Regardless of what you are distributing – shrink-wrapped CDs, online applications or smartphone apps – software licensing takes on an added layer of complexity when open source software issues are part of the mix.  The law in the US has been clarified thanks to the Jacobsen v. Katzer case, which was finally dismissed last month after the parties reached a settlement. As part of the settlement, a permanent injunction was entered, stipulating that Katzer must refrain from “reproducing …modifying … or distributing” the open source material.  (See our previous post: Open Source Update: Cisco Sued & New Ruling in Jacobsen vs Katzer).

To avoid GPL violations, make sure you get good advice on an OSS policy for your organization, and avoid the fate of Best Buy, Samsung, Westinghouse, and JVC – all of whom were named in a copyright infringement lawsuit filed by the Software Freedom Law Center (SFLC) in December 2009.

Richard Stobbe will be speaking at a conference in Calgary on April 9 on the subject of Open Source Licensing: Copyright & Beyond

Calgary – 09:00 MST

Former basketball star Ed O’Bannon and former quarterback Sam Keller have now joined forces in a multimillion-dollar federal class action lawsuit that is proceeding in the US against the National Collegiate Athletic Association (NCAA). The lawsuit has been joined by 15 former NCAA basketball and football athletes.  Collegiate sports is big business in the US and the NCAA generates significant revenues from merchandising and licensing. The NCAA’s defence is that athletes like O’Bannon waived all their commercials rights when they signed a form authorizing the NCAA to use their images for promotional activities.  The lawsuit alleges that the NCAA is improperly profiting by using athletes’ images in video games such as the Electronic Arts title NCAA Basketball ’09. 

If you are considering using any personality or likeness in a video game or smartphone app, ensure you get proper legal advice on well-drafted written authorizations.

Link to: Consolidated Class Action Complaint (PDF) 

Related Reading: Video Games & Free Speech  

Calgary – 07:00 MST

Many companies in Canada and the US are waiting for clarity on the software and business-method patent debate.

• In the US, we’re watching the proposed Patent Reform Act of 2010,
• A ruling from the US Supreme Court is expected on the Bilski appeal ;
• In Canada, we’re waiting for the decision in the Federal Court appeal of the Patent Appeal Board’s rejection of Amazon’s 1-click patent, and 
• CIPO has announced that it will introduce MOPOP amendments relating to Computer implemented inventions.

Patent offices on both sides of the border are issuing rejections, but one (in)famous software patent has been re-examined and upheld.  The USPTO recently completed in lengthy review of Amazon’s controversial 1-click patent and confirmed the patentability of many of the original claims.  Amazon has avoided the defeat of a re-examination and rejection and has in fact emerged with a narrower but arguably more defensible set of claims.  This is good news for Amazon, but does little to settle the wider debate, since the 1-click patent has become a poster-child for patent reform, and this decision merely fuels the debate further. The patent is set to expire in September, 2017.  

Calgary – 07:00 MST

Google generates serious revenue ($20 billion+) from its AdWords program and “Keyword Suggestion Tool”. Yahoo! has its equivalent Sponsored Search service, and so does Microsoft through Bing Search Advertising.

All of these internet advertising services allow advertisiers to buy “keywords” to appear in online ads within sponsored search results.  Advertisers can buy words, phrases, or even a competitor’s trade-mark to ensure that their ads appear in the sponsored results. This practice is common… and so is the frustration of brand owners when they Google their own brand and then see competitor’s ads popping up.  If you’re one of those brand owners, what can you do about it?  If Rescuecom’s experience is anything to go by, then the answer might be … if you can’t beat ’em, join ’em.

Rescuecom’s attempt to sue the mighty Google (Rescuecom Corp. v. Google, Inc., 562 F.3d) achieved some success – a US appeal court determined that Rescuecom could proceed with its trade-mark infringement lawsuit based on the sale of Rescuecom as a “keyword”.  But Google (predictably) fought back tooth-and-nail, and Rescuecom recently dropped its suit altogether.  Now, it is Rescuecom that is in trouble for its own AdWords use of a competitor’s mark: Best Buy’s “geek squad”.   Rescuecom is trying to convince the court that its use of a competitor’s mark in AdWords is legitimate.   Everyone else is buying up their own brands as keywords, to prevent competitors from getting there first.

Meanwhile, Google continues to cash cheques.

Related Reading: a list of current AdWords Lawsuits

Calgary – 10:00 MST

A popular Chinese night market in a suburb of Vancouver became the arena for an intellectual property infringement case involving trade-marks and copyright. 

In a recent Federal Court decision (Target Event Production Ltd. v. Cheung and Lions Communications Inc., 2010 FC 27), Target, the original operator of the Richmond night market, sued a rival event operator for infringing on the registered mark RICHMOND NIGHT MARKET (in English and Chinese), as well as infringing copyright in the layout and site plans for the night market.  One important element in the decision relates to the distinctiveness of the marks. 

The Court acknowledged that the marks including RICHMOND NIGHT MARKET were “originally merely descriptive” but over time they became “valid trademarks because they enjoyed substantial goodwill and had acquired distinctiveness…”  But the judge went on to say that “this acquired distinctiveness was not, in my view, durable. Once Raymond Cheung and Target failed to open a night market in 2009, it is my view that Target’s Names, which were inherently weak, lost their distinctiveness and the associated goodwill.”

The lessons for business? 

1. Weak, descriptive marks can acquire distinctiveness over time through advertising and use, but that distinctiveness can easily be lost.  Unique, distinctive marks will always be much stronger and easier to protect.
2. Remember: directors can be liable for infringement.  In this case, the director of the defendant company was personally liable for the infringement since he was aware of the copyright and still went ahead with the unauthorized copying. As described in the well-known case Mentmore Manufacturing Co. v. National Merchandise Manufacturing Co., a director will be liable where there is “deliberate, wilful and knowing pursuit of a course of conduct that was likely to constitute infringement or … an indifference to the risk of it.”

Calgary – 10:00 MST

In late 2009, ICANN (the Internet Corporation for Assigned Names and Numbers) announced plans to implement internationalized country-code top-level domain names (ccTLDs) using non-Latin characters. See our previous post: Internationalized Domain Names.

Four ccTLD requests are moving along the process and are now ready for the final step in the process, the application for string delegation. The four countries and the corresponding internationalized ccTLDs are:

Canadian trade-mark owners who have a brand presence in these jurisdictions are advised to monitor developments to ensure that their domain name and trade-mark protection strategies are harmonized when the new top-level domains become active.  Contact us for advice on trade-mark and domain name strategies.

Related reading: IDN ccTLD Fast Track Process.

Calgary – 10:00 MST

Does a US judge have jurisdiction over a website operated in Canada?  The answer is found in a recent US court decision involving a Canadian website operator  (Columbia Pictures Industries Inc. v. Fung ). 

In that case, the Motion Pictures Association of America sued Gary Fung, operator of IsoHunt (a popular BitTorrent site). Mr. Fung’s web sites were all hosted in Canada but the US court had no trouble establishing it could extend its ruling to cover Mr. Fung and his activities. The MPAA convinced the court that infringement had taken place within the US.  From there, it wasn’t a leap to tag Mr. Fung with liability under the US theories of “inducement, material contribution, and vicarious infringement”, even though Mr. Fung’s conduct occurred outside the US.

The court said that “United States copyright law does not require that both parties be located in the United States. … Plaintiffs need only show that United States users either uploaded or downloaded copyrighted works; Plaintiffs need not show that a particular file was both uploaded and downloaded entirely within the United States.”

Last year, Mr. Fung, through his company isoHunt Web Technologies Inc., attempted to launch a pre-emptive strike against the recording industry by seeking a declaration that its operations did not violate the Copyright Act.  No final ruling has been issued in that case.

Related Reading: Canadian P2P Copyright Battle Continues

 

Calgary – 09:00 MST

 

A game developer incorporates martial arts moves into a new video game. Is the choreography of those moves protectable by copyright?   The answer is, apparently, yes. 

The 1997 decision in Ahn v. Midway Manufacturing Co., 965 F. Supp. 1134 (N.D. Ill. 1997) decided that under US law, certain martial arts routines fell within the subject matter of copyright.  In that case, a software developer hired dancers to create moves which were later incorporated into the well-known game “Mortal Kombat”. A dispute arose about the ownership of the routines, but the dancers had assigned their rights to the software developer under a written contract, so they could not maintain a claim for joint ownership.  The 2005 US decision in Open Source Yoga Unity v. Choudhury, 2005 WL 756558 (N.D. Cal. Apr. 1, 2005) suggests that yoga moves can be eligible for copyright protection.

Does this apply in Canada as well?  Yes, in Pastor v. Chen, 2002 BCPC 169 (CanLII), the court reviewed a dispute about dance routines, and decided that the “uniquely choreographed moves and dance styles” were properly covered by copyright.  Game developers should take care to get advice whenever incorporating choreographed elements into their applications.  And the next time you’re on the dance floor, just be sure not to infringe the copyright in anyone’s new dance moves.

Calgary – 09:00 MST

Copyright protects a range of creative works – photographs, images, software, books and music, to name a few.  And copyright law is considered to be “territorial” – this means that Canadian copyright law deals with protection and enforcement within Canada.  So what happens when works are published online, or transferred across borders?  Do the traditional territorial concepts break down in an environment where borders are technologically nonexistent?

Two recent cases illustrate how the law adapts to these issues: 

1. In Moberg v. 33T LLC et al., 2009 WL 3182606 (D. N.J. Oct. 6, 2009), a US court considered the publication of images online in Germany. The case turned on a technicality of whether a work published on a website in Germany (or anywhere outside the US) should be considered for legal purposes to have been simultaneously published in the US. The court decided that the images were not “United States works” leaving the author free to make a copyright infringement claim in the US, without first registering copyright in the US.  This helps clarify the rights of Canadian authors who may wish to sue in the US, even though copyright in their works is not registered there.
2. The Canadian decision in Thumbnail Creative Group Inc. v. Blu, 2009 BCSC 1833 (CanLII) dealt with a transfer of images across the Canada / US border. In this case, a BC company alleged that certain Canadian defendants provided images to the US defendants in violation of the author’s copyright and moral rights.  The court analyzed the situation and found that if copyright infringement occurred anywhere, it was in the US, not Canada. Since Canadian copyright law is territorial, it cannot be infringed by any act which occurs outside Canada. The court dismissed the claim, indicating that a US court was more appropriate to decide the matter.

Calgary – 14:00 MST 

Calling all small business owners. Remember that nagging feeling that you should get a handle on your brands and trade-marks? Here’s a local cautionary tale that illustrates why trade-marks are critical for small business. A popular chain of Calgary eateries has been trading under the name NELLIE’S for years.  Last month, the 5-restaurant chain was cited for highly publicized health code violations.  The problem?  Another local eatery, also trading under the name NELLIE’S, but independently owned and operated, is now caught up in the bad press, even though it had no violations.    

Lessons for business?  There are many reasons to protect your brand, and this is just one of them.  A unique, distinctive brand that sets you apart from the competition, will help avoid “guilt by association” and will help your business become stronger and more valuable.  Contact us to review options and strategies for trade-mark protection.

 

Calgary – 09:00 MST

Even Google can’t win them all.  In a recent domain name arbitration decision, Google Inc. v 207 Media, a small Canadian company has prevailed against a challenge by almighty Google Inc.  Google objected to the registration of the domain name GROOVLE.COM, claiming that it was too close to Google’s own famous brand name.  In a domain name arbitration, a complainant must prove 3 things:

(1)   the domain name is identical or confusingly similar to the complainant’s trademark ;
(2)   the person who registered the domain name has no rights or legitimate interests in respect of the domain name; and
(3)   the domain name has been registered and is being used in bad faith.

In this case, the arbitrator decided that Google failed on the first count. GROOVLE was found to be not confusingly similar to Google’s trade-mark. This follows an earlier decision where Google challenged the domain name FROOGLES.COM and lost (Google, Inc. v. Wolfe, FA 275419 (Nat. Arb. Forum, July 18, 2004)).

The real dispute was not so much the similarity of the names (Google has better things to do than chase every single misspelled variation of its domain name).  It was rather the use by Groovle of Google’s Custom Search Engine program.  This program permits users to embed a Google search box into their own site; Groovle took this one step further and permitted users to essentially customize their own search page, using Google’s engine, but displaying Groovle’s brand.

Calgary 10:00 MST

 

The Apple rumour mill – which usually spins at an alarming rate even on a slow day – has been at risk of popping a gasket over the past few months with speculation over Apple’s latest product release: a tablet-like device which is expected to do to the handheld tablet category what the iPod did for MP3s.  The iPad product was released today.

The new product was described in great detail by those who had no idea what it looked like, what it was called or what functionality or interface it might have. This attests to two things: the marketing power of consumer expectations, and the strength of Apple’s trade secret and intellectual-property protection program.  Several years ago Apple sued a journalist who posted information about one of Apple’s forthcoming software products (in O’Grady v. Superior Court, 139 Cal.App.4th 1423 (Cal.App. 2006)). Apple sought an order forcing the journalist to disclose his sources. In the most recent round of speculation, the company’s lawyers fired a letter at a Silicon Valley gossip site when the site offered a $100,000 bounty for any photos of the tablet. Ultimately Apple lost its legal battle with the journalist, but the practical message was clear: that it takes its confidential information very seriously.

Calgary – 07:00 MST 

In the 1990s, researchers at the University of Saskatchewan developed a transgenic variety of flax known as CDC Triffid, which was genetically designed to be herbicide-resistant. The crop received regulatory approval in the mid-1990s, but was never adopted by Canadian farmers for commercial use, because of fears that its use would close export markets such as the European Union, which has a zero-tolerance for GMO foods.

Those fears have now materialized. The flax industry is scrambling to discover why CDC Triffid seeds appear to have propogated in Western Canadian flax fields, despite having been “decommissioned” fifteen years ago.  This story has all the makings of a science-fiction tale (indeed, the name of the crop comes from a sci-fi novel about carnivorous plants).  The intellectual property issues are also interesting, since the original research would have produced an invention subject to intellectual property rights – likely patentable in the same way that the transgenic crops developed by Monsanto and others have been patented (though there is no indication that CDC Triffid was ever the subject of a patent).

The most recent case where Monsanto enforced its patent rights over a farmer was in the 2009 case of Monsanto Canada Inc. v. Rivett, 2009 FC 317 (CanLII), where a farmer was hit with a damage award for his unauthorized use of Monsanto’s patented canola seeds.  In that case, the court reviewed the concept of the “innocent user” who finds a patented higher life form has “escaped” and started growing on his land. As noted in Infringement of Patent on Higher Life Form “Life forms have a way of getting up and moving around: seeds propagate and blow away, creatures crawl, viruses replicate and invade.”  The Triffid case is a perfect illustration.

Calgary – 07:00 MST

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Clean technologies continue to be a significant source of investment capital in 2010. Provincial governments in Canada are looking for ways to attract and retain both the investment dollars as well as the technical and business expertise that flows from those investments.

The Alberta government is accepting applications in the field of bio-energy infrastructure development in connection with a $239 million fund it has established for biorefining. Industry Canada’s database of funding opportunities is listed here.

Contact us for strategic advice on financing, corporate services, and intellectual property protection.

Calgary – 09:00 MST

With a few weeks to go before the Winter Olympics, VANOC’s anxiety about official marks (what you might call “brand-wringing”) continues.  The list of protected terms was expanded in December (curiously, this order managed to pass before Parliament was shut down) to include the mascots like Quatchi, at right, and various other symbols of the events. 

Companies of all stripes – from small retailers of cheap knock-off T-shirts, to independent app-developers, to major financial institutions – are scrutinized by VANOC to see if their efforts run afoul of the rules.  It has become clear that the Olympic and Paralympic Marks Act has cut both ways.  VANOC has a powerful enforcement tool to use against infringers and pretenders.  On the other hand, the legislation is like a handbook for companies who are not official sponsors to determine exactly where the line is. For example, Scotiabank’s recent “Show Your Colours” campaign, and the new “International Collection” by Roots, both make use of carefully crafted, non-infringing design elements that evoke the excitement and energy of the Games, while scrupulously avoiding any offense under the Act. 

VANOC’s anxiety is understandable – sponsors have paid handsomely and expect protection.  But you can’t provide a handbook, then complain when people read it and follow it. 

Related reading: Ambush Marketing: The Names That Cannot Be Spoken… (Part 1)

Calgary – 09:00 MST

There a few recent updates from the Canadian Intellectual Property Office (CIPO):

1. Trade-marks: Is Canada finally going to join the Madrid Protocol? CIPO has just a opened a consultation on a Proposal to amend the Trade-marks Act. The proposed amendments focus on  “new business practices and improved international standards”. This may re-ignite the debate about whether Canada should ratify the Madrid Protocol. 
2. Patents: CIPO launched three new two-year Patent Prosecution Highway pilot projects with Japan, Denmark, and Korea, which supplements the ongoing project with USPTO.  The procedures of the Canada-US PPH pilot project will be harmonized with the newly-introduced programs.
3. Patents: There is a new Chapter 12 of the MOPOP on Subject-Matter & Utility and a revised Chapter 13 of the MOPOP on Examination of Applications.  Note that the subject of business-method and software patents (covered by Chapter 16, Computer-Implemented Inventions) is being revised by the Patent Office and proposed revisions are expected by Spring 2010.

Calgary – 11:00 MST

The court injunction preventing infringing sales of Microsoft Word (see: Microsoft Loses Patent Appeal) went into effect on Monday. While the company says it is complying with the court order, MS has submitted another appeal in the patent infringement case, asking a panel of 11 judges of the US Federal Circuit Court of Appeals to review the case and quash the original judgment.

Typically, appeals are heard by a three-member panel.  Microsoft already tried that and lost in December, 2009.  Any review of a decision of the US Federal Court of Appeals should properly be made to the US Supreme Court, but Microsoft’s latest tactic is referred to as an “en banc rehearing”, a type of review at the Federal Court of Appeals level which can be permitted for “precedent-setting questions of exceptional importance”.  The court will decide if this question qualifies for such a rehearing, and if not, then Microsoft will likely take the appeal up to the Supreme Court.

Calgary – 9:00 MST

2010. Winter. Games.   As the 2010 Olympics reach a frenzied pitch in Vancouver, the contests on the ice and snow will be matched by brand battles on billboards and posters.  You will recall that in Beijing, the “Brand Police”  (see: Olympics and the Trade-Mark Police) covered up offending trade-marks with duct tape. Not just in Olympic venues, but throughout the city.  Such practices have now come to Canada, where Olympic volunteers risk having their shoes and t-shirts swaddled in duct tape to cover up the brands of companies who are not official sponsors. 

Some retailers have danced close to the line (such as Lululemon’s famous dig at Olympic brand-control), and some knock-offs have been caught when they stepped over the line.

When VANOC assesses whether a product or advertisement offends the Olympic brand they look at the following factors. Essentially, they will be looking to see if the use of the Olympic marks falsely creates the impression of a business association with the Olympics.

• Factually accurate use: When the Olympic brand is used, is it used accurately and without distortion or modification?
• Relevant use: VANOC is less likely to object if the use is relevant to a larger storyline and isn’t so gratuitous or disproportionate that it creates the impression of a business association with the Olympics. 
• Commercially neutral: VANOC is less likely to object if the brand is used in a commercially-neutral manner that does not create the impression of a business association with the Olympics. 
• Undue prominence: How much prominence is given to the brand?  
• Use of Olympic or Paralympic visuals: Use of Olympic visuals in connection with a business  – logos, archival Games images, team uniforms or Olympic medals – is a red-flag for VANOC.
• Unauthorized association: This is a catch-all category – VANOC will look at surrounding circumstances such as the timing and strategic placement of the advertising in question.

Companies wishing to publish last-minute advertisements in the lead-up to the 2010 Games are encouraged to seek advice before they go to print with ads, signage or product packaging.  It is worth noting that Lululemon, though they were publicly scolded by VANOC, has not been met with any other threats or cease-and-desist letters. So they appear to have found the line, and stayed on the right side of it.

Related Reading: Olympic Lawsuits, Our Trademark Anthem

Calgary – 09:00 MST

A mobile app is just like any other software application and should be properly licensed to end-users.  Even for free versions, the app developer is not giving it away, but merely making a copy available to the user under certain conditions. 

Recent updates to the iTunes Store software have made it possible for app developers to make full-text end-user license agreements (EULA) available to purchasers. Not many app sellers take advantage of this, though sophsticated game developers such as Electronic Arts have lost no time in using the improved tools to post full versions of their EULAs.  Developers who sell their apps through other channels – such as titles in Blackberry App World – will have to tailor their EULAs to each channel.

Developers should get advice on licensing their apps to protect their intellectual property rights. The default end-user license that is embedded in Apple’s SDK Agreement is generic and limited and developers should consider the benefits of inserting their own tailor-made license.

Calgary – 09:35 MST

Apple launches a cellphone. Nokia releases a laptop. Apple buys an online advertising division and Google moves aggressively into software and hardware. With the release today of Google’s nexus one phone, which positions itself as an iPhone competitor, the ongoing battle for the smartphone market heats up another few degrees. 

Nokia and Apple are already locked in patent litigation with each claiming the other has infringed its portfolio of patents.  Nokia raised the stakes when it broadened its legal attack to include all of Apple’s popular iMac desktops as well as the iPhone.  Meanwhile, with the release of Google’s branded nexus one phone (manufactured by HTC), the search-engine titan elbows into the cellphone market with its own Android-based device. Android apps will compete head-to-head with iPhone apps. In the midst of all this market positioning, intellectual property litigation is one more tool; it is reminiscent of the battle in the late 1980s when Motorola effectively declared war on upstart Nokia and used patent infringement as its main weapon. It also recalls the use of copyright in the turf wars between Apple and Microsoft in the 1990s. 

The lessons for business? Don’t ignore the value of intellectual property protection as both an offensive and defensive tool.  If you don’t know where to start, then obtain an intellectual property audit and come up with a budget and a list of priorities.

Calgary – 15:35 MST