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Canadian
Intellectual
Property Bulletin
Volume
11 - November, 2000
This newsletter is not intended to constitute a legal opinion on any of the issues
discussed. Readers should seek professional legal advice on issues of concern to them - we
would be pleased to elaborate on any of the articles herein and discuss how it might apply
to specific problems. Contact us for more information.
Assigning
and licensing Intellectual Property
Assignments and licenses allow original owners to
‘sell’ or ‘loan’ their intellectual property rights. These devices may deal with legal or equitable rights given
in whole or in part.
Assignments ‘sell’ intellectual property by
transferring title or ownership in the rights from assignor to assignee.
However, the nature of the specific right can prevent an assignee from
enjoying the full benefit of the assignment.
For example, moral rights belong exclusively to the author and can never
be assigned. Also, some copyrights
automatically revert to the author’s estate upon their death regardless of an
existing assignment.
Licenses differ from assignments as the licensee is
only granted permission to use the property or right but there is no change in
ownership. The scope of rights
granted to the licensee can be specifically effected both by the type of license
involved and by any terms imposed by the licensor. For example, an exclusive license allows only the licensee to
use the right, a sole license allows both the single licensee and the licensor
to use the right and a non-exclusive license allows multiple licensees and the
licensor to use the right. Again,
not all licenses result in full and free use of the right.
For example, trademarks that become non-distinctive are worthless to even
a valid licensee. In
addition, any terms imposed by the licensor must be in accordance with the
requirements of the Competition Act.
The consequences of the
agreement are related to the requirements and formality of the process.
For example, assignments result in a change of ownership and thus should
be made in writing In contrast, licenses that merely grant permission to
use may be implied or established orally.
Assignments and licenses are enforced according to traditional contract
principles. Defenses to
enforcement include inequality of bargaining power, insufficient notice or
disclosure, lack of independent legal advice, misrepresentation, fraud,
unreasonable restraint of trade, undue influence, breach of trust and unconscionability.
Obtaining
International
Patent Protection
Unfortunately, there is no unified system whereby an
‘international patent’ provides worldwide coverage. Historically, Canadian inventors seeking international
protection had file on a country-by-country basis.
The cost of translating, filing, and defending multiple applications as
well as hiring numerous national patent officers was often an overwhelming
burden to small companies and independent inventors. The international legal community has responded to the above
concerns by creating several agreements and treaties that unify and standardize
the patent application process.
Since 1978, the European Patent Convention has
allowed patents to be issued in several member countries through a single
application. However,
this privilege only extends among the seventeen member countries and thus has no
effect beyond Europe. On a larger
scale, the Patent Cooperation Treaty allows patent applicants to take the
initial steps towards patent protection in member countries by filing a single
international application. The PCT
advantage is that the national filing date is accepted as the priority date for
all international applications. This
global movement is possible because all member countries agree that the Treaty
complies with their national patent
laws and procedures.
The Paris Convention, a second international treaty,
establishes the foundation of the international patent system.
This treaty ensures that issued patents receive equal treatment in all
member countries. To receive this benefit and maintain the earliest priority
date the patent application must be filed within twelve months of the earliest
member-country filing date. Similar movements are afoot in the trademark
community, allowing for regional or international protective steps to be taken.
Should you have questions regarding international intellectual property
protection please contact us.
Passing
Off:
Protecting Your
Trademark
The tort of passing off occurs when one trader
misrepresents his wares as originating from or related to the wares of another
person or business. This
misrepresentation frequently occurs in the context of trademarks, trade names or
design marks. It can be used to
prosecute or defend both common law and registered trademarks and thus is serves
as a powerful intellectual property tool.
The Supreme Court has identified three essential
elements of a passing off action: the
existence of goodwill, a misrepresentation causing public deception and actual
or potential damage to the plaintiff.
Existing goodwill associated with the mark is
established through evidence that the business has acquired reputation and
public association with the mark. However,
if both parties can prove that they have developed goodwill in the mark then the
court may have no choice but to allow concurrent use despite the existence of
public confusion.
The second requirement, a misrepresentation causing
public deception, implies that the marks must cause public confusion. This confusion is evaluated from the viewpoint of the ultimate or
ordinary consumer on ‘first impression’
and is more likely if the two businesses share a geographic area or
market or if there are documented cases of confusion among consumers. Canadian courts attempt to determine whether the business was improperly
‘filching’ another’s reputation or whether it acted to avoid public
deception. Seiko Time was able to
successfully defend an action in passing off largely due to the fact that they
had posted notices disclaiming the manufacturer’s warranty in relation to
their products.
Finally, the plaintiff must be able to prove that the
passing off caused damage to their goodwill or business.
This damage will be ‘deemed’ to have occurred if the first two
elements in the passing off action are proven.
Otherwise, proof of lost sales or business will suffice when the parties
are in direct competition. Please
feel free to contact us if you have questions regarding trademark infringement,
passing off or other issues.
Misnaming the Inventor of your Patent
It is very common for more than one person to be
working in researching and developing a patentable invention.
It is not surprising that with the number of people working on projects,
especially for larger companies, the inventor or co-inventors on a patent may be
misnamed. This may be purely
accidental or it might be that so many people were involved that is hard to
determine who is and who is not an inventor by legal definition. Another question arises when there is an outside contract for research
pertaining to the patentable invention because the contractor’s contribution
can be found to be large enough to have them defined as an inventor and a
confidentiality agreement alone will not help in this situation.
The outcome of this misnaming, in most situations, is that the patent can
be declared invalid. One way to
prevent this is simple diligence, but there are other methods available that can
offer further protection from a patent being declared invalid due to misnaming
the inventor. Please feel free to
contact us if I can be of more assistance in this area.
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