Darkzone Technologies Inc. v. 1133150 Ontario Ltd.

Darkzone Technologies Inc. v. 1133150 Ontario Ltd.

The court exercised its discretion under Rule 402 to refuse to award costs to the defendants because the plaintiff had reasonable grounds to commence the action, acted promptly to discontinue once provided with exculpatory information discovered at discovery, and the defendants unreasonably withheld disclosure of the identity of the actual operator until discovery, thereby causing unnecessary delay and expense; accordingly the plaintiff was granted leave to discontinue without paying defendants' costs.

Citation
2002 FCT 1
Parties
Plaintiff: DARK ZONE TECHNOLOGIES INC.; Defendant: 1133150 ONTARIO LTD.; Defendant: ALI NASSER-EDDINE; Defendant: MOHAMED HAFEZ
Court
Federal Court
Jurisdiction
Canada
Judgment Date
2 January 2002
Procedural Posture
Intellectual Property Litigation / Motion for Leave to Discontinue Under Rule 402 (discontinuance Without Costs)
Outcome
Leave to discontinue granted and defendants denied costs
Legal Topics
Infringement, Costs, Discontinuance, Discovery, Franchise Termination
Source Language
English
Intellectual Property Civil Procedure Franchise Law Infringement Costs Discontinuance Discovery Franchise Termination

Case Brief

Summary, issues, holding and outcome

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Parties

DARK ZONE TECHNOLOGIES INC.

Plaintiff

1133150 ONTARIO LTD.

Defendant

ALI NASSER-EDDINE

Defendant

MOHAMED HAFEZ

Defendant

Procedural Posture

Intellectual Property Litigation / Motion for Leave to Discontinue Under Rule 402 (discontinuance Without Costs)

Legal Issues

  1. 1 Whether a plaintiff discontinuing an action must pay costs to the defendant as a matter of right
  2. 2 Whether the plaintiff conducted reasonable pre-filing investigation before commencing IP infringement proceedings
  3. 3 Whether defendants' denials and failure to disclose identity of the actual operator justified an award of costs on discontinuance

Ratio Decidendi

The court exercised its discretion under Rule 402 to refuse to award costs to the defendants because the plaintiff had reasonable grounds to commence the action, acted promptly to discontinue once provided with exculpatory information discovered at discovery, and the defendants unreasonably withheld disclosure of the identity of the actual operator until discovery, thereby causing unnecessary delay and expense; accordingly the plaintiff was granted leave to discontinue without paying defendants' costs.

Court Disposition

Leave to discontinue granted and defendants denied costs

Orders

  • Plaintiff is granted leave to serve and file forthwith a Notice of Discontinuance, without costs.