Trademark and copyright infringement cases are typically litigated in the Federal Court of Canada which has the expertise and jurisdiction to decide these cases. While they can also be litigated in provincial courts, the parties to these disputes (particularly plaintiffs) often prefer to litigate them in the Federal Court for a variety of reasons. However, the Federal Court has more limited subject matter jurisdiction than provincial courts do. Its jurisdiction is limited to intellectual property and other federal matters. It does not have general jurisdiction over disputes concerning contracts, torts and confidential information. Generally speaking, those disputes must be litigated in the provincial courts.
So what happens when a dispute over trademark rights turns on the interpretation of a contract? Many intellectual property disputes involve collateral issues relating to contracts between parties concerning the ownership and usage of the intellectual property. It used to be that an underlying contractual dispute would need to be resolved in a provincial court before the Federal Court could adjudicate the intellectual property issue. This was costly and inefficient.
However, in Salt Canada Inc. v. Baker, 2020 FCA 127 (“Salt”), the Federal Court of Appeal held that the Federal Court may exercise jurisdiction over issues that are outside of its intellectual property jurisdiction if those issues are ancillary to the intellectual property issues.
Pre-Salt
Prior to the Federal Court of Appeal’s decision in Salt, litigants in an intellectual property dispute that depended on the resolution of an underlying contractual dispute had to first seek a ruling in a provincial superior court before seeking relief in the Federal Court. In cases like Hutchingame Growth Capital Corporation v. Dayton Boot Co. Enterprises Ltd., 2019 FCA 152 the Court assessed whether it could decide a case by determining whether intellectual property was the core aspect of the dispute and, if not, referring the matter to the court with the greatest claim to the core aspect. At paragraphs 55 and 56, the Federal Court of Appeal stated:
“In the circumstances, the Federal Court had no choice but to stay the proceedings under section 57 of the [Trademarks] Act until the issue of ownership had been resolved by the Supreme Court of British Columbia (and any appeal rights have been exhausted) (FC Act, s. 50(1)). It is only after the issue of ownership has been finally determined that the Federal Court will be in a position to determine if any entries on the register should be either struck out or amended.”
The decision in Salt
Recognizing that bringing multiple actions was costly and inefficient (see paragraphs 32 and 33), the Federal Court of Appeal in Salt reasoned that the Federal Court has the flexibility to rule on contractual disputes when that determination is a required step in resolving an issue under the Federal Court’s jurisdiction. The Federal Court of Appeal justified this through lengthy analysis of the Federal Court’s regular need to interpret contracts while deciding issues within its exclusive jurisdiction (see paragraph 40):
“This express rejection tears at the notion that Parliament regards the interpretation of agreements as a task alien to the Federal Courts or that its judges are incapable of applying contractual principles. Sometimes the Federal Courts have to do it under the jurisdiction they have lawfully been given. Where contractual disputes arise within its jurisdiction, the Federal Courts are empowered to resolve these disputes just as any other court does, and they do so all the time.”
The decision in Salt is clearly intended to remove the need for separate proceedings in a single dispute but it is notably vague on how concurrent jurisdiction in parallel proceedings should be resolved when they arise. In paragraph 45, the Federal Court of Appeal explains that the management of parallel proceedings will be different depending on the circumstances:
“There will be cases where the Federal Court does not have jurisdiction because the matter is purely contractual between private parties: see, e.g., McNamara Construction et al. v. The Queen, 1977 CanLII 13 (SCC), [1977] 2 S.C.R. 654, (1977), 75 D.L.R. (3d) 273. And there will be cases where on the particular facts it would be more appropriate for the Federal Court to stay proceedings before it to allow ongoing related litigation in the provincial superior courts to go ahead: Hutchingame Growth Capital Corporation v. Dayton Boot Co. Enterprises Ltd., 2019 FCA 152, 52 Admin. L.R. (6th) 1. […]”
Post-Salt
Post Salt caselaw confirms that the Federal Court has concurrent jurisdiction when ruling on ancillary issues where a determination is required to decide on issues within the Federal Court’s exclusive jurisdiction. This year, the Federal Court of Appeal reaffirmed its approach in Wanakome Inc. v. Martin, 2026 FCA 12. In this case, the Federal Court of Appeal was faced with determining if the Federal Court had overstepped its jurisdiction by “effectively” ruling on an issue related to parallel proceedings between the same parties (a shareholder dispute and a trademark opposition proceeding). The Federal Court of Appeal found that the Federal Court had not exceeded its jurisdiction and – at paragraph 6 – endorsed the practice the Federal Court took by carefully determining which issues are within its jurisdiction and only ruling on ancillary issues that relate to that authority.
What this all means
This ongoing development of the boundaries of jurisdiction between federal and provincial courts represents an effort by the legal system to make proceedings more efficient when the expertise of a decision maker is not at issue. This opens the door for the courts to find a flexible approach that maximizes efficiency based on the facts of a dispute.
Since Salt, IP cases with ancillary non-IP issues can be litigated entirely in the Federal Court. But it’s important to find experienced IP litigators like those of us at Shift Law who can frame the issues in a way to convince the Court that it has jurisdiction over all of the issues, avoiding the need for litigation in multiple courts and the associated costs and delays.
How Shift Law can help
Disputes involving intellectual property rights and related contractual issues can raise complex questions about which court has jurisdiction. Shift Law has experience navigating these issues and developing litigation strategies that help clients avoid unnecessary proceedings, costs and delays.
Frequently asked questions
Below are answers to common questions about Federal Court jurisdiction in trademark and copyright disputes, including cases involving contractual issues and proceedings in provincial courts.
Can trademark and copyright infringement cases be litigated in provincial courts?
Yes. Trademark and copyright infringement cases can be litigated in either the Federal Court or provincial courts. However, parties often prefer to litigate these disputes in the Federal Court because of its expertise and jurisdiction in intellectual property matters.
Can the Federal Court decide contractual disputes involving intellectual property rights?
Yes, in certain circumstances. In Salt Canada Inc. v. Baker, 2020 FCA 127, the Federal Court of Appeal held that the Federal Court may exercise jurisdiction over issues outside its intellectual property jurisdiction if those issues are ancillary to the intellectual property issues. This can avoid the need for separate proceedings in provincial and federal courts.
What did the Federal Court of Appeal decide in Wanakome Inc. v. Martin?
In Wanakome Inc. v. Martin, 2026 FCA 12, the Federal Court of Appeal reaffirmed that the Federal Court may rule on ancillary issues where a determination is required to decide matters within its jurisdiction. The Court found that the Federal Court had not exceeded its jurisdiction and endorsed its approach of carefully determining which issues fell within its authority.
