By Richard Stobbe

An inventor had a “wow” moment when he came across a design improvement for cold-weather visors – something suitable for the snowmobile helmet market. The helmet maker brought the improved helmet to market and also pursued both patent and industrial design protection. The patent application was ultimately abandoned, but the industrial design registration was issued in 2010 for the “Helmet Face Shield” design, which purports to protect the visor portion of a snowmobile helmet.

AFX Licensing, the owner of the invention, sued a competitor for infringement of the registered industrial design. AFX sought an injunction and damages for infringement under the Industrial Design Act.  The competitor – HJC America – countered with an application to expunge the registration on the basis of invalidity. HJC argued that the design was invalid due to a lack of originality and due to functionality.

Can a snowmobile visor be protected using IP rights?

A registrable industrial design has to meet certain criteria: (i) it must differ substantially from the prior art (in other words it must be “original”); (ii) it cannot closely resemble any other registered industrial designs; and (iii) it cannot have been published more than a year before application for registration.

In AFX Licensing Corporation v. HJC America, Inc., 2016 FC 435 (CanLII),  the court decided that AFX’s industrial design registration was valid but was not infringed by the HJC product because the court saw “substantial differences” between the two designs. In summarizing, the court noted the following:

“First, the protection offered by the industrial design regime is different from that of the patent regime… the patent regime protects functionality and the design regime protects the aesthetic features of any given product.” (Emphasis added)

The industrial design registration obtained by AFX does “not confer on AFX a monopoly over double-walled anti-fogging face shields in Canada. Rather, it provides a measure of protection for any shield that is substantially similar to that depicted in the ID 964 illustrations, and it cannot be said that the HJ-17L meets that threshold.”

The infringement claim and the expungement counter-claim were both dismissed.

Calgary – 07:00

 
By Richard Stobbe

Yesterday UK voters elected to approve a withdrawal from the EU.  What does this mean for Canadian business owners who have intellectual property (IP) rights in the UK?

The first message for Canadian IP rights holders is (in true British style) remain calm and keep a stiff upper lip. All of this is going to take a while to sort out and rights holders will have advance notice of the various means to protect their rights in an orderly fashion. The British are not known for rash actions — ok, other than the Brexit vote.

Rights granted by the EU Intellectual Property Office (EUIPO), will be impacted, although the extent of the impact is still to be negotiated and settled. The UK’s membership in WIPO (the World International Property Organisation) is independent of EU membership and so will not be affected by this process. Similarly, the UK’s participation in the European Patent Convention is not dependent on EU membership.

Current speculation is that EU Trade Marks will continue to be recognized as valid in the EU, although such rights will not be recognized in the UK. This may require Canadian rights holders to submit new applications for those marks in the UK, or there may be a negotiated conversion of those EUIPO rights into national UK rights, permitting these registered marks to be recognized both in the EU and the UK.

Copyright law should not be dramatically impacted, since many of the rights of Canadian copyright holders would benefit from international copyright conventions that predate the EU era. However, UK copyright law was undergoing a process to become aligned with EU laws. For example, recent amendments to the UK Copyright, Designs and Patents Act 1988 were enacted in 2014 to implement EU Directive 2001/29, and the fate of these statutory amendments remains unclear at the moment.

Again, this won’t happen overnight.  Many bureaucrats must debate many regulations before the way forward becomes clear. That’s not much of a rallying cry but it is the reality for an unprecedented event such as this. The good news? If you are a EU IP rights negotiator, you will have steady employment for the next few years.

Calgary – 10:00 MST

By Richard Stobbe

A word that clearly describes a particular product or service cannot function as a trademark for that product or service. The Trademarks Act phrases this idea in a more formal way: section 12(1)(b) says that a trade-mark is registrable if it is not … “whether depicted, written or sounded, either clearly descriptive or deceptively misdescriptive in the English or French language of the character or quality of the wares or services in association with which it is used or proposed to be used or of the conditions of or the persons employed in their production or of their place of origin”. (Emphasis added)

The case of  Primalda Industries Corp v Morinda, Inc., 2004 CanLII 71759 (CA TMOB), reviewed an application for the trade-mark TAHITIAN NONI Design, for the following wares: “skin care preparations; namely, cleansers, lotions, gels, moisturizing creams” and similar products. The term TAHITIAN NONI refers to the morinda citrifolia tree, which is commonly known as ‘NONI’ in the Polynesian language.  The application was opposed based on a challenge that the mark offended section 12(1)(b) since it was “clearly descriptive or deceptively misdescriptive” of the products, by virtue of the fact that the name is a clear description of ingredients in the skin care products, which are derived from the fruit of the ‘Tahitian NONI’ tree.

This might be like trying to register the word CANADIAN MAPLE in association with skin care products derived from, say, the syrup from the maple tree.

However, after reviewing the Act, the court rejected this ground of opposition. Why?

“It is self-evident from the legislation,” the Court said, “that words that might be descriptive in a language other than French or English are not subject to paragraph 12(1)(b). As the opponent alleges in its statement of opposition that ‘NONI’ is a Polynesian word and there is no evidence that it is an English or French word, I conclude that TAHITIAN NONI Design cannot be unregistrable pursuant to paragraph 12(1)(b).”

In short, a clearly descriptive word can be registrable in Canada as long as it is not descriptive in the English of French language.

Calgary – 07:00 MST

By Richard Stobbe

Silverpop Systems provides digital marketing services through a cloud-based tool called ‘Engage’. Leading Market Technologies, Inc. (“LMT”) engaged Silverpop through a service agreement and during the course of that agreement LMT uploaded digital advertising content and recipient e-mail addresses to the Engage system.  A trove of nearly half a million e-mail addresses, provided by LMT, was stored on the Engage online system. In November 2010, Silverpop’s system was hacked, putting LMT’s email list at risk. Silverpop notified LMT of the data breach.  After LMT refused to pay for further service, Silverpop suspended the agreement.

Litigation commenced in 2012, with LMT claiming damages for breach of contract and negligence based on Silverpop’s failure to keep the email list secure. Should the service provider be liable? Silverpop argued that it was engaged to provide access to its online system, not specifically to keep data secure. Thus there was no breach of its obligations under the agreement. And anyway, if LMT suffered any damages, they were indirect or consequential and consequential such damages were excluded under the terms of the agreement. LMT countered that, in fact, the agreement quite clearly contained a confidentiality clause, and that the damages suffered by LMT were direct damages, not indirect consequential damages.

The US Federal Circuit Court of Appeals in Silverpop Systems Inc. v. Leading Market Technologies Inc. sided with Silverpop:

• “Here, the parties’ agreement was not one for the safeguarding of the LMT List. Rather, the parties contracted for the providing of e-mail marketing services. While it was necessary for LMT to provide a list of intended recipients (represented as e-mail addresses on the LMT List) to ensure that the service Silverpop provided (targeted e-mail marketing) was carried out, the safe storage of the list was not the purpose of the agreement between the parties.” (Emphasis added)

The court was careful to review both the limit of liability clause (which provided an overall cap on liability to 12 months fees), and the exclusion clause (which barred recovery for indirect or consequential damages). The overall limit of liability had an exception: the cap did not apply to a breach of the confidentiality obligation. However, this exception did not impact the scope of the limit on indirect or consequential damages.  Since the court decided that the claimed breach did not result from a failure of performance, and the consequential damages clause applied to LMT’s alleged loss. As a result, LMT’s claims were dismissed.

Lessons for business?

• Those limitation of liability and exclusion clauses are often considered “boilerplate”. But they really do make a difference in the event of a claim. Ensure you have experienced counsel providing advice when negotiating these clauses, from either the customer or service provider perspective.

Calgary – 07:00 MST

By Richard Stobbe

A documentary film is, by its nature, a work of non-fiction. It expresses a set of facts, arranged and portrayed in a particular way. If a fictional novel is written, based on a documentary film, is copyright infringed? Put another way, does copyright protect the “facts” in the documentary?

In the recent Federal Court decision in Maltz v. Witterick, the court considered a claim of copyright and moral rights infringement by the makers of a documentary entitled No. 4, Street of Our Lady about the Hamalajowa family, a real-life family  who harboured and saved three Jewish families during the Second World War in Poland.  A writer, inspired by the documentary, wrote a fictional young adult novel based on the same real-life experiences of the Hamalajowa family, even going so far as to use many of the same names, the same storyline and facts. The book, entitled My Mother’s Secret, was published by Penguin Canada and went on to become a modest success.

After hearing of the book, the filmmakers sued both the author and Penguin Canada for infringement of their copyright in the documentary film. Although there was no verbatim copying of the dialogue or narrative, the filmmakers claimed that their copyright was infringed in the overall themes, relying on the interesting case of Cinar Corporation v. Robinson, which stands for the proposition that the cumulative features of a work must be considered, and that for the purposes of copyright a “substantial taking” can include similarities such as themes. The filmmakers also argued that a distinction must be drawn between “big facts” and “small facts”. For example, a “big fact” that Polish Jews were captured and deported to concentration camps is not deserving of copyright protection, whereas a “small fact” that a particular Jewish family was taken away from a particular place on a specific day – this kind of fact is deserving of protection, and it was this type of information that was copied by the author from the documentary film without permission.

The court rejected this notion. “The Applicants’ arguments based on differences between “small” and “large” facts, with the former deserving of protection in this case and the latter not so deserving, are without merit. Copyright law recognizes no such difference or distinction. Facts are facts; and no one owns copyright in them no matter what their relative size or significance.” (Emphasis added)

The Court also made an important clarification regarding characters in the story. Citing the Anne of Green Gables decision, the filmakers claimed infringement of the “well-delineated characters” in the film, including the members of the Hamalajowa family. They argued that “the characters in the Book are clearly based on and are virtually identical to the individuals in the Documentary.” This analysis is misguided, according to the Court. “[T]here are no fictional characters in the Documentary; there are only real people or references to and recollections of once real persons, and there cannot be copyright over a real person, whether dead or alive.” (Emphasis added)

The copyright and moral rights claims were dismissed. The important message that is reinforced by this fascinating decision is that the only copyright in the filmmakers’ story lies in their expression of that story and not in its facts.

Calgary – 07:00 MST

By Richard Stobbe

Where should a lawsuit be heard? Canada? The US? In other posts we discuss the idea of a “choice of law” and “forum selection” clauses in contracts. In those cases, the parties agree to a particular forum in advance.

What if there is no contractual relationship? There’s just an intellectual property infringement claim. What is the proper forum for that dispute to be heard?

In Halo Creative v. Comptoir Des Indes Inc., David Ouaknine, Case No. 15-1375 (Fed. Cir., Mar. 14, 2016), a recent decision out of the US Federal Circuit Court of Appeals, this issue was reviewed.

Halo Creative, a Hong Kong based furniture maker, launched an IP infringement lawsuit against Comptoir Des Indes, Inc., a Canadian company, and its CEO, claiming infringement of Halo’s U.S. design patents, U.S. copyrights, and one U.S. common law trademark. The lawsuit was filed in the Northern District of Illinois. The Canadian company moved to dismiss the lawsuit based on a “forum non conveniens” argument – essentially an argument that the Federal Court of Canada would be a better place to litigate the claims. The Illinois district court agreed with the Canadians and dismissed the case. Halo appealed.  At the appeal level, the court looked at the adequacy of the Canadian court to litigate this issue.

The Federal Court of Canada was certainly an available forum but there was no evidence that Halo could seek a satisfactory remedy there, since the infringing activity took place in the U.S., and the infringed rights were all based on U.S. registrations or U.S. based trademark rights. IP rights are fundamentally territorial.  The U.S. court even quoted a Canadian textbook: “a Canadian court would not have jurisdiction to entertain in an action brought by an author of a work in respect of acts being committed outside Canada, even if the defendant was within Canada.” (Emphasis added)  Here, there was no evidence that any infringement occurred in Canada.

The motion was dismissed and the lawsuit will proceed in the U.S.

Calgary – 07:00 MST

By Richard Stobbe

So much confusion, so little time. The Trade-marks Act teaches us that the use of one trade-mark causes confusion with another trade-mark if the use of both trade-marks in the same area would likely lead to the inference that the products associated with those trade-marks emanate from the same person, even if the products are of a different class. Confusion is assessed by looking at all the surrounding circumstances including:

• the inherent distinctiveness of the trade-marks;

• the extent to which the marks have become known;

• the length of time the trade-marks have been in use;

• the nature of the products or business;

• the nature of the trade; and

• the degree of resemblance between the two trade-marks in appearance or sound or in the ideas suggested by them.

In the case of U-Haul International Inc. v. U Box It Inc., 2015 FC 1345 (CanLII), U-Haul International applied to register the trade-marks U-BOX WE-HAUL and U-BOX, for use in association with “moving and storage services, namely, rental moving, storage, delivery and pick up of portable storage units.” A competitor – U Box It – opposed these applications on the basis of confusion with its registered U BOX IT mark for use for use in association with “garbage removal and waste management services.” 

Are “moving and storage services” in the same area as  “garbage removal and waste management services”? 

U-Haul argued that the two companies offer completely different services, and “that garbage removal and waste management are the ‘exact opposite’ of moving and storage, and in different channels of trade.” However, the court agreed with the opponent’s argument that confusion was based on “the similar manner in which the services are provided, and not on any finding that the services were in fact the same.”

After reviewing all of the factors listed above, the court found a reasonable likelihood of confusion, and refused to register the two marks U-BOX WE-HAUL and U-BOX, based on confusion with the registered mark U BOX IT.

Calgary – 05:00 MST

By Richard Stobbe

A interesting Report on Business article by the founder of a Canadian business is useful as a cautionary tale about brand confusion (see: I was outraged when Sobey’s rebranded its chain with the same name as my company). The author of the article tells of her struggles when grocery chain Sobeys launched a brand - FRESHCO – that was identical to the name of her then 15-year old company, also named FRESHCO.  It sounds like a frustrating experience. In particular, the author notes that her company was “federally incorporated across Canada, and not trademarked,” leaving her with no legal options to prevent the entry of Sobey’s FRESHCO brand for grocery store services. For small business owners or start-ups, this might be worth examining with a legal lens:

• First, it’s important to remember that incorporation is completely different from trademark registration. One is creation of a corporate entity, and one is the registration of a brand name. The corporate name sometimes (but does not necessarily) mirror the core brand name of the business. A corporate name is no guarantee of anything in the trademark realm.
• Next, don’t forget that trademark rights are based on use in the marketplace, and a business generates certain trademark rights even without taking the step of registration at the Canadian Intellectual Property Office. In other words, a  business can defend common law trademark rights based on past use even in the absence of a registered trademark. It’s just harder than with a registered mark.
• A registered trademark provides stronger rights across Canada, and that kind of brand protection should always be considered by business owners as part of their investment. Even after an incident like the one described by this author, it’s open to the earlier user of the mark to apply for registration, even after many years of “unregistered” use.
• In this case, the Sobey’s trademark FRESHCO for grocery services is in a different channel of trade than the author’s FRESHCO mark for construction services. Trademark law permits similar or even identical marks to co-exist, so long as consumers aren’t confused. Think of DELTA for hotel services and DELTA for faucets. Identical marks, different channels of trade. There is actually nothing improper about that, as frustrating as it may seem to the earlier user.

The author appears to have used this as a positive opportunity to reinvest in the brand and refocus the company’s marketing message. If this kind of thing happens to your business, ensure that you get legal advice from an experienced trademark lawyer on your options as you make decisions for your company.

Calgary – 07:00 MST

 
By Richard Stobbe

Can a binding contract be formed merely with a link to another set of terms? (For background on this topic, check out our earlier post What, exactly, is a browsewrap? which reviews browsewraps, clickwraps, clickthroughs, terms of use, terms of service and EULAs).

The answer is clearly… it depends. Consider the American case of Holdbrook Pediatric Dental, LLC, v. Pro Computer Service, LLC (PCS), a New Jersey decision which considered the enforceability of a set of terms which were linked from a paper hard-copy version of the contract. In this case, PCS sent a contract to its customer electronically. The customer printed out the paper version and signed it in hard copy. A hyperlink appeared near the signature line, pointing to a separate set of Terms and Conditions in HTML code. Of course on the paper copy these terms cannot be hyperlinked.

PCS asserted that these separate terms were incorporated into the signed paper contract, since they function as a clickable hyperlink in the electronic version.  The court disagreed: “In order for there to be a proper and enforceable incorporation by reference of a separate document . . . the party to be bound by the terms must have had ‘knowledge of and assented to the incorporated terms.’”  Here, there was no independent assent to the additional Terms and Conditions, and the mixed media nature of the contracting process worked against PCS. In addition to the fact that the separate terms were not easily accessible by the customer, the text was not clear. It merely said “Download Terms and Conditions”, without providing reasonable notice to the customer that assent to the main contract included assent to these additional terms. The additional terms were not binding on the customer.

Lessons for business? Get legal advice!

Calgary – 07:00 MST

By Richard Stobbe

The Vancouver Aquarium brought an injunction application to stop the online publication of a critical video entitled “Vancouver Aquarium Uncovered”, which used the Aquarium’s copyright-protected materials in a “derogatory manner”, according to the Aquarium.

In the fascinating case of Vancouver Aquarium Marine Science Centre v. Charbonneau, 2016 BCSC 625 (CanLII), the court weighed the Aquarium’s effort to prevent the unauthorized use of their copyright-protected video clips, against the movie producer’s argument that the exposé is on a topic of public interest and shouldn’t be silenced.

This represents the first judicial review of Section 29.21 of the Copyright Act, first introduced in 2012, which covers “non-commercial user-generated content”. In the injunction application the court skimmed over this issue, preferring to leave it to trial. However, the court made passing comments about the availability of a defence which relies on showing that the copyright-protected content was used “solely for non-commercial purposes”. In this case, there was evidence before the court that the movie had recently been screened in Vancouver where attendees had been charged a $10 entry fee. The court also made reference to an Indiegogo fundraising campaign related to the movie production.

Ultimately, the court restricted publication of 15 images and video clips – about 4 minutes worth of content - which the Aquarium claimed to own. The injunction stopped short of attempting to enjoin publication of the whole video, but rather ordered that the defendants remove the 15 contested segments from the video.

If it proceeds to trial, this will be one to watch.

Calgary – 07:00 MST

By Richard Stobbe

The adage “use it or lose it” captures the essence of the ongoing requirement to put a trademark into commercial use. If you abandon your mark, you effectively give up your trademark rights. The corollary is to “use it as registered, or lose it” Not quite as catchy, but just as important.

The Federal Court decision in Padcon Ltd. v. Gowling Lafleur Henderson LLP 2015 FC 943 reminds us of this. In this case, a trademark owner obtained a registration in 2006 for the mark THE OUTRIGGER STEAKHOUSE AND BAR in association with “restaurant, bar and pub services”. When challenged, the trademark owner could only show use of the word OUTRIGGER alone, together with the ® symbol, on its menus and on some related promotional materials. 

Are deviations permitted? When the court considers a mark-as-used against the mark-as-registered, it will consider the following test:

…The practical test to be applied in order to resolve a case of this nature is to compare the trade mark as it is registered with the trade mark as it is used and determine whether the differences between these two marks are so unimportant that an unaware purchaser would be likely to infer that both, in spite of their differences, identify goods having the same origin.

That question must be answered in the negative unless the mark was used in such a way that the mark did not lose its identity and remained recognizable in spite of the differences between the form in which it was registered and the form in which it was used.

The court decided that use of OUTRIGGER alone on menus and promotional materials did not constitute evidence of use of the mark-as-registered: THE OUTRIGGER STEAKHOUSE AND BAR. The registration was expunged.

Lessons for business?

• Review your marks-as-used, and compare against your marks-as-registered.
• Consider developing brand guidelines to ensure that your organization, and others who might be authorized to use your trademarks, are in compliance with the guidelines.
• If you already have brand guidelines, ensure that there are clear lines of responsibility for enforcement.

Calgary – 11:00 MT

By Richard Stobbe

A class action case against Facebook (see our previous posts for more background) is heading to the Supreme Court of Canada.

The BC Court of Appeal in Douez v. Facebook, Inc., 2015 BCCA 279 (CanLII)  had reviewed the question of whether the Facebook terms (which apply California law) should be enforced in Canada or whether they should give way to local B.C. law. The appeal court reversed the trail judge and decided that the Facebook’s forum selection clause should be enforced.

Facebook now joins Google, whose own internet jurisdiction is also going up to the Supreme Court of Canada this year.

These are two cases to watch.

Calgary – 07:00 MT

By Richard Stobbe

Let’s take an example. Is the word PARIS registrable as a trademark in Canada? A quick search of the registry shows that there are over 250 registered marks which contain the word PARIS for everything from jewelry to software to real estate management services.

A geographical name can be registrable. It depends. The issue is whether the word is “clearly descriptive or deceptively misdescriptive” in the English or French languages of the place of origin of the goods or services.

In MC Imports Inc. v. AFOD Ltd., a 2016 case Federal Court of Appeal decision, the court reviewed a challenge to the registered mark LINGAYEN in association with fish sauce and shrimp paste products. The owner of the LINGAYEN mark had sued a competitor for infringement; the competitor sold shrimp paste under a different brand, but the packaging included the phrase “Lingayen Style” to describe its product. This reference to “Lingayen” was, according to the claim, an infringement of the LINGAYEN registered mark.

Lingayen is a municipality in the Philippines known for its distinctive shrimp paste products. Thus, the court found that the use of the phrase “Lingayen Style” was not use of the word for trademark purposes, but was used to describe the place of origin of the goods with which it is associated.  Therefore, there was no infringement.

When considering a geographical trademark, ensure that you seek experienced counsel.

Calgary – 07:00 MST

By Richard Stobbe

Adidas, Veuve Clicquot, Barbie… When is a mark considered “famous” in Canada, and do famous marks enjoy special protection? A handful of Canadian cases have outlined the court’s treatment of well-known brands:

• Sure, Barbie is famous… but not “trump-card” famous. That was the conclusion of the court in Mattel, Inc v 3894207 Canada Inc., when Mattel raised a challenged that the mark BARBIE used in connection with “restaurant services” would lead consumers to make an inference that the restaurant was affiliated with Mattel’s famous BARBIE doll mark.
  Canadian Courts will not automatically presume that there will be confusion just because one mark is famous. As the Federal Court in Mattel phrased it, “the fame of the mark could not act as a marketing trump card such that the other factors are thereby obliterated.” Canadian courts will assess all of the surrounding circumstances to determine confusion. In Mattel, they considered the restaurant services to be distinguishable from Mattel’s famous doll.

• The owner of the famous luxury brand VEUVE CLICQUOT encountered similar difficulties in its infringement claim against a purveyor of “mid-priced women’s wear” being sold under the brand CLIQUOT in Quebec.  In Veuve Clicquot Ponsardin v Boutiques Cliquot Ltée., Veuve Clicquot argued that the association with – sniff – mid-priced apparel was damaging its carefully managed reputation. In an interesting turn of phrase from the decision, the Supreme Court of Canada noted that the champagne maker “has been building its fine reputation with the drinking classes since before the French Revolution.” The role of champagne “drinking classes” as a catalyst for the French Revolution is perhaps a topic for a separate article. In any event, the Court did not find any evidence that the VEUVE CLICQUOT brand image was tarnished, or that the goodwill was otherwise devalued or diluted. The infringement claim was dismissed, leaving the CLIQUOT women’s wear shops free to continue business.

• In a more recent case, shoemaker Adidas challenged a competitor’s registration of a two-stripe design for shoes. Adidas complained that the two-stripe design was confusing with its own three-stripe design. In Adidas AG v. Globe International Nominees Pty Ltd., the Federal Court conceded that “the adidas 3-Stripes Design is well-known, if not famous, in Canada and internationally.” However, in deciding that the two-stripe mark was not confusing with the Adidas 3-stripe design, the Court sounded a cautionary note for owners of famous brands:
  

  “Fame and notoriety associated with a trademark can be a double-edged sword for a trademark owner. On the one hand, an enhanced reputation may provide the owner with extended protection for the trademark beyond goods and/or services covered by a registration for the marks … On the other hand, when a trademark becomes so well known or famous that the public is so familiar with it and readily identifies that trademark as used in the marketplace on goods and/or services, it may be that even as a matter of first impression, any differences between the well-known mark and another party’s trademark, as used on the same or similar goods and/or services, may serve to more easily distinguish the other party’s trademark and reduce any likelihood of confusion.”

  Put another way, a mark can be so well-known to consumers that small differences in a competing mark will enable consumers to distinguish between the two marks.

Get advice on trade-mark protection and infringement from Field Law’s experienced trademark team.

Calgary – 07:00 MT

By Richard Stobbe

This is a story of what “use” really means. In the internet context, a trademark can be displayed on a website by a Canadian company, and that website can be accessed anywhere in the world. Similarly, a foreign company can display its mark on a website which can be accessed by Canadian consumers. Is the foreign company’s mark being “used” in Canada for trademark purposes, merely by being displayed online to Canadian consumers?

If you follow this kind of thing… and who doesn’t?… you would say that this issue was settled in the 2012 case HomeAway.com, Inc. v Hrdlicka, [2012] FCJ No 1665 where Justice Hughes said clearly: “a trade-mark which appears on a computer screen website in Canada, regardless where the information may have originated from or be stored, constitutes for Trade-Marks Act purposes, use and advertising in Canada.”

Not so fast.

In Supershuttle International, Inc. v. Fetherstonhaugh & Co., 2015 FC 1259 (CanLII), the court reviewed  a challenge to the SUPERSHUTTLE trademark, which was registered in connection with “airport passenger ground transportation services”. The SUPERSHUTTLE mark was displayed to Canadian consumers who could reserve airport shuttle transportation in the United States. The mark was registered in Canada and displayed in Canada, but no shuttle services were actually performed in Canada. The court concluded that: “While the observation of a trademark by individuals on computers in Canada may demonstrate use of a mark, the registered services must still be offered in Canada.” (Emphasis added)

Non-Canadian trademark owners should take note: merely displaying a mark in Canada via the internet may not be enough for “use” of that mark in Canada. The services or products which are listed in the registration must be available in Canada. Make sure you get experienced advice regarding registration of marks in Canada.

Calgary – 07:00 MT

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By Richard Stobbe

As reviewed in Part 1, since July 1, 2014, Canada’s Anti-Spam Law (or CASL) has been in effect, and the software-related provisions have been in force since January 15, 2015.

In January, 2016, the Canadian Radio-television and Telecommunications Commission (CRTC) executed a search warrant at business locations in Ontario in the course of an ongoing investigation relating to the installation of malicious software (malware) (See: CRTC executes warrant in malicious malware investigation). The allegations also involve alteration of transmission data (such as an email’s address, date, time, origin) contrary to CASL. This represents one of the first enforcement actions under the computer-program provisions of CASL.

The first publicized case came in December, 2015, when the CRTC announced that it took down a “command-and-control server” located in Toronto as part of a coordinated international effort, working together with Federal Bureau of Investigation, Europol, Interpol, and the RCMP. This is perhaps the closest the CRTC gets to international criminal drama. (See: CRTC serves its first-ever warrant under CASL in botnet takedown).

Given the proliferation of malware, two actions in the span of a year cannot be described as aggressive enforcement, but it is very likely that this represents the visible tip of the iceberg of ongoing investigations.

Calgary – 07:00 MT

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By Richard Stobbe

Since July 1, 2014, Canada’s Anti-Spam Law (or CASL) has been in effect, and the software-related rules have been in force since January 15, 2015.

With the benefit of hindsight, we can see a few patterns emerge from the efforts by the enforcement trifecta: the Privacy Commissioner of Canada, the CRTC and the Competition Bureau. (For background, see our earlier posts) What follows is a round-up of some of the most interesting and instructive enforcement actions:

This certainly points to the more technical risks of poorly implemented unsubscribe features, rather than underlying gaps in consent. Perhaps this is because heavy enforcement action related directly to consent is still to come. Implied consent can be relied upon during a three-year transitional period. After that window closes, expect enforcement to focus on failures of consent.

To put this all in perspective, consider enforcement of other laws within the CRTC mandate: in 2014 the CRTC did not issue any notices of violation of CASL, but issued 10 notices of violation related to the Unsolicited Telecommunications Rules and the National Do Not Call List (DNCL); in 2015 the CRTC issued 1 notice of violation of CASL and about 20 related to the Do Not Call List.

Calgary – 07:00 MT

By Richard Stobbe

There has been much speculation about the impact of 3D printing on the enforcement of IP rights. But very few decisions. Now, finally, a case you can sink your teeth into: ClearCorrect v. ITC, 2014-1527 deals squarely with a patent infringement allegation which focuses on 3D-printing technology.

This case relates to the production of orthodontic appliances known as teeth aligners. According to patents owned by Align Technology, their aligners “are configured to be placed successively on the patient’s teeth and to incrementally reposition the teeth from an initial tooth arrangement, through a plurality of intermediate tooth arrangements, and to a final tooth arrangement…” as listed in the ’880 patent. (As soon as you see the word “plurality”, you just know you’re reading a good patent.)

ClearCorrect, a competitor of Align Technology, produced aligners by means of 3D-printed digital models of aligners. ClearCorrect electronically transmitted digital files to its subsidiary ClearCorrect Pakistan (thus skirting the US patent rights) where digital models of the aligners were created and configured. ClearCorrect Pakistan then electronically transmitted these digital models back to ClearCorrect US, where the digital models were 3D-printed into physical models. From there, aligners were manufactured using the physical models.

The patent owner alleged that the transmission of these digital three-dimensional models should be stopped at the border, just like any infringing “article” would be stopped. Typically, an owner of US patent rights can employ the resources of the ITC to stop and seize articles – take for example, a piece of equipment or a consumer product – which infringes a US patent. This prevents the infringing articles from being imported into the US, even if they are manufactured overseas. In this case, the court had to decide if digital three-dimensional files constituted “articles” for these purposes.

In the end, the court considered articles to be “material things” and decided that the 3D-printable digital files were not “articles”. Thus, the ITC lacked jurisdiction to prevent the entry of these files into the US. (Exactly how it could prevent the transmission of the files is another matter entirely.)

Something to chew on while we wait to see if the decision will be appealed.

Calgary – 07:00 MT

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By Richard Stobbe

Naruto the monkey must abandon his budding photography career and go back to using his opposable thumbs towards some other end. To bring the monkey-selfie case to a close, the US District Court outlined its careful reasoning for rejecting the copyright claims of Naruto, a six-year-old crested macaque. (If you missed the background story, see our earlier post.)

The decision in Naruto v. Slater (US District Court No. Calif. Case 15-cv-04324-WHO) is, if nothing else, a study in restraint. The judge reviews cases involving other non-human claimants, such as the 2004 decision dealing with a claim advanced on behalf of the world’s whales, porpoises, and dolphins, regarding violations of the US Endangered Species Act.

In its final analysis, the court concluded: “Naruto is not an ‘author’ within the meaning of the Copyright Act. Next Friends argue that this result is ‘antithetical’ to the ‘tremendous [public] interest in animal art.’ Perhaps. But that is an argument that should be made to Congress and the President, not to me. The issue for me is whether Next Friends have demonstrated that the Copyright Act confers standing upon Naruto. In light of the plain language of the Copyright Act, past judicial interpretations of the Act’s authorship requirement, and guidance from the Copyright Office, they have not.”

Calgary – 07:00 MT

By Richard Stobbe

Copyright attempts to balance the rights of authors with the rights of users. It’s this tension – copyrights vs. user rights – that makes copyright so fascinating (…to some people).

In 2012, Parliament enacted some changes to Canadian copyright law, which included a number of so-called “user rights” or exceptions to infringement, some of which were conditional on rules dealing with the circumvention of technological protection measures. I’ll give you an example: under section 29.23, recording a TV program for time shifting on your PVR is not an infringement of copyright as long as you did not circumvent a technological protection measure (or “TPM”). So circumvention of a TPM can take you outside the benefit of the exception, with the result that the recording would constitute an infringement.

No court has had a chance to review the rules around TPMs… until the decision in 1395804 Ontario Limited (Blacklock’s Reporter) v Canadian Vintners Association (CVA), 2015 CanLII 65885 (ON SCSM), an Ontario decision which interprets circumvention of a TPM.

A “technological protection measure” is, according to the Copyright Act any “effective technology, device or component” that controls access to a work and whose use is authorized by the copyright owner. It is deliberately broad. The Blacklock’s case dealt with a subscription-based online newsletter published by Blacklock’s. When their CEO was mentioned in a Blacklock’s article, the CVA bypassed the subscriber paywall to access the article. Did the CVA hack into the system and then scrape and republish the Blacklock’s content? No (although such conduct might have justified the $13,000 in copyright infringement damages that were awarded by the judge). The CVA obtained a copy of the article via email, from a colleague who did have a subscription.

According to this case, circumventing a technological protection measure includes obtaining a copy of an article by email, where the article sits behind a paywall. The good news is that no hacking skills are required!

Since this case will not be appealed, it stands as the leading case, although it has been called controversial, bizarre and an extraordinary misreading of copyright law. Since it is the decision of an Ontario small-claims court, it is not binding on other courts in Canada. And since Blacklock’s is pursuing copyright infringement claims against others – there are 10 claims currently filed in the Federal Court – this issue should be canvassed at the Federal Court where further clarification may emerge. Stay tuned.

Calgary – 07:00 MT