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Business brief 2016: Canada

20-05-2016

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.

"One of the main quirks of Canadian law is the need to provide a use basis when applying for trademark registration."

Canada has recently implemented changes to allow customs seizures which will be an additional tool for trademark owners.

Copyright

How will copyright protection change in the next few years?

There have been a number of amendments to the Copyright Act that came into force at the end of 2014, including new or broadened exceptions to infringement, related notably to use of technology.

A first decision was rendered by the Copyright Board which interpreted some of these new exceptions restrictively. It will be interesting to see how these new exceptions will be interpreted by the courts in the future and to understand their real impact in the Canadian copyright world.

What are the key challenges to copyright owners in your jurisdiction?

Copyright infringement on the internet is a problem as it is more difficult to control and it is more difficult to stop.

However, injunctions and orders for seizures of infringing goods can be applied for when the location of the infringement is known. The courts are quite favourable towards issuing Anton Piller orders when there is clear evidence that infringement is taking place.

An interesting tool is also the seizure of a URL which we believe will be expanded in the future, making it much more difficult for infringers to set up shop. We are starting to see URLs become property that can essentially be forfeited as a result of litigation.

How can your firm help IP owners protect their rights?

We are very active in terms of strategic counsel and litigation.

Our team of trademark and patent attorneys, counsel, advisors and litigators has great depth of expertise and experience. Fasken is knowledgeable in all sorts of technology and industries, ranging from pharmaceuticals and biologics to complex electronics and communication systems to name a few.

In the last decade we have been involved in a number of leading cases, including Eurocopter v Bell Textron, marking the first time punitive damages were awarded as a result of patent infringement in Canada.

We recognise that the cost of litigation can sometimes be prohibitive so in a bid to bring down the costs and make it more accessible for clients, we have been working very hard at streamlining our processes and putting forth coherent litigation prevention strategies, including ADR.

It is important to remember that individual IP rights cannot be considered in isolation.They all form part of a client’s business strategy. Because of our expertise in all fields of IP, we are able to position our clients with an optimal IP portfolio.

Julie Desrosiers is a partner and chair of the technology and intellectual property practice at Fasken Martineau. She regularly acts for high technology businesses in connection with injunctions, seizures and procedures. Her practice is almost exclusively in the field of patent litigation. She can be contacted at: jdesrosiers@fasken.com

Marek Nitoslawski is a partner at Fasken Martineau. He has successfully handled litigation involving patents, copyright, trademarks, trade dress and trade secrets. He also focuses on unfair competition before the Québec courts, the Federal Court of Canada and the Supreme Court. He can be contacted at: mnitoslawski@fasken.com

Julie Desrosiers, Marek Nitoslawski, Fasken Martineau, copyright, Copyright Act, Google, trademark, patent, PCT,

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