The defendants appealed a prothonotary's order dismissing their motion to stay the proceedings in favour of arbitration in Bermuda.
The plaintiff alleged copyright, trademark, and radiocommunication infringement.
The Federal Court allowed the appeal, finding that the prothonotary applied the incorrect legal test.
Following the competence-competence principle from Dell Computer Corp v Union des consommateurs, the Court held that the complex issues of mixed fact and law regarding the scope, validity, and termination of the agreement must first be determined by an arbitrator.