While there are an array of similarities between the intellectual property ("IP") regimes of the United States and Canada, there are quite a few marked differences. With the significant amount of attention being placed on Canada on the heels of the U.S. Presidential Election, we figured this might be a particularly relevant time to look to the Canadian IP system. Foreign companies carrying on business in Canada must familiarize themselves with both the requirements of and protections afforded by this legislation.
IP in Canada is governed by six pieces of federal legislation: The Patent Act; The Trade-marks Act; The Copyright Act; The Industrial Design Act; The Integrated Circuit Topography Act; and The Plant Breeders’ Rights Act. These statutes have evolved in response to issues, such as global technological developments, international treaties and public access needs.
The Canadian Intellectual Property Office (“CIPO”), an agency of Industry Canada, administers the first five acts, sharing responsibility with the Department of Canadian Heritage for the Copyright Act. CIPO also maintains databases of registered patents, copyrights, trade-marks, industrial designs and integrated circuit topographies. The Canadian Food Inspection Agency administers the Plant Breeders’ Rights Act, which applies to certain new plant varieties.
For an invention to be patentable in Canada, it must be: (1) Novel (i.e., not already publicly disclosed somewhere); (2) Useful (functional and operative); and (3) Non-obvious to someone skilled in the art (i.e. demonstrate “inventive ingenuity”).
A Canadian patent gives the inventor the right to exclude others from “making, using or selling” the invention for 20 years from the filing date; no patent term extensions of any kind are available in Canada. As of October 1, 1989, Canadian patents are granted to inventors who are the first to file a patent application, not the first to invent. This means that it is essential to prepare and le a patent application at the earliest opportunity.
An applicant who previously led a patent application in a member country of the Paris Convention may claim the bene t of that early ling date for an application for the same invention that is led in Canada within the following 12-month period. Effective January 1, 1996 this bene t was extended to applicants who first led in any World Trade Organization member country.
Protest and Re-examination
Before a patent is granted, the Patent Act provides for formal opposition proceedings on the basis of prior patents, published applications and printed publication. There is also a procedure for re-examination of an issued patent.
The Patent Office charges maintenance fees both during prosecution of the patent application and after a grant. These fees are payable annually from the second anniversary of ling in amounts that increase over the term of the patent.
Although an infringement action can be commenced in the Superior Court of any province, generally it is brought in the Federal Court. The action is heard by a judge alone (there are no jury trials) and the resulting court order is effective across the country. If infringement is found, the successful party is entitled to injunctive relief, damages or an accounting of profits, delivery up and costs.
While there are exceptions, the current trend favors the patentee; claims are construed liberally and held valid unless clearly without merit. Accordingly, a foreign enterprise seeking to establish a business in Canada that might involve a patented process, method or product should conduct a careful search of Canadian patents in force and have the search results interpreted by someone familiar with Canadian patent law.
A trade-mark is a word, symbol or design (or a combination of these) that is used to distinguish the wares or services of a person or organization from those of others in the marketplace. A Canadian trade-mark registration can often be obtained within 20 to 24 months of ling and gives the registrant the exclusive right to use the mark across Canada for a period of 15 years, with renewal for successive 15-year periods on payment of renewal fees.
Foreign businesses that are considering setting up a business in Canada should take steps to protect their trade-marks in Canada be- fore actually starting to sell products or perform services here. This move will minimize the possibility that someone else, observing the use abroad, will le in Canada first and preclude registration by the true owner of the mark. Obtaining a Canadian trade-mark registration will also assist foreign entities in obtaining a .ca domain name registration (as there are certain Canadian presence requirements associated with obtaining .ca domain names). A trade-mark application may be based on use of the trade-mark in Canada as well as proposed use.
Before registration of a proposed use trade-mark will be granted, the applicant must confirm that use in Canada has started. A Canadian application may also be based on registration and use of the mark in the applicant’s country of origin, without use in Canada.
A trade-mark that has stood on the register for three years may
be subject to summary cancellation. At the request of any person and on receipt of the prescribed fee, the Registrar sends a notice requiring the registrant to either establish that the mark was in use for each of the defined wares or services at some time during the three-year period immediately before the date of the notice, or offer satisfactory reasons to excuse the absence of use. If the registrant’s evidence or explanation is not accepted, the registration will be can- celled or restricted. This procedure provides a relatively inexpensive method of pruning the “deadwood” from the register.
In Canada, there is no requirement to record licensees. To maintain the distinctiveness of a licensed mark, however, the trade-mark owner must have control over the character or quality of the wares and services to which the licensed mark is applied. Corporate control over the licensee will not, in and of itself, be sufficient to establish the requisite level of control. Under the Trade-marks Act, if notice is given of the fact that the mark is used under license and the identity of the trade-mark owner, it will be presumed that the use is a licensed use and that the character or quality of the licensed wares or services is controlled by the owner (although such presumption may be rebutted and, as such, it is important for licensors to exercise true control with respect to the use of the licensed marks).
Copyright subsists in all original literary, artistic, dramatic and musical works, including computer programs, provided that the author is a citizen or resident of a treaty country or the work, if published, was first published in a treaty country (see “International Treaties” below). Copyright gives the owner the sole right to produce or reproduce a work, or a substantial part of it, in any form.
While copyright protection generally lasts for the life of the author, plus 50 years, the Canadian government is considering extending this term to 70 years, as is the case in the U.S. and the European Union. Under the Copyright Act, the Copyright Board certifies tariffs which set out royalties payable for certain uses of copyright material.
Registration, while not necessary, provides certain presumptions that are useful if the copyright is litigated and prevents any person from relying on the defense of “innocent infringement” (i.e., where the infringer did not know and had no reason to suspect that copyright existed in the work). If there is no registration, an infringer who successfully proves the defense of innocent infringement could be prohibited from further copying but would not be liable for damages.
Canada is a member of the International Copyright Convention (the “Berne Convention”) and of the Universal Copyright Convention. Under the latter agreement, each of the contracting nations agrees to protect works first published in other contracting nations, provided that the published copies of the work are marked with the symbol © followed by the date of first publication and the name of the copyright owner.
Ornamental shapes or the configuration of industrial objects may be registered under the Industrial Design Act for patent-like protection for a period of five years, renewable for one further five-year period. To be valid, a design application must be led in Canada within one year of its first publication in Canada or elsewhere. Only the “proprietor,” who is the author, may validly apply for registration, unless the author has executed the design for another party for consideration or payment; in this case, the other party is the first proprietor. If the design is then assigned (i.e., sold), the assignee will be considered a subsequent proprietor and either the first or subsequent proprietor may apply to register. Care must be taken to correctly assess the facts, to name the correct “proprietor” and to le the application in a timely manner.
Canada’s Integrated Circuits Topography Act provides exclusive rights in the design or “topography” of integrated circuits (the semi-conductor chips used in modern electronic technology). The law provides the creator of a topography or a successor in title a 10-year exclusive right to reproduce the topography, manufacture the integrated circuit incorporating the topography and import or commercially exploit the topography or integrated circuit incorporating it.
To be valid, an application must be led in Canada within two years of the first commercial exploitation of the topography anywhere in the world. Reverse engineering of a registered topography is lawful if used for analysis, evaluation, research or teaching, but not for commercial purposes.
Kelly Moffatt is a partner in Osler, Hoskin & Harcourt LLP’s Intellectual Property Department, assisting companies in representing virtually every business sector in the acquisition, commercial exploitation and protection of intellectual property.