Business brief 2016: Canada

Patents

How do you register patent rights and what are the costs?

Obtaining a patent can cost between C$15,000 ($12,000) and C$30,000. This depends on the technology and the amount of pushback from the Canadian Intellectual Property Office examiner.

There is nothing unusual about how patent prosecution is done in Canada as we are part of the Patent Cooperation Treaty (PCT).

Whether national or international coverage is most appropriate depends on where the client’s markets are. Other considerations include the nature of the technology, its importance and the budget that the client can allocate to filing.

What are the costs of defending a patent?

To defend a very simple patent case costs around C$500,000. These costs can exceed C$5 million in more complex cases.

Our system is similar to the US system in that we have depositions and document production which have an impact on the importance, difficulty and cost of the litigation. Fortunately, Canadian litigation is not as expensive as in the US and discovery is not as extensive.

Is there anything unusual about Canada’s patent law that companies should be aware of and what are the most common mistakes businesses make?

It is very important for companies that plan to file or defend patents in Canada to realise that, although Canada is part of the PCT system, Canadian law with respect to patents is somewhat different from that in the UK or the US. Indeed, our jurisprudence has evolved differently, particularly with respect to utility, one of the conditions of validity.

This difference has led to extensive litigation. For example, Eli Lilly, a US pharmaceutical company, has alleged that the Federal Court’s interpretation of the law violates Canada’s obligations under the North American Free Trade Agreement. This case should be heard shortly.

This difference is important: a patent that would be found valid in the US could be held invalid in Canada. For companies with key technology, it is important that the patent be examined carefully by a patent attorney to ensure that it fulfils the utility requirement before its filing in Canada.

We recently filed a disclaimer with respect to some elements of the claims contained in one of our clients’ patents before the commencement of Canadian litigation, which was expected as there was litigation in other jurisdictions. The purpose of the disclaimer was to narrow the claims. This strategy made all the difference when litigation arose in Canada.  The narrower claims were found to be valid.

Traditionally, applicants draft the patent application in their home jurisdiction and file the identical application in Canada without verifying the differences that might exist in the law. This is a dangerous approach. Although we recognise that a company with a large patent portfolio cannot necessarily treat every single patent as a piece of art, we recommend that the company ensures that Canadian law is complied with, particularly when the patent involves key technology.

Trademarks

Have there been any changes to trademark law in the last 12 months?

Equustek v Google is likely to have far-ranging consequences. Google recently persuaded the Supreme Court of Canada to hear the case.

British Columbia-based Equustek managed to get an order from the court ordering Google to take down offending websites, not just in Canada but across the globe. Google claims that this is an excess of jurisdiction.

Canada will also soon join the Madrid Protocol. One of the main quirks of Canadian law is the need to provide a use basis when applying for registration. This is often the cause of confusion and choosing the wrong use basis can result in an invalid or defective registration.

When Canada joins Madrid (expected in late 2017 or early 2018), the use requirement will be dropped. Although it will create a simpler application process, this will make it harder to appreciate prior rights held by third parties.

What are the key challenges for trademark owners in your jurisdiction?

One of the key threats is counterfeiting, although it is not on the kind of scale seen in other countries.

Trademark owners have a number of recourses under Canadian law. Anton Piller orders and other extraordinary recourses are useful tools readily granted by courts to enforce IP rights.