Major Victory for IP Rights Holders

The Supreme Court of Canada’s (SCC) decision in Google v. Equustek presents a major victory for intellectual property rights holders. In the right circumstances, injunctive relief may be obtained from a Canadian court to protect IP around the world.

The plaintiff, Equustek, claimed trade secret and trademark rights in products previously distributed by the defendant. The defendant went on to sell its own version of the products, which the plaintiff alleges infringed its rights. Rather than defending the claim, however, the defendant made sales via the internet outside of Canada, leading to the plaintiff taking default judgment.

The plaintiff sought the co-operation of Google to de-index the defendant’s websites from its search results such that the defendant products could not be found through a Google internet search.

While Google did so for, it refused to voluntarily remove the defendant’s websites from other domains. This led Equustek to apply for an interlocutory injunction to require Google, a non-party, to de-index the defendant’s websites from all of its domains, wherever that may occur throughout the world.

The British Columbia Supreme Court granted the order sought by the plaintiff. This was upheld by the British Columbia Court of Appeal, and now by the SCC.

As in the courts below, the majority in the SCC applied the traditional test for interlocutory injunctions:

  1. Is there a fair case to be tried?
  2. Without the injunction, will the plaintiff suffer irreparable harm?
  3. And does the balance of convenience favour granting the injunction?

The SCC upheld the decisions below and denied Google’s appeal.

The SCC held that the only way to ensure the injunction attained its objective of restricting the defendant’s activities was to have it apply where Google operates: globally.

The SCC held that the onus was on Google to prove that such an order would violate the laws of another country – and so should not be granted – rather than requiring that the applicant bear that onus. This is a significant shifting of the onus away from the party seeking the injunction and onto a non-party.

The majority of the SCC concluded that, on balance, the worldwide injunction was the only way to effectively mitigate the harm to Equustek pending trial and was fair given that any harm to Google by complying with the injunction was minimal.

The two dissenting judges would have dismissed the appeal, noting, among other things, that the order was effectively a final order where there had been no determination of the underlying merits of Equustek’s IP rights claim regarding the defendant’s alleged infringement. In the absence of an extensive review of the merits, which they believed was warranted in the circumstances, the minority held that the test for a permanent injunction was not met and thus would have allowed the appeal.

Note: This article is of a general nature only and is not exhaustive of all possible legal rights or remedies. In addition, laws may change over time and should be interpreted only in the context of particular circumstances such that these materials are not intended to be relied upon or taken as legal advice or opinion. Readers should consult a legal professional for specific advice in any particular situation.