No Default Judgment Even Where No Defence
Mövenpick-Holding v. Inter Management Services Limited 2009 FC 358 (Hugessen, J.)

April 9, 2009

Bayo Odutola and Celine Kowbel for the Plaintiff, Mövenpick-Holding
No one for the Defendant, Inter Management Services Limited (“IMSL”)

IMSL was one of several defendants in a trade-mark and passing-off action. A stay of proceedings against IMSL imposed by the Bankruptcy and Insolvency Act had been lifted and IMSL’s statement of defence struck. The Plaintiff applied for default judgment against IMSL.

Although IMSL was foreclosed from defending the action against it, another defendant was defending the action on the basis that the trade-marks owned by the Plaintiff were invalid and should be expunged and therefore granting default judgment against IMSL could lead to “a curious and contradictory result” that would not be in the best interests of justice. Thus, the claim against IMSL was stayed pending resolution of the claim against the other defendant regarding validity of the registrations. The Court did leave the door open to the Plaintiff to amend its pleadings against IMSL in order to obtain default judgment without causing such an anomalous result.

By: Tanya J. Rothe