Canadian Intellectual Property Bulletin

Volume 4 - November, 1996

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.

NEW PATENT RULES:

Revision of Patent Rules led to significant changes in Canadian Patent Law

On May 6, 1993, the Intellectual Property Improvement Act was given Royal Assent. Significant changes to the Patent Act were expected pending revision of the Patent Rules. The changes to the Patent Act and the new Rules entered into force on October 1, 1996 and apply mainly to applications filed on or after October 1, 1996. The spirit of the new rules strongly parallels the PCT requirements and regulations.

• a Canadian "provisional" patent application is now possible;
• universities will be able to pay small entity fees
• multiple dependent claims can now refer to other multiple dependent claims and the "in the alternative rule" has been dropped.
• applications filed under the new Rules must make Paris Convention priority claims within four months of the filing date. Previously, priority claims, if not made at the time of filing, had to be made within six months of the filing date.
• requests for examination must be made within five years of the filing date.
• accelerated examination can only commence once an application has been laid open.
• the full amount of the maintenance fees on applications may be paid in advance.
• under the new Rules, the Description (formerly known as the Disclosure) cannot refer to documents not available to the public (i.e. pending unpublished patent applications).
• drawing requirements have been broadened. Under the new Rules, photos can now be submitted for drawings.
• applications which have become abandoned inadvertently may be reinstated within one year of the date of abandonment upon payment of a fee and completing the action required by the Patent Office.
• Canadian National Phases: National entry into Canada may be delayed by 12 months for both Chapters 1 and 2 applications provided that an additional $200.00 Government fee is submitted upon entry into Canada.

New Commissioner of Patents:

Sheila Batchelor has been appointed as Commissioner of Patents and Registrar of Trade-marks. The appointment, announced on July 31, 1996, was made by the Governor in Council and effective September 1, 1996.

Copyright infringement - substantial copying of generic words and phrases

Tomas v. Boaden Catering Ltd. (1995), 68 C.P.R. (3d) 275, Federal Court Trial Division

Plaintiffs and defendants were restaurant operators. The plaintiffs alleged that the defendants had copied their menu and sued for copyright infringement. In particular, 58% of two pages of the plaintiff's menu appeared in the defendant's menu and a table had been substantially copied. The defendants made some effort to improve the plaintiffs' table.

HELD: The use of the plaintiff's table constituted copyright infringement. Looking at the brochure as a whole, however, the Court found that most of the words and phrases which had been copied were generic phrases ad titles to which the plaintiff did not have a monopoly.

Despite the defendants attempts to change and improve the table copied from the plaintiffs, it did substantially copy the plaintiffs table and the other standard requisite elements establishing copyright infringement were present.

Concurrent jurisdiction in copyright matters - Federal/provincial:

Winlie Containers (Canada) Ltd. v. MFM Industries Ltd. (1996), 68 C.P.R. (3d) 370, New Brunswick Queen's Bench

Plaintiff manufactured shipping containers, and alleged that the defendant's containers were identical to their own, with the exception of minor manufacturing defects. Action for copyright infringement was brought in the Federal Court of Canada and action brought in provincial Queen's Bench for an injunction in respect of passing-off and unauthorized use of confidential information.

HELD: Injunction refused. While there was a concurrent jurisdiction in the Federal Court of Canada and the superior provincial court in copyright infringement matters, the Court deferred from exercising their concurrent jurisdiction in this case in favor of the Federal Court since the action was already before the Federal Court, the appropriate remedy was available there, and that court had expertise in copyright law. The plaintiff had plead evidence of passing-off and breach of confidentiality, which established triable issues within the jurisdiction of the Queen's Bench, but in terms of meeting the test of demonstrable irreparable harm to obtain the injunction the plaintiffs were unable to succeed.

Kane v. Hooper (1996), 68 C.P.R. (3d) 267, Federal Court Trial Division

Defendant made an application to the court to dismiss an action for being outside of the jurisdiction of the Federal Court because the defendant had plead provincial law as a defense. Argument that provincial law defenses take the action outside of the jurisdiction of the Federal Court and that the appropriate venue is the provincial superior court of concurrent jurisdiction.

HELD: So long as the principal nature of the lawsuit in question involves patent, trademark or copyright matters, contractual disagreements do not change the nature of the proceeding and take the lawsuit out of the jurisdiction of the Federal Court.

Summary judgment - copyright:

Ault Foods Ltd. v. George Weston Ltd. (1996), 68 C.P.R. (3d) 87, Federal Court Trial Division

The plaintiffs and defendants were both producers of milk cartons and milk bags. A brought action against G for copyright infringement and passing-off surrounding the get-up of milk packaging containers. Both parties filed extensive affidavit evidence, evidence of cross-examination on affidavits and survey evidence, and applied for summary judgment.

HELD: Serious issues to be tried were demonstrated by the evidence filed by the parties. This was therefore not an appropriate case in which the Court should make an award of summary judgment. The affidavits were sufficiently contradictory to raise issues of credibility, and in such a case the Court should hear the experts testify in person.

Summary judgment - patents:

Hayden Manufacturing Co. v. Canplas Industries Ltd. (1996), 68 C.P.R. (3d) 186, Federal Court Trial Division

Plaintiff held a patent for a vacuum cleaner set-up. They brought action against defendant for patent infringement. The defendant made an application for summary judgment dismissing the action on the basis that the valve in question was not an essential component of plaintiff's machine. There was conflicting evidence between the parties as to whether or not the valve formed an essential component of the plaintiff's patent.

HELD: Serious issues to be tried were demonstrated - this was therefore not an appropriate case in which the Court should make an award of summary judgment. The affidavits were sufficiently contradictory to raise issues of credibility, and in such a case the Court should hear the experts testify in person. The validity of the patent could not be assessed without looking at the credibility issue.

Relevance of patent file histories in patent infringement actions:

Richter Gedeon Vegyeszeti RT v. Merck & Co. (1996), 68 C.P.R. (3d) 8, Federal Court Trial Division

In patent infringement action, issue arose as to whether or not witnesses needed to answer questions surrounding the patent file histories of a Canadian patent and a corresponding Hungarian patent to illuminate the state of the prior art.

HELD: Where prosecution file history is useful, certain portions may need to be disclosed. The witnesses were required to answer questions regarding the experience of the witnesses along with their exposure to any relevant materials prior to the priority date.

Nature of evidence required on injunctive relief applications in patent infringement cases:

Plastichange International Inc. v. 2964-9004 Quebec Inc. (1996), 68 C.P.R. (3d) 102, Federal Court Trial Division

Plaintiff applied for an injunction restraining the defendant throughout the completion of a patent infringement lawsuit surrounding patent for a coin container.

HELD: The amount of lost sales to potentially be suffered by the plaintiff were quantifiable and therefore compensable by damages - this did not form a solid ground upon which to grant the injunction. The Court refused to grant an injunction on the basis that evidence of irreparable harm filed by plaintiff was speculative and not clear. In order to succeed in an application for injunctive relief, clear non-speculative evidence of irreparable harm must be shown, along with the balance of convenience favoring the applicant.

Distinctiveness of prefixes:

McDonald's Corp. v. Coffee Hut Stores Ltd. (1996), 68 C.P.R. (3d) 168, Federal Court of Appeal

M had opposed C's application for registration of the trademark "McBeans" for coffee, tea and other wares. There was evidence of actual use following the date of the trademark application.

HELD: Appeal was allowed. Use by M of trademarks with "Mac" or "Mc" prefixes did not confer a monopoly to the use of those syllables, either alone or in combination with other words.

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