The appellant, an unauthorized dealer, sold genuine Seiko watches lawfully acquired from outside the authorized Canadian distribution network.
The respondent, the authorized Canadian distributor, obtained a permanent injunction at trial preventing the appellant from advertising or selling Seiko watches in Canada, arguing that the sale of the watches without the authorized warranty and point-of-sale service constituted passing off.
The Supreme Court of Canada allowed the appeal and struck out the injunction, holding that neither the classic nor the extended tort of passing off applies where a vendor sells identical, lawfully acquired goods under their original trademark, provided there is no misrepresentation to the public.
