May 12, 2020

Counterfeiting and the Pandemic

In the face of the ongoing COVID-19 pandemic, and preparations for reopening some sectors of the economy, the need for medical supplies is at the forefront of everyone’s mind. While it is important that medical supplies be available, it is paramount that the supplies are safe and effective.

As Canadians adapt to the COVID-19 pandemic, people will often rely on trusted and familiar brands to provide safe and effective personal protective equipment (PPE). Two weeks ago, international manufacturer of PPE, 3M, filed a notice of application in the Ontario Superior Court to protect the supply of their N95 face masks. In its notice, 3M claimed that Caonic Systems Inc. used the Shopify e-commerce platform to sell N95 face masks that it claimed were made by 3M. 3M further alleged that Caonic Systems Inc. claimed false affiliation with 3M, used 3M trademarks without authorization, and made the masks available for sale at five times the list price. 3M is requesting the Superior Court order Caonic Systems Inc. to identify the locations of the masks sold to evaluate the authenticity of the product.

3M is taking significant legal action in multiple jurisdictions in the United States, and now Canada, to stop parties from trying to take advantage of the global pandemic for financial gain.

In response to the COVID-19 pandemic, new laws, orders and directions have been introduced by governments to protect communities in these unprecedented times. For example, in Ontario, the government has expressly prohibited price-gouging under the Declaration of Emergency that is currently in place (Emergency Management and Civil Protection Act). Courts in Canada remain open to assist parties with on-going legal matters, as well as new and novel issues brought on by the COVID-19 pandemic.

It was also announced this week that US Immigration and Customs Enforcement (ICE) have partnered with 3M, and other companies including Pfizer, Alibaba, Amazon and Merck to tackle COVID-19 related fraud.

3M’s allegations have not been proven in Court. This case will be interesting to follow to understand how Ontario Courts will deal with a number of issues, including protection of IP and price-gouging, in the face of the COVID-19 pandemic.