CIRA party at Drake Hotel 2015

Guest Post by Lauren White.  On Weds 23rd February evening I attended the CIRA, the Canadian Internet Registration Authority member’s networking event at The Drake Hotel. This landmark Toronto boutique hotel and hipster event space has dot ca website and has had one ever since they opened their doors more than a decade ago. They say its to celebrate Canada, but let’s face it, Drake dot com was probably long gone when they did their search.raymitorontoooooooo

CIRA has held events at The Drake before, and now again in 2016 they chose the boutique hotel lobby bar to host their annual members’ networking party. Despite the ice storm outside, the whole joint was soon filled to capacity because the room only holds about 120 people and CIRA has a great reputation for generosity.

Everything was free for CIRA members. Non members got one free drink. So there was ample incentive to join the collective and anyone who expressed any interest or wanted another free drink was promptly ushered toward the membership enrollment booth. This attraction was staffed by two librarians eager to take your details and replace white lanyards with red ones. Red lanyards were solid gold at the bar.

We’re glad you decided to join us! was printed on the cocktail napkins.

cira - Canadian Internet Registration AuthorityThe crowd was filled with small business owners and data center managers, government employees and civil liberties activists. It was a strange mix of many different parts of Canadian society. The networking was almost entirely vocational. “Hey so what do you do?” followed by ‘Cool.’

Meet David Michaels who once owned www dot michaels dot ca and maybe one day he will own it again – time and good lawyers will tell.


David got screwed out of his .ca domain by the retail giant Michaels and now he’s raising money for an appeal – to the Supreme Court of Canada!

David’s story is heartbreaking, and once he started telling this cautionary tale everyone shut up and listened. The story is simply that he registered on February 12, 2001, which is years before the Michaels Arts and Craft Stores switched their name to Michaels.

After a few attempts to secure the domain name from David the retailer chose to pursue the matter in the courts. David alleges the retailer had its Delaware Business Trust file a (fraudulent?) trademark application to register the word Michaels as a trademark, in June 2001, based on use in Canada since 1984.

Michaels signatureIn 2009 Michaels Stores Inc., which operates the Michaels Arts and Craft Stores, rebranded as just MICHAELS and adopted a logo that looks similar to David’s own signature in 2009 in the USA, and about 2011 in Canada.

on January 4, 2012, Michaels Stores Procurement Co. Inc (Delaware, USA) “MSPCI” alleged that David was infringing on their trademarks. On January 11, 2012, they sent him a draft statement of claim and demanded his domain name in exchange for $10,000 and they would drop their claims.

On January 20, 2012, Michaels claims that a woman named Heather Morschauser, Michaels corporate counsel told David they didn’t want to sue him, and she offered $100,000 for the michaels dot ca domain name. He declined the offer because the traffic on his site had exceeded more than a million visitors annually for the previous 3 years, and they wouldn’t let him keep his michaels dot ca email address that he had used since registering it in February 2001. Besides, he figured a business with more than $4 billion dollars in annual revenue could afford to pay more than $100,000 for a valuable domain name.

The 2014 Federal Court Infringement Suit

MSPCI and their licensee, Michaels of Canada ULC (Nova Scotia), a new and aggressive arts & craft store franchise financed by Bain Capital, sued David in Federal Court for trademark infringement in April 2014 seeking again to take his michaels dot ca domain name.

And to make a long sad story much shorter, On March 15, 2016, the Federal Court of Appeal ruled that the Federal Court has the power to order the transfer of property, such as domain names, based on common law or equity. David Michaels has now officially lost his domain… But he’s not down for the count yet. He rises with clenched fists!

How can David battle his Goliath?

To begin with, David Michaels would like to force the Courts to set aside the default judgment on the basis of fraud. He claims he can can prove a material misrepresentation in the Plaintiff’s application to register the word Michaels. Alternatively, he would like to get an Ontario Superior Court to overrule the FCA, based on jurisdiction to make an order for the transfer. His last hope would be an appeal to the Supreme Court of Canada based on the Federal Court’s lack of jurisdiction to make the order and a breach of natural justice.

In summary, I agree with David Michaels that the Court’s enhanced powers are dangerous as it appears the Federal Courts seem to have followed the utilitarian views of Jeremy Bentham, instead of John Locke’s views regarding property. Its clear the Federal Court of Canada didn’t consider the Ontario Property and Civil Rights Act in this decision. Indeed the court’s decision enhances the Federal Court’s powers to make some extraordinary remedies, to seize valuable property like michaels dot ca domain name from a small proprietor and give it to a multinational corporation – this eviscerates the rule of law in Canada with regards to property disputes.

I also believe CIRA should get more involved in this case and lend their resources to David’s cause. Stay tuned for links to David Michaels’ crowdfunding page.

How’s that for networking?

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