The Chocolate Bar Caper: Copyright & Parallel Imports

toblerone.bmpIn an earlier post we discussed the use of copyright to control product distribution.  In the 2005 case of Euro Excellence, Inc. v. Kraft Canada Inc., the Federal Court of Appeal upheld an injunction against an unauthorized distributor of “grey market” Toblerone chocolate bars, based on an innovative claim of copyright infringement.  Under that decision, copyright seemed to provide a useful tool against parallel importers, where legitimate products are imported into a territory outside the official manufacturer’s supply chain.  Trade-mark law does not provide any help in this area after the decision in Coca-Cola v. Pardhan, another Federal Court of Appeal decision.  Copyright however seemed suitable to the task.

The case was appealed up to the Supreme Court of Canada and in its convoluted decision (Euro-Excellence Inc. v. Kraft Canada Inc., 2007 SCC 37), the Court now appears to have removed copyright as a tool in parallel importation cases.  The majority agreed that copyright protection should extend to product labels and agreed that if a work is entitled to copyright protection, then it should be protected like any work, without an analysis of whether the work is “incidental” or whether the copyright holder has a “legitimate economic interest”.  But the majority decision also made it clear that copyright is no longer a viable option for manufacturers in parallel import or “grey market” cases in Canada where the local distributor relies on an exclusive license to prevent importation. 


Calgary – 12:30 MST

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Anti-Camcording Law & Olympic Marks Law

Canada gained two new intellectual property laws in June: the Olympic Marks legislation, (officially Bill C-47, the Olympic and Paralympic Marks Act) which provides a new species of “super-protection” for Olympic trade-marks, and a new anti-camcording law, which amends the Criminal Code to prohibit unauthorized recording of a movie (officially Bill C-59).

Calgary – 11:00 MST 


Online Contract Amendment Not Binding

After Talk America bought AOL’s long distance telephony business, it amended several terms in the service contract, adding an arbitration clause, a class-action waiver and a New York choice-of-laws clause.  Talk America implemented these amendments by posting them to its website.

When a customer tried to sue Talk America, lawyers attempted to deflect the lawsuit, invoking the mandatory arbitration clause and citing the class-action waiver.  However, in this case the customer had originally signed on with AOL, prior to the amendments made by Talk America. 

In Douglas v. U.S. District Court for the Central District of California, No. 06-75424 (9th Cir. July 18, 2007) the Court of Appeals put these amendments to the test.  Generally the court decided that the online postings were not binding on the customer, noting “Parties have no obligation to check the terms on a periodic basis to learn whether they have been changed by the other side.” 

In Canada, this issue was considered by the Ontario Superior Court in its 2002 decision in Kanitz v. Rogers Cable Inc. (2002), 58 O.R. (3d) 299.  In Kanitz, Rogers posted the amendments on its customer support webpage and the court decided that Rogers had provided its customers with sufficient notice of the amendments.  Mandatory arbitration provisions and class-action waivers (such as the ones at issue in Kanitz) are now ineffective in Ontario under consumer protection legislation that was introduced in July, 2005 in response to the Kanitz decision.

How does a company amend its service contracts? Very carefully.

Online postings of contract amendments are more likely to be effective when the original contract permits such changes, the customer is provided with sufficient notice of the changes, and the notice provides a clear explanation of the changes.  The changes must comply with local consumer protection legislation.


Calgary – 12:30 MST

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US Court of Appeals Cites Infringing YouTube Video

Law Professor Eric Goldman has picked up on an interesting twist in an otherwise commonplace trade-mark infringement case that went to the US Seventh Circuit Court of Appeals (Central Manufacturing, Inc. v. Brett, 2007 WL 1965673 (7th Cir. July 9, 2007). 

The case involved famous baseball player George Brett and it’s clear that the judge was a serious baseball fan. On page 3 of the decision, Judge Evans recounts a scene from a 1983 Yankees game and indicates that:

“The whole colorful episode is preserved, in all its glory, on YouTube, at (last visited June 6, 2007).”

If you link there now, you’ll find the standard warning that “This video is no longer available due to a copyright claim by MLB Advanced Media.“  It was taken down after a complaint by the copyright owner.  In other words, the Court of Appeals has encouraged readers to access infringing content, something warned about in the Perfect 10 case.  Applying the analysis regarding contributory infringement, did the Court know of infringing activities and fail to take “reasonable and feasible steps” to refrain from providing access to infringing content? If so, they might be liable for contributory infringement!

This case shows a couple of things:

  • Judges and courts are becoming more technologically savvy (imagine a link to a YouTube video in a judgement from 5 years ago);
  • Even the most well-meaning links can raise questions about infringement.  Infringing links can usually be taken down if challenged, although this link is now immortalized in a Court of Appeals decision.


Calgary – 11:10 MST

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Disgruntled Customers Lose Domain Name

In a recent decision under the CIRA Domain Name Dispute Resolution Policy (CDRP)  (McKee Homes Ltd. vs. Gerlinde Honsek , June 25, 2007), unsatisfied homeowners wanted to set up a customer complaint site directed at the contractor who built their home.   The stated intent of the site was to provide a forum for customers to detail their buying experience “from a customer point of view”. 

The domain name was identical to the contractor’s trade mark MCKEE HOMES and the contractor launched a complaint under the CDRP.  The arbitration panel found that the registrant lacked legitimate interests in the domain name despite the stipulation in the CDRP that legitimate interests can be established if the use is for criticism. 

The panel decided that “The Registrant can achieve her objective of criticism by adopting a domain name that is not identical to Complainant’s mark, or that does not otherwise suggest some type of connection with the Complainant.”  The whole point of a criticism or complaint site is that it does suggest some type of connection to the subject matter of the critique.  How close can a domain name be to the trade-mark and still be able to take advantage of the “criticism” exception in the CDRP?  That is left to future decisions.  


Calgary –  10:30 MST

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Dot-Asia Domain Coming Fall 2007

The dot-asia top-level domain (for example: is the Asian cousin of the dot-eu domain which was launched for Europe in 2006. The new dot-asia domain will be introduced in phases, starting in October 2007. 

According to the preliminary information provided by the registrar, anyone can be a registrant for dot-asia domains.  In order to satisfy the eligibility requirements, one of the associated contacts for the applied domain must be a “legal entity in Asia” which means either a natural person or an organization such as a corporation within the Asia-Pacific region as defined by ICANN.

Trade-mark owners whose trade-marks were applied for in the designated Asia-Pacific region prior to March 16, 2004 will be eligible for advanced registration during the dot-asia sunrise period . Canadian companies with trade-marks in Asia should review their eligibility and consider submitting their applications to take advantage of the sunrise period.  This kind of preventive measure can save significant costs when compared with chasing cybersquatters after the general registration opens.


Calgary – 14:35 MST

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