Group III International Ltd. v. Travelway Group International Ltd., 2024 FC 1195
Justice Lafrenière - 2024-10-11
Read full decision. Automatically generated summary:
After a long and somewhat convoluted history of litigation between the parties, the Federal Court of Appeal granted an accounting of profits by way of reference under Rule 153 (see 2020 FCA 210) ... The parties and their experts also part ways or differ on various deductions for direct (incremental) costs, the applicability of the full costs method and deductions for overhead costs, and the applicability of any reduction of profits for “replaced sales”, described later in this report. Apart from these issues, there is a major dispute between the parties as to the implications of the Federal Court of Appeal’s passing off findings that gave rise to the present reference. ... Knowing full well that Travelway was taking the position that there was no causality between the profits generated from the sale of the Infringing Products and the use of the Infringing Marks, Wenger could have collected data or other evidence to show that consumers who purchased the Infringing Products were actually confused as to the source of the goods, such as complaints generated by confused consumers; however, it failed to adduce any such evidence. Based on the evidence before me, I conclude that Travelway has established, on a balance of probabilities, that a reasonable estimate of the degree of causation between the sales of the Infringing Products at Walmart and Travelway’s profits falls within a range of 5% and 25% and consider it just and appropriate to assess it at the midpoint at 15%. ... With a focus firmly on actual revenues and costs, I therefore conclude that Travelway should be permitted deductions for costs that are more likely than not linked with the production, promotion and sale of the Infringing Products using the full cost or absorption accounting approach.
Decision relates to:
- T-1380-13 - WENGER S.A. ET AL v. TRAVELWAY GROUP INTERNATIONAL INC.