Clients often have misconceptions about patents and trademarks. For example, a client contacted me the other day and asked that I make every effort to expedite his patent application. He wanted it granted as soon as possible, and pressed me for a best case scenario about how quickly I could obtain his patent. The client was frantic because a competitor was threatening to sue him for infringement of a patent the competitor had obtained. The client thought that obtaining a patent would make him safe from the threatened legal action. Unfortunately, it is a myth that your patent will save you from being sued by a competitor. You can obtain a patent and still be sued for infringing a patent owned by a competitor. For example, it is possible to obtain a patent for an improvement to an existing product or method, if the improvement is new and unobvious. However, if the improvement relates to something that is patented, and if in order to use the improvement it is necessary to use the subject matter of the original patent, then use of the improvement would infringe the original patent unless the owner of the original patent gave permission for such use. Thus, it is possible to obtain a patent for an invention but to be unable to work the patent without the permission of the owner of a patent for some underlying technology. When there is an allegation of patent infringement, you must either negotiate your way out of the problem (perhaps by cross-licensing) or “design around” the problem. Fortunately for my client, the client’s product is in the early stage of development and the allegation of infringement came up at the first tradeshow where the product was displayed. The client is now considering what changes can be made to the product to avoid the competitor’s patent. If the “design around” attempt is not successful or will take too long, the client has patents on some other technologies that can be used as bargaining chips in a negotiation. That same day, one of our Trademark Agents, Laura Duckett, came into my office to discuss two Trademarks a client had asked us to apply for two years previously. The Trademarks had been allowed by the Trademark Office. The problem was that, in the intervening period, the client had changed the Trademarks. With respect to one of the Trademarks, the client had asked us to apply for a Trademark consisting of two words. However, he had dropped one of the words and was now using a single word. To make matters worse, the single word was a “generic” term for the product that we will be unable to register. With respect to another of the Trademarks, the client had also asked us to apply for a Trademark consisting of two words. However, in the intervening period, he had made a substitution replacing one of the words with another word he liked better. Unfortunately (or fortunately depending upon your point of view), the Trademark Office grants you protection for the Trademark you apply for. It is a myth that the Trademark office will accommodate changes should your Trademark “evolve”. If you make material changes to your Trademark, you have to start the Trademark registration process all over again. When you get involved with Intellectual Property issues, instead of relying upon myths communicated to you by well meaning friends, seek the assistance of a Registered Patent Agent or Registered Trademark Agent in your area. A list of licensed agents is maintained on the Canadian Intellectual Property Office website at cipo.gc.ca.
I like to spread the word when I think someone is doing something right. Today I am excited about a communication I received from the Business Development Bank of Canada (BDC). I am on the email list for the BDC and receive notices regarding various articles, some of which I download and read. I received an email offer for a free e-book entitled “Social Media – A Guide for Entrepreneurs”. I know I should improve my knowledge of and activity in Social Media, so I followed a link to the BDC website and signed up for the e-book. The BDC website confirmed that an email had been sent to me with a link to download my free email. Then the part I am really excited about occurred. A message popped up on the BDC website offering a free website evaluation. I always like any kind of objective evaluation. Your golf score objectively measures whether your golf game is improving. A metronome objectively measures whether you are keeping time when playing music. Now here was a tool for objectively measuring the website experience at the Thompson Cooper website. The resulting report we received from the BDC for the tcllp.ca website was divided into four parts: Accessibility (to mobile devices), Marketing, Website experience, and Technology (how well designed the website is). In some areas, such as accessibility to mobile devices and date last amended (currency), the tcllp.ca website scored 10 out of 10. However, in the Marketing area, the score was a dismal 4.3, with scores of 2 out of ten for meta-tags and 0 out of 10 for feeds (whatever they are). Clearly there is work to do. I would like to thank the Business Development Bank of Canada for the free e-book (which I intend to read). I would also like to thank the BDC for the website evaluation which opened my eyes regarding the shortcomings of our website. If you like free stuff, as I do, I urge you to go to get on the BDC email list. For the things that you have missed, articles, social media book, and website evaluation, follow the link to the BDC website and check it out. https://www.bdc.ca/en/articles-tools/entrepreneur-toolkit/business-assessments/pages/free-website-evaluation.aspx
One can gain an understanding of issues that the profession is wrestling with by reviewing the titles of the presentations from the 2016 IPIC annual meeting. Continuing Professional Development: “The Skill Set of the IP Practitioner of the Future – Where will IP be in 20 years?” Trademarks: “Trademarks in Metatags and Keywords – A summary of the Current State of the Law in Canada as Contrasted with the U.S. and Europe”, “Brand Boot Camp”, “Best Practices before the Trademark Office”. Patent Issues: “Patent Issues that Keep In-House Counsel Up at Night”, “Patentability: Dealing with Challenges in IT and Life Sciences”, “Best Practices before the Patent Office”. Online Issues: “Managing Online Content: Tips, Traps, and Tariffs for IP Practitioners”. Rights Issues: “Publicity Rights: Guidelines for Giving Clients Practical Risk Assessments”. Litigation Issues: “Remedies – Quick Results in Trademark Cases: Myth or Reality”, “Top IP Cases of the Year”, “Appellate Advocacy in Specialized Area of the Law”.
Many of the above issues I deal with on a regular basis and have written articles about over the past year. However, the presentation of “Futurist” Jeremy de Beer was of general application and may be useful to the reader. Mr. de Beer described an approach to predicting the future using a “grid”. He creates this grid by placing a first line that represents a trend that one can see today, such as automation (self driving cars, smart homes with remotely controlled appliances). One end of the line represents the present and the other end of the line represents the future, if the trend continues. He then places a second line crossing the first line at 90 degrees to create his “grid” having four quadrants. The second line represents a second trend that one can see today, such as the increasing capability of smart phones. Again, one end of the line represents the present and the other end of the line represents the future, if the trend continues. A first quadrant will predict what happens if neither trend continues, a second quadrant will predict what happens if the first trend continues and the second does not progress, a third quadrant will predict what happens if the second trend continues and the second trend does not progress, a fourth quadrant will predict what happens if both trends progress. Mr. de Beer indicates when you extrapolate what may happen some of your “predictions” (especially in the fourth quadrant) should appear to be ridiculous. If this does not occur, you are not pushing the trend far enough. Self driving cars and everyone carrying miniature computers that connect to the internet would have sounded ridiculous 20 years ago. It is not viewed as being ridiculous today.
Comment: I received some comment from Keith Sketchley that I felt should be shared. He indicated that one should beware of overly simplistic methodologies. He identified two fundamental flaw, in the futurists approach that he described as follows:
1. Trends do not continue indefinitely, in part because people change behaviours. In technical things that’s called “feedback”. For example, increasing prices of a product will be met by reduced consumption in response to prices, demand drops, suppliers lower their prices.
2. It is difficult to predict new products and services, and some predictions fall far short. For example, a professor gave a Mr. Smith a C, sneering at his idea that people would pay a premium for assured delivery timing of documents. Mr. Smith went on to start an industry, he called his company “Federal Express
Some time ago, I travelled to Calgary to try to settle a legal dispute through mediation. In mediation, a mediator attempts to guide the parties to a negotiated settlement. However, in this case the arrangement was that if the parties could not arrive at a settlement, the mediator would change roles and become an arbitrator, that is, authorized to impose a settlement upon the parties. My client and I travelled to Calgary for the weekend, in the expectation that we would fly back Sunday night having resolved the dispute. My client’s view was the same as mine, that even a poor settlement would be better than a great lawsuit. Time was also important, as my client had to resolve the dispute with the Calgary Company, before he would be free to enter into a new agreement with another company that was waiting in the wings for the dispute to be resolved. The mediation did not go well. Every time we made progress, the opposing lawyer would inflame the discussions with allegations of “facts” that my client strongly disputed. The point was reached where my client told me that he had had enough and he wished to move on to the arbitration phase. The matter then took an unexpected turn. Instead of hearing submissions and rendering a prompt decision, the arbitrator required a “Statement of Claim” to be prepared and served by a first date, a “Statement of Defence” to be prepared and served by a second date, an exchange of relevant documents to take place by a third date, examination of the parties under oath by a fourth date, and a “trial” at the Alberta Law Society Offices in Calgary on a fifth date, and indicated that a written decision would be rendered by him by a sixth date. Under the schedule set forth by the arbitrator, it took another 11 months for the dispute to be resolved. In another matter, I attended a settlement meeting in Edmonton with the General Manager of a biotech company. The General Manager had to report to a wealthy individual who was the major shareholder and financial backer of the biotech company. On the other side of the negotiating table was a person from the University’s commercialization office and a person heading up a biotech research team. The person from the University’s commercialization office had to report to a University oversight committee. The people in the room rapidly had a meeting of the minds and reached agreement on all issues, subject to approval of the persons to whom we reported. It was in the reporting back that the agreement fell apart. The major shareholder and financial backer, and the University oversight committee repeatedly came back with further conditions which made the job of settling the matter more difficult. The first settlement meeting gave rise to a second and then a third settlement meeting, as each side tried to cope with shifting and evolving instructions. I recently read an article regarding Federal Court Prothonotary (type of judicial officer) Mireille Tabib’s experiences as a mediator, which inspired this commentary. The article, along with my own experiences, provides the following “rules” to follow when entering into negotiations of a legal dispute. The first rule is to start at an early stage, where the focus is still on business concerns and has not yet shifted to “winning” the legal case at all costs. The second rule is to focus on commercial realities, that is, what will “work” as a settlement and not the details of the claim that are often in dispute. The third rule is that everyone doing the actual negotiating must have full authority to settle.
YELP is an online service that was founded in 2004 to help people find local businesses. People can establish a YELP account for free. Similarly, businesses can setup an account for free, post photos and send messages of special offers to their customers. YELP makes money by selling ads to local businesses, such as dentists, pet sitters and moving companies. A feature of YELP is the ability of a customer to post a review of a business after he or she has used the services or products of the business. Each review reflects a customer’s personal experience and “tells it like it was”. This means that some of the reviews are beneficial to the reputation of a business, as they are “glowing” reviews that describe a positive experience. This also means that some reviews are harmful to the reputation of a business, as they are “critical” reviews that describe a negative experience. YELP does not permit paying advertisers to change or re-order the reviews they receive. YELP recently advised that some customers have received legal threats from businesses after posting critical reviews. In some cases legal proceedings have actually been commenced. One example given was a dentist, who on five different occasions has initiated legal actions against customers (former patients) who posted critical reviews. Another example given was that of a professional pet sitting company who sued a customer after a critical review suggested that the pet sitter had killed their fish. Another example given was that of a moving company who sued a customer after a critical review awarded them just one star. The objective of such legal actions is to get the critical reviews taken down. YELP has expressed concern that the threat of legal action will silence customers who would otherwise post critical reviews. In order to combat this activity, YELP has tagged certain business accounts with a “Consumer Alert” which is reproduced below:
Consumer Alert: Questionable Legal Threats
This business may be trying to abuse the legal system in an effort to stifle free speech, including issuing questionable legal threats against reviewers. As a reminder, reviewers who share their experiences have a First Amendment right to express their opinions on YELP.
Freedom of speech is enshrined in United States law as part of the First Amendment to the United States Constitution. In Canada, our equivalent is “The Canadian Charter of Rights and Freedoms”, which lists “fundamental freedoms, including “freedom of thought, belief, opinion and expression”. Unlike their American counterparts, Canadian judges have given more weight to the value of personal reputation than to free speech. I recommend that Canadian customers posting critical YELP reviews stick to the facts. Any embellishment that goes beyond the facts may give the business or an individual from the business an opening to sue under the laws of libel.
I recently read an article entitled “The scope and limitations of Non-Disclosure Agreements”. The article explained that a non-disclosure agreement is an agreement in which a party receiving information (Receiving Party) agrees to take reasonable precautions to protect from disclosure information received from a party disclosing information (Disclosing Party). The article then went on to list a series of matters that must be addressed in a well drafted non-disclosure agreement, including: identifying the information that is to be protected, identifying that the information is being disclosed in order to permit the Receiving Party to complete a specified task for the Disclosing Party, setting forth rules regarding disclosure to employees and safe storage of the information while the task is being undertaken and requiring the destruction or return of the information when the Receiving Party has completed the specified task. The article also touched upon remedies available to the Disclosing Party in the event of a breach of the agreement. Although the article was well written, in my opinion, the author neglected to touch upon a significant limitation of non-disclosure agreements. Most non-disclosure agreements contain the following provision: “The Receiving Party shall have no obligation with respect to such information where the information has become publicly known through no wrongful act of the Receiving Party”. Entrepreneurs carefully go around and have non-disclosure agreements signed by parties who are assisting them by manufacturing and supplying components. Non-disclosure agreements are also signed by parties who are assisting in the preparation of business plans, creating brand names and logos, setting up websites, and setting up marketing plans. Finally, non-disclosure agreements are signed by parties being approached for investment capital and by parties being approached to assist in marketing and wholesale distribution. Then on the day of the launch of the product or service, all of the Receiving Parties who signed non-disclosure agreements are released from their obligations, as the Disclosing Party has publicly released the information and thus that information has become “publicly known through no wrongful act of the Receiving Party”. Non-disclosure agreements are fine for having preliminary discussions, but once the Receiving Party is working with you, a further agreement needs to be put in place that prevents the Receiving Party from competing with you while they are working with you and for a period of time (for example 2 years) after they cease working with you. As a practical matter, one or more of the parties you are relying upon as a member of your team may have better connections and more resources than you do. Once they are released from their obligations under the non-disclosure agreement by your public disclosure, they may come to the realization that they are in an excellent position to deliver the product or service and they no longer need you. Of course, they will delay acting until they have the opportunity to gauge the market response to your new product or service. Get the additional agreements signed. After you have taken all the risks and proven there is a market for the product or service, there will be imitators. Make sure the imitators are not parties who you thought were members of your team.
This is a SLIDESHARE presentation given to the Better Business Bureau at a “Lunch N Learn” on August 17, 2016. Some names that businesses choose are simply NOT PROTECTABLE. This presentation is intended to make persons selecting business names aware of the rules used by the Trademarks Office in reviewing and approving Trademarks. Included is an overview of unregistered and registered Trademarks. If you are only acting locally and have no internet presence, it is not critical that you register your Trademark. If you are doing business over the internet, it is critical that you obtain Trademark protect in Canada and in many cases also in the United States. http://www.slideshare.net/ThompsonCooperLLP/the-name-game-protecting-product-or-business-names
SOCAN (the Society of Composers, Authors and Music Publishers of Canada) collects royalties based upon tariffs approved by the Copyright Board of Canada for Canadian performances of songs for Canadian and international songwriters and music publishers. Tariffs have been set for recorded or live music ranging from concerts to restaurants to fitness classes. Of particular relevance to this article are the tariffs for performance of songs on the internet and on mobile devices. In May of 2016 SOCAN announced that it had acquired Seattle-based MediaNet. This was followed by an announcement by SOCAN in July of 2016 that it had acquired New York-based Audiam. As with all performing rights organizations, SOCAN’s main functions are firstly to determine what music is being performed and, secondly, to collect the applicable royalty prescribed by Canadian law. Collection of royalties relating to the internet and mobile devices create technological challenges. MediaNet has more than 51 million sound recordings in its database, each containing a unique audio identifier. By acquiring MediaNet, SOCAN will be able to identify digital performances from around the world in real-time. Audiam similarly, has one of the world’s most complete databases of sound recording and underlying song/composition metadata. In addition, Audiam has technology to proactively find works that are not licensed and for which royalties have not been paid. With the combined strength of MediaNet and Audiam, SOCAN can identify the use of music on digital services such as Spotify, Apple Music, YouTube, and Google Play. When songs are performed, in addition to royalties compensating the songwriters and music publishers, there are also royalties compensating the artists who perform the songs and music recording companies. Prior to acquiring Audiam, SOCAN was not involved in collecting royalties for performing artists and music recording companies. In contrast, a significant portion of the business of Audiam was the collection of royalties for performing artists and music recording companies. With the acquisition of Audiam, SOCAN now has the capability to collect songwriter-music publisher royalties and performing artist-music recording companies royalties. With changes brought on by the internet, songwriters and performing artists had become frustrated by the ineffectiveness of the performing rights organizations in the collection of royalties, resulting in a fracturing, with new performing rights organizations being formed by the disenchanted. Through its acquisition of MediaNet and Audiam, SOCAN has greatly increased its ability to be effective at identifying uses of music on the internet and collect royalties. SOCAN’s acquisition of Audiam’s expertise in collecting royalties for performing artists and music labels, has been heralded by some commentators as an important new development that raises the possibility of SOCAN becoming a “one stop shop” on the Canadian music scene. The fact that MediaNet and Audiam are U.S. based also suggests that SOCAN will become more active in collecting royalties in the United States.
In Re Simon Shiao Tam, a decision of the United States Court of Appeals for the Federal Circuit rendered December 22, 2015, was recently brought to my attention. Mr. Tam named his band “THE SLANTS” to make a statement about racial and cultural issues in the United States. When he applied for Trademark protection, his application to register THE SLANTS was rejected as being “disparaging” of oriental people pursuant to a section of U.S. Federal law that bars registration of Trademarks that consist of “immoral, deceptive or scandalous matter or matter that may disparage … persons, living or dead, institutions, beliefs, or national symbols or bring them into contempt of disrepute”. Mr. Tam won his case through a constitutional argument. The First Amendment to the US Constitution reads in part, “Congress shall make no law … abridging the freedom of speech”. The Court of Appeals indicated that it is a bedrock principle of the First Amendment that the government may not penalize private speech merely because it disapproves of the message it conveys. The Court of Appeals found the provisions regarding “disparaging” Trademarks unconstitutional and commented, without deciding, that the prohibition against registering immoral or scandalous Trademarks may similarly be unconstitutional. The Tam case has wide implications. There has been a much publicized dispute between native groups and the Washington Redskins Football team over their use of the disparaging term “Redskins”. The Court of Appeals noted that there are currently awaiting appeal other Trademarks applications raising First Amendment issues including:
STOP THE ISLAMISATION OF AMERICA,
THE CHRISTIAN PROSTITUTE,
HAVE YOU HEARD THAT SATAN IS A REPUBLICAN,
RIDE HARD RETARD,
MARRIAGE IS FOR FAGS,
DEMOCRATS SHOULDN’T BREED,
2 DYKE MINIMUM,
DON’T BE A WET BACK,
N.I.G.G.A. (NATURALLY INTELLIGENT GOD GIFTED AFRICANS).
There is a similar provision under Canadian law (section 9(1)(j)), that prohibits the registration of Trademarks that are scandalous, obscene or immoral. The writer has handled a few cases where this objection has been raised. The leading Canadian court decision, which dealt with an application to register BUBBYTRAP (for women’s bras), requires Canadian Trade-marks Examiners to take into consideration evolving standards of what Canadians would consider scandalous, obscene or immoral. The writer was successful in convincing the Trademark Branch that the Trademark CALIFORNICATE was not one that the Canadian public would view as scandalous obscene or immoral. The Tam case in the United States raises an interesting issue, as to whether the Canadian Trademark law regarding scandalous, obscene and immoral Trademarks is contrary to the provisions concerning “freedom of thought, belief, opinion and expression” in our Canadian Charter of Rights and Freedoms. Is the U.S. approach to the freedom of speech the best approach? Personally, I would prefer that there be some limits on Trademarks that are scandalous, obscene or immoral in order to avoid a stream of swear words and off colour expressions being protected by Trademark. What are your views? Communicate with the writer at firstname.lastname@example.org.
Attached is a SLIDESHARE link that relates to a presentation given to the COWICHAN VALLEY BAR ASSOCIATION on July 26, 2016. The presentation was intended to give this gathering of experienced corporate lawyers background on the law relating to patents and designs, along with some practical insight based upon my years of experience. It was an enjoyable evening and there was a great dialog that arose out of questions that were asked.http://www.slideshare.net/ThompsonCooperLLP/patents-designs-for-corporate-lawyers