I guess this falls under the category of “online law” – the proceedings of the Old Bailey (London’s Central Criminal Court) dating back to the year 1674 are now online.  Here are a few excerpts from trade-mark criminal cases from the 1800s. They’re a great of snapshot of horse-and-buggy intellectual property law:

10th September 1894 Unlawfully selling two bottles of gingerbeer to which a trade mark was falsely applied. A kid was caught recycling gingerbeer bottles by collecting empties, washing them, filling them with his own home-brew gingerbeer, then selling them from a roadside wheelbarrow. The manufacturer nailed him for trade-mark infringement – essentially passing off his homebrew for that of the brandname drink. 

13th January 1896 Falsely applying to 1,080 electric lamp holders a mark so resembling the trade-mark of the Edison and Swan United Electric Light Company as to be calculated to deceive.  A more sophisticated operation involving a scheme to unload counterfeit lamp holders. The verdict: Nine Months’ Imprisonment.  The trade-mark owner is the company run by Edison and Swan – the American and British inventors who owned light-bulb patents, and eventually joined forces after settlement of a patent infringement lawsuit.

Some things never change.  

Calgary - 09:30 MST

First, there has been much debate about when the Tory government in Ottawa will table their revised copyright bill.  In late 2007, draft legislation was pulled amid an unusual groundswell of opposition.  Now, there is renewed speculation that the bill will be introduced before Parliament breaks for the summer (assuming there is no election in the meantime).  If it is introduced, the bill will head into a thorough committee review, meaning the bill wouldn’t likely become law until sometime next year. 

Second, the QuebecTorrent case (a lawsuit by the canadian recording industry against an online file-sharing site) is reportedly scheduled to go to trial this summer. (Earlier post here.) If it proceeds through to a court decision, it will be a potentially landmark case for online copyright law in Canada, and it will be interesting to see how it dovetails with the proposed copyright legislation.  In the US, a decision released Monday (Atlantic Recording Corp. v Howell) is a setback for the anti-file-sharing efforts of the US recording industry.  In that decision, the court stated that copyright is not infringed unless there is actual distribution of an unauthorized copy of the work: “Merely making an unauthorized copy of a copyrighted work available to the public does not violate a copyright holder’s exclusive right of distribution.”  This is significant since loading a file onto a shared folder is “making available”, and according to this decision, such an act on its own does not constitute infringement. 

 

Calgary – 10:30 MST

In a story we posted last year, eBay lost when the Canada Revenue Agency compelled disclosure of its records – specifically, records showing how much money was earned in Canada by so-called “PowerSellers”. 

The Federal Court of Appeal (eBay Canada Limited vs. The Minister of National Revenue, 2008 FCA 141) has now upheld that lower court decision, and ordered eBay Canada Ltd. to produce the names, addresses, phone numbers, e-mail addresses as well as gross sales figures for all Canadian PowerSellers.  eBay’s argument that the records were stored in the US and did not reside in Canada, was not accepted by the Court and this decision has implications on a number of levels – the right to privacy for anonymous eBay sellers, as well as the production of documents by US and other foreign companies doing business in Canada.

 Calgary – 10:15 MST

As a plug for the local technology industry, we report that the Government of Alberta has just announced a few economic measures aimed at tech companies:

• Starting January 1, 2009, companies will be able to take advantage of a refundable tax credit worth 10% of eligible expenditures on scientific research and experimental development up to $4 million for a maximum annual credit of $400,000.
• $100 million is earmarked to establish the Alberta Enterprise Corporation. This government entity will provide early-stage venture capital for technology start-ups by co-investing in early-stage venture capital funds.

Calgary – 10:00 MST

This story is reminiscent of the dot-com days, when tech companies hit the wall at two hundred miles an hour.  One day they’re flush with cash, enjoying the new marble floors and capuccino machines; the next, the doors are closed and everyone is laid off.

Canadian company Geosign rode this wave in 2007 with $100 million in revenue and $160 million in VC funding.  Now, a year later, the sign posted on their home page says it all: “Sorry, this site is temporarily unavailable. Please check back later.” 

How did it happen?  The company was like a small sailboat that capsized when the mighty Google supertanker changed direction.  Geosign initially profited by taking advantage of an internet advertising system that came to a crashing halt when Google changed its policies. The changes were made by Google to ensure that ad-words took visitors to legitimate content, rather than pages which were composed of nothing but more ads. Google feared that customers would lose confidence in ad-words (and the Google search engine) if searches simply led to a nest of advertising links.  Before Geosign could reposition itself as a content-provider, Google had changed its policies and the damage was done.  Geosign went belly-up.  It serves as a cautionary tale for small tech companies and illustrates the power of dominant players like Google.

Related reading: Financial Post Business Magazine Cover story: “Blown away“

 

Calgary – 15:25 MST

A recent US Court of Appeal decision (North American Medical Corp. v. Axiom Worldwide, Inc., 2008 WL 918411, 11th Circuit Court of Appeals, April 7, 2008) deals with meta-tags and trade-mark infringement.  In a nutshell, the court agreed that the use of a competitor’s trade-marks in metatags constitutes infringement.  This decision is the latest, but does not settle the matter in the US; first, the Second Circuit Court of Appeals has applied different reasoning, and next, the changing nature of metatags requires a more sophisticated analysis of how search engines produce results. 

In Canada, the decision in BCAA et al. v. Office and Professional Employees’ Int. Union et al., 2001 BCSC 156 (CanLII) is still one of the most-cited case on the topic of trade-marks and metatags.  In the midst of a labour dispute, a disgruntled union used the BCAA’s metatags in a union protest site.  The court found that one of the early versions of the union’s site did constitute passing-off.  However, both the North American Medical case and the BCAA case illustrate the problem posed by changing technology. 

In BCAA, the court noted that: “When search engines gather information they seek out and obtain the information in the meta tags.  Meta tags are used by most search engines and directories to gather information.”  This statement is no longer accurate, because of the way search engine technology has evolved.  New court decisions will have to catch up to the search engines.

In the meantime, don’t use competitor’s trademarks in your website metatags – it won’t do you much good in search engine rankings, and the courts are clear that it will be perceived as infringement.

Calgary – 10:15 MST

A new decision and a new policy:

• In a recent decision (Enterprise Rent-A-Car Company v. David Bedford ), Enterprise won handily in its dispute over the bank of names registered by Mr. Bedford, a BC domainer. The dozen domain names (enterpriseautorental.ca, enterprisecarrentals.ca, enterprisecanada.ca, etc.) were used with a pay-per-click advertising scheme and this decision provides a useful precedent for trade-mark owners, along with the panelist’s finding that the test under the CDRP is one of resemblance, not confusion.
• CIRA, Canada’s official dot-ca domain name registry, is introducing changes to the WHOIS policy, starting in June 2008.  Under the new policy, private information about individual registrants will no longer be accessible through the dot-ca WHOIS database. The WHOIS information of corporate registrants will be displayed by default. This means that in order to contact an individual owner of a dot-ca domain name – say, for the purposes of proposing a transaction, or complainaing about trade-mark abuse – a new “administrative process” will be used.  This new process is under development, but it is expected to be an online form which will automatically forward correspondence to anonymous registrants, via CIRA. 

 

Calgary – 10:30 MST

Million of colours or millions of dollars in damages?  Apple’s lawyers must be wondering whether people have too much time on their hands.  A recent California lawsuit  alleges that Apple’s ad copy for its iMac computers is misleading because it incorrectly boasts “millions of colours”.  Gullible customers take this to heart and suffer when it turns out to be inaccurate. Just like Microsoft’s ads claim that “Xbox Live is where games come alive.”  And Maxwell House alleging that it’s “Good to the Last Drop.” …Right. That’s what ads do. They make the products sound great so you spend your money.

In an oft-cited Ontario case (Church & Dwight Ltd. v. Sifto Canada Inc., 1994 CanLII 7314 (ON S.C.)), the court dealt with an allegation of false advertising.  To succeed on this claim in Canada, you have to prove: 

• actual economic loss,
• that the offensive statements were false, and
• that they were made with the intent to cause injury,
• that they were made without lawful justification.

According to the Sifto case, advertisements claiming a product is “100 per cent pure and 100 per cent natural” are “examples of the ‘puffery’ which is the staple of the advertising industry and of marketers everywhere.”   Apparently, this hasn’t been explained to iMac customers in California.

Related Reading:  “Quebec couple battles corporate giant and wins” where a Telus customer successfully sues for a deceptive promotion under Quebec’s Consumer Protection Act

Calgary – 10:30 MST

We posted last month about a Canadian company that lost a patent infringement suit in Texas to competitor Blackboard Inc.  The Canadians lost another round a few weeks later when the judge barred them from selling the infringing products in the US.  In a recent reversal of fortune, the U.S. Patent and Trademark Office has now issued a preliminary decision that rejects all 44 patent claims made by Blackboard Inc. in its software patent. 

This shows the value of a coordinated patent litigation defence – fighting the patent infringement claim both in the courts and in the USPTO. 

 

Calgary – 15:30 MST

 

In our earlier post we wrote about the practice of domain kiting and domain tasting.  Other common tricks, such as Network Solutions’ practice of “front-running” (using customer search strings to pre-emptively register domain names before customers can get them), reflect the growing competitiveness in the domain name industry.

One more thing to watch for: a number of outfits such as AsiaDNR, or China Net Technology Limited, are sending “helpful” notices to Canadian domain name owners.  These notices appear to be from an official Asian registry and purport to notify owners that they are providing a service to protect the owner’s rights because someone else is trying to register “example.cn”, “example.hk”, “example.asia” … and ten other variations.  It’s just one more form of spam.

This practice is not new, but seems to be more common in the past six months.  It is best to ignore these notices.  I don’t know of any legitimate registrars who provide this kind of “helpful” service.  Decide whether any of the variations are of use to your business.  If you are a local Canadian operation with no plans to expand into Asia, then you may conclude that none of the Asian top-level domains will make sense for your company from a business perspective.  Even if you decide you need an Asian domain name presence, go through a legitimate registrar, such as AsiaDNS or Webnames.

Calgary – 14:01 MST

In Canada, what is the liability of online service providers — so-called “interactive computer services” —  including Craigslist, Yahoo Groups or Facebook?

The US Court of Appeals decison last week in the case of Chicago Lawyers’ Committee for Civil Rights Under Law v. Craigslist, Inc., 2008 WL 681168 (7th Cir. March 14, 2008) highlights the US approach: under Section 230 of the Communications Decency Act, providers of an “interactive computer service” who publish information provided by others can obtain immunity from liability.  In the Craigslist decision, the popular site was sued on the basis of discriminatory rental listings which were posted on the site.  The court decided that Section 230 immunity protected Craigslist from liability for those postings.

In Canada, the law is still unclear. Courts have touched on this issue.  The Canadian decision in Society of Composers, Authors and Music Publishers of Canada v. Canadian Assn. of Internet Providers (C.A.), 2002 FCA 166 (CanLII) dealt with copyright online and commented that: “…operators of host servers and Internet access providers do not effectively control the content of what is transmitted …their role is passive and that their activities usually consist only of the provision of the means of telecommunication.” 

We previously reviewed the decision in Crookes v. Yahoo, 2007 BCSC 1325 (CanLII), which dealt with alleged defamatory postings on a Yahoo site.  Although the case was decided on other grounds, the court observed that: “Yahoo did not author the postings.  Yahoo is joined in this action on the basis that it provided the means by which the defamatory material was published and it failed to remove the postings.”  This is precisely the area that requires clarity, and we’re waiting for a decision to tackle this issue head-on. 

 

Calgary – 10:50 MST

You win some, you lose some.

An injunction is essentially a court order which prevents a company from doing something, such as using a trade-mark or a patent.  It can be a very useful tool in intellectual property litigation.  However, as we’ve reviewed in other cases, the test in Canada for obtaining – and maintaining – an injunction is not easy to meet.  The test derives from the Supreme Court decision in RJR-Macdonald Inc. v. Canada (A-G), 1994 CanLII 117 (S.C.C.) .  Two recent Canadian cases illustrate this – one win and one loss:

• Trade-Mark Case: In a recent decision out of Manitoba, the Court decided that the Plaintiffs in Marlborough Hotel Corporation et al. v. First Canadian Hotels & Entertainment Ltd. et al. were entitled to an interlocutory injuction in a battle over the use of the “Skyview Ballroom” mark for hotel services.
• Patent Case: In the recent Alberta decision in Core Laboratories Canada Ltd. v. Lonkar Services Ltd., 2008 ABCA 76 (CanLII), the Court of Appeal overturned an injunction granted by the lower court.  At the lower court, the judge had granted an interim injunction prohibiting the appellants from marketing and providing services which include the use of a gamma ray spectral memory tool. On appeal, the court decided the test had not been met.

Calgary – 10:45 MST

To update our earlier post , the owner of the trade-mark CHEAP TICKETS lost at the Federal Court of Appeal in the decision in Cheaptickets and Travel Inc. v. Emall.ca Inc. et al., 2008 FCA 50. The expungement order was upheld.

The court agreed with Emall that the marks were generic and “clearly descriptive” when used in association with travel agency and ticket agency services.

Calgary – 13:00 MST 

A photographer is hired to do some work on an ad campaign.  If the photographer’s bill is never paid, and the photographs are used, is it copyright infringement? 

The Copyright Act makes it clear that copyright would belong to the person who ordered the photographs.  But that only applies if the photographer is paid – no money, no copyright.  The recent Alberta decision in Don Hammond Photography Ltd. v. The Consignment Studio Inc., 2008 ABPC 9 might be the first time a court has considered those particular sections of the Act.  In that decision, the court was clear that copyright was infringed when the photographs were used without payment of the photographer’s invoice, and that statutory damages were appropriate in the circumstances.  The lessons for business? 

• Pay your photographers;
• When engaging an ad agency, website designer or other graphic designer, determine who is responsible for payment of photographers and other sub-contractors; and
• Remember this doesn’t just apply to an ad campaign. The same principle applies to images used in any corporate media – websites, annual report packages, brochures, and newsletters.

Calgary –  10:30 MST

A promising Canadian company is hit with a dubious software patent owned by a US competitor. The Canadian company is based in Ontario; the US patent-holder is headquartered in Washington, DC.  But the lawsuit takes place in the infamous Eastern District of Texas: the plaintiff-friendly outback of patent infringement litigation.  

Without commenting on the merits of the case, the recent decision in Blackboard Inc. vs. Desire2Learn Inc. illustrates the perils for Canadian businesses of facing a patent lawsuit in the US. The Canadian company lost last week and is now reviewing its options to appeal the $3.1 million ruling.  The lessons for business?

• defensive patents may provide leverage for settlement or cross-licensing; 
• a successful challenge to the vailidity of the plaintiff’s patent will deep-six the patent infringement claim; developments in US law are bringing clarity to the patentability of software and business-methods and the grounds for challenging such patents (See: Business Method Patents Under Review);
• experienced patent litigation lawyers will review other options, including interim injunction orders which, if successful, can effectively put the defendant out of business.

Meanwhile, draft US patent reform legislation attempts to control forum-shopping, and may force litigants to commence their lawsuits in jurisdictions which are more closely connected to their headquarters or their actual place of business. In other words, Washington-based Blackboard Inc. would have to sue in Washington.  What a thought.  Until then, the patent battles will continue in Texas, and Canadian companies will have to keep their powder dry. 

Calgary – 9:45 MST

The US Federal Circuit Court of Appeals has decided to review a number of issues that go to the heart of business-method patents in the In re Bilski case. Essentially Bilski has claimed a method for managing risk.  The claim is not tied to any software or “machine”; it is merely a mental process of how to conduct business.  The court will review:

(1) Whether the business method claim in Bilski’s patent application is “patent-eligible subject matter”?

(2) What standards should be used to determining whether a process or method is eligible for patent protection?

(3) Whether the claimed method is not patent-eligible because it is an abstract idea or mental process; when does a claim that contains both mental and physical steps create patent-eligible subject matter?

(4) Whether a method or process must result in a physical transformation of an article or be tied to a machine to be patent-eligible subject matter under US patent law? and

(5) Whether it is appropriate to reconsider or overrule the leading business-method-patent decision in State Street Bank & Trust Co. v. Signature Financial Group, Inc., (Fed. Cir. 1998)?

The State Street Bank case has been held up for the last 10 years as authority for the patentability of software and business methods.  For those watching the business-method-patent and software-patent debate, this is the front line and will impact patent holders in both the US and Canada. 

For related reading, see: US Patent Reform

 

Calgary – 10:50 MST

The Canadian Intellectual Property Office has released some updated tools to assist practicitioners in drafting and filing industrial design applications, including sample drawings.   In Canada, industrial design protects the shape, pattern or ornamentation of a product – anything from the shape and pattern on a common metal spoon, to the design of an in-line skate, to the shape and layout of a handheld digital device.  The design on the left was registered for a telephone in 1917; on the right, a design registered by RIM in 2007.  Once registered, protection lasts for ten years, with a maintenance fee required at the five-year point.

Calgary – 10:45 MST

Microsoft announced today that it is embracing certain interoperability principles in connection with its bread-and-butter products such as Windows Vista including the .NET Framework, Windows Server 2008, SQL Server 2008 and Office 2007.  This means making technical specifications and information available to make it easier for third-party software to operate with Microsoft’s products.  Presumably the thinking is that if more third-party products can work with Microsoft software, then this will increase sales for Microsoft.  It does not mean that Microsoft software will be made available under an open source model.

In short, while this will result in lots of headlines that couple the word “Microsoft” with the word “Open”, this does not signal a move by the software giant into open-source territory.  For Microsoft, some form of openness is inevitable – particularly in light of two unavoidable forces: market imperatives (read: Google) that show the success and value of open-source and collaborative technologies; and the decision against Microsoft by the EU’s Court of First Instance last fall, that ordered Microsoft to open up (Judgment of the Court of First Instance in Case T-201/04 Microsoft / Commission).

As part of its announcement, Microsoft has promised not to sue open source developers for “development and non-commercial distribution” of software that draws on these open protocols.  But developers of commercial applications must still come back to Microsoft to obtain a license, on “reasonable and non-discriminatory terms, at low royalty rates”.  It remains to be seen how this will play out with developers in practical terms.  Many developers are understandably skeptical given Microsoft’s antagonistic history with the open source community.  

 

Calgary – 13:15 MST 

 

The Montreal Gazette  interviewed Richard Stobbe, lawyer with the Technology & IP Group, for an article on intellectual property rights in the internet context.  The article also provides an interesting perspective on developments in IP rights in other countries.   

Calgary – 11:45 MST

The story of Montrealer Gérémi Adam, who is an alleged copyright pirate, has attracted more attention after the man dropped out of sight on the date of a scheduled court appearance last month.  He did appear in court yesterday to answer the charges and to plead not guilty.  If the case goes to trial it will provide a good test case on what evidence the court will accept as proof that a particular individual posted a particular pirated copy of a movie.  He was charged before Canada’s new anti-camcording law came into effect, so he will face penalties under the previous copyright infringement provisions.  Another Montreal man, Louis-René Haché, was charged under the new anti-camcording legislation enacted last year and his case may provide a test of that law.    

Related reading: Microsoft Scores Software Piracy Win

Calgary – 16:00 MST