Newsletter Archives - 2002-2004
Reports on Judgments
- April 2004 - Music File Sharing is Legal in Canada
- March 2003 - FIRKIN Domain Name Ordered Transferred to Firkin Hospitality Group Inc.
- October 2002 - Official Marks and Public Authority Status under s. 9(1)(n)(iii)
- May 2002 - Lego Blocks Cannot Be Protected as Trademarks
- Federal Court allows Markman Proceeding in Patent Infringement Action
- Federal Court of Appeal Reinstates Patent with Incorrect Inventorship Claim
- Patent Protection for Transgenic Organisms?
- Protegez vos actifs
- Meta-tags, Framing, Linking and IP
- Is Grey Marketing Lawful?
- Faire des affaires sur internet
- Not Copyright Infringement To Transfer Images
- Harvard Mouse Not Patentable in Canada
- Competition Bureau Intellectual Property Enforcement Guidelines
Reports on Judgments
FIRKIN Domain Name Ordered Transferred to
Firkin Hospitality Group Inc. - March 2003
On March 17, 2003, Uniform Domain Name Dispute
Resolution (UDPR) Panelist John J. Upchurch,
ordered the domain name transferred to the Firkin
Hospitality Group Inc., the owner of a Canadian
registration for the trademark FIRKIN, which it
has used in association with the operation of
licensed restaurants and pubs throughout Canada
since 1987.
Between 1996 and 2002, the domain name had been
registered to the Bridgeport Brewing Company of
Portland, Oregon. For some unknown reason, the
registration was allowed to lapse, and on June 20,
2002, Pete Smith, purportedly of Great Britain,
registered the domain name. In December 2002, the
Complainant, Firkin Hospitality Group Inc.,
contacted Smith and informed him of its trademark
rights in the name. Smith advised the Complainant
three times that he was about to sell the name to
another party, and requested they make him an
offer. However, in January 2003, instead of
selling the domain name, Smith claimed to begin
renting the domain name to the Firkin Development
Group of Bangkok, Thailand. The contact
information for the domain name was also changed
to Samut Prakaan of Bangkok, Thailand. At the same
time, Smith continued to solicit offers from the
Complainant. The evidence, in the form of e-mail
messages exchanged between the Complainant, Smith
and Prakaan, proved that Pete Smith and Samut
Prakaan were both located in Bangkok, Thailand,
and both accessed the Internet from the same
computer using the same IP address at the same
time. They were in fact the same person.
Panelist Upchurch ruled that the domain name was
identical to the trademark FIRKIN, in which the
Complainant had rights. Since the Respondent
failed to file a response, there was no evidence
that it had any rights or legitimate interests in
the domain name. Finally, there was extensive
evidence that the Respondent had registered the
domain name solely for the purpose of selling it
to the Complainant, which was clear proof of bad
faith.
The decision can be viewed at: http://www.arbforum.com/domains/decisions/145205.htm
Firkin Hospitality Group, Inc. was represented by
Barry E. Hutsel.
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Federal Court allows Markman Proceeding in Patent
Infringement Action
In Realsearch Inc. v. Valone Kone Brunette Ltd.,
(unreported, 2003 FCT 669), the Federal Court of
Canada granted a defendant's motion for a United
States style "Markman Proceeding" for a judge to
construe the claims of a patent prior to an
infringement or invalidity trial. In the United
States, unlike Canada, patent infringement trials
are held before a jury.
The defence in Realsearch argued that by having a
separate, preliminary proceeding to construe the
claims, the result would be a reduction in the
duration of discovery, an increased likelihood of
settlement, a provision of the "public
notification function of patents", and a reduction
in "litigation chill" suffered by the defendants.
The Federal Court considered the recent Supreme
Court decisions of Whirlpool Corp. v. Camco Inc.,
[2000] 2 S.C.R. 1067 and Free World Trust v.
Electro Sante Inc. (2000), 9 C.P.R. (4th) 168, in
which it was found that the construction of claims
must be performed before the issues of validity
and infringement are addressed. The court further
found that claim construction performed at an
early stage in the proceedings could help the
parties to evaluate the relative merits of their
positions, potentially leading to settlement.
Based on this the court ordered that the issue of
claim construction be determined separately in a
pre-trial hearing.
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Federal Court of Appeal Reinstates Patent with
Incorrect Inventorship Claim
In a recent decision, 671905 Alberta Inc. v. Q'Max
Solutions Inc., the Federal Court of Appeal found
that an incorrect claim of inventorship need not
necessarily invalidate a patent. In this case, the
true inventor had not been named in the petition,
while two people who were not inventors were
named. The trial judge found that this error was
an untrue material allegation that rendered the
patent void. On appeal, the Court disagreed,
holding that because the error was not made
wilfully with the purpose of misleading, the
patent was not invalid.
The Court did find, however, that because of the
incorrect claim of inventorship, the chain of
title from the true inventor to the plaintiffs was
not complete, and the plaintiffs were therefore
not the legal representatives of the inventor and
could not sue for infringement. Presumably the
plaintiffs in this case will be able to correct
the flaws in the chain of title and again sue for
infringement, but nonetheless they have incurred
significant expense because of their initial error
in naming the inventors.
In summary, although errors in claims of
inventorship may not prove fatal to the patent,
they can still be very costly, and it is therefore
advisable to take care in naming the correct
inventors when filing a patent application.
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Lego Blocks Cannot Function as a Trademark - May 2002
In Kirkbi AG and Lego Canada Inc. v. Ritvik
Holdings Inc./Gestions Ritvik Inc. 2002 FCT 585,
(T-2799-96, reasons for judgment May 24, 2002)
Lego asserted trade-mark rights in the upper
surface of LEGO toy building blocks. The surface
included a pattern of raised studs used to connect
one block to the under side of a second block.
Ritvik sold MICRO building blocks which could be
used interchangeably with LEGO blocks. LEGO sued
for trademark infringement.
Ritvik alleged that the Lego Indicia was not a
trade-mark because the studs were: functional,
claimed and disclosed in expired patents, not
distinctive and not recognized or used by Lego as
a trade-mark.
The Federal Court held that the Lego Indicia and
"all its features are dictated by functional
consideration . . ." As the functionality of each
stud related primarily or essentially to the
blocks themselves, the Lego Indicia could not be a
trade-mark. Lego therefore had no basis for a
passing-off action or an infringement action, even
though there was significant evidence of both
reputation and actual confusion. The action for
passing-off was dismissed on the ground that a
functional trade-mark is not capable of trade-mark
protection. This conclusion is interesting in
light of the Court's findings (in obiter dicta)
that Lego had goodwill derived in whole or in part
from the Lego Indicia; that they met the onus to
establish a likelihood of confusion, and showed
actual confusion in the Canadian market place.
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Official Marks and Public Authority Status under
s. 9(1)(n)(iii) - October 2002
"Public Authorities" have special status pursuant
to s.9 of the Canadian Trade-marks Act. They can
own an "official mark". Official marks give the
owner very powerful rights and remedies that are
similar to registered trade-marks.
The Canadian Trade-marks Office released a
Practice Notice on October 2, 2002 requiring
evidence of "public authority" status by the
Applicant for an official mark. The practice
notice adopts the reasoning in Ontario Association
of Architects v. Association of Architectural
Technologists of Ontario, 2002 FCA 218 reversing
[2001] 1 F.C. 577; (2000), 9 C.P.R. (4th) 496 (F.C.T.D.).
The test for public authority is now a two part
test that considers (1) whether the organization
is under a significant degree of government
control and (2) whether the activities of the body
are for public benefit. This change narrows the
number of organizations that qualify as "public
authorities." Simply being a creature of statute
is no longer enough to show a significant degree
of control by the government.
Hallmarks of government control include that the
government may exercise a degree of ongoing
influence in the body's governance and decision
making. As to public benefit, the Registrar will
consider the body's objects, duties and powers,
including distribution of assets.
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Patent Protection for Transgenic Organisms?
Although plants and animals appear to be
unpatentable, it may still be possible to protect
transgenic organisms from infringement (Schmeiser
v. Monsanto Canada Inc.).
Monsanto developed a strain of canola that
contained a gene rendering the canola resistant to
the pesticide Roundup (glyphosate). Monsanto
obtained a patent, which covered a gene for
glyphosate resistance, and various plant cells
containing the gene. Notably, the patent did not
claim the canola plant as a whole.
Mr. Schmeiser grew some of Monsanto's canola,
without Monsanto's authorization. Monsanto sued
him for patent infringement, alleging that any
unauthorized cultivation of the canola plant
constituted use of the patented invention. The
Federal Court found Schmeiser had infringed, and
the Federal Court of Appeal, in a recent decision,
agreed. Although Monsanto had no patent for the
canola plant per se, they were still able to
protect the plant as if they did have such a
patent. This is particularly significant in light
of the Supreme Court of Canada's recent Harvard
Mouse decision, in which the court appeared to
state that higher life forms, including plants and
animals, are not patentable.
Although it remains to be seen, it may be that by
patenting genes and/or cells containing those
genes, inventors can protect transgenic plants and
animals from infringers, even though they cannot
actually obtain patents for these organisms.
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Protegez vos actifs
Il existe deux faÇons pour une entreprise de
protÉger les nouvelles technologies et le
savoir-faire qu'elle a dÉveloppÉ ou acquis. Le
dÉpÔt de brevet et le secret de fabrique.
On entend par secret de fabrique, une technologie
pouvant demeurer confidentielle i.e. information
ou Équipement ayant une certaine valeur
commerciale et qui n'est connu et utilisÉ que par
un nombre restreint de personnes. Il est bien
entendu que la technologie en question doit
demeurer confidentiel. Il est de plus Évident que
dÈs la comercialisation du produit sur le marchÉ,
les concurrents pourront se le procurer pour enfin
l'analyser afin d'en comprendre le fonctionnement
en vue de l'imiter et de le reproduire, ce qui est
permis, À moins qu'il n'y ait d'autres protections
comme un brevet, dessin industriel ou droit
d'auteur Également rattachÉes au produit en
question.
Il s'ensuit que si une technologie doit Être mise
sur le marchÉ afin d'Être exploitable, devenant
par le fait mÊme accessible À tous, il ne sera pas
possible de la protÉger par voie de secret de
fabrique. Par contre, s'il s'agit plutÔt d'un
procÉdÉ de fabrication pouvant Être utilisÉ de
faÇon confidentielle À mÊme les bÂtiments de
l'entreprise, alors une telle technologie pourra
Être protÉgÉe comme secret de fabrique, tout en
s'assurant que des paramÈtres internes À
l'entreprise soient en place pour sauvegarder la
confidentialitÉ.
L'avantage majeur de ce type de protection demeure
la gratuitÉ. C'est peut-Être avantageux mais
potentiellement risquÉ.
Le brevet, quant À lui, se dÉfinit comme un titre
de propriÉtÉ de durÉe limitÉe dÉlivrÉ par le
gouvernement d'un pays À un inventeur pour une
invention prÉsentant la particularitÉ d'Être À la
fois utile, nouvelle et originale.
Etant un droit de propriÉtÉ, le droit confÉrÉ par
un bervet est implicitement limitÉ au pays oÙ il a
ÉtÉ obtenu. De plus, dans la quasi-totalitÉ des
pays du monde, oÙ une rÉcente uniformisation des
droits de propriÉtÉ intellectuelle a pris place
dans le cadre des accords du GATT, un brevet n'est
valide que pour une pÉriode maximale de vingt (20)
ans À partir de la date de dÉpÔt de la demande.
Un brevet pour Être valide doit, entre autres
choses, fournir une description dÉtaillÉe et
complÈte de l'invention et de la faÇon dont elle
fonctionne, pour permettre À tous et chacun de la
comprendre et de pouvoir la reproduire et d'en
bÉnificier une fois le brevet expirÉ. On peut donc
comprendre que si une entreprise ne veut pas voir
sa technologie Être divulguÉe au public qu'elle
devra abandonner l'idÉe de breveter l'invention.
Mais pourquoi le gouvernement d'un pays est-il
donc prÊt À octroyer un tel privilÈge? De par sa
nature mÊme, le brevet d'invention Équivaut À une
forme de contrat passÉ entre un inventeur ayant
dÉveloppÉ une nouvelle technologie utile et
dÉsireux de vouloir amortir les coÛts de ses
recherches et le public, reprÉsentÉ par le
gouvernement, qui lui est interessÉ À bÉnificier
des technologies nouvelles. Comme dans tout
contrat, les deux parties auront des droits et des
obligations. L'esprit inventif est ainsi stimulÉ
et le rÉsultat reprÉsente un apport considÉrable
pour la sociÉtÉ.
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Meta-tags, Framing, Linking and IP
The Internet has created new forms of unfair
competition. Vigilance is vital and monitoring the
Internet for infringement is key in order to
prevent a loss of intellectual property rights.
Meta Tags
Text and graphics on a web site are written in
HTML which contains invisible tags and markers.
Some of these tags, commonly called meta-tags, may
be used to designate words that are identifiable
by search engines. It has become a popular
practice for a company to bury the trademarks of a
better-known competitor in these meta-tags in
order to ensure that when searching, a viewer will
find both companies even when looking for the
better-known one. Sometimes referred to as
"invisible trade-mark infringement", it is
probably more accurate to call such practice
deceptive trade practice or unfair competition.
Framing
HTML permits viewing of web sites as frames.
Generally, a frame will be in the left vertical
portion of a web site. When viewers click on a
hyperlink, a second web site will be displayed
only in the larger right portion, thus maintaining
the original frame. This puts the first web site
in the advantageous position of using the second
web site's information without crediting the
latter. Issues of copyright infringement, unfair
trade practice and trademark infringement may
therefore arise in framing situations.
Linking
Finally, linking to another's web site without
authorization or in a misleading way may be seen
as unfair competition and/or copyright
infringement. The use of "deep links", or links
taking the viewer to portions of a web site below
the identifying information on the homepage, are
potentially even more misleading than "surface
links" which at least link to the homepage of the
web site thereby giving credit where credit is
due.
The above are only some of the issues resulting
from specific technological attributes of the
Internet.
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Is Grey Marketing Lawful?
Legal recourse against grey marketers has been
drastically reduced by two relatively recent
decisions of the Federal Court of Appeal, Smith &
Nephew Inc. v. Glen Oak Inc. (1996), 68 C.P.R.
(3d) 153 (F.C.A.) and Coca-Cola Ltd. v. Pardhan
(1999), 85 C.P.R. (3d) 489 (F.C.A.). Briefly, it
would appear that a Canadian distributor and/or
manufacturer who does not own the Canadian
trade-marks in question has no cause of action
against a grey marketer in trade-mark infringement
or passing-off. The Federal Court of Appeal has
not, however, explored the issues arising if the
Canadian distributor/manufacturer is also the
trade-mark owner.
Smith & Nephew was a Canadian licensee of the mark
NIVEA, owned by the German company Beiersdorf AG
("BDF"). Glen Oak imported and sold in Canada
NIVEA trade-marked products which it obtained from
a Mexican manufacturer, licensed by BDF to
manufacture and sell the product in Mexico. The
Federal Court held that the Smith & Nephew could
not complain of the sale in Canada of NIVEA goods
which were manufactured by or under license from
the trade-mark owner because there was no
deception as to the origin of the goods. However,
the court was careful to restrict the scope of its
decision to the facts in the case before it, where
the respondent was only a licensee, and not the
trade-mark owner.
Coca-Cola Ltd. and Coca-Cola Bottling Ltd. were,
respectively, the owner of COCA-COLA trade-marks
in Canada and the Canadian manufacturer/licensee.
Pardhan and others had been transshipping
Coca-Cola products from Canada to the United
States. Although its decision focussed on a
procedural issue, the Federal Court of Appeal did
say that the resale of goods obtained in the
normal course of trade could not constitute 'use'
of the Coca-Cola trade-mark by Pardhan. This,
along with the fact that there was no deception as
to the origin or nature of the products, meant
that no infringement had occurred.
However, neither Smith & Nephew nor Coca-Cola
resolved the issues arising in cases where
Canadian trade-mark rights are owned by the
Canadian manufacturer and/or distributor; they did
not overrule the decision in H.J. Heinz Co of
Canada Ltd. v. Edan Foods Sales Inc. (1991), 35
C.P.R. (3d) 213 (F.C.T.D.). In that case, the
plaintiff Heinz was the Canadian manufacturer of
Heinz products and the registered owner of HEINZ
marks in Canada. The defendant Edan imported Heinz
products lawfully manufactured in the United
States by the U.S. manufacturer and holder of the
U.S. trade-mark rights, and sold them in Canada.
The court granted an interlocutory injunction to
Heinz, holding that because Heinz had specifically
formulated its products for the Canadian market,
they were not the same as Edan's products.
Accordingly, if Edan continued to sell its
products in Canada, the result would be confusion
in the marketplace, and damage to Heinz'
reputation.
In light of the decision in Coca-Cola, it would
appear that grey marketing can give rise to no
cause of action in trade-mark infringement, since
the resale of legitimate goods does not constitute
trade-mark use. It would also seem, by virtue of
Smith & Nephew, that only the trade-mark owner
could be successful in a passing-off action for
grey marketing. The Federal Court of Appeal has
left open the issues arising in cases where
Canadian trade-mark rights are owned by the
Canadian manufacturer and/or distributor.
Accordingly, an action in passing-off might be
available when the plaintiff is both the
registered trade-mark owner and the Canadian
manufacturer, particularly when the Canadian
products are specifically designed for the
Canadian market.
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Faire des affaires sur internet
Vous avez dÉcidÉ de faire le saut sur Internet. Ou
bien vous y Êtes dÉjÀ, considÉrant que votre
entreprise est toujours À la fine pointe des
dÉveloppements. On y voit un marchÉ en croissance
exponentielle, on parle d'une maniÈre
rÉvolutionnaire de faire des affaires. Les coÛts
de production, de promotion et de distribution
sont moindre grÂce À Internet. De trÈs bonnes
affaires quoi.
Oui, peut-Être, mais il faut mieux Être bien
informÉ et prÉparÉ afin de pouvoir faire face aux
diffÉrentes ÉventualitÉs.
Noms de domaines et marques de commerce
Lorsqu'on a une entreprise, il faut pouvoir vous
trouver. Il est donc primordial que vous soyez
localisÉ intelligemment car d'une certaine maniÈre
les noms de domaines sont À Internet ce que sont
gÉnÉralement ailleurs les adresses ou numÉros de
tÉlÉphone. Tout comme les marques de commerce
permettent d'identifier un produit ou un service
et de l'associer avec une entreprise particuliÈre,
si vous allez faire des affaires sur Internet, il
est de votre intÉrÊt À enregistrer un nom de
domaine et de vous assurer que ce dernier n'entre
pas en conflit avec des marques de commerce
enregistrÉes car, si c'Était le cas, le
propriÉtaire de la marque pourrait bien vous
forcer À abandonner votre nom de domaine et À vous
relocaliser sur Internet, probablement À une
adresse qui vous serait moins favorable d'oÙ
l'importance de se distinguer de ses concurrents.
Un nom de domaine non seulement sert À guider
l'utilisateur (client potentiel) À repÉrer un site
grÂce aux engins de recherche, mais Également À
promouvoir un service ou un produit de sorte que
le nom de domaine devient un ÉlÉment essentiel de
la politique de communication de l'entreprise.
Droits d'auteur
Il est important de rÉaliser que ce que l'on voit
sur Internet est rÉgi par le droit d'auteur.
Celui-ci protÈge ce qu'on appelle des oeuvres, À
condition qu'elles soient originales, qui sont de
quatre (4) types: littÉraires, dramatiques,
musicales et artistiques. En bref, À peu prÈs tout
ce que vous Êtes susceptible de rencontrer sur
Internet est sujet au droit d'auteur. Il ne faut
pas copier sans l'autorisation du dÉtenteur du
droit d'auteur. D'un autre cÔtÉ, ce que votre
entreprise rend disponible sur Internet est
protÉgÉ de la mÊme faÇon et les autres ne peuvent
le copier sans votre autorisation.
Finalement, protÉgez-vous. Il est important de
clairement identifier, par Écrit, sur vos pages
Web, les conditions auxquelles vos services,
produits ou informations sont offerts. De plus,
limiter explicitement votre responsabilitÉ et
assurez-vous que votre client a bien lu et compris
les conditions en le faisant simplement cliquer
son acceptation ou refus.
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Not Copyright Infringement To Transfer Images
The Supreme Court of Canada, in Theberge v.
Galerie d'Art du Petit Champlain Inc., 2002 SCC
34, determined that copyright in a work is not
infringed where the image of the work on an
authorized poster is transferred to a canvass.
The plaintiff, Theberge, assigned to a publisher,
the right to make reproductions of his work on
cards, posters and stationary products. The
defendant galleries purchased posters from the
publisher and using a process of lifting the ink
from the poster, they transferred the images to
canvass for resale.
The artist's position was that by transferring the
posters onto canvass the galleries infringed his
copyright. The artist assigned the right to make
reproductions of his works on paper. He did not
assign the right to make reproductions in other
media. The artist applied to the Quebec Superior
Court for an injunction, accounting and damages
against the galleries. He obtained a writ of
seizure before judgment to recover possession of
all the infringing copies of his work. The
galleries applied to quash the order. The motions
judge found that there was no infringement and
ordered that the goods be returned to the
defendant galleries. The court of appeal found
there was infringement and upheld the seizure.
The Supreme Court of Canada split 4-3 on the
decision that the transfer to canvass of the ink
image from authorized paper posters does not
constitute copyright infringement. Theberge was
unable to obtain a seizure of the canvass
reproductions before judgment. Justice Binnie for
the majority made a distinction between moral and
economic rights of artists. The economic rights
can be assigned and an artist can only assert the
economic rights he has retained. Moral rights on
the other hand are not capable of assignment and
are infringed where the work is modified to the
prejudice of the creator. Justice Binnie found
that Theberge was asserting a moral right
disguised as an economic right, and this he was
not entitled to do. Moreover, Justice Binnie held
that as the original paper of the posters was left
blank the process did not constitute
"reproduction" under the Copyright Act. This is
because no additional or new copies were created.
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Harvard Mouse Not Patentable in Canada
In a recent decision, President and Fellows of
Harvard College v. Canada (Commissioner of Patents
), by a slim 5-4 majority, the Supreme Court of
Canada ruled that the infamous Harvard mouse was
not patentable in Canada. In reaching this
conclusion, the majority overturned the majority
decision of the Federal Court of Appeal, and
restored the finding of the Federal Court Trial
Division, the Commissioner of Patents and the
Patent Examiner.
The ultimate conclusion of the majority was that
the present language of the Patent Act (the "Act")
did not explicitly permit the granting of a patent
for a higher life form. Rather, the language was
more restrictive or exhaustive. Thus, it was not
up to the Court to expand the parameters of the
Act so as to include such life forms. Instead,
this was a decision that should be left to the
exclusive purview of Parliament.
Published newspaper reports would suggest that the
pharmaceutical industry was disappointed with this
decision. It would not be surprising if it now
turned its attention to attempting to convince
Parliament to amend the Act so as to permit the
patenting of higher life forms. For the present
time, however, the decision of the Supreme Court
is the determinative decision on this issue. It
therefore warrants some review.
Harvard was, however, successful in obtaining a
patent for the "oncomouse" in the United States
and throughout the European Union. A similar
patent was issued in Japan and New Zealand has
granted a patent for genetically modified mouse
that has been made more susceptible to developing
HIV.
The bottom line is that the "oncomouse" itself is
not subject to patent protection in Canada.
However, the process by which it is made is.
Therefore, one would not be able to create an "oncomouse"
by using this process. However, if one were to
purchase an existing "oncomouse", and successfully
breed new generations simply by allowing nature to
take its course, this would not appear to violate
Harvard University's patent.
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Competition Bureau Intellectual Property
Enforcement Guidelines
Undue restraint of Trade and lessened competition
are illegal. The exercise of an IP right to
further these goals is illegal. The Competition
Bureau has drafted guidelines for dealing with
intellectual property matters which may have
implications under the Competition Act. Conduct
that is the "mere exercise of an intellectual
property right", the right to unilaterally exclude
others from using the intellectual property is not
subject to the general provisions of the
Competition Act. However, under section 32 of the
Act, the Federal Court has the power to intervene
in the exercise of such a right if there is undue
restraint of trade or lessened competition. For
example, a firm's refusal to license its
intellectual property could stifle competition.
The court will likely impose a remedy only if the
following conditions are satisfied: 1) the
intellectual property holder in question is a
dominant player in the relevant market; 2) access
to the intellectual property in question is
essential in order for competing firms to
participate in the relevant market; and 3)
imposing a remedy would not stifle further
innovation. Conduct relating to intellectual
property that is more than just an exercise of an
intellectual property right is subject to the
general provisions of the Competition Act.
Examples of such conduct include the licensing,
sale, or transfer of intellectual property rights,
market allocation agreements, or mergers. The
Competition Bureau will review suspect
transactions, taking into consideration the
relevant market, the market power of the players
involved, the market concentration, the ease with
which new players may enter the market, horizontal
effects, anti-competitive effects (for example,
raising competitors' costs), and efficient use of
resources.
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Music File Sharing is Legal in Canada - April 2004
The Federal Court has ruled that Internet service
providers are not required to identify online
music sharers to Canada's music industry. It also
ruled that online downloading of music files for
personal use, and placing music files in shared
folders on a PC, does not amount to copyright
infringement in Canada.
Justice Konrad von Finckenstein ruled that the
evidence provided by the music companies was not
sufficient to show that any copyright infringement
had occurred and compared downloading music to
using a photocopy machine in a library.
"I cannot see a real difference between a library
that places a photocopy machine in a room full of
copyrighted material and a computer user that
places a personal copy on a shared directory
linked to a P2P service," Justice von Finckenstein
wrote. He went on to say "No evidence was
presented that the alleged infringers either
distributed or authorized the reproduction of
sound recordings...They merely placed personal
copies onto shared directories on their computers
which were accessible by other computer users via
an online download service."
The music companies, represented by the Canadian
Recording Industry Association, had identified 29
people, through online pseudonyms, they alleged
had shared music online using well known services
such as Kazaa and iMesh. They wanted the Internet
service providers to provide them with the
identities of the individuals so they could be
sued for copyright infringement.
This is in contrast to rulings in the United
States where the music industry has sued over 1000
people for copyright infringement.
In light of a recent Supreme Court of Canada
decision, placing music files in a shared folder
available to P2P users does not constitute
infringement under Canadian law. The judge also
emphasized the importance of considering the
privacy rights of individual subscribers. (April
2004)
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