used to deliver the Counterfeit Merchandise.
[67] I find that the Ward Defendants have traded on the established reputations of Burberry and Chanel for designing, manufacturing and selling luxury merchandise, passed off the Counterfeit Merchandise as genuine, and directed public attention in Canada to their online sales of Counterfeit Merchandise in a manner that materially misleads the public causing real and significant damage, all contrary to subsections 7(b), (c) and (d) of the Trademarks Act.
(b) Copyright infringement [68] Burberry, as the exclusive owner of the copyright in the BURBERRY Copyrighted Works, has the sole right to produce or reproduce those Works, or any substantial part thereof, in any material form whatever. A person infringes Burberry’s exclusive rights contrary to section 3 and subsection 27(2) of the Copyright Act by (i) producing or reproducing the BURBERRY Copyrighted Works; or (ii) selling, possessing for the purposes of selling and/or importing into Canada for the purpose of selling, a copy of the BURBERRY Copyrighted Works that such person knew or should have known infringes copyright or would infringe copyright if it had been made in Canada.
[69] The Ward Defendants are not and have never been authorized by Burberry to import, distribute, offer for sale, sell or otherwise deal in any product bearing the BURBERRY Copyrighted Works. They have nevertheless imported, possessed (for the purpose of selling) and/or sold merchandise bearing the BURBERRY Copyrighted Works. Further, each of the Ward Defendants clearly knew, or should have known, that the items they were selling infringed copyright in the BURBERRY Copyrighted Works.
[70] As a result, I find that the Ward Defendants are in violation of sections 3 and 27 of the Copyright Act and have infringed Burberry’s rights in and to the BURBERRY Copyrighted Works.
(c) Liability of the Ward Defendants [71] I find J. Ward and K. Ward jointly and severally liable for the infringing conduct described in this judgment.
[72] Although J. Ward figures prominently in the Plaintiffs’ evidence, K. Ward imported at least one shipment of Counterfeit Merchandise that was detained by CBSA on January 14, 2022. He is also listed on the City of Edmonton Business Licence for JKB Collections that was valid until June 21, 2022. The address listed on the business licence is the address from which the Ward Defendants appear to conduct their online business, is the address to which Counterfeit Merchandise was directed and redirected after clearing customs, and is the return address on purchased and shipped Counterfeit Merchandise: 3620 17 Avenue NW, Edmonton, AB T6L 2N6. This address is the residential address at which K. Ward and J. Ward were both personally served the Plaintiffs’ Statement of Claim.
VII. Plaintiffs’ motion for default judgment is granted [73] I have found that the Ward Defendants are in default and that Plaintiffs are entitled to bring this motion for default judgment under Rule 210(1). I have also found that the Plaintiffs have established that the Ward Defendants have infringed the BURBERRY Trademarks, CHANEL Trademarks and the BURBERRY Copyrighted Works.
[74] Accordingly, I will grant the Plaintiffs’ motion for default judgment.
VIII. Remedies [75] The Plaintiffs request comprehensive relief intended to deter and stop the Ward Defendants’ infringing and harmful activities and attempts to evade detection. The nature of the Ward Defendants’ business lies at the heart of certain aspects of the relief sought. The Ward Defendants operate online in a low risk, low cost arena that facilitates instant rebranding with little to no interruption or out-of-pocket expense. Detection can be fleeting. I have taken these considerations into account in crafting the relief granted within the broad ambit of sections 53.1 and 53.2 of the Trademarks Act and sections 34, 38, 38.1 and 44.12 of the Copyright Act.
(1) Declaratory relief [76] The infringing activities of the Ward Defendants date from at least April 2021 and are ongoing despite J. Ward’s 2021 agreement to cease her trade in Counterfeit Merchandise. In light of the scope, nature and duration of the Ward Defendants’ importation and sale of Counterfeit Merchandise, the Plaintiffs are entitled to declarations as between the parties regarding the validity and ownership of the BURBERRY and CHANEL Trademarks and the infringement by the Ward Defendants of the BURBERRY and CHANEL Trademarks and the BURBERRY Copyrighted Works (Microsoft Corporation v 9038-3746 Quebec Inc., 2006 FC 1509 at para 101 (TD) (Microsoft).
(2) Injunctive relief and destruction of Counterfeit Merchandise [77] The Ward Defendants’ conduct demonstrates their intention to avoid the Plaintiffs’ efforts to enforce their intellectual property rights. They have persisted in their infringing activities long after the Plaintiffs demanded they cease their activities and long after J. Ward agreed to do so by signing cease and desist letters in August 2021. The Ward Defendants have ignored this proceeding and have continued to offer Counterfeit Merchandise for sale as recently as July 2023, all while attempting to evade detection by carrying on business under numerous names and online identities and disguising their identities from CBSA by redirecting deliveries post-customs clearance. I agree with the Plaintiffs that there is a serious risk, if not high likelihood, that the Ward Defendants will continue their infringing conduct.
[78] The Plaintiffs have established multiple causes of action and have demonstrated the necessity of injunctive relief (lululemon Athletica Canada Inc. v Campbell, 2022 FC 194 at paras 29-31 (lululemon). I will grant the Plaintiffs (i) a permanent injunction restraining the Ward Defendants from infringing, directly or indirectly, the BURBERRY Trademarks, CHANEL Trademarks and BURBERRY Copyrighted Works (the Injunction); and (ii) an order requiring the delivery up and destruction of any and all Counterfeit Merchandise (subsections 53.1(7) and 53.2(1) of the Trademarks Act and subsections 34(1); 38(1) and 44.12(9) of the Copyright Act; Louis Vuitton Malletier S.A. v Wang, 2019 FC 1389 at paras 202‑203 (Wang); Louis Vuitton Malletier v Sheine Reyes Rosales, 2023 FC 217 at para 39 (Rosales)).
[79] The Plaintiffs request injunctive relief that is tailored to respond to the expanding and changing online scope of the Ward Defendants’ infringing activities (NunatuKavut Community Council v Nalcor Energy, 2014 NLCA 46 at para 71; lululemon at paras 32-33). The relief sought is on terms largely similar to that granted by the Court in other cases involving the importation and sale of counterfeit goods (Louis Vuitton Malletier S.A. v Singga Enterprises (Canada) Inc., 2011 FC 776 at para 123 (Singga); Wang at para 202). There are, however, novel aspects to the Plaintiffs’ requested relief. Those novel aspects are in addition to and designed to support and enforce the terms of the Injunction.
(i) Manufacturer and supplier information
[80]