Effective January 4, 2004, the Canadian Intellectual Property Office (CIPO) has implemented a new fee schedule. Changes to fees charged under the Patent, Trade-marks, Copyright and Industrial Design Acts were first proposed in October 2002, and were published in March and June 2003. The following provides some highlights of changes to fees that will affect many of our clients. This is not a comprehensive list of the fee changes. For the complete schedule of CIPO fees, use our link on the last page of our newsletter. The fee schedule is also available on the CIPO webpage at:

• Filing fees: Increases to $200.00, up from $150.00, for small entities and to $400.00, up from $300.00, for large entities.
• The basic national fee for a PCT application increases; $200.00, up from $150.00, for small entities, $400.00 up from $300.00 for large entities.
• On requesting an examination where the application has been the subject of an international search there is a new fee; $100.00 for small entities, $200.00 for large entities. If there hasn’t been an international search the fees are $400.00 for small entities (up from $200.00) and $800.00 for large entities (up from $400.00).
• Transmittal fees increase to $300.00 from $200.00.
• Maintenance fees remain the same for YR 2 - 4 of the patent’s life. They increase to $150.00 for YR 5 - 9; $200.00 for YR 10 - 14; and $400.00 for YR 15 - 19.

• The application fees increase from $150.00 to $300.00
• The request to renew fee increases from $300.00 to $400.00.
• The fee for an application to amend a trademark increase to $450.00 from $300.00.
• Filing a statement of opposition will now cost $750.00, up from $250.00.

• The basic fee will increase to $400.00 up from $160.00.
• Maintenance fees increase to $350.00 from $215.00 for a s. 18(1) registration; for a s. 18(2) registration the fee increases to $50.00 from $35.00.

Note that this is only a selection of the fee changes that will come into effect. We noted ones that will be of most interest to our clients. For a complete schedule of the fee changes, go to our website at www.furman-kallio.com, and follow the link to the Canadian Intellectual Property Office.

Furman & Kallio is pleased to welcome two new members to the firm: Scott Davidson B.Eng., LL.B. and Dr. Colin Rasmussen B.Sc., M.Sc., Ph.D., LL.B.

Scott rejoined Furman & Kallio in 2003 as an associate, after articling at the Toronto IP firm of Bereskin & Parr and being called to the bar in Ontario, Canada. Scott’s educational background in Engineering and Computer Science allows him to represent clients involved in a wide range of industry sectors with respect to the protection and exploitation of their intellectual property rights and interests. Scott Davidson practices in the Regina office of the firm.

Colin is currently completing his articles of clerkship with Furman & Kallio. With over 20 years of active research experience in Canada and the United States, Colin is conversant with both the scientific and legal aspects of emerging issues in intellectual property matters related to biotechnology in addition to his background or experience relevant to medical and pharmaceutical subject matters. Colin Rasmussen is articling out of the Saskatoon office of the firm.

The Final phase of the Personal Information Protection and Electronic Documents Act (PIPEDA) came into effect January 1, 2004. The Act sets out

requirements for how organizations may collect, use or disclose personal information in the course of commercial activities. While the Act already applies to government agencies, this next phase will apply to all commercial activities in Canada. Commercial activities are broadly defined by the Act and can apply to more than businesses and corporations, and may include certain activities are broadly defined by the Act and can apply to more than businesses and corporations, and may include certain activities of non-profit organizations as well. The law gives persons the right to know why an organization collects information, what use they will make of it, and to whom it will be disclosed. It also gives people the right to know who is responsible for protecting personal information, and that the information is accurate and up-to-date. It also provides for persons to make complaints if they feel that their personal information is being abused. The law requires organizations to obtain consent when collecting information and have personal information policies that are clear, understandable and readily available.

It is important that individuals, businesses and other organizations understand what the new Act requires, the rights it grants to individuals and the procedures for making and responding to complaints. In our next newsletter we will provide a more detailed summary of what is involved in PIPEDA and what organizations should be doing in order to comply with the new law. In the meantime, if you have any questions about your privacy policies and whether they will satisfy the new requirements, please contact us and we can facilitate the referral to a privacy specialist.

Late last year the Supreme Court of Canada rendered its long-awaited decision on whether a higher life form (in this case a mouse genetically modified to be susceptive to cancer - termed an oncomouse) is patentable. The pivotal issue in the case was the interpretation of s.2 of the Patent Act, namely, whether a genetically modified mouse qualified as an invention, by being a "composition of matter".

The litigation started when the Commissioner of Patents denied an application for a patent on a "non-human mammal" made by the President and Fellows of Harvard College, the owners of the genetic modification that created the oncomouse. The Commissioner denied the application in a Final Action on the grounds that higher life forms are not patentable. The process by which the mouse was made was deemed patentable (i.e. putting the mouse gene into the egg), but the resulting mouse was not. Harvard took the decision to the Federal Court Trial Division, which upheld the Patent Office’s decision. Harvard appealed to the Federal Court of Appeal. The Commissioner and the Attorney General for Canada appealed to the Supreme Court, and as anyone remotely interested in the issue already knows, the answer the SCC gave in a 5 - 4 decision was that higher life forms are not patentable. That the court decided the case in this way is curious for at least two reasons.

First, a number of countries with patent regimes analogous or identical to Canada’s had already granted patents on the oncomouse, including the United States, Japan and several European countries. If they considered a mouse a patentable composition of matter, what inspiration led to the opposite conclusion at the SCC? The second revolves around the court’s preoccupation with the distinction between "lower" and "higher" forms of life. Lower forms of life such as bacteria and yeast have been patentable since the last century. The majority of the court in oncomouse case took the position that there is a common sense distinction to be made between single-celled, non-sentient life and multi-cellular forms that are not patentable as a principle of law, and there are no arguments from the biotech camp that they should. The final reason the majority contended that higher life forms is that Parliament did not contemplate the patenting of life forms and so could not have intended them to be patentable. As the dissent rightly pointed out, "While Parliament did not contemplate the oncomouse in 1869 when it enacted the definition of ‘invention’, it did not contemplate moon rockets, antibiotics, telephones, e-mail or hand-held computers either". The whole purpose of a Patent Act is to protect the innovations of those who come up with inventions that haven’t been contemplated. If something had been contemplate, it wouldn’t be patentable, as it would fail the test for non-obviousness.

The immediate concern stemming from the decision is that it sends a negative signal to those who might wish to invest in the still-young Canadian biotechnology industry. The decision simply runs counter to every other patent jurisdiction where the issue of patenting "higher" life forms has been tested to date. However, a similar concern was expressed in 1978 when a patent was refused for a hybrid soybean plant. That case eventually went to the SCC, where the refusal was upheld, not on the question of whether life forms were patentable, but on the technical point that depositing a seed for the plant with the Patent Office did satisfy the requirement of the Patent Act to publicly disclose the invention (Pioneer Hi-Bred Ltd. v. Canada (Commissioner of Patents) (1987, 14 C.P.R. (3d) 491). Parliament’s response was to enact the Plant Breeder’s Rights Act (S.C. 1990, c. 20) to protect the innovation of those who create new and useful strains of plants. One suspects that a similar solution could deal with the damper the SCC has put on life form related patents, although we hope it doesn’t take a decade for the solution to be realized as was the case with the Plant Breeder’s Act. The final concern is to what this does to efforts to harmonize intellectual property law worldwide. Whether one believes economic globalization to be a good thing, it is a reality, and Canada does complete in the world marketplace. Until Parliament fashions a response to the Harvard decision, one expects there to be at least temporarily a chilling effect on investment in Canadian biotech related to the development of molecular genetics-based animal model systems. Fortunately, biotech is much more than oncomice, so that the overall impact on Canadian biotech, and especially agriculturally-related biotech might be expected to be minimal.

The Federal Court of Appeal confirmed in the recent decision of Kirkbi AG v. Ritvik Holdings Inc., [2003] FCA 297 that while diamonds may be forever, patents aren’t. The case revolved around the issue of whether the shape of the LEGO building block (the LEGO Indicia) could be protected as a trademark. At trial, the Federal Court had previously decided that the LEGO Indicia is primarily functional and therefore not a valid trademark under the Trade-marks Act. Kirkbi AG, the owner of the LEGO name appealed the decision based on the argument that functionality doesn’t preclude protection of a distinguishing guise. This point was important to Kirkbi, as the last of the patents protecting the LEGO blocks had previously expired. As a result, Kirkbi’s monopoly over plastic building blocks, a lucrative industry worldwide, would come to an end unless another form of intellectual property protection could be found.

Kirkbi argued both at trial and in the present appeal, that the shape of the LEGO block was so ingrained in the public’s mind that the shape was associated with LEGO products, making it a distinguishing guise. There are other well-known examples of shapes that do qualify as distinguishing guise, such as the shape of the Coca-Cola bottle. The concern that both the trial and appeal courts had in this case was that now that the LEGO patent covering the knobs on the LEGO block had expired, LEGO was trying to prolong their patent monopoly by claiming the knobs were now a distinguishing guise and therefore protectable indefinitely as a trade-mark. The Supreme Court of Canada had previously dealt with the issue of extending monopoly rights past the term of a patent in the case of Whirlpool Corp. v. Cameo Inc., [2000] 2 S.C.R. 1067, calling it "evergreening".

Here, the Federal Court of Appeal evaluated the policy of extending monopoly rights past the term of a patent as elaborated in the Whirlpool case, among others, to conclude that as the knobs on the LEGO block are purely functional, the shape of LEGO cannot be protected as a distinguishing guise. As the Court said, "a prior patent for the thing claimed as a mark is surely some evidence of functionality", and "in our case if the knobs were cut off the LEGO bricks, the brick would not function - it would not fasten together with another brick". The Court’s decision reaffirms the position that a trademark may have some functional aspect and remains valid, but if the item is primarily functional it cannot be protected by a trademark. The Court also further pointed out that it doesn’t matter whether the mark is registered or not, the principles are the same. Finally, the result confirms that while a patent holder may enjoy exclusive use of his invention during the life of the patent, the law of intellectual property will "prevent the abuse of permitting a person to effectively obtain perpetual patent protection by means of a trade-mark".

The Federal Court of Appeal recently rendered a decision on an appeal launched by the pharmaceutical company, Astrazeneca AB, of a court order upholding the Registrar of Trade-marks decision of March 9, 2000 to refuse Astrazeneca’s application for registration of a yellow tablet design as a trademark under the Trade-marks Act. The "little yellow pill" in question was Astrazeneca’s 2.5 mg dosage version of its hypertension drug felodipine, maketed under the trade name PLENDIL.

What Astrazeneca contended was that the shape and colour were distinctive for its product since no other round yellow pills containing felodipine were marketed in Canada. Novopharm in opposing the application for a mark by Astrazeneca contended that yellow tablets were common to the trade and, in the earlier proceeding, had provided evidence of some 21 pharmaceutical tablets of this design. In the present appeal, Astrazeneca argued that the earlier findings were in error for a number of reasons, most notable that the requirement to show that the colour of the tablet had a secondary meaning was unreasonable, and that pharmacists rely on a pill’s shape and colour to confirm the brand when dispensing drugs.

In making its decision, the Court of Appeal noted the long-standing principle that colour alone is not inherently distinctive (Wal-Mart Stores v. Samara Brothers Inc., 54 USPQ2d 1065 (2000) (U.S. Sup. Ct.) at 1068), agreeing that Novopharm had demonstrated that Astrazeneca’s product was not the only round yellow tablet available in Canada, and so did not distinguish Astrazeneca’s products from those of other manufacturers. The court also notes that pharmacists do not distinguish a drug by pill colour and shape alone, but by the packaging and markings on the box and the pill itself (drugs have an identification - DIN - number to distinguish them).

In the end, the Court held the Astrazeneca’s appeal in that they failed to establish that the public, including pharmacists, identified the appearance of their round yellow tablets as Astrazeneca’s and not of another manufacturer. The court found that while the colour distinguished the particular dosage of PLENDIL from other dosages formats sold by Astrazeneca, but it wasn’t distinctive of PLENDIL in the context of the broader Canadian pharmaceutical market.

On December 11, 2003, the Supreme Court of Canada ruled on the application for leave in the Barton No-Till Disk Inc. v. Dutch Industries Ltd. case. Barton had sued Dutch claiming patent infringement. Dutch had countered, claiming Barton’s patent was invalid on the basis that maintenance fees had been improperly paid.

The Commissioner of Patents had accepted a correction payment from Barton, but Dutch successfully argued at trial that the Patent Rules do not provide the Commissioner with the discretion to accept top-up payments. On appeal, the Federal Court of Appeal overturned the trial decision, deciding that the Commissioner could accept top-up payments. Dutch had sought leave from the Supreme Court to appeal this reversal. The Supreme Court refused to hear the appeal.

The decision of the Court of Appeal is now the last word on this issue. Therefore, where there has been an error in payment of fees due to a mischaracterization of an entity as a small entity, the Commissioner will be permitted to accept a top-up payment in order to cure the deficiency.

Counterfeiting of trademarked goods is a serious trade problem and several international agreements require special border measure of signatory countries. Recently, new initiatives by federal law enforcement to prevent the import of infringing goods provide another measure of protection for owners of Canadian registered trade-marks.

Canada is required under Articles 51 and 57 of the WTO’s Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement and Article 1708 of NAFTA to implement special border measures to deal with counterfeit trademarked goods or pirated copyright goods. Trademark owners and copyright holders, once aware of such goods, can approach the courts to direct the Canada Customs and Revenue Agency (CCRA) to detain such goods, pursuant to s. 53.1 of the Canadian Trade-marks Act. The process runs as follows:

• The complainant makes an ex parte application to a court, gives notice to the Minister of National Revenue (MNR) and establishes a prima facie case of infringement.
• The court, if satisfied that a claim may exist, then orders detention of the goods by CCRA. The court may require security from the complainant to cover any amounts chargeable to the goods, or to compensate the owner, importer or consignee for any damages sustained.
• The CCRA notified the complainant and the owner or importer of the detention, and within 14 days must commence a court action for a final determination of whether the goods were or were not imported legally, and notify the MNR.
• The MNR may then give the complainant or importer an opportunity to inspect the goods in order to prove or refute the complaint.

The primary drawback of these measures is that they only operate where the trademark owner has knowledge of infringing goods entering Canada. As a result, a major initiative of the CCRA and the RCMP has been to prevent entry of these goods. Prior to August 2000, enforcement of intellectual property rights depended primarily on owners taking private action. Since then, CCRA has taken a more active enforcement role, directing customs officers to exercise their power to seizure as public officers under s. 489(2) of the Criminal Code.

CCRA officers, acting on information from the RCMP may seize commercial-scale shipments of suspected infringing goods, without warrant, provided they have reasonable grounds to believe the goods have been used in, obtained by, or afford evidence of a federal offence. In addition, CCRA officers may seize goods they discover on their own, provided the RCMP endorses the seizure and is willing to take custody.

What this collaboration represents is a significant effort to prevent the entry into Canada of goods that infringe Canadian trade-marks. As part of the development of their cooperation, the CCRA and RCMP are also organizing a working group on intellectual property rights enforcement. The groups will have representatives of the RCMP from each of the Canada’s major entry ports, CCRA officers and official from federal Justice Department.

The goal of the working group will be to develop and coordinate approaches to IP protection, as well as to train CCRA and RCMP officers on how to detect counterfeit goods. The group will also share information with international partners like Interpol and U.S. Customs. Overall, these new initiatives greatly increase the protection of Canadian trade-mark owners, and should help to diminish the trade in counterfeit goods.

One of the issues that have developed in the use of webpage domain names has been the problem of "cybersquatting". The practice of cybersquatting is one where a domain name is registered with one of the Internet registration authorities (in Canada the Canadian Internet Registration Authority - CIRA), without any intent of actually using the name other than to sell the rights to it to a company with the same name. The registration authorities have moved to deal with this problem in recent years; in Canada CIRA’s response was to create the CIRA Domain Name Dispute Resolution Policy (CDRP). Because the policy is part of CIRA’s domain name registration agreement, it is binding on all .ca registration. The advantage of the CDRP is that it provides a quick and reasonably cheap way to resolve disputes arising from registration made for the purpose of cybersquatting.

The policy is similar to the World Intellectual Property Organization’s (WIPO) Uniform Dispute Resolution Policy, but there are some important difference. First, to have a matter fall under the CDRP, the complainant must first satisfy a "Canadian presence" requirement which includes owning a Canadian registration for the trade-mark in question. Success of a complaint brought under CDRP requires:

• The domain name is confusingly similar to a trade-mark for which the complainant had rights in prior to the registration of the impugned domain name.
• The domain name was registered in bad faith.
• The domain name registrant has no legitimate interest in the domain name.

The degree of proof on each of these points varies, from proof on a balance of probabilities on the first two, as opposed to the last one, which requires only the "some evidence" be provided.

A dispute can take between 60 - 90 days (assuming all parties use the maximum time allotted them under the policy). If the complainant is successful, CIRA will take another 60 days to transfer or cancel the domain name registration. The final step is to provide the losing party time to consider whether they wish to take the matter to a court of law. Note that the registrant (the alleged cybersquatter) and the complainant both retain the right to take the matter to court should they not be satisfied with the outcome of the CDRP process. However, one suspects that the outcome of the CDRP dispute resolution process would have significant evidentiary weight in any subsequent legal proceedings.

While there is an international process, CIRA feels that the CDRP allows a response to Canadian trade-mark owners and domain name registrants that takes into account the Canadian legal regime. The major criticisms of the UDRP were that it to be diluted in order to deal with a variety of international legal regimes, and that it was too pro-complainant. While there have been few cases heard under the CDRP (4 t date and only one contested case so far - see the Cheap Tickets and Travel v. Emall.ca case comment that follows), it is interesting to see whether the made-in-Canada policy effectively protects Canadian trademark owners from the problem of cybersquatting, without unreasonable restricting domain name registrations by legitimate users.

On January 31, 2003, a panel appointed by the B.C. Internaional Arbitration Centre, rendered Canada’s first contested decision involving a dot-ca domain name registration under the Canadian Internet Registration Authority’s (CIRA) dispute resolution policy (CDRP). The policy deals with complaints related to the practice of cybersquatting, where someone registers a domain name with the intention of selling it to the trade-mark holder of that name (prior to current rules dealing with cybersquatting, companies like Panasonic and Avis were early victims of this practice). The dispute process contains a three-part test where the complainant must establish that:

• The dispute domain name is confusingly similar to a mark in which the complainant had rights prior tot the date of registration of the domain name and continues to have some rights;
• The registrant has no legitimate interest in the domain name; and
• The registrant has registered the domain name in bad faith.

In the present case, the complainant, Cheap Tickets and Travel Inc. claimed that their registered trade-mark "Cheap Tickets" was infringed by the domain name www.cheaptickets.ca registered with CIRA by Emall.ca. The case turned on the issue of priority. Cheap Tickets had registered their trade-mark in July 2002, while Emall.ca had registered the cheaptickets.ca name in September 1999. In the result, the panel determined the Cheap Tickets had not established that, prior to September 1999, they had used the "Cheap Tickets" mark in Canada to distinguish its wares, services or business.

As a result, the only argument available to the complainant was that it had established the use of the name "Cheap Tickets" prior to the 1999 domain name registration. The panel held that, given the descriptive nature of the term "Cheap Tickets", and the fact that they had used the term "Cheap Tickets and Travel" to describe their business since 1996, they had not established an exclusive right to the "Cheap Tickets" name prior to September 1999.

From a predictive point of view, the deficit in the decision is that, having decided that Cheap Tickets and Travel Inc. hadn’t established a right to the name prior to the Emall.ca domain name registration; the panel didn’t bother t address the other two parts of the test to be applied in domain name disputes. Given that Emall.ca does provide travel services on the www.cheaptickets.ca website, it is unlikely that a panel would have found that the registration was not legitimate or made in good faith. Consequently, Canada still waits for the CDRP to deal with a true case of cybersquatting.