chapter microsoft ® powerpoint ® presentation prepared by gail mckay, llb, thompson rivers...
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CHAPTERCHAPTER
Microsoft® PowerPoint® Presentation Prepared ByGail McKay, LLB, Thompson Rivers University
© 2008 McGraw-Hill Ryerson Ltd., All Rights Reserved.© 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved.
14Intellectual Property – Patent, Trademark, Copyright, and Franchising Law
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-2
OBJECTIVES
1. To discern and appreciate the importance of intellectual property rights in business
2. To examine patent law protection
3. To examine trademarks and their protection
4. To examine copyright and industrial design protection
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-3
INTRODUCTION
To protect what is not physical is a challenge, but that is the task of intellectual property law – which protects inventions, creations, and artistic works of the mind – in some cases a business’s most important asset
Although the four categories of intellectual property are protected by federal legislation, they nevertheless remain vulnerable if risk reducing strategies such as registration and confidentiality are not followed
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-4
TYPES OF INTELLECTUAL PROPERTY
A patent is an exclusive right granted to an inventor of something new and different to produce the invention for 20 years in return for the disclosure of the invention to the public
A trademark is a mark which distinguishes one’s goods or services from those of others
Copyright is the right of ownership and control over works of art, and the right to copy them
Industrial design is the production of an artistic work by an industrial process
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-5
CONFIDENTIALITY: 1st LINE OF DEFENCE
A promise to keep information confidential may constitute an enforceable clause in contracts among businesses, partnerships or joint ventures who are discussing or exchanging ideas
Or, in the most common cases, an employer may design a confidentiality clause upon hiring a new employee who will be using special equipment or having access to secret processes and formulas
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-6
PATENTS: THE PATENT ACTThe Patent Act protects inventors of “any new and useful art, process, machine, manufacture or composition of matter, or any new or useful improvement in the same”
The invention must be neither unlawful nor only a slight improvement on an already existing invention
The invention must be more than what a skilled worker could produce, since skill alone may not be the subject matter of a patent; and the invention must be kept secret and out of the public domain before filing the application
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-7
PATENT PROCEDURE
1. Patent agent searches for similar patents 2. Agent submits a petition and very detailed
specifications3. A claims statement describing what is new
and useful about the invention is submitted4. If the invention is a machine or product
requiring the assembling of parts, a drawing demonstrating how to do this is submitted
5. The patent filing fee and a short abstract written in non technical language is required
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-8
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-9
PATENTS, continued
An examiner at the Canadian Intellectual Property Office searches to ensure the invention does not infringe on any other patent and if it does not, a patent is issued upon the payment of an issue fee
There is also an annual fee to maintain the patent; however the registered patent provides the inventor with the exclusive rights to the manufacture and distribution of the invention for 20 years
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-10
FOREIGN PATENT PROTECTION
An agreement in Paris in 1883 recognized that an inventor who had applied for patent protection in his or her own country should have, upon application with 12 months of the original application, protection in member countries as well
This philosophy has been confirmed by an international patent cooperation treaty which creates a uniform filing date for the inventor by allowing backdating of a foreign patent application to the date of the original in the inventor’s own jurisdiction
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-11
COMPULSORY LICENCES
An inventor who has been granted a patent may be obligated to produce the subject of the patent to satisfy public demand, or to license it to another willing to work the patent in return for payment of royalties
Compulsory licences may be issued by the Commissioner of Patents after the patent has been in effect for three years, allowing someone else to work the patent - especially when production is part of a sequence upon which others rely
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-12
INFRINGEMENT
A monopoly to produce an invention for a fixed period of time is created for the inventor when a patent is issued; therefore unauthorized production, importation or any other type of working of the patent by anyone else is a patent infringement
Remedies for infringement include damages, an injunction and an accounting
The defendant may argue that a patent was invalid, that it had expired, or that he or she had ongoing tacit approval of the patentee
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-13
TRADEMARKS
A trademark is a distinguishing mark chosen by a business to identify its goods or services as distinct from those of other businesses
The trademark may be a mark, a name, or a combination of both; a search must be conducted for similar names or marks; but if the search results are clear, the trademark is registered in the federal Intellectual Property Office – allowing protection for 15 years, with renewals allowed indefinitely
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-14
TYPES OF MARKS
Service marks are used by companies that provide a service to the public
Certification marks identify goods or services of a certain quality produced in certain conditions
A distinctive guise is associated with the shape of the packaging or of the product itself
Trade name is a word or name instead of a mark and must not be similar to another name
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-15
REGISTRATION REQUIREMENTS
To meet the requirements of the Trademark Act, a trademark must be distinctive – not easily confused by the public with another company’s trade name - and it must be used
There are specific prohibitions against:1.Offensive symbols or names2.Marks belonging to royalty or governments3.Marks associated with a well known person who is living or has died within 30 years4.An ordinary word that could apply to all manner of similar products
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-16
ENFORCEMENT
To prevent infringement of a trademark, the owner is expected to take legal action for an injunction and accounting of lost profits
To succeed in a passing off action, the plaintiff must show the person passing off the goods or services misrepresented them as those of a well known business, that the goods or services could be confused with those of the well known company, and finally that the defendant well known company was injured by the misrepresentation
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-17
FOREIGN TRADEMARKS
An international convention to which Canada is a signatory permits the user of a foreign trademark to apply to have it registered in Canada
Conversely, registered Canadian trademarks may, under the terms of the same convention, be registered in foreign member jurisdictions
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-18
COPYRIGHT
Copyright is the right to prevent copying or altering literary or other artistic works, and may include recording by electronic or mechanical means, photocopying, and storing in a computer retrieval system
The Copyright Act gives the sole right to publish or reproduce an original work to the creator of it, a right which lasts throughout the lifetime of the writer or artist and endures for 50 years after his or her death
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-19
COPYRIGHT, continued
Registration of copyright is not essential, but acts as public notice of the copyright
Writing or artistic work created in the course of employment is an exception to the ownership rights of the creator
A right of copyright arises in the actual arrangement of words or in the way an idea is expressed, but not in the idea itself
Copyright may be assigned, and licences may be granted in return for payment of royalties
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-20
COPYRIGHT, continued
Copyright may not be infringed in cases of fair dealing - which include copying for private study, research, criticism, review or newspaper summary
However, infringement may occur if the moral rights of the writer or artist are affected
Moral rights are defined as the “right to the integrity of the work” including the right that it be free from distortion or mutilation which may injure the honour or reputation of the creator
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-21
INFRINGEMENT IN ELECTRONIC MEDIA
Unauthorized copying from the Web by cut and paste methods or by downloading without the payment of royalties or without express permission of the copyright holder or agent is an infringement of copyright
However, the anonymity of infringers on the Internet is a serious problem not yet solved by trying to hold Internet Service Providers (ISPs) liable – although ISPs who continue to host infringing material after having being served notice of that fact by the copyright holder will now be found liable
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-22
DOMAIN NAMES
At the present, there is no specific intellectual property law associated with domain names despite the fact that they have an economic value equivalent to a trademark
A practice known as cybersquatting occurs when someone registers a domain name for the explicit purpose of later extorting money for surrendering it to a trademark holder – a practice now illegal in the United States
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-23
PERFORMING RIGHTS SOCIETIES
The purpose of performing rights societies is to facilitate an assignment of rights to perform artistic works
The societies charge fees to issue licences to perform the plays or musicals, with part of the fee being paid to the artist and part to the operating costs of the society; fee schedules are filed with the Copyright Board and published in the Canada Gazette
Collective societies operate licensing schemes for performances that are not held in theatres
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-24
INDUSTRIAL DESIGNS
The Industrial Designs Act protects a design that will be reproduced by an industrial process
A registrable design is one that has - in the finished article – features of shape, pattern or ornament, configuration or any combination of these “that appeal to and are judged solely by the eye”
A registered design gives its creator exclusive rights to produce the design for five years, renewable once, for a total of ten years
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-25
FRANCHISES
A franchise is a contractual relationship that licenses the use by one business of the trade name, trademark and detailed operating procedures of a well established business, as well as providing the franchisee with a defined geographic area in which to operate
The franchise agreement strictly controls the conduct of the franchisee to ensure that the business standards of the reputable franchisor outlined in its confidential operating manual are upheld
Fundamentals of Canadian Business Law, Second Edition © 2008 McGraw-Hill Ryerson Ltd. All Rights Reserved. 14-26
SUMMARY
The intellectual property of a business is one of its most valuable assets
Intellectual property includes patents, trademarks, copyright and industrial designs
Each type, except copyright, requires registration and each type has its own federal statute offering an exclusive right to use the intellectual property for a specific period of time