Target Event Production Ltd. v. Cheung

Target Event Production Ltd. v. Cheung
Court (s) Database
Federal Court Decisions
Date
2010-01-11
Neutral citation
2010 FC 27
File numbers
T-702-08
Decision Content
Federal Court
Cour fédérale
Date: 20100111
Docket: T-702-08
Citation: 2010 FC 27
Ottawa, Ontario, January 11, 2010
PRESENT: The Honourable Madam Justice Simpson
BETWEEN:
TARGET EVENT PRODUCTION LTD.
Plaintiff
and
PAUL CHEUNG AND LIONS COMMUNICATIONS INC.
Defendants
REASONS FOR JUDGMENT AND JUDGMENT
TABLE OF CONTENTS
Paragraphs
INTRODUCTION
1
THE PARTIES
6
THE RICHMOND NIGHT MARKET 2000-2007
9
THE RICHMOND NIGHT MARKET DOCUMENTS
34
THE DEFENDANTS’ NIGHT MARKET
37
THE PLAINTIFF’S ALLEGATIONS
(i) Specific Allegations of Copyright Infringement and Passing Off
55
(ii) Target Located a Suitable Site for 2008
57
(iii) Target Could Have Opened a Market in 2008
73
(iv) Target’s Failure to Open was Due to a Shortage of Vendors
78
COPYRIGHT
(i) The Claims
84
(ii) The Registrations
85
(iii) The Application of the Copyright Act
86
(iv) Target’s Contract
102
(v) Target’s Rules
104
(vi) Target’s Market Site Plan
109
TRADEMARKS AND PASSING OFF
(i) Admissions
113
(ii) Registration
117
(iii) Use of Target’s Names 2000-2007
120
(iv) Conclusions about Acquired Distinctiveness and the Loss Thereof
159
(v) The Trade-marks Act
161
(vi) The Surrounding Circumstances
163
(a) Raymond Cheung’s Conduct
164
(b) Media Coverage
168
(c) Lions’ Website
187
(vii) Discussion
(a) Vendors
189
(b) Visitors
202
(c) The Collateral Documents
211
The Personal Indemnity Agreement
212
The Rules and Regulations
214
“Vendor Parking Information”
215
Penalties and Fines Chart for the Night Market 2008
216
The Night Market 2008 Recycling and Garbage Information
217
(d) Lions’ Website
219
(e) Lions’ Correspondence
222
(viii) Conclusions about Trademarks and Passing Off
227
THE PERSONAL LIABILITY OF PAUL CHEUNG
229
REMEDIES
235
JUDGMENT
INTRODUCTION
[1] Night markets are public events at which vendors sell a wide variety of food products and merchandise. They are a traditional form of family entertainment in Asia and first appeared in British Columbia in 1996 with the opening of the night market in Vancouver’s Chinatown.
[2] The Plaintiff’s night market began in the year 2000 and was held in various locations in the City of Richmond (Richmond).
[3] From 2004 until it closed in 2007, the night market was held on a leased property at 12631 Vulcan Way (the Vulcan Way Property). However, the lease expired at the end of 2007 and the Plaintiff decided to relocate rather than renew the lease. Unfortunately, the Plaintiff did not find a new location and did not operate a night market in either 2008 or 2009.
[4] The Defendants took advantage of the business opportunity vacated by the Plaintiff. They signed a lease and, in 2008, opened a night market on the Vulcan Way Property (the Lions’ Market).
[5] This case deals with the Plaintiff’s allegations of copyright infringement and passing off under subsection 7(b) of the Trade-marks Act, R.S.C. 1985, c. T-13 in connection with the Defendants’ operation of the Lions’ Market.
THE PARTIES
[6] The Plaintiff, Target Event Production Ltd. (Target) is incorporated pursuant to the laws of British Columbia. Target’s President is Mr. Raymond Cheung.
[7] The Defendant, Lions Communications Inc. (Lions) is also a British Columbia company. It was incorporated on March 11, 2008.
[8] The Defendant, Mr. Paul Cheung, is Lions’ majority shareholder and its Director of Operations. He is not related to Raymond Cheung. Lions’ other shareholder is Mrs. Grace Au. She is the wife of Mr. Alvin Au. He served as an advisor to Paul Cheung while Lions’ Market was being created. He was well-suited to this role because he had held markets in Richmond for several years in conjunction with Chinese mid-autumn and New Year’s celebrations. Mr. Philip Moy was Lions’ accountant and he also advised Paul Cheung during the development of Lions’ Market.
THE RICHMOND NIGHT MARKET 2000-2007
[9] Raymond Cheung described the vendors as the key element of his Richmond Night Market. He testified that 80-85% were of Asian descent. He said that vendors are primarily part-time workers who fall into three categories. Some are business people whose stores are overstocked, some are single mothers looking for a seasonal income and others are young people who treat booths as first business ventures.
[10] The Richmond Night Market was open from 7:00 pm to 1:00 am on Friday, Saturday and Sunday nights and also on Monday nights on long weekends. The market was open on this basis from May to October.
[11] The rental income paid by vendors for their booths accounted for approximately 90% of Target’s revenue from the Richmond Night Market. The event was free for visitors.
[12] In October, at the end of a market season, it was common for vendors to pay a deposit towards the rental of a booth for the next year. Then, in the following February or March, they would attend at Target’s office to select a booth, complete vendor application forms and make final payments.
[13] A vendors’ orientation meeting would be held annually in late March or early April. It would be attended by vendors and representatives from Richmond’s health, traffic and fire departments. The vendors would be given the forms they needed to comply with Richmond’s license and permit requirements. After those documents were issued, the Richmond Night Market would open early in May.
[14] In 2000, using a company he owned called Starlight Event Limited, Raymond Cheung held his first night market on a leased section of an outdoor parking lot at the Continental Shopping Mall in Richmond.
[15] The first Richmond Night Market had 60-80 booths which were rented by vendors who sold merchandise and food. The event was successful, but the market overwhelmed the mall. This meant that a new location was needed for 2001.
[16] In 2001, Raymond Cheung incorporated the Plaintiff and it operated the Richmond Night Market on a larger site at the Landsdowne Mall. This market involved more booths and had room for carnival rides which were added on several weekends. However, the site did not have adequate parking.
[17] In 2002, Raymond Cheung created a logo for the Richmond Night Market (the Logo). It is a bold blue circle which includes the text “Richmond Night Market Summer Festival” in English and the name “Richmond Summer Night Market” in Chinese characters. There is also a version of the Logo which mentions Target’s name and its web address.
[18] In 2003, the Richmond Night Market was moved to the Bridge Point Market. The event was a success but the site was too small.
[19] In 2004, Target leased the open space on the Vulcan Way Property. The lessor was Cathay Importers 2000 Limited (the Landlord). From 2004 until 2007, Target held its Richmond Night Market at that location.
[20] The Vulcan Way Property covered approximately ten acres. It featured a 100,000 sq. ft. warehouse. The balance of the site was comprised of vacant land on each side of the warehouse. Target used the parcel next to River Road for the Richmond Night Market. It housed several existing features including the Landlord’s truck loading dock, a row of tall steel pylons which had once been part of an overhead crane and an open-sided shed. These features will be referred to collectively as the “Structures.” Target used the land on the other side of the warehouse for parking. Additional parking was secured at nearby retailers.
[21] To create the night market at the Vulcan Way Property, the Plaintiff installed plumbing, wiring, a transformer, a stage in the shed, washrooms, an office trailer and canopy tents to cover vendors’ and sponsors’ booths.
[22] In the period from 2004 to 2007, the Richmond Night Market became a significant success. In 2004, the Richmond Chamber of Commerce recognized Raymond Cheung for business excellence. On July 9, 2005, an article in the Vancouver Sun described the Richmond Night Market as #1 topping a list of 50 summertime events in British Columbia. In the fall of 2006, Raymond Cheung was nominated as one of the 100 top Chinese-Canadians in the province and CBC television featured Target on its national business program entitled “Venture.” The Defendants formally admitted that, by 2007, the Richmond Night Market had become recognized as one of the premier cultural events in British Columbia.
[23] This success was due, in part, to Target’s marketing and promotional activities. They included:
a. A website which, after 2005, permitted vendors to download application forms and plans showing how the booths were arranged.
b. A series of advertisements in 2007 on the interior (80 ads) and the exterior (15 ads) of Vancouver buses.
c. Postcards which were given to visitors to the Richmond Night Market. They included photos of the market and Target’s name, telephone and web address. 50,000 were printed each year and they were handed out from 2001 to 2005. They referred to the Richmond Night Market in English and to the Richmond Summer Night Market in Chinese characters.
d. Key chains, transistor radios and shopping bags which were given to visitors and which featured Target’s Logo.
e. Advertisements which were aired in Mandarin and Cantonese on radio stations owned by Fairchild Radio. In 2005, the names Richmond Summer Night Market and Richmond Night Market were both used in these ads.
f. Advertisements which were placed in Japanese, Vietnamese and Korean newspapers in the Lower Mainland as well as in the Georgia Strait – an English language weekly in Vancouver. In 2006, it carried twelve half page ads.
g. Advertisements which appeared on OMNI TV in Chinese, Japanese, Korean and Punjabi.
[24] The Richmond Night Market was the subject of articles in the Vancouver Sun and the Province newspapers. As well, daily newspapers such as Ming Pao and Singtao (in Chinese), the World General (in Taiwanese) and Vancouver Shinpo (in Japanese) published articles about the Richmond Night Market.
[25] As the Richmond Night Market developed, Raymond Cheung kept his market fresh and interesting with a variety of events and entertainment. Every year, there were opening and closing ceremonies to which VIPs were invited. In 2004, Richmond’s Mayor and MP attended to cut the opening ribbon in front of a sign which read “Richmond Night Market”.
[26] The Richmond Night Market was also known outside British Columbia. Raymond Cheung gave interviews to media representatives from Toronto, Seattle and Hong Kong.
[27] Sponsors were very pleased with the Richmond Night Market and wrote to congratulate Raymond Cheung on its success. They also applauded the positive impact the market had on tourism in Richmond. Sponsors included OMNI TV, the Four Points Sheraton, Fairchild Radio, the Richmond Review, which was a bi-weekly local newspaper, and the Richmond Chamber of Commerce. In 2004, Costco Wholesale wrote Raymond Cheung saying that the Richmond Night Market had become a “must attend event” in Richmond.
[28] Politicians were also supportive. In 2005, Mr. John Yap, MLA in Richmond-Steveston described the Richmond Night Market as a “destination of choice.”
[29] By 2007, staging the Richmond Night Market had become a complex undertaking. The market had an average of 30,000 visitors per evening and the number of vendors had risen from 60-80 in 2000 to 280-300 in 2007.
[30] In March of 2007, Raymond Cheung realized that he was going to have difficulty renewing his lease at an acceptable rent before it expired at the end of 2007. Accordingly, in the spring of 2007, Target began to search for a new location for the 2008 Richmond Night Market.
[31] In May of 2007, an article was published in the Richmond Review. It featured a photograph of Raymond Cheung and text thereafter which read “Richmond Night Market organizer Raymond Cheung is ready for next week, but next year is another matter.” Raymond Cheung confirmed in his testimony that, by this time, he had spoken to his vendors about the expiry of the lease and his uncertainty about a new location for his night market in 2008.
[32] In October 2007, Target made an offer to lease, which the Landlord rejected, and since terms could not be agreed, Target’s lease expired. Thereafter, Target refunded all the deposits it had taken from vendors who had planned to rent booths at the Vulcan Way Property in 2008.
[33] A Target press release dated April 7, 2008, which was sent to the media (the Press Release), announced the cancellation of the 2008 Richmond Night Market. Target’s website made a similar announcement but also said that Target had big plans for 2009. The evidence shows that Target hoped to sign a long term lease for a 15 acre property in Richmond. However, those plans did not materialize and Target did not hold a night market in either 2008 or 2009.
THE RICHMOND NIGHT MARKET DOCUMENTS
[34] As the Richmond Night Market developed, Raymond Cheung wrote and revised the various contracts and information bulletins needed to keep 300 vendors and 30,000 visitors interacting safely and productively.
[35] Those documents included:
a. A two-sided Vendor Application form (the Vendor Application Form). It existed in two versions, one for food vendors and the other for vendors of merchandise. Each form included:
· A contract which was on the front of the Vendor Application Form (Target’s Contract) and
· Rules and Regulations which were on the reverse side of the Vendor Application Form (Target’s Rules).
b. A plan for the market showing the location of food and merchandise booths, sponsors’ booths, washrooms, the office and the stage (the Market Site Plan). It was used by vendors to select the booths they wished to rent. There was a large version of the Market Site Plan at Target’s office and it was also available on Target’s website.
c. Personal Indemnity forms. They were prepared by Raymond Cheung’s lawyer in 2003.
d. Rules and Regulations.
e. Vendor parking information.
f. A vendor Penalty List.
g. A special vendors’ notice about how to recycle cardboard.
[36] Target’s allegations of copyright infringement relate only to items (a) and (b) above. However, the Plaintiff says that the other documents are relevant to its allegations of passing off. These documents (i.e. (c) to (g) above) will be referred to collectively as the “Collateral Documents.”
THE DEFENDANTS’ NIGHT MARKET
[37] At age sixteen Paul Cheung began to work for his older brother Mr. Johnny Cheung and his company Paradise Entertainment (Paradise). Paul eventually became a shareholder in the company.
[38] For eight years, Paradise was responsible for setting up events held at the Plaza of Nations (the Plaza). It is a facility on False Creek comprised of an inside hall and a covered outdoor area with a stage.
[39] In 1996, the Plaza was the venue for the Canadian Airlines Chinese New Year’s Market. It lasted several days and involved approximately 300 vendors selling food and merchandise under canopy tents. Health permits were required for the food vendors and fire safety regulations had to be observed. Charitable events staged by Paradise for the Honourable Raymond Chan in Cambie Park in Vancouver also involved Chinese markets. Paul Cheung worked on these events.
[40] Paradise’s contract at the Plaza came to an end in 1998 and, for the next decade, Paul Cheung’s employment did not involve Chinese markets. However, in 2008, his brother heard that the Vulcan Way Property was available for rent as a location for a night market. Johnny asked Paul whether he would be interested in operating such an event. When Paul expressed interest, Johnny arranged a meeting with the Landlord.
[41] Terms were agreed and a lease was signed effective March 1, 2008. However, Paul Cheung testified that the lease was actually signed before February 28, 2008. This evidence makes sense because the application to Richmond for a Temporary Use Permit (TUP) was dated February 25, 2008 and was signed by the Landlord (the TUP Application).
[42] Richmond required a name for the Lions’ Market as part of the TUP Application. Accordingly, Paul Cheung turned his mind to the issue and, on January 22, 2008, he sent an email to his brother and to Philip Moy, suggesting a variety of names. He testified that he wanted a name that was different from the one Target had used. All the names he suggested included the word “Events.” However, none of his ideas were accepted and the name “Summer Night Market” appeared in English on the TUP Application. Alvin Au testified that he selected that name in discussion with Paul Cheung. For use in Chinese characters, they selected the name Richmond Summer Night Market. That was the same name that had appeared in Chinese characters on Target’s Logo. They also decided to use the name Summer Night Market in Chinese characters. All these names were used extensively in promoting Lions’ Market.
[43] Paul Cheung testified that he considered building the Lions’ Market where Target had located its parking. However, when he realized that the fresh water pipes, the sewage lines and the electrical supply (collectively the Services) were on the River Road side of the Landlord’s warehouse, he realized that Target had held its market in the most convenient place and he decided to use the same site for his night market. This, he was entitled to do.
[44] However, in addition to using Target’s site, Paul Cheung also used its Market Site Plan. This was the plan that Raymond Cheung had created showing the layout of the booths and other facilities at the Richmond Night Market on the Vulcan Way Property. Target owned the copyright in the Market Site Plan and registered it on April 22, 2008.
[45] Paul Cheung used Target’s Market Site Plan in four ways:
· To expedite the signing of a lease agreement with the Landlord. The Landlord gave Paul Cheung a copy of the Market Site Plan and insisted that he use it as a condition of leasing the Vulcan Way Property.
· To expedite the filing of the TUP Application. Since the Landlord’s signature was needed on the TUP Application, Paul Cheung agreed to use Target’s Market Site Plan and submitted it as part of the TUP Application. To accomplish this, he downloaded it from Target’s website and asked Alvin Au to work on it. Alvin Au only changed the heading. He deleted the references to Target and inserted “Summer Night Market Richmond B.C. 2008.”
· To expedite the approval of the TUP Application. I think it reasonable to infer that Richmond’s staff were able to deal with the application more readily because they were assessing a site plan that they had already approved for Target’s use.
· To contract with 40 vendors in mid-March 2008 (the First Forty Vendors). They picked their booths using Target’s Market Site Plan.
[46] Target complained when it discovered that its Market Site Plan had been submitted as part of the TUP Application and the plan was withdrawn. Thereafter, Paul Cheung had another plan prepared by Mr. Francis Yau of Andrew Cheung Architects Inc. Lions submitted this version to Richmond on May 10, 2008 (the Lions’ Site Plan).
[47] Paul Cheung testified that the Lions’ Site Plan was drawn by his architect in consultation with a plumbing engineer, a structural engineer and personnel from Richmond. He said that, after these consultations, it became clear that Target had laid out the market in the most practical and cost effective manner given the location of the Services, the location of the Structures and Richmond’s requirements for fire lanes. Nevertheless, Paul Cheung testified that Lions’ Site Plan was significantly different from Target’s Market Site Plan.
[48] However, in my view, the plans were not significantly different. I find that the Lions’ Site Plan was a substantial reproduction of Target’s Market Site Plan. The basic organization of the market was unchanged - the stage, washrooms, storage facilities and food court locations remained the same. No booths were relocated. Different type fonts were used, some icons were replaced with words and some words were omitted. However, these were essentially cosmetic and not substantive changes. The only change of substance was the elimination of approximately forty-eight booths to create an emergency route which headed directly from the car entrance on River Road towards the visitor entrance on Vulcan Way. Paul Cheung did not testify that this change was Lions’ idea. Presumably, it was made at Richmond’s request.
[49] The Defendants used the Lions’ Site Plan to complete the TUP Application and showed it to approximately sixty vendors when they rented booths after the approval of the TUP. They also used it to construct the Lions’ Market.
[50] Alvin Au prepared a radio advertising campaign in Chinese seeking vendors for Lions’ Market. The ads were broadcast in mid-March, 2008. He testified that, just after the ads were aired, he telephoned the vendors he had known from his prior Chinese market events. He said that some of them applied for booths and brought other vendors to Lions for the same purpose. At this time, Lions signed up the First Forty Vendors. He also said that he contacted all the vendors who rented booths from Lions in 2008.
[51] Paul Cheung said that the First Forty Vendors provided him with copies of Target’s Collateral Documents. After this lawsuit was commenced, he had them retyped in “Microsoft Word” format. I infer that this work was done so that Lions’ employees could easily revise them for Lions’ use.
[52] Richmond held two public meetings as part of the TUP Application approval process. The first was on May 5, 2008. It was the Richmond Council’s General Purposes Committee Meeting. At that meeting, a motion was passed recommending the approval of Lions’ TUP Application at the next public meeting of Council. That meeting was held on May 20th and the TUP Application was approved.
[53] After the approval, Lions contracted with approximately 60 to 80 additional vendors so that the Lions’ Market had approximately 100 to 120 vendors in 2008.
[54] Each vendor had to qualify for and purchase a Richmond business license and those who sold food also needed a health permit. To facilitate this process, Lions held a vendors’ orientation meeting on April 30, 2008. Lions’ Market partially opened on May 30, 2008. However, the opening of the booths in the food court was delayed by a lack of plumbing. The entire Lions’ Market opened at the end of June 2008.
THE PLAINTIFF’S ALLEGATIONS
(i) Specific Allegations of Copyright Infringement and Passing Off
[55] The Plaintiff takes issue with the following activities which it alleges constitute copyright infringement and/or passing off:
a. The Defendants’ use of the names Richmond Night Market and Richmond Summer Night Market and Summer Night Market Festival in English and in Chinese characters in the following circumstances:
i. when contacting neighbours asking for their comments about Lions’ Market
ii. when contacting suppliers of services and parking providers
iii. when advertising to vendors and to the public
iv. when operating Lions’ website
v. when broadcasting Chinese radio ads
vi. when listing in the 738 Directory
b. The Defendants’ use of a photo of the Plaintiff’s market on the home page of the Defendants’ website.
c. The Defendants’ use of the Plaintiff’s Market Site Plan.
d. The Defendants’ use of the Plaintiff’s Vendor Application Form.
e. The Defendants’ use of the Plaintiff’s Collateral Documents.
[56] I will deal with each of these specific allegations as the reasons unfold. However, in my view, the following broad allegations should be considered first because they underpin the Plaintiff’s case for damages.
(ii) Target Located a Suitable Site for 2008
[57] Target alleges that it found a suitable site for a Richmond Night Market in 2008. The site was comprised of 5 parcels of land covering approximately 2 ¼ acres (the New Site). The New Site was owned by Mr. Norman Tam and was located on both Bridgeport Road and Sea Island Way in Richmond. For the reasons discussed below, I have not been persuaded that Raymond Cheung ever concluded that the New Site was suitable for the Richmond Night Market.
[58] The Press Release which Raymond Cheung issued on Monday, April 7, 2008 read in part:
Richmond Night Market founder Raymond Cheung announced that his company, Target Events, will not be holding the famous Richmond Night Market, also known as Richmond Night Market Summer Festival, in 2008.
It is with great regret that we announce that we have not been able to find an alternate location for this year’s Richmond Night Market. We started the Richmond Night Market in 2000 and have been pleased to see it grow into one of the Lower Mainland’s premier attractions over the last eight years.
We continue to actively consult with the City of Richmond to find an alternate location for 2009.
[my emphasis]
[59] In my view, this public announcement that no market would be held in 2008 would have been a memorable event and it is reasonable to expect that Raymond Cheung would have been very clear about the status of his efforts to secure the New Site as of the date of the Press Release. However, in his initial examination for discovery he could not say when he located the New Site or when he reached an agreement with Norman Tam about the rent.
[60] He initially testified that he found the New Site in March, April or February. He later said that it was located sometime in February/March 2008.
[61] With regard to the rent for the New Site, he said that, after ongoing discussions, “we finalized everything by April 11.” However, he also said that agreement was reached at the beginning of April. Finally, during the same examination, he testified that he thought that an agreement to lease the New Site had been reached “before April 7th.”
[62] If Raymond Cheung had, in fact, been involved in ongoing and potentially fruitful discussions with Norman Tam or if indeed a rental agreement had already been reached in early April, it makes no sense that he would have issued the Press Release on April 7th announcing the cancellation of the Richmond Night Market because a new location had not been found.
[63] Raymond Cheung substantially changed his evidence in a subsequent examination for discovery. Then he said that he first learned of the New Site on Tuesday, April 8th, the day after the Press Release. At trial, Raymond Cheung also said that Norman Tam telephoned him to suggest the New Site and that on Wednesday, April 9 they had a lengthy telephone conversation. Norman Tam was not called to testify to corroborate this evidence and, in my view, corroboration was required in view of the dramatic alteration in the evidence on a key point. The fact that Raymond Cheung could not give consistent evidence about when he first learned of the New Site indicates to me that he never considered that it was a suitable venue for a market.
[64] Raymond Cheung also testified on his second discovery that, “before Friday, April 11th,” he had reached an agreement with Norman Tam about the rent. There is corroboration for this point. In a letter to Richmond dated April 11, 2008, Norman Tam authorized Raymond Cheung of Target to apply for a TUP for a night market at the New Site. It is therefore clear that some understanding was reached before April 11th. However, there is no evidence that a lease was signed.
[65] Raymond Cheung also testified that, between April 8th and 11th, he measured the New Site and was satisfied that it could hold a sufficient number of booths to create a viable market. He also said that he spoke to the owners of a new Casino in the neighbourhood and secured the necessary parking. He said that he was able to make a speedy assessment about the viability of the New Site because one of his earlier Richmond Night Markets had been located nearby.
[66] In my view, this evidence is not credible. The new Casino had not existed when he held his earlier market. Accordingly, his former familiarity with the neighbourhood was no longer relevant. Traffic patterns would inevitably have changed and, without discussion with Richmond, Raymond Cheung could not have realistically assessed the viability of the New Site from the point of view of traffic flow and management.
[67] I also find that his evidence about parking is not credible. Without corroborating evidence, I cannot conclude, on a balance of probabilities, that the Great Canadian Casino would have sufficient unused parking spaces on summer weekend evenings to meet the needs of the Richmond Night Market.
[68] There is a further reason to believe that, on this topic, Raymond Cheung is not a truthful witness. He explained on his second examination for discovery that he had been uncertain about whether the New Site was first known to Target in February, March or April because he was not the first person to speak to Norman Tam. He said that Mr. Kiichi Kumagai, a former Richmond councillor who was helping Target locate a new site, was the one who initially spoke with Norman Tam (the Explanation).
[69] Raymond Cheung acknowledged that Kiichi Kumagai’s email of August 8, 2008, accurately summarized the main properties he had been investigating in 2008. However, it made no mention of the New Site.
[70] At trial, Raymond Cheung explained this during his re-examination by denying that Kiichi Kumagai had ever been involved with the New Site. However, this denial meant that the Explanation had been untrue.
[71] Finally, the minutes show that Raymond Cheung told the Richmond Council’s General Purposes Committee meeting on May 5, 2008 that he was optimistic about restarting the Richmond Night Market event at a new location in 2009. Raymond Cheung testified at trial that, although the New Site was viable on May 5th, he didn’t mention it to the Committee which was considering Lions’ TUP Application because it was not relevant. This statement is simply not credible. If Raymond Cheung had had a viable site which he believed could have been approved for use in 2008, I am confident that he would have told Richmond about it in the hope that it would have denied Lions a TUP.
[72] To summarize, I have concluded that Raymond Cheung never considered the New Site to be a suitable location for a 2008 Richmond Night Market because:
· He did not raise it at Richmond’s meeting on May 5, 2008.
· He called no evidence to support his conclusion about its suitability.
· It did not appear on Kiichi Kumagai’s email.
· He could not give consistent evidence about when or by whom or by what means the New Site was located.
· He did not reveal it to vendors when he called them in mid-April to see whether they would rent a booth at a 2008 Richmond Night Market.
(iii) Target Could Have Opened a Market in 2008
[73] Target also says that it could have opened the Richmond Night Market on the New Site at the end of June 2008. The evidence shows that Target intended to use an old building on the New Site for sponsors’ booths. This, Raymond Cheung agreed, would have required a rezoning application. There was no evidence about the time needed to secure approval of such an application. He also needed a TUP and he agreed that its assessment would take approximately 2½ months. He acknowledged that the process had taken three months at the Vulcan Way Property.
[74] However, before an application for a TUP could be submitted, a site plan had to be developed. Raymond Cheung’s evidence was that the preparation of a site plan alone would have taken 2 ½ months. The site plan had to show booth locations, vendor and emergency vehicle traffic flow, water and sewage lines, the location of a grease trap, electrical supply and wires and the washroom locations.
[75] In addition, a building permit was needed for the installation of water and power, a traffic management plan had to be prepared, public transit had to be investigated, neighbours had to be canvassed for their opinions about the opening of a new night market and vendors had to be signed up and licensed. Raymond Cheung initially explained that vendors needed six months lead time to prepare for a market. He subsequently qualified his evidence saying that he had spoken only of “new” vendors. However, a review of the transcript shows that he did not use the word new and appeared to be speaking of vendors generally. Finally, once approved, the market had to be constructed on the New Site.
[76] No one from Richmond was called to testify about whether it would have been prepared to expedite Target’s applications for rezoning and for a TUP for the New Site.
[77] It is therefore my conclusion that there was never a time in the spring of 2008 when Raymond Cheung could have opened a night market at the New Site at the end of June 2008.
(iv) Target’s Failure to Open was Due to a Shortage of Vendors
[78] Raymond Cheung’s wife is Ms. Karen Wan. She testified in her role as her husband’s administrative assistant and dealt with the availability of vendors in the spring of 2008. She said that, over the years, Target had developed a list of about 400 vendors. In mid-April 2008, Raymond Cheung asked her to call all their past vendors (the Target Survey). She was to advise them that Target had found a suitable new site for a night market in 2008. However, she was not to tell them where the new site was located. In this regard, it is noteworthy that Ms. Louisa Fung, a vendor and a witness for the Plaintiff, did not corroborate Karen Wan’s evidence. Louisa Fung did not say that she had been told that a site had been found. Rather, she said that she was asked whether she would be interested in renting a booth “if” there was a site.
[79] Karen Wan also said that, during the Target Survey, she was instructed not to discuss with prospective vendors the size of the deposit Target would require. As I understand this evidence, it means that she was forbidden to discuss rent.
[80] Karen Wan’s evidence was not clear about how many vendors she contacted but she said that she spoke to “a lot” of vendors and learned that not many were willing to join Target in 2008. Raymond Cheung was more precise in his testimony. He said that his staff advised him that the Target Survey showed that only 50-60 vendors were willing to come to his market in 2008. Given this number, he concluded that he could not operate a profitable market in 2008.
[81] Target relies on evidence from the Target Survey to substantiate its allegation that the only reason it could not open a night market in 2008 was because of Lions’ conduct. Target says that, by infringing copyright and passing off, Lions caused vendors to think they were dealing with Target and persuaded them to rent booths at its market. This, according to Raymond Cheung, left an insufficient number of vendors available for Target’s market in 2008.
[82] In my view, this allegation is not supported by the evidence from the Target Survey. Raymond Cheung had been widely quoted in the media saying that he was having trouble finding a location for his night market in Richmond because he wanted to lease 15 acres. As well, approximately one week before the Target Survey, the Press Release had been issued cancelling the 2008 market for lack of a location. Furthermore, two vendors testified that location was an important consideration for them in deciding whether to join a night market. One was Louisa Fung, a witness for the Plaintiff who had rented a booth at Target’s market from 2005-2007. The other was Raymond Lee, a witness for the Defendants. He forfeited a $2,000.00 deposit at the Chinatown Night Market in order to join Lions’ Market in 2008 because he preferred a location in Richmond. In these circumstances, any survey to elicit expressions of interest for 2008 that did not disclose the location or the rent could not be expected to produce meaningful results.
[83] There is also a question of numbers. If Target knew 400 vendors and Lions had only rented booths to the First Forty Vendors before its TUP Application was approved on May 20, 2008, there should have been sufficient vendors available to Target during the Target Survey in mid-April if it had been willing to disclose that it had found an attractive location and that it was charging competitive rents.
COPYRIGHT
(i) The Claims
[84] The Plaintiff’s copyright claims relate to the following documents:
· The Vendor Application Form for food vendors
· The Vendor Application Form for vendors of merchandise.
· The Market Site Plan.
(ii) The Registrations
[85] On April 22, 2008, the Canadian Intellectual Property Office registered the following Certificates of Registration of Copyright. They deal with the three documents listed above (together the Registrations):
· No. 1057825 for “Richmond Night Market Summer Festival – Food Vendor Application and Contract” as a literary work, listing the Plaintiff as owner and May 1, 2005 as the date of first publication
· No. 1057826 for “Richmond Night Market Summer Festival – Merchandise Vendor Application and Contract” as a literary work, listing the Plaintiff as owner and May 1, 2005 as the date of first publication
· No. 1057824 for “Richmond Night Market Site Plan” as a literary/artistic work, listing the Plaintiff as owner and May 1, 2006 as the date of first publication
(iii) The Application of the Copyright Act
[86] The Defendants have pleaded that copyright does not subsist in the Market Site Plan because of its alleged functionality. They submit that the Ontario Court of Appeal’s decision in Delrina Corp. v. Triolet Systems Inc. (2002), 58 O.R. (3d) 309, confirms that, when there is only one possible manifestation of an idea or function, recognizing copyright over that manifestation would have the effect of granting the copyright owner a monopoly over the idea or function.
[87] Paul Cheung testified that Lions’ Site Plan represented the only possible way to position the vendors’ booths, the washrooms and the stage given the location of the Services and the Structures. However, he has no experience designing night markets and his evidence was not corroborated by his architect or by any Richmond personnel or by any of the experts he allegedly consulted. Accordingly, I do not accept that the defendants could not have designed a fresh layout for their market that did not substantially reproduce Target’s Market Site Plan. For this reason, the Ontario Court of Appeal’s decision in Delrina does not apply.
[88] The Plaintiff relies on paragraph 27(2)(b) of the Copyright Act, R.S.C. 1985 , c. C-42. It provides as follows:
27. (2) It is an infringement of copyright for any person to
[…]
(b) distribute to such an extent as to affect prejudicially the owner of the copyright,
[…]
a copy of a work, sound recording or fixation of a performer’s performance or of a communication signal that the person knows or should have known infringes copyright or would infringe copyright if it had been made in Canada by the person who made it.
27. (2) Constitue une violation du droit d’auteur l’accomplissement de tout acte ci-après en ce qui a trait à l’exemplaire d’une oeuvre, d’une fixation d’une prestation, d’un enregistrement sonore ou d’une fixation d’un signal de communication alors que la personne qui accomplit l’acte sait ou devrait savoir que la production de l’exemplaire constitue une violation de ce droit, ou en constituerait une si l’exemplaire avait été produit au Canada par la personne qui l’a produit :
[…]
b) la mise en circulation de façon à porter préjudice au titulaire du droit d’auteur;
[89] The Plaintiff alleges the following prejudice:
· when Lions gave vendors Target’s Rules and its Market Site Plan, those vendors were misled into thinking they were dealing with Target and it was prejudiced by the loss of potential vendors. However, since I have concluded that Target could not have opened a market in 2008, a shortage of vendors, had it existed, would not have been prejudicial;
· when Lions gave vendors Target’s Rules and Market Sit