Federal Court Says No To Converting Trademark Infringement Claim From Application To Action

On September 9, 2024, in iFit Inc v Safe Sweat Fitness Ltd., 2024 FC 1406, the Federal Court of Canada (the Court) dismissed a motion by iFit Inc. et al. (the Applicants) for an order converting their application into an action.

In the underlying application, the Applicants sought damages or an accounting of profits for trademark infringement, depreciation of goodwill, and passing off. The Applicants chose to proceed by application rather than action, which limits the scope of discovery and cross-examination.  The Applicants’ current motion followed an unsuccessful motion by the Applicants to compel the respondent to produce financial documents relevant to the issue of an accounting of profits and subpoena a witness for cross-examination.

The Court considered six factors from a previous decision regarding the conversion of an application to an action, including that an applicant’s choice of proceeding should not lightly be interfered with, the fairness of the process, and the need for discovery.  The Court found that the Applicants “have not been able to “compel” the evidence they require because this is an application — the type of proceeding they chose — not because of anything improper done by the respondent.”   This led the Court to conclude that “it would be contrary to Rule 3 [of the Federal Courts Rules] to permit the applicants, who chose to proceed by way of application, and then found themselves in a situation where they do not have the evidence needed to make out certain aspects of their case through no fault of the respondent, to then convert the proceeding into an action under opposition for the respondent so that the applicants can avail themselves of the broad documentary and oral discovery rights and obligations under the Rules.”

Summary By: Michelle Noonan