KerrLaw Logo JAMES D. L. KERR
CLIENT MEMO
TO:           Business Clients FROM:   James D.L. Kerr Lawyer
            17 – 151 Merton St.
            Toronto
, Ont., M4S 1A7
            Tel 416 485-4254
            Fax 416 485-8836
            
E-mail: jkerr@kerrlaw.ca
            www.kerrlaw.ca

            Certified Specialist Civil Litigation
DATE:      April 28, 2006
RE:          INTELLECTUAL PROPERTY: Patents, Trade Marks, Copyright,
                   Industrial Designs and Integrated Circuit Topography


“Intellectual property” means ideas, designs and creativity that have the potential for commercial exploitation and are owned by a person, firm or corporation. “Ownership” means that the owner has the exclusive right to “exploit” (i.e., sell or license) the property, or goods or services that derive from or incorporate the property, to the exclusion of all others, usually for a specified time period.

 

In Canada, certain types of intellectual property can receive legal recognition through registration; these are patents, trade marks, industrial designs, copyrights and integrated, Copyright circuit topographies.

 

It is very important to note, however, that pure ideas (as opposed to ideas that are reduced to some concrete form) are generally not protectable; for example, a board game, such as Trivial PursuitTM, is protected by trade-mark and copyright (see below), however, the idea behind the game (a contest based on correctly answering questions in specific categories) is not protectable.

 

Patents:

 

Patents cover new inventions (process, machine, manufacture, composition of matter), or any new and useful improvement of an existing invention. An example of an originally patented invention is the photocopier. A patent is obtained by registration under the “Patent Act” (Canada).

 

For an invention to be “patentable”, it must demonstrate novelty, utility and ingenuity. “Novelty” means the invention must be new. “Utility” means the invention must work and must have a useful function. “Ingenuity” means that the invention is a development or an improvement that would not have been obvious beforehand to workers of average skill in the technology involved.

 

A patent can be obtained for an improvement to an existing patented invention, but if the original patent is still be in force, manufacturing or marketing the product with the improvement would probably be an infringement of the existing patent. This situation is often resolved by a “license” agreement between the patent owners.

 

A patent gives the inventor the right to exclude others from making, using or selling the invention for 20 years from the date the patent application was filed. In exchange for this 20-year exclusivity right, the inventor must provide a full description of the invention so that anyone else will be able to make and sell the invention after the 20 years has expired. In this regard, the Patent Office will “lay open” the application to public inspection 18 months from the earlier of the filing date in Canada, or the filing date abroad under an international treaty (known as the "convention priority date").

 

Patents are granted to the first inventor to file an application.

 

In Canada and the United States, the invention must not have been disclosed in public more than one year before the filing date of the application. Most other countries require filing before use or written disclosure anywhere in the World. Many countries require that the patented invention be manufactured or otherwise worked in that country within a certain period, usually three years.

A patent application consists of an “abstract”, a “specification” and often drawings.

The abstract is a brief summary of the contents of the specification. The specification comprises a clear and complete description of the invention and its usefulness and the “claims” which define the boundaries of patent protection. The specification must be so clear and complete that it will enable anyone with average skill in the technology to make or use the invention after the patent expires. Only the information specified in the “claims” receives patent protection. Patent applications can be complex and, for that reason, inventors usually engage the services of a patent lawyer or patent agent to prepare, file and marshal the patent application through the registration process.

 
Obtaining a Canadian patent does not protect the invention in another country. To obtain patent protection in other countries, patents must be obtained in each country where protection is sought. Under the Patent Cooperation Treaty (the “PCT”), a foreign patent may be applied for either through the Canadian patent office or directly to the patent office of the foreign country concerned. The PCT is administered by the World Intellectual Property Organization in Geneva and provides a standardized international filing procedure that permits a single filing that constitutes an application to as many as 123 countries.

 

As noted above, however, the patent laws and requirements in other countries may different from those in Canada. However, many countries, including Canada, belong to the Paris Convention for the Protection of Industrial Property, a treaty that provides that the filing date in one member country will be recognized by all the others provided an application is filed in those countries within a year of the first filing.

 

The Patent Act does not require that patents be marked as "Patented." However, marking an article as patented in Canada when it is not is against the law. An invention may be marked "Patent Applied For" or "Patent Pending" after an application has been filed. These phrases have no legal effect but may serve as warnings to others that the exclusive right to manufacture the invention will be enforced once the patent is granted.

 

Obtaining a patent can be a costly process. At present, government filing and maintenance fees are divided into “small entities” (“SE”) and “large entities” (“LE”). An SE is a university or an entity that employs 50 or fewer employees. An SE pays a $200 filing fee and an LE pays a $400 filing fee. When the Patent Office has completed it’s processing of the application, both categories pay a $200 completion fee. Additional fees of up to $1000 are payable during the examination phase of the application. If the application is allowed, an approval fee is payable: $150 for an SE, $300 for an LE. Maintenance fees of between $50 per year and $450 per year are payable on an escalating basis throughout the life of the patent. The major expense, however, is the patent lawyer’s and/or patent agent’s fees which will vary depending on the complexity of the application and any appeals made necessary by adverse patent office rulings.

 

On average, it will take 2 to 3 years to obtain a patent in Canada. As mentioned above, however, patent rights are retroactive to the filing date of the application.

 

The government does not enforce patent rights on behalf of the patent holder. If a patent is infringed, the patent holder must enforce the patent by suing the infringer in court, which can be an expensive undertaking.

 

Trade-marks:

A trade-mark is a word, symbol or design (or any combination of these features), used to distinguish the wares or services of one person or organization from those of others in the marketplace. An example of a trade-mark is Coca ColaTM.

A “trade name” is not synonymous with a trade-mark. A trade name is the name under which a person, firm or corporation conducts business and is only registrable if it is also used to identify wares or services.

Trade-marks can be registered or unregistered. A registered trade-mark is one that is registered with the government of Canada under the Trade-marks Act. Registration of a trade-mark gives the owner the exclusive right to use the trade-mark anywhere in Canada so long as the owner continues to use it somewhere in Canada. Use of an unregistered trade-mark to the extent that it has become known in a geographic area (for example, a city) will give the owner “common law” exclusivity in that geographic area only.

 

Trade-marks for precious metals must, however, be registered; a filing receipt is necessary if the metals are to pass through customs.

 

Trade-mark registration has a 15-year term but is renewable every 15 years in perpetuity so long as the owner continues to use the trade-mark.

 

Trade-marks registered in Canada are not protected in other countries. The trade-mark must be registered in each country for which protection is sought. Canada is, however, a member of the Convention of the Union of Paris; under the Union, a priority filing date can be obtained in other member countries so long as the application for registration is made within 6 months of the filing date in the first member country in which an application has been filed. In other words, the filing in the second country is retroactive to the filing date in the first country. A large number of countries (including the United States) are party to the Madrid Protocol. The Madrid Protocol is a procedural mechanism that permits a trademark owner to register in a number of countries with a single application to the trade-mark office in the owner’s country (a so-called “international trade-mark”). If the trademark office of a country designated in the application does not refuse protection within a specified period, the protection of the trade-mark is the same as if it had been registered in that country. At the date of this Memo, however, Canada is not a member of the Madrid Protocol.

 

In addition to cross-Canada exclusivity, trade-mark registration is valuable in the event of a dispute with an infringer because the registered owner does not have to prove ownership; the onus is on the challenger.

 

A registered trade-mark is also a valuable asset for business expansion through licensing franchises.

 

Trade-marks are only good as long as they are in use. Failure to use a trade-mark for an extended period can result in the registration being cancelled. A corollary of that is that ownership of a trade-mark cannot be secured by simple registration.

Trade-mark registration is relatively inexpensive. The government filing fees for an application for registration are $250 (non-refundable) if the application is submitted on-line or in any other case $300 for each trade-mark applied for, and, a $200 completion fee if the application is successful. If the applicant uses the services of a lawyer or trade-mark agent, the fees charged by the lawyer or agent will be in addition to the government filing fees.

It generally takes about a year to 18 months to obtain registration.

While not required by law in Canada, it is advisable to give notice that a trade mark has been registered by marking the wares in association with which the trade-mark is used.  In the United States, this is done by showing beside the trademark and this is sometimes used in Canada.  Notice of registration can also be used by printing the words "Reg'd T.M." below the trademark. Owners of unregistered trade-marks can give notice of their claim by using the superscript “TM” (for example, see Coca Cola in the opening paragraph of this section, above).

The government does not enforce trade-mark rights on behalf of the owner. If a trade-mark is infringed, the owner must enforce the trade-mark by suing the infringer in court, which can be an expensive undertaking.

Copyright:

Copyrights provide protection for literary, artistic, dramatic or musical works (including computer programs), and performances, sound recordings and communications signals. An example of a work possessing copyright is the novel The Da Vinci Code.

 
Titles, names and short word combinations are usually not protected by copyright. Other items which are not protected by copyright include slogans, methods (such as a method of teaching or sculpting, etc.), plots or characters, and factual information. For example, a newspaper reporter can take all of the facts from a competitor’s newspaper article and write an article containing those facts and that use will not be a breach of copyright so long as the article is original, independent of the facts in the article.

A copyright gives the author or performer the sole right to produce or reproduce the work, through publication, performances and so on, or to authorize such activities.

Generally, the creator of the work is the owner of the copyright. However, a work created in the course of employment belongs to the employer unless there is an agreement to the contrary. Similarly, if a person commissions a photograph, portrait, engraving, or print, the person ordering the work for valuable consideration is the owner of the copyright unless there is an agreement to the contrary.

The general rule is that copyright lasts for the life of the author, the remainder of the calendar year in which the author dies, and for 50 years following the end of the calendar year. Therefore, protection will expire on December 31 of the 50th year after the death of the author. After that, the work becomes part of the public domain and anyone can use it (for example, Mozart’s music). In the case of more than one author, the term will be measured using the life of the author who dies last and 50 years following the end of that calendar year. There are different rules for photographs, certain cinematographic works, sound recordings, performances and communications signals but in all those cases the term is 50 years from a specific date (for example, the date of the performance or creation of a tape or CD).

Absent an agreement to the contrary, the author retains “moral rights” in the work even if ownership of the work has been sold. This means that no one, including the person who owns the copyright, is allowed to use, distort, mutilate or otherwise modify the work in a way that is prejudicial to author’s honour or reputation. The author’s name must also be associated with the work as its author, if reasonable in the circumstances.


The exclusivity right is subject to a number of “fair dealing” exceptions; for example: quotes and excerpts used by critics, reviewers and researchers for purposes of private study, research, criticism, review or news reporting (in the case of criticism, review, or news reporting, the user is required to give the source and the author's, performer's, sound recording maker's or broadcaster's name, if known); non-profit educational institutions, libraries, archives and museum are permitted to make copies and perform works and other subject matter protected by copyright, free of charge, in the classroom, subject to certain restrictions; persons with a "perceptual disability" (i.e., someone who has difficulty reading or hearing) are entitled to copy a work protected by copyright in alternate formats such as braille, talking books or sign language so long as the alternate format is not commercially available; copying a musical tape for private use is also permitted.

 

Copyright exists automatically when the work is created and does not have to be registered to have protection in Canada. Copyright can, however, be registered in Canada filing a simple application form with the government of Canada’s copyright office. A certificate of registration is useful in the event of a dispute over ownership because the author of a registered work does not have to prove ownership; the onus is on the challenger to disprove it. At the date of this Memo, registration fees are $50.00 if the application is filed online and $65.00 if filed any other way.

 

Registration, however, is not a guarantee against infringement or that the author’s claim of ownership will eventually be recognized as legitimate. Verification and enforcement can only be done through the courts.

 

Canada is a member of the Berne Convention, Universal Copyright Convention, Rome Convention (for sound recordings, performer's performance and communication signals only), and the World Trade Organization (WTO). Most countries are members of one or more of the Conventions and/or the WTO. For that reason, Canadian copyright enjoys automatic protection, without registration, in most countries.

 

In Canada copies of the work are not filed with the application. The copyright office does not review or assess works in any way, nor does the copyright office check to see whether the title of the work has already been used. Many works may appear with the same title, but if each work has been created independently, each will have its own copyright protection.

 

Under the Library and Archives of Canada Act, however, two copies of every book published in Canada, and one copy of every sound recording manufactured in Canada that has some Canadian content must be sent to the National Library within one week of publication.

 

In the United States, copyright is registered with the Library of Congress Copyright Office. Unlike Canada, copies of the work must be filed with the application.

 

In Canada, there is no requirement to mark the copyright on the work. The Universal Copyright Convention (see above) provides for marking with the symbol , the name of the copyright owner and the year of first publication; for example, Jane Doe, 2006. Although not obligatory in Canada, such marking can serve as a reminder to others of a copyright as well as providing the name of the owner. Some countries that are members of the Universal Copyright Convention, but not of the Berne Convention require such marking. The copyright notice can be used whether or not the copyright has been registered. The rule in the United States is the same, although, before 1976, U.S. law did require the copyright notice.

Industrial Designs:

Industrial designs are the visual features of shape, configuration, pattern or ornament (or any combination of these features), applied to a finished article of manufacture. Unlike patents, industrial designs do not relate to, nor protect, functionality. An example of an industrial design is the appearance of a 1959 Cadillac Eldorado and in particular the large aircraft inspired rear fins. Most “knock-offs” are infringements of an industrial design.

Legal claim to ownership of an industrial design is based on registration with the government of Canada under the Industrial Design Act. Registration gives exclusive rights to the design for 10 years from the date of registration. Registration usually takes between 8 and 12 months. Registration costs $400.00 plus $10.00 for each page of drawings in excess of 10 pages. A $350.00 maintenance fee must be paid before the expiration of the first 5 years after registration. Lawyer and/or patent agent fees are in addition to the government filing fees.

Certain creations cannot be registered as industrial designs; for example: designs that are utilitarian only and which are not intended to provide visual appeal; designs that have no fixed appearance (for example, holograms); designs for components that are not clearly visible (for example, features that are hidden from view or features that are too small to have appeal to the eye); a method of construction; an idea; materials used in the construction of an article; the useful function of the article; or colour (although one can protect a pattern that may be created by an arrangement of contrasting tones).

There is no time limit for filing an application as long as the design has not been made public longer than 12 months before the application for registration and has not been offered for commercial sale or use anywhere in the world.


Ordinarily, the person who created the design is the owner. If the designer has been hired under contract to develop a design for someone else, or if another person has acquired ownership from the designer, then that person is the owner. Where a person creates a design as an employee and as part of the employment, then the employer is the owner absent an agreement to the contrary.

 

Registration gives the owner exclusive rights in Canada only. To enjoy similar rights abroad, the design must be registered in each country for which protection is sought. Most industrialized countries have equivalent industrial design protection. The United States uses the term "design patent" to describe what roughly corresponds to the Canadian registered industrial design. “Design patents” must not be confused with utility patents for inventions (see above). Procedures for obtaining international design rights are partially governed by the Paris Convention for the Protection of Industrial Property. The Paris Convention, which has some 90 member countries including Canada, allows applicants to invoke what is called "convention priority". This means that someone who has filed for design registration in one Convention country has six months in which to file an application for the design in another country and be accorded the same rights as if he or she had filed in the second country on the original filing date.

The government does not enforce industrial design rights on behalf of the owner. If an industrial design is infringed, the owner must enforce the exclusivity rights by suing the infringer in court, which can be an expensive undertaking.

Integrated Circuit Topographies:

Integrated circuit topographies refer to the three-dimensional configuration of the electronic circuits embodied in integrated circuit products or layout designs (such as computer chips). An example of an integrated circuit product is the “Intel” chip found in many personal computers.

 
Registration under Integrated Circuit Topography Act provides protection against copying of registered topographies, but does not prevent others from developing integrated circuit products which use other topographies to provide the same electronic functions. The application for registration must be filed within two years of the first commercial exploitation of the topography. The government filing fee is $200.00. Lawyer and/or patent agent fees are in addition to the government filing fees.

 

In addition, the sets of instructions stored in an integrated circuit product may be subject to protection under the Copyright Act (see above) as literary works, and may, in some cases, be patentable under the Patent Act (see above) as industrial methods; for example, the structure and method of operation of electronic circuits embodied in integrated circuit products, or industrial processes used to manufacture integrated circuit products.

The Act protects registered integrated circuit topographies for 10 years. The term begins on the filing date of the application for registration and ends on December 31 of the tenth year after the year of the first commercial exploitation or the year of the filing date, whichever is earlier.

The exclusivity right is subject to exceptions, for example: after the first legitimate sale of an integrated circuit product, the owner has no statutory right to control its use, rental, resale or redistribution; copying is permitted for the sole purpose of analysis or evaluation, research or teaching; reverse engineering is permitted, which is the process of taking apart an integrated circuit to design a new and original topography.

At the date of this Memo, integrated circuit topographies registered in Canada have rights in the United States, Switzerland, Japan and Australia.


DISCLAIMER: The foregoing is not intended to be a comprehensive guide to the applicable law. General Client Memoranda and mailings from James D.L. Kerr ● Lawyer are intended to inform clients and acquaintances with respect to current issues that may be of interest to them. Memos are current to the date shown on the Memo. The law is constantly changing, however, and for that reason a Memo may not be completely accurate after it's stated date. Where circumstances warrant, the advice of a lawyer or other qualified professional should be obtained.

2006 James D.L. Kerr