SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: CV-12-464500
DATE: 20121218

RE: Polar wireless corporation

Plaintiff

• and -

steven j. roberts, jack robert lee, 1271583 ontario inc., chun-wing lee, 1177153 ontario limited, marilyn schaffer, xtm incorporated , go to wireless inc. and James lovie

Defendants

BEFORE: Justice S. M. Stevenson

COUNSEL:
Mark A. Veneziano and Matthew B. Lerner , for the Plaintiff

Richard P. Quance , for the Defendants Steven J. Roberts,
Jack Robert Lee, 1271583 Ontario Inc., Chun-Wing Lee,
1177153 Ontario Limited and Go To Wireless Inc.

David N. Bleiwas , for the Defendants Marilyn Schaffer and
XTM Incorporated

DATES HEARD: October 29 and November 2, 2012

E N D O R S E M E N T

[ 1 ] I released Reasons for Decision on November 16, 2012, with respect to an injunction motion brought by the plaintiff, Polar Wireless Corporation ("Polar"), whereby I granted Polar an interlocutory injunction for a period of six months. The parties have been unable to agree on the form of the order and costs. Additionally, the defendants, Marilyn Schaffer and XTM Incorporated seek a stay of the data imaging paragraph of the proposed order as against them given they have sought leave to appeal to the Divisional Court. Polar does not oppose this request.

[ 2 ] I have reviewed the written submissions from all counsel with respect to the form of the order along with draft orders provided by counsel for Polar and counsel for all of the defendants, except for Marilyn Schaffer, XTM Incorporated and James Lovie. I note that James Lovie was not a party to the action at the time of the motion.

[ 3 ] Polar seeks to add the names of specific business opportunities with carriers and distributors developed at Polar in the order to ensure a shared, clear understanding, insofar as is possible, of the entities to which the injunction applies.

[ 4 ] Polar did not seek this specific relief in its Notice of Motion, Factum or in oral submissions and I decline to add these names to my order already set out at paragraph 74 of my Reasons.

[ 5 ] The parties have agreed to add certain provisions in the order with respect to Polar’s expert attending at the Injunction Defendants’ premises to create forensic images, which is acceptable; however, Polar has deleted certain provisions of my order from the draft order ‑ in particular, the wording, “which contain confidential information of Polar for preservation subject to further order of the Court”. This wording should not have been deleted as it substantially changes the wording and intent of my order.

[ 6 ] Polar also seeks to add the wording “and in particular any copies of Polar’s SIM overlay firmware” which was also not in my order and should not be inserted.

[ 7 ] The parties have also made submissions regarding costs. Polar seeks costs on a partial indemnity basis of $80,147 while the defendants, except for Marilyn Schaffer, XTM Incorporated and James Lovie submit that the costs payable to Polar should be $40,000, inclusive of HST and disbursements. Marilyn Schaffer and XTM Incorporated submit that costs should be reserved to the trial judge or, in the alternative, that costs be in the cause. They submit that the facts and issues with respect to Marilyn Schaffer and XTM Incorporated have not been finally determined and it would be unfair to award costs. They also contend that as Polar has, since the injunction, added James Lovie as a party it is likely the matter will proceed to trial.

[ 8 ] Rule 57.03(1)(a) of the Rules of Civil Procedure provides that the costs of a motion shall be fixed and payable within 30 days on the hearing of a contested motion, unless the court is satisfied that a different order would be more just. As stated by Perell J. in Quizno's Restaurant Corp. v. 1450987 Ontario Corp. 2009 CarswellOnt 3512, at para. 6 :

It may be noted that rule 57.03 (1)(a) does not make mandatory the fixing of costs and the direction that they be payable within 30 days; the rule admits of the exception of where the court is satisfied that a different order would be more just. The court’s residual discretion about costs remains: Intercontinental Forest Products SA v. Rugo , [2004] O.J. No. 4190 (Div. Ct.).

[ 9 ] Although I did find that Polar had established not only a serious issue to be tried, but a strong prima facie case with respect to breach of fiduciary duties and breach of confidence by the defendants, I cannot say for certain that the granting of the interlocutory injunction will put an end to the proceedings and that the matter will not proceed to trial. I find that it is preferable to order costs in the cause given the matter is not over and the rights of the parties still need to be determined at trial. I adopt the reasoning of Perell J. in Quizno's Restaurant Corp. v. 1450987 Ontario Corp. at para. 10 :

Where a plaintiff succeeds in obtaining an interlocutory injunction it is the preferable (although not inevitable) course to reserve costs to the trial judge, which is to say to make costs in the cause. This is the preferable course because it allows the court to have the benefit of hindsight and to avoid the possible injustice of awarding costs to a plaintiff for having succeeded in obtaining an order to protect his or her position pending trial when the outcome of the trial reveals that that plaintiff’s position was not worthy of having been protected.

[ 10 ] I make the following order:

i) Order to go in accordance with paragraphs 1 to 5 of the draft order provided to the Court by counsel for the defendants, Steven J. Roberts, Jack Robert Lee, 1271583 Ontario Inc., Chun-Wing Lee, 1177153 Ontario Limited, and Go To Wireless Inc.

ii) Paragraph 3 of the order shall be stayed solely as against the defendants, Marilyn Schaffer and XTM Incorporated, until such time as the Divisional Court rules on Marilyn Schaffer and XTM Incorporated's motion for Leave to Appeal, returnable January 21, 2013.

iii) Costs for the interlocutory injunction motion shall be in the cause.

Stevenson J.

DATE: December 18, 2012