T-1175-89
Pizza Pizza Limited (Plaintiff)
v.
Little Caesar International Inc., Little Caesar
Enterprises Inc., Little Caesar of Canada Inc.,
Little Caesar's Pizza (c.o.b. at 1091 Lauzon Road,
Windsor, Ontario), Little Caesar's Pizza (c.o.b. at
1304 Grand Marais West, Windsor, Ontario),
Little Caesar's Pizza (c.o.b. at 1930 Tecumseh
Boulevard West, Windsor, Ontario), Little Cae-
sar's Pizza (c.o.b. at 3749 Tecumseh Road East,
Windsor, Ontario), Little Caesar's Pizza (c.o.b. at
3123 Forest Glade Drive, Windsor, Ontario),
Michael Hitch, Denise Ilitch-Lites, Malina Bitch,
David H. Deal, Gerald M. Pasternak, Charles P.
Jones, Robert Massey, Kim Pollack, and Alan R.
Thompson (Defendants)
INDEXED AS: PIZZA PIZZA LTD. V. LITTLE CAESAR INTERNA
TIONAL INC. (T.D.)
Trial Division, Dubé J.—Toronto, October 19;
Ottawa, October 31, 1989.
Trade marks — Infringement — Application for interlocu
tory injunction restraining defendants from using trade mark
"Pizza Pizza" — Plaintiff operating or franchising 194 pizza
take-out establishments in Ontario and Quebec, all of which
using "Pizza Pizza" in association therewith — Expecting to
open franchised operations in Windsor within year — Little
Caesar operating 2600 pizza places in U.S.A. and Windsor —
Using "Pizza! Pizza!" in signage and advertising to advertise
two pizzas for price of one — Change in factual situation and
evolution of case law on irreparable harm in trade marks field
in five years since denial of similar application involving same
parties — Once threshold test of serious issue met, mere
infringement of proprietary right in trade mark sufficient to
constitute irreparable harm — Unauthorized use by Little
Caesar in Windsor area of plaintiffs registered mark causing
irreparable harm as diminution of owner's statutory proprie
tary interest could be perceived but not measured.
Injunctions — Trade mark infringement action — Applica
tion for interlocutory injunction — Once threshold test of
serious issue to be tried met, mere infringement of proprietary
right in trade mark sufficient to constitute irreparable harm.
CASES JUDICIALLY CONSIDERED
APPLIED:
Maple Leaf Mills Ltd. v. Quaker Oats Co. of Can.
(1984), 2 C.I.P.R. 33; 82 C.P.R. (2d) 118 (F.C.T.D.);
Joseph E. Seagram & Sons Ltd. v. Andres Wines Ltd.
(1987), 16 C.I.P.R. 131; 16 C.P.R. (3d) 481; 11 F.T.R.
139 (F.C.T.D.); I.B.M. Corp. v. Ordinateurs Spirales
Inc. (1984), 2 C.I.P.R. 56; 80 C.P.R. (2d) 187
(F.C.T.D.); Syntex Inc. v. Novopharm Ltd. (1989), 26
C.P.R. (3d) 481; 28 F.T.R. 124 (F.C.T.D.).
DISTINGUISHED:
Pizza Pizza Ltd. v. Little Caesar Enterprises Inc. et al.
(1984), 1 C.P.R. (3d) 154 (F.C.T.D.).
COUNSEL:
M. M. Field-Marsham and J. C. Cotter for
plaintiff.
Peter Y Atkinson and John Longo for
defendants.
SOLICITORS:
Osler, Hoskin & Harcourt, Toronto for
plaintiff.
Aird & Berlis, Toronto for defendants.
The following are the reasons for order ren
dered in English by
DuBÉ J.: This application by the plaintiff ("Piz-
za Pizza") is for an interlocutory injunction
restraining the defendants ("Little Caesar") from
using or advertising the trade mark "Pizza Pizza"
and any other designation similar to the trade
marks or trade names of the plaintiff, and from
directly or indirectly indicating a connection in the
course of trade between Little Caesar and Pizza
Pizza.
As of October 18, 1989, Pizza Pizza operates or
franchises some 194 take-out restaurants in the
Metropolitan areas of Toronto, Ottawa and Mon-
tréal, as well as other locations throughout the
province of Ontario. It is the registered owner in
Canada of several trade marks, the first having
been registered on March 3, 1972. Both its corpo
rate stores and its franchised outlets operate under
the trade mark "Pizza Pizza", used in association
therewith since December 1967. Within the year,
Pizza Pizza expects to open franchised restaurants
in several other communities, including Windsor
and London, Ontario. Its approximate annual net
sales have grown from $170,000 in 1968 to $100.4
million in 1988. Its advertising budget for 1988
was $6.3 million.
Little Caesar operates over 2,600 restaurants in
a pizza chain based in the United States, through
corporate restaurants and by way of franchised
outlets. It has operated five fast food take-out
restaurants in the Windsor, Ontario area for the
past 1' years. As part of its advertising and
signage it uses the phrase "Pizza! Pizza!" in com
bination with its trade mark "Little Caesar". The
purpose of that exclamatory phrase is to advertise
the promotion of two pizzas for the price of one.
Pizza Pizza's method of doing business is sub
stantially different from that of Little Caesar.
Little Caesar does not deliver its products in the
Windsor area. All sales are made at the individual
stores with approximately 90% of Little Caesar's
customers calling ahead to order pizzas for pick
up. Each store has its own telephone number.
By contrast, Pizza Pizza's business operations
focus upon the delivery of its products. A comput
erized telephone system is used to handle all deliv
ery orders for the plaintiffs products. The delivery
telephone number is 967-1111 in the Toronto area.
Is has become well-known as a result of the plain
tiff's extensive advertising efforts. Other telephone
numbers are used outside Metropolitan Toronto.
In June 1983, the plaintiff commenced a similar
action in this Court against Little Caesar and
Viking Restaurants Incorporated, a Little Caesar
franchise operating in London, Ontario. The plain
tiff alleged infringement and moved for an inter
locutory injunction based substantially on the
same allegations and arguments advanced in the
instant motion. On October 3, 1984, the Associate
Chief Justice dismissed the application, mainly on
the ground that the plaintiff had not shown irrepa
rable harm. The last paragraph of his reasons
reads as follows (at page 156):'
There is considerable support for the position advanced by
both the plaintiff and the defendants and I fully expect it to be
a difficult decision for the trial judge. There is no reason to
believe that in the period pending trial, damages suffered by
the plaintiff cannot be fully compensated by a monetary award.
Upon the special facts of this case where the plaintiffs opera
tion is almost entirely in one market and the defendants' in
another and where the obvious disclaimer of the descriptive
word "pizza" will be a factor in the ultimate decision, it seems
to me that the better exercise of discretion favours adjudication
of all issues at trial.
This interlocutory application is therefore dismissed with
costs.
Apparently, the matter was then resolved be
tween the parties and that action was not pursued.
However, in the ensuing five years the factual
situation has changed considerably and the juris
prudence on irreparable harm in the field of trade
marks has evolved substantially. Consequently, I
now propose to grant the interlocutory injunction
and for the following reasons.
In 1983, the plaintiff carried on business mostly
in the Metropolitan area of Toronto and operated
some 50 outlets, whereas the defendant Viking
Restaurants Incorporated operated four pizza
locations in London, Ontario. As mentioned ear
lier, the plaintiff now operates or is about to
operate at some 200 locations in Montréal and
throughout Ontario, including Southwestern
Ontario. Because of its increased advertising
budget and heavy volume of sales, it now covers
virtually the entire province of Ontario, including
Windsor. The finding of the Honourable Associate
Chief Justice, that "the plaintiffs operation is
almost entirely in one market and the defendants'
in another", is no longer valid.
' Pizza Pizza Ltd. v. Little Caesar Enterprises Inc. et al.
(1984), 1 C.P.R. (3d) 154 (F.C.T.D.).
It is common ground that the threshold test for
an interlocutory injunction, a serious issue to be
tried, has been met. The second requirement,
irreparable harm, canvassed in the recent jurispru
dence, points in the direction that the mere
infringement of the proprietary right in a trade
mark is of itself sufficient to constitute irreparable
harm.
In Maple Leaf Mills Ltd. v. Quaker Oats Co. of
Can., 2 Cattanach J. granted an interlocutory
injunction for the infringement of the trade mark
"Pounce" for cat food. He said (at page 43
C.I.P.R.) that "The mere infringement of the pro
prietary right in a trade mark is of itself sufficient
to constitute irreparable harm not compensable for
in damages." He said that the trade mark is
presumed to be valid and found that there was "a
risk of unquantifiable damage, which need not be
proven but need only be anticipated, to the plain
tiff if the interlocutory injunction is refused and
the plaintiff should be successful at trial." He
concluded (at pages 43-44 C.I.P.R.) that the
status quo should be maintained:
The maintenance of the status quo is accomplished by an
interlocutory injunction. That is its object and effect.
In Joseph E. Seagram & Sons Ltd. v. Andres
Wines Ltd.,' my colleague Cullen J. granted an
interlocutory injunction to restrain the defendant
from selling a vodka cooler under the trade name
"Wildberry". He said (at page 145 C.I.P.R.):
It is quite apparent to me that we have an arguable case of
infringement of a registered trade mark and therefore this
injunction will be granted. The law is quite clear that this can
be done without the necessity of having to consider balance of
convenience and irreparable harm. (Duomo Inc. v. Giftcraft
Ltd. (1984), 3 C.I.P.R. 70, 1 C.P.R. (3d) 165, at 169 (Fed.
T.D.); Maple Leaf Mills Ltd. v. Quaker Oats Co., supra;
Universal City Studios v. Zellers (1983), 73 C.P.R. (2d) 1
(Fed. T.D.), at pp. 8, 9; I.B.M. Corp. v. Ordinateurs Spirales
Inc. (1984), 2 C.I.P.R. 33, 80 C.P.R. (2d) 187, at 198 (Fed.
T.D.)).
2 (1984), 2 C.I.P.R. 33; 82 C.P.R. (2d) 118 (F.C.T.D.).
3 (1987), 16 C.I.P.R. 131; 16 C.P.R. (3d) 481; 11 F.T.R. 139
(F.C.T.D.).
The learned judge quoted our colleague Madam
Justice Reed in I.B.M. Corp. v. Ordinateurs Spi-
rales Inc., 4 where she granted an interlocutory
injunction, even though it was "hard to conclude
that the plaintiff would suffer irreparable harm
from the actions of the defendant alone". How
ever, she referred to the "floodgates effect" or
"death by 1,000 cuts" which would result from a
failure to grant the injunction, thus encouraging
"many others to enter into the field of importing
and selling the computers containing the pro
gramme in which the plaintiff holds a certificate of
copyright".
In a more recent decision, Syntex Inc. v. Novop-
harm Ltd.,' MacKay J., of this Court, reviewed all
the recent authorities on irreparable harm and
concluded as follows (at page 502 C.P.R.):
In light of these authorities it seems clear to me that the
unauthorized use of a registered trade mark results in irrepa
rable harm to the owner whether that be perceived as a
diminution of the owner's statutory proprietary interest in
exclusive use, a loss of the distinctiveness of the trade mark, the
implicit recognition of a compulsory licence if the owner's right
not be protected or because of the inevitable loss of market
share where a well established market, developed with wares
that are the subject of a registered trade mark, is entered by
one who uses the trade mark without authorization. All of these
perceptions relate to harm in a non-monetary sense for which
damages do not readily provide appropriate compensation.
Clearly, in the case at bar, the unauthorized use
by Little Caesar in the Windsor, Ontario area of
the plaintiff's registered mark would cause harm
to the plaintiff which is irreparable, in the sense
that the diminution of the owner's statutory pro
prietary interest could be perceived but not mea
sured. Loss of the distinctiveness of the trade mark
"Pizza Pizza", which must be assumed to be valid
at this stage of the proceedings, would also ensue,
as would an inevitable loss of market share in the
areas where the plaintiff already operates, as well
as in those areas where the plaintiff intends to
operate. These harms cannot be readily measured
in monetary terms by an accountant, but can be
foreseen and perceived by anyone. The two words
of the trade mark "Pizza Pizza" appearing on the
(1984), 2 C.I.P.R. 56; 80 C.P.R. (2d) 187 (F.C.T.D.), at p.
70 C.I.P.R.
5 (1989), 26 C.P.R. (3d) 481; 28 F.T.R. 124 (F.C.T.D.).
signage and the wares of Little Caesar in the
Windsor area obviously affect the plaintiff's trade
mark, which at this stage stands registered
throughout Canada.
On the other hand, the alleged harm to be
suffered by Little Caesar if the injunction is grant
ed appears to be minimal. The "Pizza! Pizza!"
signage for the Windsor outlets would have to be
replaced, at a cost of $8,000. However, the signs
can be returned if the injunction is lifted. Some of
the advertising material may not be used during
that period, but non-offending material can be
obtained from Little Caesar's restaurants in the
Detroit area. Confusion will not inevitably result,
as the "Pizza! Pizza!" phrase may be replaced by
Little Caesar's own slogan: "Two Great Pizzas for
One Low Price".
For the foregoing reasons, there shall be an
interlocutory injunction restraining the defendants
by its officers, servants, workmen, agents and
employees from infringing and depreciating the
trade marks "Pizza Pizza" and "Pizza Pizza
Design" until the trial of or other disposition of
this matter, in the form requested by the plaintiff.
Costs in the cause.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.