AMERICAN EXPRESS MARKETING & DEVELOPMENT CORP. Applicant v. BLACK CARD, LLC, 2018 FC 563

Date: 20180530 Docket: T-1547-16 Citation: 2018 FC 563 Ottawa, Ontario, May 30, 2018 PRESENT: The Honourable Mr. Justice Fothergill BETWEEN: AMERICAN EXPRESS MARKETING & DEVELOPMENT CORP. Applicant and BLACK CARD, LLC Respondent ORDER AND REASONS I.

Overview [ 1 ] This order concerns the costs and disbursements payable to Black Card LLC [BCL] by American Express Marketing & Development Corp [Amex] as a result of this Court’s judgment in American Express Marketing & Development Corp v Black Card LLC , 2018 FC 362 . [ 2 ] For the reasons that follow, BCL is awarded costs in the lump sum of $35,000.00, comprising legal fees in the amount of $25,000.00 and disbursements in the amount of $10,000.00. II.

Background [ 3 ] Amex filed appeals of ten decisions of the Trade-marks Opposition Board [TMOB], which rejected its opposition to applications by BCL for the trade-mark BLACKCARD and multiple variations thereof. Shortly before Amex was due to file its memorandum of fact and law, BCL abandoned seven of the underlying trade-mark applications. [ 4 ] On April 5, 2018, this Court held that the appeals arising from the seven abandoned trade-mark applications were moot, and the Court should not exercise its discretion to decide them.

With respect to the remaining appeals, the Court held that Amex had not met its initial evidentiary burden of establishing the facts necessary to support any of the asserted grounds of opposition. The appeals were therefore dismissed. [ 5 ] BCL now seeks its costs. III. Positions of the Parties [ 6 ] BCL requests legal fees in the lump sum of $30,000.00, which it says amounts to approximately 30% of the legal fees actually incurred. BCL also seeks disbursements in the amount of $10,304.26.

In the alternative, BCL requests legal fees at the high end of Column IV of Tariff B, totalling $28,490.00, plus disbursements. [ 7 ] BCL says it was entirely successful in defending the appeals; there was an increased volume of work due to the number of appeals and legal issues; BCL’s conduct shortened the length of the proceedings; and Amex’s conduct, specifically its arguments respecting mootness and its multiplicity of filings, unduly complicated and lengthened the proceedings.

BCL asserts that Column III of Tariff B is simply inadequate in the circumstances. [ 8 ] Amex responds that BCL has not met its burden of proving special circumstances to justify a departure from the default rule, and legal fees should be assessed in accordance with Column III of Tariff B. Amex also contests some of the fees claimed by BCL.

Amex therefore says that BCL’s allowable fees should be reduced from $28,490.00 to $16,345.00. [ 9 ] In addition, Amex says that BCL’s claimed disbursements for travel and document binding are excessive or improper, and should be reduced by $500.00. [ 10 ] Finally, Amex argues that any costs award should be reduced by 30% to reflect BCL’s unnecessary cross-examinations, its delay in advising Amex that seven of the underlying trademark applications had been withdrawn, and its unreasonable printing costs.

Amex requests a further reduction of $1,260.00 to account for preparation and attendance at a contested motion respecting mootness. In sum, Amex suggests that an appropriate costs award, inclusive of fees and disbursements, is $15,060.86. IV. Analysis [ 11 ] The awarding of costs, including quantum, is a matter falling within the Court’s discretion ( Federal Courts Rules , Rule 400(1);

Canada (AG) v Rapiscan Systems Inc , 2015 FCA 97 at para 10 ). In determining an award of costs, the Court is guided by the considerations found in Rule 400(3). [ 12 ] A lump sum award is specifically contemplated in Rule 400(4), and may serve to promote the objective of the Federal Courts Rules of securing " “the just, most expeditious and least expensive determination” " of proceedings (Rule 3; Nova Chemicals Corporation v Dow Chemical Company , 2017 FCA 25 at para 11 [ Nova ]).

A lump sum award may be particularly appropriate in complex matters where a precise calculation of costs would be unnecessarily complicated and burdensome ( Nova at para 12 , citing Mugesera v Canada (Citizenship and Immigration) , 2004 FCA 157 at para 11 ). [ 13 ] As a matter of good practice, a party seeking a lump sum award based on a percentage of actual legal fees above the amounts provided for in the Tariff should provide a sufficient description of the services rendered to satisfy an opposing party and the Court that the fees actually incurred are reasonable ( Nova at para 18 ). [ 14 ] While the legal issues in this proceeding may have been more complex than those raised in a typical trade-mark appeal, I am not persuaded that " “a precise calculation of costs would be unnecessarily complicated and burdensome” " , nor that the amounts prescribed by Tariff B would be wholly inadequate ( Nova at para 13 ).

Indeed, both parties have prepared draft bills of costs in accordance with Tariff B. To provide further context, BCL notes that an award at the high end of Column III would total approximately $20,000.00, and an award at the high end of Column V would total approximately $35,000.00. As previously mentioned, BCL seeks an award at the high end of Column IV, in the amount of approximately $30,000. [ 15 ] In my view, BCL is entitled to increased costs over those prescribed by Column III of Tariff B. BCL’s request for partial indemnity comprising 30% of actual legal fees is not unreasonable.

Amex does not seriously dispute BCL’s assertion that its actual legal fees were approximately $100,000.00, although it raises reasonable concerns regarding some of the steps taken by BCL to respond to the appeals. [ 16 ] For the sake of simplicity, I award BCL legal fees in the amount of $25,000.00. This amounts to approximately 25% of the legal fees actually incurred by BCL, and is at the mid-point between the high end of Column III and the high end of Column IV of Tariff B.

While this approach is imprecise, the calculation of lump sum awards is " “not an exact science, but reflects the amount the Court considers to be a reasonable contribution to the successful party’s actual legal fees” " ( Nova at para 21 , citing Consorzio del prosciutto di Parma v Maple Leaf Meats Inc , 2002 FCA 417 at para 8 ). [ 17 ] Amex takes issue with only $500.00 of the $10,304.26 in disbursements claimed by BCL.

For the sake of simplicity, I award BCL $10,000.00 in disbursements. [ 18 ] I am not persuaded that BCL’s costs award should be reduced by 30% to reflect the late withdrawal of seven of the underlying trademark applications. While this unexpected development no doubt caused certain costs to be thrown away, Amex responded with a supplementary argument respecting mootness that was ultimately unsuccessful. In my view, the parties’ strategic choices in this regard balance each other out, and are ultimately a neutral factor in the assessment of costs.

ORDER THIS COURT ORDERS that Amex shall pay to BCL costs in the lump sum of $35,000.00, comprising legal fees in the amount of $25,000.00 and disbursements in the amount of $10,000.00. “Simon Fothergill” Judge FEDERAL COURT SOLICITORS OF RECORD DOCKET: T-1547-16 STYLE OF CAUSE: AMERICAN EXPRESS MARKETING & DEVELOPMENT CORP. v BLACK CARD, LLC WRITTEN SUBMISSIONS CONSIDERED AT: Ottawa, Ontario ORDER AND REASONS: FOTHERGILL J. DATED: May 30, 2018

WRITTEN REPRESENTATIONS BY : Vincent M. de Granpré For The Applicant Daniel M. Anthony For The Respondent SOLICITORS OF RECORD : Osler, Hoskin & Harcourt LLP Barristers and Solicitors Ottawa, Ontario For The Applicant Smart & Biggar Barristers and Solicitors Ottawa, Ontario For The Respondent