There have been a rash of new lawsuits against Google’s AdWords program including 2 major class-action claims:

• FPX, LLC v. Google, Inc., 2:2009cv00142 (E.D. Tex. complaint filed May 11, 2009) (Class action);
• Soaring Helmet Corp. v. Bill Me Inc., 2:2009cv00789 (W.D. Wash. complaint filed June 9, 2009);
• John Beck Amazing Profits, LLC v. Google Inc. 2:2009cv00151 (E.D. Tex. complaint filed May 14, 2009). (Class action);
• Stratton Faxon v. Google;
• And the ongoing Rescuecom case.

What are the issues for Canadian TM owners in connection with the US class actions? First, the US class actions have yet to be certified, meaning the US lawsuits may not be eligible to proceed as class actions, but if they do, then they could attempt to settle the issue for trade-mark owners across the US (those who do not opt out). Canadian class-actions may also be commenced, if the US class actions are certified, or if the US actions appear to be making headway against Google.  Many trade-mark owners will likely opt out since they won’t want to be tied into litigation over which they have no control.  But there will still be plenty of class members who will happily join a class action against Google in the hopes of getting a portion of the any settlement or damage award.  For trademark owners who opt in, the lawsuit is trying to peg Google with liability and damages and any damages (more likely a settlement of some kind) would be split between the class members. For those who opt in, there is also a risk that they would be bound if the Court finds that Google is not liable, and they would then be stopped from suing Google on their own separate actions against Google or the other defendants based on trade-marks infringement in in keyword advertising.

However, let’s face it: if the class action lawsuit fails, then the chances of anyone suing Google on this issue decrease substantially. Companies who benefit from AdWords and are buyers of TM keywords in their AdWords advertising, are likely to want to opt out of the class. These companies also face the possibility of being sued in future TM infringement litigation if the class actions succeed against Google.

For its part, Google doesn’t seem to be showing signs of backing down – they recently announced that they will allow a group of “special” advertisers to use competitors’ trade-marks to appear right in the ad copy, even if the trade-mark owner objects.

Calgary – 15:00 MST

 

In both Canada and the US, the business method patent is, at the moment, on the run (see our previous post: Business Method Patents Under Review). Business method and software patents have been the subject of fierce debate in the intellectual property community. Last October, the US Court of Appeals for the Federal Circuit ruled in the Bilski decision that a process for managing risk in commodities markets did not deserve a patent, because it was not tied to a machine, did not result in a “physical transformation”, and therefore did not meet patentability requirements.   

In Canada, business method patents are not automatically unpatentable – they are assessed according to the usual patentability criteria and CIPO’s Manual of Patent Office Practices. But a recent ruling by the Canadian Patent Appeal Board has denied Amazon’s “one-click” patent, throwing doubt on the patentability of business methods in Canada. Essentially, the CPAB found that, as in the Bilski case, there was no “physical transformation” so the application did not meet Canadian patentability requirements. (For further discussion, see: Amazon’s One-Click Patent Application Gets Bilski’d.)

Now,  the US Supreme Court has decided to weigh in by agreeing to review the Bilski decision. The decision may finally determine whether business methods are patentable. 

 

Calgary – 9:45 MST

When you buy a business, it is common for the seller to agree to non-competition restrictions. In other words, the seller agrees not to compete against you for a certain period of time afterwards. These clauses are standard, but can be tricky to enforce, as shown in the recent decision in Belron Canada Incorporated v. TCG International Inc., 2009 BCSC 596 (CanLII). 

In 2005, Belron bought the Speedy Auto Glass business in Canada from TCG for about $53 million, a deal which included the trade-marks, franchise agreements and proprietary glass repair technology.  For this price, Belron expected that TCG would refrain from competing against Belron in the auto-glass repair business in Canada for seven years.

When TCG launched a website at www.windshields.com that seemed to target Canadian customers, Belron sued for breach of the non-competition promises, and sought an injunction to restrain TCG from operating the site in Canada. In this case, the court wasn’t convinced that the injunction should be issued, so the case will go to trial for a final decision on whether the site constitutes a breach of the non-competition obligations.  The Belron decision applied the recent Supreme Court of Canada decision in Shafron v. KRG Insurance Brokers (Western) Inc., 2009 SCC 6, a case which debated the meaning of the phrase “Metropolitan City of Vancouver” in a non-competition clause. The Shafron decision also illustrates the importance of taking care in drafting clear non-competition clases.

The lessons for business?

• In any business acquisition, it is important for both sides to get advice on non-competition, non-solicitation and non-interference clauses to ensure the clauses are clear and enforceable;
• Where intellectual property assets are involved (as in the Belron case), special care must be taken to also review post-closing confidentiality and trade-secret obligations;
• “Injunctive Relief” clauses, which state that one party is automatically entitled to an injunction, are not necessarily enforceable. Belron had such a clause in its contract with TCG, but the court still did not issue the injunction order.

Calgary – 09:00 MST  

In our previous post on The Whisky Caper: Scotch Whisky Association vs. Glenora Distillers, we noted that a Canadian distiller won the right to use the word GLEN in its trade-mark for Canadian whisky, against the objections of the Scotch Whisky Association.  The Association has now announced  that it will appeal the decision up to the Supreme Court of Canada (SCC).  Even if the SCC agrees to hear the case, a decision won’t be expected for several years.

Calgary – 11:45 MST

Want to trade-mark the colour green? Just ask the makers of painter’s tape for some pointers.

They applied (several times) to register the colour GREEN as a trade-mark for their well-known green painter’s tape, based on use in Canada since 1993. 3M and others opposed the latest application, arguing that the trade-mark was not distinctive since many competitors also sold green tape products.

In the recent decision in 3M Company v. Tape Specialities Limited, 70 C.P.R. (4th) 138 (T.M.O.B.), the Canadian Trade-marks Opposition Board decided that the colour green was not distinctive of the applicant, and the application was refused (Trademark: COLOUR GREEN #3, Refused – Section 38(8), 1062931 )

Colour can be the subject of a trade-mark registration in Canada, but contrary to popular misconceptions, it does not provide the owner with a monopoly over the colour itself, just the colour as applied to a particular product – for example, Wedgwood was able to register the colour blue (specifically Pantone #658), as applied to boxes containing clocks (Trademark: Colour Blue design, Registered, 1166661, TMA689472 ). They claim use in Canada since 1800, making this arguably one of Canada’s oldest colour trade-marks (though I question whether Pantone #658 was around in the year 1800… but only lawyers quibble about such details.)

Calgary – 11:45 MST

A Montreal company has been hit with a cease-and-desist letter over its launch of an iPhone app that helps users find the city’s “Bixi bikes”. Bixi is the public-use bicycle system in downtown Montreal. Bixi (contrary to some reports) is not a registered trade-mark, though an application for registration has been filed.

There are many iPhone apps which permit users to schedule or locate public services, such as STM mobile (designed for the Montreal transit system), not to mention similar public transit apps for cities all over the world. Apps which locate private companies are also common, such as apps which pinpoint Starbucks, Tim Horton’s and TD bank locations.

It would be interesting to hear the court’s view on whether the use of Bixi in this form constitutes trade-mark infringement, but the letter appears to have worked. The app site now contains a French-language notice that says “We understand that it was an error (made in good faith) to use the trade-mark Bixi. We hope to work with Stationnement de Montréal and Bixi to find a solution that will respond to your needs.”
Calgary – 13:45 MST

Call it the “Facebook Factor”.  The way people use the internet and social media is colliding with litigation in ways that couldn’t have been foreseen even a few years ago:

• In a recent Nova Scotia case, a judge considered evidence of a plaintiff’s Facebook page in a personal injury lawsuit, and the evidence contradicted the plaintiff’s claim;
• In Murphy v Perger [2007] OJ No. 5511 (QL), a defence lawyer successfully forced production of post-accident Facebook pictures showing the plaintiff engaging in various social activities – pictures that were located on a private portion of the Facebook site;
• In Leduc v. Roman, 2009 CanLII 6838 (ON S.C.), the court permitted cross-examination of the plaintiff on the content he posted on his Facebook profile;
• In Australia and New Zealand, the courts have approved service of documents via a Facebook account (story: here and here);
• In the US, there have been a rash of similar cases (see links here, here, and here) leading to a mistrial in a drug-trafficking case (when jurors admitted that they researched the case via their iPhones and BlackBerrys), chaos in the federal corruption trial of a former state senator (jurors had posted updates on the case on Twitter and Facebook), and problems in a criminal case (a juror tried to “Friend” one of the witnesses).

Related content: free online webcast summit on “Copyright War,” June 9, 2009, including “Online Legal Issues: Facebook, MySpace, Twitter, YouTube, Blogs” 

Calgary – 10:30 MST

Maclean’s magazine (macleans.ca) interviewed Richard Stobbe, lawyer with the Technology & IP Group, for an article on defamation and internet law. The article takes a look at the “dark side” of anonymity on the internet and the state of the law in Canada.

Calgary – 9:45 MST

Rebranding is supposed to provoke a response, right? Consumer interest? Marketing awards? A trade-mark lawsuit?

Brick Brewing Co., an independent Ontario brewery, recently rebranded their Red Baron beer, updating the look with a new label, to the right.  The old label, at left, was used since the late 1980s and was registered as a trade-mark in 1991.

The new label attracted the attention of rival Labatt Brewing Company and last week Labatt sued for trade-mark infringement and sought an injunction, alleging that the new Reb Baron label was confusing with Labatt’s Brava label (left).  The Brava label was also registered as a trade-mark in April, 2009.

Though the word marks RED BARON v. BRAVA, for beer, are not at all similar, the look, colour, and layout of the labels is arguably more similar, since the word Baron is given more prominence in Brick’s new label.  This highlights the risks of rebranding.  The lessons for business?  Sometimes an updated label will be launched without the same level of scrutiny that is given to a new brand. Even with a “soft” launch such as this, trade-mark searches, trade-mark advice and industry awareness can help mitigate the risk of trade-mark disputes before a new brand or label is launched.

And sometimes, you get hit with a lawsuit just because your competitor is your competitor.

Calgary – 10:30 MST

In the (now notorious) Colorado case of InfoMedia, Inc. v. Air-O-Matic Inc. (Court Case Number: 1:09-cv-00302-ZLW), two makers of rival iPhone applications are in a trade-mark battle over the use of the phrase “Pull My Finger” in association with an application for the mobile device. InfoMedia uses the phrase “pull my finger” in its marketing and is seeking a declaration that the phrase is generic when applied to the product, and cannot function to distinguish Air-O-Matic.  Air-O-Matic counters that InfoMedia is riding its coat-tails by using the phrase.  Air-O-Matic has applied for registration of the phrase as a trade-mark, in association with “Computer application software for mobile phones”, though the application is encountering trouble because of the specimen that was filed. (They should have taken a screen-shot from iTunes.) In any event they’re both enjoying some additional press, which may have been the whole point to the dispute in the first place.

Battles between competing iPhone apps will become a feature of the legal landscape, and these cases trace their lineage to the old video-game disputes of the early 1980s:

• Atari Inc. v. Williams, a 1981 case out of California, pitted Atari’s famous Pac-Man against a rival game, Jawbreaker.  The court found that the strategy of the Pac-Man game was not protectable.
• Atari Inc v. Tyrom Inc., a 1982 case, decided that rival “Gobbleman” was infringing in its use of characters and design features; Pac-Man won that round.
• Williams Electronics Inc. vs. Artic International Inc. , a 1982 case over the popular game “Defender”, established important principles in video game copyright infringement cases, and specifically determined that a player’s interaction with a game – such that the player is “creating” or “authoring” new scenes as the game is played – does not detract from the copyright protection afforded the game.

We’ve come a long way from Pac-Man… though 25 years later, that game retains a certain diginity when measured against the “Pull My Finger” fart-simulator.

Calgary – 14:45 MST 

ipblog.ca is available on your web browser from your BlackBerry or iPhone.  Bookmark the site for updates, articles and business tips on Canadian intellectual property law, trade-marks and internet law in the palm of your hand. 

Calgary – 10:00 MST

In the long-running IP battle between Mattel Inc., the makers of Barbie dolls, and MGA Entertainment Inc., the makers of rival Bratz dolls, a California federal court has issued a decision this week that appears to put a nail in the Bratz coffin.  The court dismissed MGA’s application to reduce the $100 million damage award granted to Mattel Inc. and went further. The court also implemented the order which bars MGA from making or selling the Bratz dolls.  A temporary receiver was also appointed to oversee MGA’s business.  The end of the battle appears to be near, through Bratz may still have some fight left.  The dispute arose after a designer, while he was under contract with Mattel, designed the Bratz concept, then secretly sold the concept to MGA.  The dispute centred on copyright and intellectual property claims that ultimately put the Bratz designs back into the possession of Mattel.

The lessons for business?  MGA obviously knew what it was doing, but to avoid the risk of inadvertently importing intellectual property belonging to a competitor, consider special clauses in employment and contractor agreements that can help mitigate the risks of hiring employees or contractors who bring trade secrets or IP with them when they join your company.

Calgary – 11:45 MST

It was another long battle for Microsoft, this time against a retail chain in Toronto trading under the banner “PC Village”.  In April, a Federal Court judge in Microsoft Corporation v. PC Village Co. Ltd. (2009 FC 401) awarded damages of $10,000 per copyright violation for a total of $150,000; plus $50,000 in punitive damages against all defendants jointly and severally; and a lump sum of $50,000 for solicitor/client costs and disbursements.  This means both the corporations and the individual employees are liable for the total award of $250,000.00 in damages.  The defendants initially resisted the allegations, retained a lawyer and appeared to mount a defence.  Then their defence collapsed, the defence lawyer resigned, and Microsoft won the case.

Microsoft appears to be continuing its piecemeal strategy of battling software piracy one pirate at a time. (See: Microsoft Scores Software Piracy Win and Copyright Infringer Hit with Fine )

Calgary – 15:30 MST

Two Canadian domain name decisions:

• In the saga of the domain name forsale.ca, another chapter has been written.  This domain name was the subject of an earlier battle between Globe Media and the then-owner, Dawn Internet (Globe Media International Corporation v. Dawn Internet Telephony Systems Inc, CIRA Decision 00059 (2006).  Globe Media failed in that dispute because any rights it claimed arose after the original registration of the domain name in 2000.  The domain name registration then lapsed, and was snapped up by a new registrant in January, 2009.  Globe Media offered to buy the domain name for $5,000, but by then the domain name had been flipped and sold to Bonfire Development, Inc. for $30,000.  Globe Media launched this complaint in February.  The panel found that the domain name “is so clearly generic that its registration cannot be seen as being registered in bad faith.” The complaint was dismissed. Further, the panel awarded costs of $5,000 against Globe Media for “reverse domain name hijacking“, the first award of its kind. Case Decision

 

• At first glance, this is a case determining that Americans cannot hold dot-ca domain names.  In a dispute over the domain name clearlylasik.ca, the complaint was summarily dismissed because the US complainant, who claimed rights to the mark ‘Clearly Lasik’ in Canada and carries on business in Canada under that name, failed to satisfy the Canadian presence requirements.  In fact, it appears the complainant does hold a registered trade-mark for CLEARLY LASIK, but failed to submit evidence of this.  The complaint would have likely succeeded since there was no response.  The disputed domain names now resolve to the Complainant’s site, suggesting that the matter was likely settled after this decision was rendered. Case Decision 

 

Calgary – 10:30 MST

A Quebec Superior Court judge has approved a class action in the case of Electronic-Rights Defence Committee ERDC c. Southam Inc. 2009 QCCS 1473 (search for ERDC in Superior Court judgements), a copyright case dealing with the inclusion of freelance articles in online databases, which could prove to be as important as the 2006 Supreme Court of Canada decision in Robertson v. Thomson Corp., 2006 SCC 43 [See: New Copyright Decision Released], the copyright battle pitting freelance writer Heather Robertson against the publishers of the Globe and Mail.

The impact on business? Just because you think you own the copyright in a particular work, don’t assume that right includes the right to reproduce the work in any and all media. We have been advising clients to include contractual language to clarify the rights of reproduction to include digital media.

Calgary – 18:20 MST

Last Friday, the Supreme Court of Canada upheld the decision in Fromm v. Warman, to award $30,000 in damages for internet defamation. The judgment of the Court of Appeal for Ontario, 2008 ONCA 842, handed down in December, 2008 [Link to Court of Appeal Decision] was upheld. Warman brought an action against Fromm for defamatory postings on various internet websites. Fromm took the position that the comments were “fair comment” on matters of public interest. The court upheld the finding that the postings were defamatory.

Calgary – 09:30 MST

On Friday, the federal government introduced long-overdue draft anti-spam legislation, the Electronic Commerce Protection Act. The law would allow civil lawsuits against spammers, and is designed to target email spam, as well as spam directed to cellphones and mobile devices. The proposed law would be enforced by the Privacy Commissioner, the Competition Bureau, and the CRTC, which raises questions about effective coordination of enforcement across multiple branches of government and quasi-government bodies. The law contemplates fines of up to $1 million for individuals and $10 million for corporate offenders.

Calgary – 20:45 MST

A year ago we posted a Patent Infringement Update on this case; earlier this month the USPTO rejected all 57 claims in a course-management software patent that US-based Blackboard Inc. used to successfully sue its Canadian competitor, Desire2Learn. The most recent rejection relates to claims added during the re-examination process [copies of the documents are posted here].  Blackboard originally obtained the software patent in 2006, but the patent was criticized for its broad claims covering technology that had been used by educational institutions and others for years at the time of filing. The battle is likely to continue, as Blackboard has since filed a new patent, and is suing its rival again for infringement of the new patent.

Calgary – 11:00 MST

A US appeals court has permitted an attack against Google’s (in)famous AdWords program by allowing a trade-mark infringement lawsuit to proceed.  The lawsuit was brought against Google by Rescuecom Corp., a computer service and support company.  Rescuecom alleged that Google’s AdWords program (its practice of selling the Rescuecom trade-mark to other advertisers, thereby triggering the appearance of a competitor’s advertisements and links when a Google user launched a search of Rescuecom’s trade-marks) was a violation of trade-mark rights.

On April 3, the US Second Circuit Court of Appeals ruled that Rescuecom’s lawsuit could proceed.  The outcome of this suit will be closely watched.

Related Reading: Trademark Infringement and Google AdWords  

Calgary – 14:00 MST

VANOC, the organizer of the 2010 Olympics, has launched another lawsuit in the lead-up to the 2010 Winter Games, this time to block ticket scalping. The suit filed in March against Coast2Coast Tickets alleges trade-mark violations in the effort to curb unauthorized ticket resales. The claim alleges the ticket reseller is using protected Olympic marks to give the public the impression that there is some affiliation with VANOC.  Over the past few years VANOC has also pursued trade-mark remedies against:

• a domainer who registered the domain names vancouver2010.org, vancouver2010.net, vancouverwhistler2010.net and vancouverwhisterler.com ;
• the owners of a business calling itself “Whistler Olympic Real Estate” and operating a website using the Internet domain name  ; and
• a distributor, Teepee Handicrafts Ltd., who sold and distributed merchandise bearing marks such as VANCOUVER 2010 and 2010 VANCOUVER WHISTLER without the permission of VANOC  .

Olympic litigation is likely to increase over the next year, as ambush marketing and unauthorized sales heat up in advance of the games.

Related Reading: VANOC Ticket Broker Suit Raises Concerns about Reach of Official Marks

Calgary – 10:30 MST