Warning to Internet Users - Copyright Alert System Arrives in the US

A new monitoring system, namely the Copyright Alert System (CAS), is now currently live in participating jurisdictions across the United States. This system aims to reduce the amount of intellectual property theft by allowing ISPs to collaborate with content owners and monitor a user’s downloaded content to send warnings based on a determination of whether said content is illegitimate with respect to copyright of a rights holder.

The system was created by the Center for Copyright Information (CCI), which is a group aimed to educate consumers regarding the importance of copyright protection. Their members include major content associations such as: the six major movie studios, various record labels, cable companies, the Motion Picture Association of America, and the Recording Industry Association of America. CCI has also secured participation from major ISPs across the US including AT&T, Comcast, and Verizon.

Graduated Warning Process 

The system works as such: Content owners scour the internet to find illegitimate versions of their content and inform ISPs of the details of these versions (e.g., filenames, sizes, codes, etc.). The ISPs in turn track their subscribers to verify whether they access any illegitimate content with respect to the content they were given by the content providers.

If the ISP detects that the subscriber has indeed accessed illegitimate materials, the ISP delivers a warning to the subscriber informing them that downloading copyrighted content is illegal. If the subscriber continues to access illegitimate content, the warning will occur once or twice more. The third and fourth warning require the subscriber to acknowledge that they received alerts for accessing illegitimate content. After this stage, the fifth warning disables access to websites until a phone number is called for “educational information regarding copyright”. The sixth and final warning gives discretion to the ISP to impose further sanctions such as temporarily throttling bandwidth. It should be noted that complete cessation of internet usage is not one of the sanctions proposed.

After the sixth warning there is no further action with respect to CAS. Jill Lesser, the executive director for CCI, explains the rationale of this graduated system:

We hope that by the time people get to alerts number five or six, they will stop. Once they've been mitigated, they've received several alerts, we're just not gunning to send them any more alerts because they're not the kind of customer that we're going to reach with this program.

It should be understood that a subscriber that shows complete disregard for this CAS system is still subject to copyright infringement in court, just like any other citizen. However, CAS has stated that no personal information regarding ISP subscribers will be shared with content owners as to identify the subscriber personally. Therefore there is no shortcut to determining the identities of alleged persons accused of copyright infringement through CAS.

The hope is that the CAS system works on the aggregate population to change behavior and shift the culture to that which is more informed on copyright and expectantly respects the intellectual property rights of others.

Fair Process Concerns 

One of the motivations for such an initiative was to mitigate the well-publicized drawn out court cases of copyright infringement for non-commercial use. However unlike court cases which exercise the inherent right of due process, a private system has generated proprietary mechanisms to deal with issues of appeal.

The current CAS system allows for the user to request an independent review at a nominal cost of $35. This mechanism is designed to identify false positives and allows for the user to plead their case to the ISP. If the warning is indeed false, the cost is refunded to the subscriber and the warning is removed from the account.

Successful Solution? 

This experiment is one worth keeping an eye on as there have been many suggested ideas by industry analysts and academics of how to tackle the spread of illegitimate content in the new digital era. Therefore the effectiveness of this system will be monitored by many countries, including Canada, evaluating the impact on subscribers, content owners, and the ISPs.

This notion is eloquently summarized by industry analyst and president of Public Knowledge Gigi Sohn, who states:

The Copyright Alert System will be a significant test of whether a voluntary copyright-enforcement system can work while at the same time protecting the rights of Internet users…the creators of the system have taken steps to build in consumer protections and fair process to the system, and it is my hope that it will succeed.

By Kamaldeep Sembi 

In the News - UK To Amend Patent Act:

Earlier this week the U.K. Government announced that the Patent Act would be amended to “allow clinical and field trials and health technology assessment for new drugs to be carried out without running the risk of being sued for patent infringement.”

View the U.K. Government press release, Cutting of red tape to benefit research and development of new drugs, for more information.

By Claire Palmer

The Federal Court of Appeal released three decisions relating to Rule 249 of the Federal Courts Rules

On February 19th, 2013, the Federal Court of Appeal released three decisions relating to Rule 249 of the Federal Courts Rules.

In all three cases (2013 FCA 45, 2013 FCA 46 and 2013 FCA 47), the Federal Court of Appeal upheld orders under Rule 249 permitting the obtaining of samples for the purpose of conducting tests described in the order.

Rule 249(1) recites: 

(1) On motion, where the Court is satisfied that it is necessary or expedient for the purpose of obtaining information or evidence in full, the Court may order, in respect of any property that is the subject-matter of an action or as to which a question may arise therein, that
(a) a sample be taken of the property;
(b) an inspection be made of the property; or
(c) an experiment be tried on or with the property. 

The reasons for the Federal Court of Appeal are detailed in 2013 FCA 45 and incorporated by reference into the two other decisions. The Federal Court of Appeal, in 2013 FCA 45, stated that “it is evident that the use of the words “necessary or expedient” [in Rule 249] was intended to give broad discretion to the Court” and did not accept Apotex’s submission that evidence was required ‘that the proposed tests were “the only means” for the Respondents to establish their case or at least that this was an “exceptional case” where such testing was the solution of “last resort”’. The Federal Court of Appeal further stated, for complex pharmaceutical patent cases, ‘“expediency” may well be a major factor for the Court in exercising its discretion”.

By Kay Palmer

Microsoft's Take on the U.S. Patent System

Brad Smith, General Counsel & Executive Vice President, Legal & Corporate Affairs for Microsoft, in his February 21st blog entitled “The Patent System: Fix What’s Broken, Don’t Break What’s Working” detailed specific patent reforms Microsoft supports.

The specific reforms include:

• Improved transparency of what is covered by patents and who owns those patents. In support of that end, Microsoft has pledged to publish on-line by April 1st on line the necessary information that would allow anyone to determine what patents Microsoft own. 
• Reforms to stop the abuse of Standards-Essential Patents. 
• Reforms which would see patent trolls pay if they lose a patent litigation. 
• Reforms which would see patent quality improve including providing more time for examination of an application. 

By Claire Palmer

Is Thalidomide an "Innovative Drug"?

Earlier this month, the Federal Court of Appeal in a two to one decision decided No, Thalidomide is not an “Innovative Drug”.

Thalidomide has had a checkered past. It was launched commercially in the late 1950s, approved in Canada in November of 1960 under the brand names Kevadon and Talimol, as a treatment for morning sickness and other pregnancy associated ailments. In April 1962, thalidomide was permanently withdrawn from the Canadian market and its approval cancelled because of its devastating terateogenic effects which resulted in thousands of children being born with deformed or missing limbs (see Paragraph 5 of the FCA decision).

Thalidomide was later shown to be effective for the treatment of various life threatening conditions including leprosy and some forms of cancer. An NOC was issued for Thalidomide in 2010. The Minister of Health at that time “advised Celgene that THALOMID would not be eligible for data protection because its medicinal ingredient, thalidomide, had been previously approved by the Minister in at least two drugs - KEVADON and TALIMOL.” (see Paragraph 18 of the FCA decision). The Minister’s decision was overturned by the Federal Court.

As noted in the FCA decision, the Federal Court decision (paragraph 31) was “based on the following combined facts:

i. The prior approval of thalidomide was short lived and should never have been given at the time;
ii. Thalidomide was effectively banned until Celgene came up with its NDS for THALOMID; and,
iii. The 2010 NOC approval was granted for Celgene’s product on the basis of completely new studies and data.” 

The Federal Court of Appeal reviewed this decision, focusing in its review on “Is thalidomide a “medicinal ingredient not previously approved in a drug by the Minister”?” paying particular attention to the meaning of “previously approved” (See paragraph 40 of the FCA decision).

The Federal Court of Appeal in its decision did not view the over 30 year ban as relevant and concluded that the phrase “previously approved” should be strictly construed to include any prior approval and therefore thalomide is not an “innovative drug” and not entitled to data protection.

By Claire Palmer

Think Before You Speak - Copyright in Spontaneous Statements

Copyright in Spontaneous Statements

A recent story by the Globe and Mail presents an interesting problem for organizations seeking to protect their reputation. Can spontaneous rude statements made by high profile members of the organization that are recorded and posted onto the internet, be removed?

The story involves statements made during a conference call to discuss Encana’s quarterly results. In response to a question as to whether the organization was at risk of being acquired, the CEO responded “No.” Another person, under his breath, muttered a two-word obscenity which was picked up by the microphone. A reporter for the Globe and Mail posted this conversation on the internet. Journalists were permitted to attend the meeting; however, recordings were not permitted.

Encana is seeking to have this recording removed from the website where it is posted, claiming it has copyright in the statements.

Is there copyright in the statements? 

To be clear, assuming there is no agreement to the contrary, the only aspect of the conversation posted that Encana may be able to claim copyright over is the three words said by its employees. Copyright to the question posed by the third party would belong to that third party unless the person who posed the question assigned it in writing to Encana.

For copyright to exist in a statement, the statement being copyrighted must be an “original… work”. The test for originality in Canada requires the author to exercise skill and judgement, where the skill and judgement exercised must not be so trivial as to be characterized as purely mechanical.[1] While the qualitative test for a statement to be a “work” is low, there is a quantitative minimum that must be met for copyright protection.[2]

The statements made by the Encana executives in this scenario do not qualify for copyright protection as they fail to meet both the criteria for a copyrightable work. The obscenity was not an exercise of skill and judgement. It was an impulsive response to a question that the speaker found insulting. In fact, if the speaker had exercised skill and judgement, it is likely that the he wouldn't have said the obscenity at all.

With respect to whether the statements are a work it is important to note that there are two statements which have a total of three words. The first of the three words make up one statement, and the second statement is comprised of a two-word obscenity. While it is well established that there can be no copyright in a single word;[3] a commonly used two word phrase will likely not receive copyright protection either.[4]

It is not impossible for spontaneous statements to be protected by copyright; however in this scenario it is not likely.

Is there any remedy available to Encana? 

Encana may be able to commence an action against the reporter who surreptitiously recorded the conversation and his employer. The fact that there was a prohibition on audio recordings could constitute a breach of contract.

However, if a second person were to independently repost or archive the audio clip, that clip could remain on the internet forever.

If you would like to know more about the rights available to help protect your organization’s reputation, or if you have invented an even better microphone that you would like to patent please contact us.

By Jahangir Valiani

[1]CCH Canadian Ltd. v. Law Society of Upper Canada, 2004 SCC 13. 
[2]Exxon Corp. v. Exxon Insurance Consultants International Ltd., [1982] 1 Ch. 119 (Eng. C.A.); British Columbia v. Mihaljevic (1989), 26 C.P.R. (3d) 184 (B.C.S.C.). 
[3]Exxon, supra, note 2. In this case, even where that word was invented and showed originality, it was too short to be copyrighted. 
[4]Mihaljevic, supra, note 2

Australian patent law raises the bar

In Australia, the Intellectual Property Laws Amendment (Raising the Bar) Act of 2012 will come into force on April 15, 2013.  This new Act raises the requirements for patentability among other things.  Notable among the changes is the introduction of a US-style utility requirement and a European-style sufficiency requirement.  The Act also broadens the scope of the prior art that Australian examiners will consider.

As a result, the Raising the Bar Act will have the effect of making the examination of Australian patent applications more rigorous and leading to more rejections. The Act will apply to applications filed on or after April 15, 2013, as well as applications for which the examination request is filed on or after April 15, 2013.

In order to take advantage of the current more lenient requirements, we recommend requesting examination for pending applications before the coming-into-effect date of April 15, 2013. Applicants can also avoid the more restrictive requirements of the new Act by filing before April 15, 2013 any national phase applications in Australia which would otherwise become due after this date and by submitting the examination request at the time of filing.

In addition, applicants may want to consider amending their applications before April 15, 2013 to ensure the application will meet the new patentability requirements, since after April 15, 2013, new material may not be added to the application.

Another change is the reduction of the acceptance period from 21 months to 12 months from the first Office Action. If the application is not in condition for acceptance by the end of the acceptance period, under the new Act the applicant can no longer re-file the application as a divisional of itself in order to continue its pendency.  This is the more reason why either the examination request or the necessary amendments should be filed before April 15, 2013. 

This article summarizes only some of the changes that have been introduced; there are additional developments that we have not addressed. You should seek qualified professional advice before applying this information to your own circumstances.

By: Nazanin Ghaissarnia

Changes to the USPTO fees

The United States Patent and Trademark Office (USPTO) has a new fee schedule which will be effective March 19, 2013.  Some of the fees will increase. For example maintenance fees for a standard entity patentee will increase from $1150 to $1600, from $2900 to $3600, and from $4810 to $7400, for the first, second and third maintenance fees respectively. These are significant increases; hence we recommend to our clients to pay early, as much as possible, any maintenance fees becoming due for their US patents. If the third, seventh or eleventh anniversary of the grant of your patent falls on a date up to March 18, 2013, then the maintenance fee can be paid early, by March 18, 2013, in order to avoid the increased fees.

Another group of fees that will see an increase as of March 19, 2013 is the fee for requesting extensions of time for responding to Office Actions.  The extension fees will increase from $150 to $200, from $570 to $600, and from $1290 to $1400 for the first, second and third months of extension respectively.

The fee for a Request for Continued Examination will also increase from a single $930 to $1200 for the first such Request and $1700 for any subsequent Requests.

Not all of the fees have been increased in the new fee schedule.  For example, the fee for filing a utility or national phase application has been reduced from $390 to $280.

A further development is the addition of a new category of fees entitled “micro entity fees”, which are discounted at 75% of the regular fees. The micro entity is a new segment of applicants created by the America Invents Act in addition to, and distinct from, the small entity applicants. If the applicant meets the criteria set for micro entity status, he or she can pay the fees at this new discounted rate as of March 19, 2013, after making the necessary certification to the USPTO.

This article summarizes only some of the changes that have been introduced; there are additional developments that we have not addressed. You should seek qualified professional advice before applying this information to your own circumstances.

By: Nazanin Ghaissarnia

Creativity Worth Spreading

The world famous TED conference is moving to Vancouver, B.C. in March of 2014, for at least a two-year stint. Although I’m personally not holding out any hope of attending the conference itself, it will certainly be an interesting experience to have it all happening a mere five minute walk from my desk at our MBM Vancouver office. Many of us will be hoping and working to see the spirit of the conference escape the walls of the Vancouver Convention Centre. 

TED is about ideas, each of which must be judged on their own merit. But, more importantly, TED is about creative energy. The TED website offers up a host of optimistic and enthusiastic talks on a variety of subjects, and whether one agrees with a speaker’s particular position or not, it’s hard not to get caught up in the creative spirit. 

This little bit of news coincides nicely with the launch of a series of articles on creativity, which I plan to post through this very blog over the coming year. Since the foundation of Intellectual Property is the creativity of its inventors, writers, designers, and others, it’s important to understand the creative process, to keep it healthy, and to keep it on track. I will share some of the lessons learned through personal experience, experience with inventors, and good old-fashioned research into what the experts say. The goal will be to inspire, entertain, and have a look at some tools that might just foster that creative spark that is at the heart of our business, and maybe yours too. 

So stay tuned! And while you’re waiting, here’s a little homework assignment. Go and watch a TED talk or two at www.ted.com, and see if you can’t feel some of that creative energy. Then, whether you agree with the speaker or not, see if you find yourself either expanding upon or refuting their ideas. “Ideas Worth Spreading” is their slogan, but I think the creative energy underlying the ideas can be equally infectious.

By Michael Maskery

Promoting Access to Medical Technologies and Innovation: Intersections Between Public Health, Intellectual Property and Trade

Last week, the World Trade Organization together with World Intellectual Property Organization and World Health Organization published an e-book entitled “Promoting Access to Medical Technologies and Innovation: Intersection between public health, intellectual property and trade”.  The book can be found at the following link:
http://www.wto.org/english/res_e/publications_e/who-wipo-wto_2013_e.htm

The book is designed to be a tool to policy makers and “seeks to reinforce the understanding of the interplay between the distinct policy domains of health, trade and intellectual property, and of how they affect medical innovation and access to medical technologies.”

The book is broken down into four sections.  The first of which provides an overview of the players (WTO, WIPO, and WHO) detailing their “distinct roles and mandates”, highlighting the need for a cooperation and policy coherence “in international action to address public health problems”.  The first chapter outlines “the evolution of the global burden of disease” and what its evolution means in terms of medical technologies.  It discusses the complex policy environment and what factors affect public health policy including financial, regulatory, trade, competition, and intellectual property considerations amongst others.

The second chapter, “The policy context for action on innovation and access” further highlights intellectual property and trade considerations together with the economic considerations and regulatory concerns.  The chapter provides an overview of the patent regimes, trademarks and data protection and highlights the pharmaceutical sectors “dependence on patents to capture returns to research and development” and potential consequences of its dependence.

The third chapter provides insight into medical technology innovation and includes a historical prospective and details the challenges faced today by the pharmaceutical industry.  As a patent agent, I found the section of this chapter entitled “Intellectual property rights in the innovation cycle” particularly interesting.

The final chapter discusses issues relating to access to medical technologies and highlights some of the factors that can impact access.

By: Claire Palmer

Intellectual Property Due Diligence- The Basics (Part 1)

If you are buying, licensing, or investing in any form of Intellectual Property (“IP”), then some level of due diligence is critical to be sure that you understand what you are paying for.  This is the first in a series of articles on various aspects of this important topic.

If you are contemplating any kind of IP transaction, there are some things you can check yourself using online databases. Doing some research of your own early on can avoid a lot of wasted energy and expense. Amongst the fundamental issues to consider are status, ownership, validity, scope, and freedom to operate:

Status: Have applications been filed to register the IP in question? Are they in good standing? Are any applications still pending or have they already proceeded to registration? How soon will the rights expire?

Ownership:  Who is the legal owner of the patent, trade-mark or other IP in question? Have any licenses been granted? Do any third parties have rights in the IP?

Validity/registerability: If the IP has not yet been registered, then what are the chances that a registration will eventually be obtainable? If the rights are already registered, then is that registration valid or could it be successfully challenged by third parties? 

Scope: How broad are the IP rights?  Is it still possible to register rights in all of the countries of interest?  Do any filings cover the subject matter of most importance?

Freedom to operate:  Will you be able to use the IP you purchase without then infringing on the valid IP rights of a third party? A patent grants only a negative right, the right to stop somebody using the claimed invention. The owner of a patent may not be able to practice their invention without infringing on a third party’s coexisting rights.

IP is a complex area of law and this article only touches the surface of some of the issues that may arise.  While any preliminary research you are able to do yourself can be helpful, you should always seek qualified professional assistance before making any decisions. If you are selling IP, it is advisable to undertake some level of due diligence yourself so you are prepared to answer any questions from potential purchasers and can take steps to remedy any problems.

By: Euan Taylor 

Euan Taylor is a lawyer, patent agent and trade-mark agent and is based in MBM’s Vancouver office. He has wide experience of IP due diligence for a range of commercial transactions and can be reached at etaylor@mbm.com or at 604-239-0271.

Pfizer Canada Inc. v. Pharmascience Inc., 2013 FC 120

Last week, the Federal Court released its decision to dismiss an application brought under the provisions of the Patented Medicines (Notice of Compliance) Regulations (PM(NOC) Regulations) to prohibit the issuance of a Notice of Compliance to Pharmascience Inc. (Pharmascience) in respect of its PMS-Pregabalin capsules until the expiry of Canadian Patent No. 2,255,652 ('652 patent).

Pfizer Canada Inc. had obtained a Notice of Compliance to sell tablets containing pregabalin under the brand name LYRICA, and had listed the ‘652 patent in accordance with the PM(NOC) Regulations.

Pharmascience, in a Notice of Allegation, alleged that claims 4, 6-12, 14 and 15 of the ‘652 patent would not be infringed by its product, and that the patent is invalid on the grounds of, among other reasons, inutility, lack of sound prediction, and claiming broader than the invention made or disclosed. 

Only claim 3 of the '652 patent was at issue in the present decision.  Claim 3 was construed as follows:

3. For use in treating pain, in a mammal, a therapeutically effective amount of a compound which is (S)-3-(aminomethyl)-5-methylhexanoic acid or 3-aminomethyl-5-methyl-hexanoic acid (its racemate).

Justice Hughes further construed the term “pain” as used in claim 3 to include all of the specific pains listed in claims 4 to 16 and on pages 1 and 5 of the ‘652 patent, which includes examples of both chronic and acute pain. 

As a result of this construction, and in part due to evidence provided by the inventor by way of affidavit, indicating that his objective was to test pregabalin only for chronic or persistent pain, Hughes J stated in paragraph [93]:

The evidence shows, therefore, that the inventor never tested or contemplated the testing of the racemate. The inventor stated that pregabalin is useful only in respect of chronic or persistent pain, not acute pain.

Hughes J found that claim 3 was broader in scope than the invention made or disclosed, and therefore invalid.

Hughes J also considered the utility of claim 3.  In this regard, he found claim 3 to be invalid as it “embraces pain which cannot be treated, as well as pain which ... could not have been predicted as treatable by pregabalin.” 

Hughes J also found that, since the ‘652 patent did not provide any evidence that the racemate was useful in treating pain (or that it had been tested at all), there was no factual basis or line of reasoning to soundly predict that the racemate would be useful in treating the “variety of pain encompassed by claim 3 or even some of them” (paragraph [184]).

Hughes J therefore found that claim 3 was also invalid due to inutility and lack of sound prediction.

The full decision can be found at the following link:

http://decisions.fct-cf.gc.ca/en/2013/2013fc120/2013fc120.html

By: Suzanne Hof

MÉDECINS SANS FRONTIÈRES’ PATENT OPPOSITION DATABASE

In January, the latest issue of WHO Drug Information was released.  The issue can be found at the following link:

http://www.who.int/medicines/publications/druginformation/issues/DrugInformation2012_Vol26-4/en/index.html

In this issue, Médecins Sans Frontières’ recent on-line database for patent opposition was described including details with respect to its successful opposition of an Indian patent application directed to a combination HIV treatment.  A link to the database follows: http://patentoppositions.org

This on-line resource is described as “a tool which can be used to explore how to challenge unfair patents and their negative impact on access to medicines.” The Patent Opposition Database provides a tutorial on how to file oppositions in various jurisdictions including Brazil and India, offers approaches for identifying relevant patents and prior art, and hints on how to build arguments for an opposition.

The Patent Opposition website also provides a central depot for information on existing patent oppositions, patent office decisions and court cases etc.

The option of submitting documents with respect to drug patents anonymously for publication on the website is also available.  The website identifies patent oppositions, patent applications, patent office decisions, prior art, court cases, literatures, legislation, patent searches, corrections, and a general “other” content type as the type of content eligible for submission. What was unclear to me from the website is if the Patent Applicant was notified following the submission and publication on the website of prior art and other documents.  Presumably, if the Patent Applicant was notified and there is a corresponding U.S. patent application the Applicant would have a duty to disclose this information to the USPTO.

It will be interesting to see if oppositions or other information described in this database will more have a more global impact on an Applicant’s patent rights.

By: Claire Palmer

On the importance of record-keeping when building your brand

Avocats Sans Frontières is an international NGO whose mandate relates to serving vulnerable people waiting for justice, ensuring access to justice and helping to establish legal systems that are capable of protecting these people. The first of these organizations was founded in Belgium in 1992. It has acted, among many other projects, to ensure a fair trial and a proper defense of those accused of perpetrating the 1994 genocide in Rwanda. Avocats Sans Frontières Québec is an independent organization founded in 2002 to contribute to international solidarity efforts of other Avocats Sans Frontières groups.

Lawyers Without Borders, Inc., a non-profit corporation based in Hartford, Connecticut, was founded in January 2000 and obtained trademark registrations for "Lawyers Without Borders" in the United Kingdom, Canada, Israel, New Zealand, Australia and the United States. Lawyers Without Borders, Inc.’s work is generally in the fields of trial advocacy training, neutral trial observation, community education and outreach, research and technical assistance. Lawyers Without Borders, Inc. disclaims any relationship with Avocats Sans Frontières.

In the spring of 2008, Avocats Sans Frontières Québec (ASFQ) applied to register three trade-marks, “Avocats Sans Frontières”, “Lawyers Without Borders” and “ASF”, on the basis of prior use in Canada dating back as far as 2002.

In 2009, two of the applications, “Avocats Sans Frontières” and “Lawyers Without Borders” (the Marks), met a snag - a 2005 trademark registration by Lawyers Without Borders, Inc. (LWOB Inc.) for “Lawyers Without Borders” claiming use in association with legal services dating back to 2001.

ASFQ instituted administrative section 45 summary expungement proceedings against LWOB Inc.’s mark “Lawyers Without Boarders” on the grounds of non-use and, in particular, that the use of the LWOB registered trade-mark was not in association with “legal services”. The Trademark Opposition Board (TMOB) found that the evidence submitted by LWOB Inc. - pertaining to coordinating of legal services - was sufficient to count as use of the mark in association with “legal services”.

Before that decision of the TMOB was made, ASFQ had filed an application before the Federal Court to challenge LWOB’s mark more formally. While section 45 summary expungement proceedings are quite limited in scope, an application under section 57 of the Trademarks Act allowed the ASFQ to challenge the validity of LWOB Inc.’s registration on the bases that:

• as at the date these proceedings began, the trade-mark was not distinctive of its owner LWOB Inc. but was rather distinctive of ASFQ’s activities; 
• at the time LWOB Inc. applied for the mark, ASFQ, rather than LWOB Inc., was the person entitled to secure its registration in Canada - the question here becomes: who first used the Marks in Canada; and others.

On January 14, 2013, Justice Lemieux of the Federal Court ruled that ASFQ had successfully established that the marks were indeed distinctive of ASFQ’s activities and that LWOB Inc. had not been the person entitled to secure the registration of the marks in 2003.

The grounds for this decision are some of the fundamental principles of our legal system – credibility and evidence. ASFQ was able to submit uncontroverted evidence that overwhelmingly and clearly established its use of the Marks across Canada prior to the 2003 trademark application by LWOB Inc. The evidence submitted in support of LWOB Inc.’s position was characterised by the court as providing contradictory evidence in separate affidavits relating to LWOB Inc.’s date of first use and a number of other issues. The evidence in these affidavits was further impugned by subsequent affidavits submitted by ASFQ and the affiant, the founder of LWOB Inc., could not provide certain details in respect of questions asked - relying on documents which she had reviewed but never produced.

This decision shows the importance of record keeping – especially when a company is in its infancy and one is just starting to build a brand. When any start-up or new brand is being launched, it is critical to retain records of the earliest sales or use – dated invoices bearing the new brand name, press releases, time-stamped photographs of new displays, invoices from advertising agencies. Trademark rights are acquired and maintained by use – but being able to substantiate claims of first use is where you will be able to fend off attacks by others.


By: Philip Oliver