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COPYRIGHT LAW
CRITERION
IS X-COPYRIGHTABLE? -OPENING
Berne Convention is an international copy right agreement that is codified into domestic law
via the Canadian Copyright Act. Canadian law protects the exclusive right of copyright owners
to reproduce or to authorize the reproduction of their works.
WORKS
Under section 5.1 of the Copyright Act, the following works are “copyrightable,” in every
original literary, dramatic, musical and artistic work if any one of the following
conditions is met:
Four categories of works – Copyright Act, s. 2
1. Literary works
2. Dramatic works
3. Musical works
4. Artistic works
Literary works: the words “literary work” cover work which is expressed in print or writing,
irrespective of the question whether the quality or style is high (University of London).
Furthermore, under Ascot Jockey Club Limited v. Simons, there is a requirement of preliminary
work (low standard).
Dramatic works: a) Any piece of recitation, choreographic work or mime, the scenic
arrangement or acting form of which is fixed in writing or otherwise; and b) Any
cinematographic works.
Artistic works: Covers two- and three-dimensional works- (1) Illustrations, sketches and
plastic works relative to geography, topography, architecture or science; maps, charts, plans;
(2) Paintings, drawings, engravings; (3) Photographs; (4) Sculptures, works of artistic
craftsmanship, architectural works.
ARE THE LOCATED IN A TREATY COUNTRY
Under section 5(1) (a-c) the author must be a citizen, subject, ordinary resident etc. of a treaty
country. Specific requirements for cinematic and published works.
FIXED
An additional requirement for categories of works is that they be fixed in some material form
(Berne Convention article 2 and Copyright Act s3(1)). Meaning, that the work must be written
down, recorded, made permanent/stable. In Canadian Admiral Corporation, a plaintiff failed
in their attempt to copyright a football game because for copyright to subsist in a work it must
be expressed to some extent at least in some material form, capable of identification and
having more or less permanent endurance.” Similarly, in Gould Estate, a plaintiff failed to
claim copyright in answers provided to a published interview, as a CR exists to the person
making the notes not the one providing oral statements (exemption for mere scribe).
ORIGINAL EXPRESSION
As evident in the Ascot case, copyright protect original expression or ideas- not ideas
themselves of facts. Notably, the threshold is low and that copyright subsists regardless of
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whether the work is “wise or foolish, accurate or inaccurate, of literary merit or of no merit
whatsoever” (Walter v Lane). The Act does not require that the expression must be in an
original or novel form, but that the work must not be copied from another work ; that it
should originate from the author” (University of London Press Limited).
In Canadian Admiral Expression, CCH and Cinar Corporation the Courts confirmed that an
original work is the expression of an idea through an exercise of skill and judgment. Factors
are further elaborated in CCH: where for a work to be “original” within the meaning of the
Copyright Act:
1. it must be more than a mere copy of another work.
2. it need not be creative, in the sense of being novel or unique.
3. to attract protection in the expression of an idea there must be an exercise of skill
and judgment:
• “By skill, I mean the use of one’s knowledge, developed aptitude or
practiced ability in producing the work.”
• “By judgment, I mean the use of one’s capacity for discernment or
ability to form an opinion or evaluation by comparing different possible
options in producing the work.”
4. This exercise of skill and judgment will necessarily involve intellectual effort … must
not be so trivial that it could be characterized as a purely mechanical exercise.
OWNERSHIP AND AUTHORSHIP OF COPYRIGHT
SOLE AUTHOR
The author must not be equated to a mere scribe or amanuensis. The author is the individual
who expressed the ideas in an original form. As confirmed in Neudorf, authorship has two
requirements: originality and expression.
Notably, there is an exception where there is an agreement to the contrary- though given the
case facts this exception X applies to the facts provided.
1. It comes back to originality and skill and judgment
2. Key factor is intellectual contribution, not economic (i.e. director vs. producer)
3. Minor contributions (i.e. editing, small improvements) do not constitute
authorship.
JOINT AUTHORSHIP
Under section 2 of the Copyright Act, work of joint authorship means a work produced by
the collaboration of two or more authors in which the contribution of one author is not distinct
from the contribution of the other author or authors. See Neudorf v. Nettwerk and look to test.
OWNERSHIP OF COPYRIGHT
13 (1) Subject to this Act, the author of a work shall be the first owner of the copyright therein.
- WORK FOR HIRE EXCEPTION -
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ASSIGNMENT & LICENSES OF RIGHTS
INTRO
Copyright comprises right to produce and reproduce, perform in public, publish, authorize.
Each of these primary rights are further divided as illustrated by s. 3(1) (a) to (j).
Each right can be assigned or licensed either wholly or partially.
Under section 3(4) of the Copyright Act the owner of the copyright in any work may assign
the right, either wholly or partially, and either generally or subject to limitations relating to
territory, medium or sector of the market or other limitations relating to the scope of the
assignment, and either for the whole term of the copyright or for any other part thereof, and
may grant any interest in the right by licence, but no assignment or grant is valid unless it is in
writing signed by the owner of the right in respect of which the assignment.
Also, assignment and grants of interest by licence must be in writing and signed by the owner
of the copyright, s.13(4). Unless registered, assignments and grants of interest are void as
against any subsequent assignee or licensee for valuable consideration without actual notice, s.
57(3)
ASSIGNMENTS
LICENCES
OWNERSHIP RIGHTS
Exclusive Rights Intro
Section 3(1) of the Copyright Act provides owners with the sole right to produce or reproduce
the work or any substantial part thereof in any material form whatever. To perform the work
or any substantial part thereof in public. Or if the work is unpublished, to publish the work or
any substantial part thereof, […] And to authorize any such acts.
Practical examples are further explained in ESA v. SOCAN
The right to produce and reproduce the work
Copyright owners have the exclusive right to produce and reproduce the work in any material
from whatever in a substantial part of the work.
Anne of Green Gables Licensing Authority: ownership rights extended to two- and threedimensional representations (produce and reproduce). However, copyright only protected
verbal portrait BECAUSE the character “Anne” and the situations in which she finds herself in
the book are clearly delineated, distinctive, thorough, and complete. The literary work Anne
of Green Gables contains a detailed verbal portrait that captures Anne’s physical image and
her personal qualities, a portrait which I conclude is protected by copyright.
Right to perform in public
Performance means “any acoustic or visual representation of a work, […] including a
representation made by means of any mechanical instrument, radio receiving set or
television receiving set” (Copyright Act, s. 2)
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Notably, the right to communicate a work to the public by telecommunication is a subset of
the right to perform in public (Copyright Act, s.3(1)(f); ESA v. SOCAN). Rogers
Communications Inc
As demonstrated in Entertainment Software Association right to perform and right to
produce are not to be confused. A right to perform doesn’t provide patreons with a copy of
said performance.
The Right to Publish
The right to publish the work of any substantial part thereof if the work is unpublished . The
right to publish subsists only until the first publication. A work is not deemed to be published
if the act is done without the consent of the owner (Copyright Act, s. 2.2(3)). “Publication”
includes: making copies of a work available to the public; constructing an architectural work;
incorporating an artistic work into an architectural work; or, making copies of a sound
recording available to the public. Publishing does not include: performance in public or
communication by telecommunication of a work OR exhibiting in public an artistic work.
Right to Authorize
The right to authorize is distinct from the others. To authorize is to “sanction, approve and
countenance” Muzak Corporation
INFRINGMENT OF OWNERSHIP RIGHTS
INFRGINMENT INTRO:
Canadian law protects the exclusive right of copyright owners to reproduce or to authorize the
reproduction of their works. The unauthorized reproduction of a substantial part of an original
work constitutes copyright infringement, for which a copyright owner can seek various
remedies. Cinar Corporation v Robinson, 2013 SCC 73.
Under section 27 (1) of the Copyright Act, it is an infringement of copyright for any person to
do, without the consent of the owner of the copyright, anything that by this Act only the
owner of the copyright has the right to do.
Section 2(a) of the Act defines “infringement” to include: (a) in relation to a work in which
copyright subsists, any copy, including any colourable imitation, made or dealt with in
contravention of this Act.
INFRINGMENT COPYING WORK
Under section 3 (1) of the Act defines the rights of copyright owners to include: the sole right to
produce or reproduce the work or any substantial part thereof in any material form whatever,
to perform the work or any substantial part thereof in public or, if the work is unpublished, to
publish the work or any substantial part thereof.
Accordingly, copyright infringement is established when the defendant has produced a
substantial copy, including a colourable imitation of the plaintiff’s work. Notably, infringement
is not limited to an exact copy [RAINS].
In Francis Day & Hunter v. Bron the Court established the following factors when considering
infringement: (1) sufficient objective similarity between the infringing work and the copyright
work for the infringing work to be described as a reproduction or adaptation of the copyright
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work, or a substantial part thereof; and (2) the copyright work must be the source from which
the infringing work is derived: the copyright work need not be the direct source: and, work
created independently is not infringing.
The court will have to balance the rights of the artist and public. As seen in Rains, where the
courts give Rains exclusive access to this territory would unfairly silence independent
expressions of the idea and render absurd the very purpose of the Act. Lastly, Pyrha Design
clarified that work will have copied a “substantial part” where it has recreated a substantial
part of the originality in the copyrighted work.In Cinar, unauthorized taking of a substantial
part of the original expression (not IDEA) is infringement! Here, the SCC accepted the trial
judge’s findings of copying: overall architecture of submission for TV show; Personalities of
protagonist and secondary characters; and Graphic appearance of setting and protagonist..
AUTHORSHIP-MORAL RIGHTS
Moral rights intro
Under section 14 of the Copyright Act,
The author of a work has, subject to section 28.2, the right to the integrity of the work and, in
connection with an act mentioned in section 3, the right, where reasonable in the
circumstances, to be associated with the work as its author by name or under a pseudonym
and the right to remain anonymous.
Furthermore, in section 28.1 Any act or omission that is contrary to any of the moral rights of
the author of a work or of the performer of a performer’s performance is, in the absence of
the author’s or performer’s consent, an infringement of those rights.
Importantly, there is NO assignment of moral rights but they may be waived (section 14).1.(24).
Right to the integrity of the work
Under section 28.2 (1) 28.2 (1) The author’s or performer’s right to the integrity of a work or
performer’s performance is infringed only if the work or the performance is, to the prejudice of
its author’s or performer’s honour or reputation, (a) distorted, mutilated or otherwise modified;
or
(b) used in association with a product, service, cause or institution.
.
As confirmed in Maltz v Witterick, the test for reputational damage is subjective and objective.
The subjective meaning the author’s testimony that the alleged infringement has impacted their
honour/reputation. In addition, the objective component requires evaluation of the prejudice
based on public or expert opinion.
A positive example of this is, Snow v Eaton, where the addition of Christmas scarves to the PL
sculpture. The Court found that this addition constituted an infringement of moral rights under
s.12(7) of the Copyright act. The subjective component was met through Snow’s frustration
with the situation. And the objective through colleagues and experts in the field whom agreed
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with the prejudice to snow’s honour and reputation. Contrarily, in Thomson v Afterlife, the
objective element failed as no objective evidence was provided (such as public opinion or expert
evidence)
REMEDIES
DAMAGES
Liability for infringement
35 (1) Where a person infringes copyright, the person is liable to pay such damages to the
owner of the copyright as the owner has suffered due to the infringement and, in addition to
those damages, such part of the profits that the infringer has made from the infringement and
that were not taken into account in calculating the damages as the court considers just.
(2) In proving profits,
(a) the plaintiff shall be required to prove only receipts or revenues derived from the
infringement; and
(b) the defendant shall be required to prove every element of cost that the defendant claims.
Injunction only remedy when defendant not aware of copyright
39 (1) Subject to subsection (2), in any proceedings for infringement of copyright, the plaintiff
is not entitled to any remedy other than an injunction in respect of the infringement if the
defendant proves that, at the date of the infringement, the defendant was not aware and had no
reasonable ground for suspecting that copyright subsisted in the work or other subject-matter
in question.
Exception where copyright registered
(2) Subsection (1) does not apply if, at the date of the infringement, the copyright was duly
registered under this Act.
38.1 (1) Subject to this section, a copyright owner may elect, at any time before final judgment
is rendered, to recover, instead of damages and profits referred to in subsection 35(1), an
award of statutory damages for which any one infringer is liable individually, or for which any
two or more infringers are liable jointly and severally,
(a) in a sum of not less than $500 and not more than $20,000 that the court considers just, with
respect to all infringements involved in the proceedings for each work or other subject-matter,
if the infringements are for commercial purposes; and
(b) in a sum of not less than $100 and not more than $5,000 that the court considers just, with
respect to all infringements involved in the proceedings for all works or other subject-matter,
if the infringements are for non-commercial purposes.
Damages – Statutory Damages
Trader v CarGurus, 2017 ONSC 1841
[53] Trader is claiming the minimum of $500 per work. It submits that based on simple
arithmetic; it is entitled to statutory damages of $98,370,000 ($500 times 196,740 infringed
photos). That number would be $76,266,000 based on my reduced number of 152,532 Trader
Photos.
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DEFENCES TO COPYRIGHT INFRINGMENT
Fair Dealing
Under the Berne Convention (article 9(2)) allows parties to permit the reproduction of such
works in certain special cases. Accordingly, categories in Canada fall under a “fair dealing”
exemption can act as defenses to copyright (s. 29, 29.1 and 29.2) including research, private
study, education, parody or satire, criticism or review and news reporting.
In CCH, the fair dealing test was clarified as follows:
1. Is the dealing for an allowable purpose?“ large and liberal interpretation in order to
ensure that users’ rights are not unduly constrained” - CCH
2. Is the dealing fair?
- The purpose of the dealing,
- The character of the dealing
- The amount of the dealing
- The alternatives to the dealing
- The nature of the work
- The effect of the dealing on the work
Question of fact – depending on the circumstances of each case
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TRADEMARK LAW
CRITERION
IS IT TRADEMARKABLE
Under section 2 of the Trademark Act (TMA), a trademark means: (a) a sign or combination
of signs that is used or proposed to be used by a person for the purpose of distinguishing or
so as to distinguish their goods or services from those of others, (b) a Certification Mark,
Mattel Inc. v 3894207 Canada Inc: a trademark is used as a source distinguisher. And often
acts as an assurance to the consumer that the quality will be what he or she has come to
associate with a particular trade-mark.
Notably, trademarks generally fall under Federal jurisdiction, most disputes go to Federal
Court (Kirkbi).
At Examination, the Registrar will consider whether:
1. There is a proper trademark application that conforms to the requirements of s. 30
2. The mark is registrable (s. 12)
3. The applicant is entitled to registration (s. 16)
4. The trademark is distinctive
S. 37: The Registrar shall refuse an application if she is not satisfied of the above
There is a proper trademark application that conforms to the requirements of s. 30
Under section 30 there are certain requirements that are necessary to fulfil within a TM
application. Section 30(2) provides further details on such requirements. These are
elaborated on in rule 31 which provides information prescribed for the purpose of 30(2)(d).
Mark is registrable (s. 12)
Section 12 provides 5 “subcategories” that if any one is met by an application there mark is
“unregistrable” and will subsequently be rejected by the Register.
12(1)(a)= name and surname clause
12(1) (b) = clearly descriptive or misdescriptive – place of origin
12(1) © = name of literal ingredients
12(1) (d) = CONFUSING
12(1) € = prohibited sign
CONFUSING
Under section 16:
Persons Entitled to Registration of Trademarks
16. (1) Any applicant who has filed an application … for the registration of a registrable
trademark is entitled … to secure its registration in respect of the goods or services specified
in the application, unless at the filing date of the application or the date of first use of the
trademark in Canada, whichever is earlier, it was confusing with
- Furthermore, in section 12(1) (d) marks that are confusing with a registered TM are not
registerable. Here, the Examiner follow the section 6(5) analysis.
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Section 6 (2): The use of a trademark causes confusion with another trademark if the use of
both trademarks in the same area would be likely to lead to the inference that the goods or
services associated with those trademarks are manufactured, sold, leased, hired or
performed by the same person, whether or not the goods or services are of the same general
class or appear in the same class of the Nice Classification.
Section 6(5): In determining whether trademarks or trade names are confusing, the court or
the Registrar, as the case may be, shall have regard to all the surrounding circumstances
including
(a) the inherent distinctiveness of the trademarks or trade names and the extent to
which they have become known;
(b) the length of time the trademarks or trade names have been in use;
(c) the nature of the goods, services or business;
(d) the nature of the trade; and
(e) the degree of resemblance between the trademarks or trade names, including in
appearance or sound or in the ideas suggested by them.
-
-
-
As seen in Masterpiece, the resemblance between the marks is generally the most
important factor of the confusion analysis. However, marks must be viewed as a
whole-not dissected. Marks should be assessed from the perspective of ordinary
hurried purchaser.
Furthermore, the “nature or goods and services” the parties’ fields of trade is a major
factor and it is difficult to establish confusion when parties marks are used with highly
dissimilar goods/service (Mattel).
Surround circumstances: evidence of actual confusion/co-existence is relevant but not
actually necessary (Mattel).
The perspective for confusion is “the casual consumer somewhat in a hurry. Mattel
In summary, it is important when applying the likelihood of confusion test in Canada not
to restrict oneself to the five enumerated factors. Considering all relevant surrounding
circumstances, including the five enumerated factors, will provide the most accurate
assessment of the likelihood of confusion, and submitting appropriate evidence and
arguments on these additional issues can be the deciding factor in succeeding in an
opposition or infringement action.
Trademark is distinctive
Under section 37(1)(d) the Registrar can refuse a mark that is not inherently distinctive.
Accordingly, a trademark must have some degree of inherent distinctiveness or must have
acquired distinctiveness at the time of filing of the application. In class we discussed some
examples of TMs lacking distinctiveness: geographic locations, generic designs, words of
colours, one and two letter or number maker, laudatory words/phrases, and provides generic
information.
Notably, under TMA 32 (1) An applicant shall furnish the Registrar with any evidence that the
Registrar may require establishing that the trademark is distinctive at the filing date of the
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application for its registration, if any of the following apply: (a) the applicant claims that their
trademark is registrable under subsection 12(3) (addresses name and descriptiveness issues
at section 12(1)(a) and 12(1)(b) of the TMA); (b) the Registrar’s preliminary view is that the
trademark is not inherently distinctive.
OPPOSE A TM
Opposition INTRO
Under section 38 opposition to applications can be opposed up to two months from date of
advertisement. As clarified in Seagram & Sons, the legal burden is upon the Applicant to
show that its application complies with the provisions of the Act. The following are grounds
of opposition under section 38(2); application does not conform to the requirements of
section 30(2); the application was filed in bad faith; the trademark is not registrable (s. 12);
That the applicant is not the person entitled to registration of the mark (s.16); that the mark
is not distinctive (s. 2); At the filing date the applicant was not using and did not propose to
use the trademark in Canada in association with the goods or services specified in the
application.
Notably, you only need to win on one ground to successfully oppose the opposition.
[38(2)(a)] Application does not conform to the requirements of section 30(2)
A statement of opposition may be based on the ground that the application does not
conform to the requirements of section 30(2). The material date for compliance with section
30 is the date of filing the application.
[38(2)(a.1) The application was filed in bad faith
For example, Cerverceria Modelo, S.A. de C.V. v. Marcon (70 CPR (4th) 355 where the
applicant tried to register CORONA for drinks other than beer. Moreover, Lifestyles
Improvement Centers, LLP v. Chorney (63 CPR (4th) 261) where a licensee tried to register
licensor’s mark.
[38(2)(b) Trademark is not registrable
A statement of opposition may be based on the ground that the trademark is not registrable.
Look to s. 12 for possible opposition grounds based on non-registrability (e.g., go through
section 12 of the TMA and see if anything applies)
• An opponent can rely on 12(1)(b) if the mark is either clearly descriptive or
deceptively misdescriptive of the character or quality of the associated goods or
services. Material date = date of filing of the application
• Under s.12(1)(d), the opponent may allege that the applicant’s trademark is confusing
with a registered trademark. Material date = date of the decision
• Section 38(2)(c) & 16: the applicant is not the person entitled to registration of the
mark because: prior use of a confusing mark. Prior application to register a confusing
mark (that was pending at the date of advertisement). Prior use of a confusing trade
name.
[38(2)(d)] Mark is Distinctiveness (s.2)
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Section 38(2)(d): the mark is not distinctive (s.2). The applicant’s mark might lack
distinctiveness if it is generic, primarily merely a surname, clearly descriptive, confusing with
another party’s trademark, etc. Material date = date of filing of the opposition
TM LICENSING OR ASSIGNMENT
TM licensing or assignment intro:
A trademark owner can license a third party to use its trademark provided the owner has
control over the character/quality of the licensed goods/services.
- Use by the licensee will accrue to the benefit of the owner.
- This is critical for maintaining distinctiveness of a mark and ultimately to protect brand
owner’s rights.
LICENSING
Under section 50 of the TMA, 50. (1) For the purposes of this Act, if an entity is licensed by or
with the authority of the owner of a trademark to use the trademark in a country and the
owner has, under the licence, direct or indirect control of the character or quality of the
goods or services, then the use, advertisement or display of the trademark in that country as
or in a trademark, trade name or otherwise by that entity has, and is deemed always to have
had, the same effect as such a use, advertisement or display of the trademark in that country
by the owner.(2) For the purposes of this Act, to the extent that public notice is given of the
fact that the use of a trademark is a licensed use and of the identity of the owner, it shall be
presumed, unless the contrary is proven, that the use is licensed by the owner of the
trademark and the character or quality of the goods or services is under the control of the
owner.
• License can be written or oral
• Key component: control by the licensor of the character or quality of the
goods/services
• In proceedings where licensed use is an issue, control can be established by:
• Providing copy of license agreement that provides for the requisite control
• Swearing to the fact that the licensee exerts control
• Providing evidence that demonstrates the licensee exerts control
• In the absence of valid control there can be no valid license and owner risks
losing the mark for lack of distinctiveness or non-use
- Hallmarks of control include: Design products and oversee manufacture of goods, right
to obtain samples of finished products, often a mechanism in place allowing licensor to
inspect goods/services and to take steps to correct deficiency in the quality.
Assignment
S. 48 (1): a trademark, whether registered or unregistered, is transferrable, and deemed
always to have been transferrable, either in connection with or separately from the goodwill
of the business and in respect of either all or some of the goods or services in association
with which it has been used. Assignor immediately ceases to have any right to use the
trademark.
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HOW TO LOSE TM RIGHTS POST REGISTRATION
INTRO
There are two main ways to lose rights in a trademark registration: (1) Non-use cancellation
proceedings (s. 45); and (2) Invalidity proceedings (s. 18)
SECTION 45 USE OF GOODS AND SERVICES
s. 45: After three years beginning on the day on which a trademark is registered, unless the
Registrar sees good reason to the contrary, the Registrar shall, at the written request of any
person who pays the prescribed fee — or may, on his or her own initiative — give notice to
the registered owner of the trademark requiring the registered owner to furnish within three
months an affidavit or a statutory declaration showing, with respect to all the goods or
services specified in the registration or to those that may be specified in the notice, whether
the trademark was in use in Canada at any time during the three-year period immediately
preceding the date of the notice and, if not, the date when it was last so in use and the
reason for the absence of such use since that date.
Under s.45: the Registrar can cancel a registration (in whole or in part), if the owner cannot:
Firstly, show “use” of the mark within 3 years preceding the date of the Section 45 Notice, or;
provide “special circumstances” excusing non-use.
Generally, three main issues: “use” with goods & services as defined in s.4 use by the
Registrant or authorized licensee or “use” of the trademark as registered.
“Use”:
 As defined in s.4 of the Act;
 In accordance with all of the goods and services listed in the registration
Use with Goods:
- A trademark is deemed to have been used in association with goods if, at the time of
the transfer of the property in or possession of the goods, in the normal course of
trade, it is marked on the goods themselves or on the packages in which they are
distributed or it is in any other manner so associated with the goods that notice of the
association is then given to the person to whom the property or possession is
transferred. (see evidence notes)
SEE: Nightingale Interloc Ltd. Prodesign Ltd
Use in association with services:
- A trademark is deemed to be used in association with services if it is used or displayed
in the performance or advertising of those services.
- Use by export (s. 4(3)): a mark that is marked in Canada on goods or on the packages in
which they are contained in, when the goods are exported from Canada, deemed to be
used in Canada in association with those goods. (see evidence notes)
SEE: Nightingale Interloc Ltd. Prodesign Ltd
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SECTION 45 USE OF TM AS REGISTERED (ITS CHANGED)
The practical test to be applied in order to resolve a case of this nature is to compare the trademark as it is registered with the trade-mark as it is used and determine whether the differences
between these two marks are so unimportant that an unaware purchaser would be likely to
infer that both, in spite of their differences, identify goods having the same origin.
SEE: Bull v CII Honeywell + Promafil Canada Ltee v Munsingwear Inc.
Example: Do you think the evidence shows use of the mark “as registered”?
• Yes, the mark does not lose its identity and remains recognizable despite the difference
(see Honeywell) the DOMINANT features are the letters and person with backpack on
mountain are preserved as mark as registered and the way it appears on the right. Use
of mark in evidence constitutes use of mark as registered.
Invalidity proceedings (s. 18)
Under section 18 there are ways to challenge the validity of a registration.
TM.
NOT registerable
18(1)(a) — The trademark was not registrable at the date of registration
Section 12. Relevant date = date of registration.
18 (1)(b) The trademark is not distinctive at the time proceedings bringing the validity of the
registration into question are commenced.Relevant date = time proceedings (e.g.,
application) initiated. Distinctiveness – look to s.2 Distinctiveness may be lost when: the
mark becomes generic or part of the public domain; the mark is improperly assigned; and
the mark is improperly licensed.
18(1)(c)- the trademark has been abandoned. Requires intent to abandon (but intent can be
inferred from a long period of non-use, e.g., YIWU – 2021 FC 1040). NOTE: Section 45 does
not require demonstration of intent to abandon. Relevant date = date of commencement of
proceedings
18 (1)(d) Subject to section 17, the applicant for registration was not the person entitled to
secure the registration. Registration invalid if applicant not entitled to registration of the
mark. Entitlement – look to s.16
18 (1)(e) the application for registration was filed in bad faith. New ground of invalidity.
Relevant date presumably date of filing of application
ENFORCEMENT OF EXCLUSIVE RIGHTS
Passing off – TMA s. 7(b) (common law and registered rights)
The common law action for passing off has been statutorily codified in Canada’s Trade-marks Act (Act) in
section 7(b) through (d). TMA prohibits a trader from directing public attention to their goods, services, or
business in a manner likely to cause confusion between them and the goods, services, or business of
another. The critical elements of a passing off claim include the existence of goodwill, deception of the
public due to a misrepresentation, and actual or potential damage. Subway v Budway
Passing off happens when someone deliberately or unintentionally passes off their goods or services as
those belonging to another party. This action of misrepresentation often damages the goodwill of a person
or business, causing financial or reputational damage.
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•
•
•
Actual damage need not be proved but there must be a likelihood of damage.
Territorially restricted to where the senior mark enjoys reputation or goodwill
Must prove actual/probable damage through evidence
• Direct competitors/loss of sales
• In Subway v Budway, “loss of control over the use and commercial impact of their marks,
which has been recognized as actual damage sufficient to meet the third requirement of the test
for passing off” (para 34)
THREE ELEMENTS REQUIRED TO ESTABLISH PASSING OFF:
** Territorially restricted to where the senior mark enjoys reputation or goodwill**
•
•
Sufficient reputation of goodwill
COPY + PASTE: Goodwill for the purposes of passing off requires that a mark is distinctive and
possesses reputation, which may engage consideration of distinctiveness, length of use, sales
volumes, advertising, and intentional copying. I am satisfied that Ms. Johnson’s evidence clearly
shows goodwill in the SUBWAY trademarks. I agree with Subway that the existence of goodwill
is reinforced by the respondents’ conduct in taking advantage of that goodwill and reputation by
copying the logo and using a submarine sandwich mascot.
•
•
Deception of the public due to misrepresentation (confusion)
The misrepresentation to the public cited by Subway is the likely confusion with its trademarks.
For the same reasons discussed above, I conclude that there is a likelihood of confusion between
the respondents’ BUDWAY trademark and Subways.
•
Actual or potential damage
- In Subway v Budway, “loss of control over the use and commercial impact of their marks, which
has been recognized as actual damage sufficient to meet the third requirement of the test for
passing off” (para 34)
Infringement – TMA ss. 19 & 20 (only registered rights)
o Section 19: the registration of a trademark in respect of any goods or services, unless shows to be
invalid, gives to the owner of the TM, the exclusive right to use throughout Canada of the TM in
respect of those goods and services. [NARROW]
o Section 20: owner’s exclusive right is infringed by a person who uses a confusing trademark or
trade name [BROADER AMBIT]= “confusingly similar marks”
o Can only bring this with REGISTERED RIGHTS!!!!
Key components to establish infringement under s. 20:
(1) Plaintiff owns a registered trademark
(2) a sale, distribution or advertisement (etc.) of any goods or services has occurred
(3) in association with a confusing trademark or trade name
(4) by a person not entitled under the Act to use the registered mark
(5) as a trademark or tradename
 COPY + PASTE CONFUSOIN: The right to exclusive use is deemed infringed by the sale,
distribution, or advertisement of goods or services in association with a confusing
trademark: Trademarks Act, s 20(1)(a). A trademark is confusing with another trademark if use of both
in the same area “would be likely to lead to the inference that the goods or services associated with
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those trademarks are manufactured, sold, leased, hired or performed by the same person, whether or
not the goods or services are of the same general class. In determining whether trademarks are
confusing, the Court has regard to all of the surrounding circumstances, including the particular
circumstances identified in subsection 6(5) of the Trademarks Act. The test for confusion is to be
applied as a matter of “first impression in the mind of a casual consumer somewhat in a hurry” at a
time when they have “no more than an imperfect recollection” of the registered mark and without
giving the matter “detailed consideration or scrutiny”----According to the decision, the test for
confusion is the "first impression in the mind of a casual consumer somewhat in a hurry."--- In conducting the confusion analysis (6.5), all of the factors favoured Subway:
(a) the inherent distinctiveness of the trademarks or trade names and the extent to which they
have become known;
-
-
DEGREE OF RESEMBELENCE: The BUDWAY trademark used by the respondents strongly resembles both the ’134 Mark and the ’443 Mark. In
each case, the word element of the mark is similar, with the similarities in letters and pronunciation between SUBWAY and BUDWAY being selfevident. The fact that “budway” is not itself a word means that it would tend to be read in a manner to connote the common word “subway.” In
context, the connotation would be with Subway’s SUBWAY-branded restaurants in particular. The similarity between the marks, and the associative
connotation with Subway’s restaurants, is further enhanced by the respondents’ use of the same logo elements that appear in the ’134 Mark and the
’443 Mark, namely the colour differentiation between the first three and last three letters, and the arrow design motif. The use of green colouring and
an oval background is a further point of similarity with the ’134 Mark in particular. The differences between the marks, including the two different
letters and the addition of more arrows, do not serve to materially undermine the resemblance, particularly to a casual consumer.
DISTINCTIVENESS: The ’134 Mark and the ’443 Mark each have a fairly high degree of inherent distinctiveness. The word “subway” is a
common word, but it does not as a whole describe or suggest Subway’s goods or services. The “sub” element is clearly connected with the
submarine sandwiches sold at Subway restaurants, but the use of that element in the SUBWAY trademarks is distinctive. This distinctiveness is
further enhanced by the graphic elements of the marks, which include the arrow designs and colour differentiation. In addition, Ms. Johnson’s
affidavit contains extensive evidence showing that Subway and its trademarks are well known in Canada. There were more than 3,100 Subway
restaurants in Canada as of September 2020, including over 400 in British Columbia, 67 in Vancouver, and 4 in West Vancouver in particular.
Subway’s sales in Canada were at least US$1.5 billion per year in the period from 2014 to 2019, with annual marketing expenditures of at least
US$80 million. Subway’s website, which shows the SUBWAY logo substantially in the form of the ’443 Mark, had 32.3 million page views in
2019. While Ms. Johnson’s evidence does not associate these figures with the various SUBWAY trademarks, and it may be difficult or impossible to
do so, it is clear that the SUBWAY trademarks, including through their graphic representation as seen in the ’134 Mark and the ’443 Mark, have
become well known in Canada and have gained significant acquired distinctiveness. While the respondents’ BUDWAY trademark similarly has
some distinctiveness, the distinctiveness of its graphic elements derives primarily from adopting the elements seen in the SUBWAY trademarks.
There is no evidence that the BUDWAY trademark has become known to any material extent. The relative distinctiveness of the trademarks again
points to a finding of confusion.
(b) the length of time the trademarks or trade names have been in use;
-
The ’134 Mark has been registered since 2000 based on use since 1997, while the ’443 Mark was registered in 2019. The historical
evidence provided by Ms. Johnson shows use of the marks for many years. The respondents, by contrast, have apparently only used
their mark for a short period of perhaps a year. This factor again points to a finding of confusion.
(c) the nature of the goods, services or business;
- The ’134 Mark is registered in association with restaurant services, including preparation of food
for take-out. The ’443 Mark is registered in association with a variety of food goods,
including sandwiches and wraps for consumption on or off the premises; and snacks
namely…pastries, cookies, and with a number of services including restaurant services, namely
providing of food and beverages for consumption on and off the premises; and eat-in and take-out
food restaurant services.
- While neither mark is registered for use in association with cannabis products, Subway
underscores the baked goods in the ’443 Mark registration, and the baked goods being offered for
sale at the Budway on Clark cannabis store. Subway notes that its registration for the ’443 Mark in
association with “cookies” does not limit the contents of those cookies and would even cover
cookies containing cannabis. It notes that this overlap in goods distinguishes its case from that
in Herbs “R” Us, where I concluded that the cannabis products offered by the respondent and the
toys and other product lines in the applicant’s registrations were fundamentally dissimilar and
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-
made confusion unlikely: Toys “R” Us (Canada) Ltd v Herbs “R” Us Wellness Society, 2020 FC
682 at paras 35–38, 43–45.
I agree that the overlap between the goods offered by the respondents and those identified in the
registration make this case different from Herbs “R” Us. As Subway notes, although “their
ingredients may differ, both parties offer foodstuffs and edible products to their
consumers.” Further, even without the registration for “cookies” in particular, I consider the
differences between the goods and services identified in the SUBWAY registrations and the edible
and other cannabis products offered by the respondents to be less fundamentally dissimilar than
those in Herbs “R” Us. I also agree with Subway that the respondents’ use of a submarine
sandwich mascot and references to “munchies” further draws the goods into closer comparison.
(d) the nature of the trade; and
- While Subway did not place significant reliance on this factor, both Subway and the respondents
appear to offer goods at a retail level with a similar size of store, offering goods for immediate
purchase, including on a “take-out” basis. While there was little evidence as to the nature of the
respondents’ trade, this factor at least does not undermine the likelihood of confusion.
- Based on the foregoing factors, I am satisfied that Subway has shown there is a reasonable
likelihood of confusion between the respondents’ BUDWAY trademark and each of the ’134 Mark
and the ’443 Mark. As in Herbs “R” Us, the context makes it perfectly clear that the respondents
have adopted their mark by deliberately drawing on the famous mark of the applicant. Unlike in
that case, given the goods and services set out in the applicant’s registration, I conclude that there
is a likelihood of infringement.
(e) the degree of resemblance between the trademarks or trade names, including in appearance or
sound or in the ideas suggested by them.
 Conclusion: There was a strong resemblance which favoured Subway, owing the similar word
elements, the same logo elements, the same colour differentiation between first three and last three
letters, and the arrow design motif.
Depreciation of goodwill – TMA s. 22 (only registered rights)
- Section 22 of the Trademarks Act prohibits the use of a registered trademark “in a manner that is
likely to have the effect of depreciating the value of the goodwill attaching thereto.” Section
22 has four elements, namely use, goodwill, linkage, and damage.
- Only applies to registered TM
- Four Elements:
(2) USE: Registered mark or a mark that is “sufficiently similar” is used by the
Defendant in connection with goods or services (whether or not they are
competitive with those of the claimant).
(3) GOODWILL: Registered mark is sufficiently well known to have “significant
goodwill” attached to it (though not necessarily well known or famous).
(4) LINKAGE: Mark is used in a manner likely to have an effect on the goodwill
attaching to it (i.e. linkage or mental association between the marks)
(5) DAMAGE: likely effect is to depreciate the value (reducing the esteem of the
brand, a diminution of the uniqueness of the brand).
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-
-
COPY + PASTE: Firstly, that a claimant’s registered trademark was used by the defendant in
connection with wares or services — whether or not such wares and services are competitive with
those of the claimant. Secondly, that the claimant’s registered trade-mark is sufficiently well
known to have significant goodwill attached to it. Section 22 does not require the mark to be well
known or famous (in contrast to the analogous European and U.S. laws), but a defendant cannot
depreciate the value of the goodwill that does not exist. Thirdly, the claimant’s mark was used in a
manner likely to have an effect on that goodwill (i.e. linkage) and fourthly that the likely effect
would be to depreciate the value of its goodwill (i.e. damage).
the Court emphasizes that, when it is looking at USE, the mark does not need to be exactly as
registered, and the Court finds that the BUDWAY mark is closely akin to the marks, such that it
would evoke a mental association of the marks.
Veuve Clicquot: Would use of Cliquot with women’s clothing store depreciate the goodwill?
Court said “no” – the plaintiff failed to prove a likelihood of depreciation: Fails on last two
elements of the test: 1. No evidence that somewhat hurried consumer who saw word "Cliquot" in
defendants' stores would make connection to plaintiff's mark. 2. Use of CLIQUOT name in
relation to women's clothing store was not likely to depreciate value of goodwill attaching to
VEUVE CLICQUOT trademark
DEFENCES
Statutory limitations
TMA does not have limitation period. S. 39(1) Federal Courts Act – the general limitation law
of the province in which the action arose governs. So, in Ontario, the Ontario Limitations Act
governs: 2 year basic limitation from date discovered or reasonably could have been
discovered and 15 year ultimate limitation from date of act or omission (irrespective of basic
limitation period). If “otherwise than in a province” – S. 39 of Federal Courts Act has six year
limitation period after cause of action arose.
Acquiescence
Definition: “If a party, who could object, lies by and knowingly permits another to incur an
expense in doing an act under the belief that it would not be objected to, and so a kind of
permission may be said to be given to another to alter his condition, he may be said to
acquiesce.” DF must prove its case. Key is showing “the owner of the legal right has done
something beyond mere delay to encourage the wrongdoer to believe that he does not intend to
rely on his strict rights, and the wrongdoer must have acted to his prejudice in that belief…”
Invalidity (of registered trademark) – s. 18 TMA
Full defence against infringement and depreciation of goodwill. If in Federal Court, will
usually counterclaim for expungement of the registered trademark (but cannot do this in
provincial court).
Loss of distinctiveness
Important for claims of passing off (e.g., no registration to invalidate). Look for improper
assignment, licensing, or common use of the mark.
REMEDIES
REMEDIES
Injunction – interim (e.g., urgent – seize evidence), interlocutory (e.g., usually lasts until trial),
permanent (granted after trial)
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•
Interim/interlocutory difficult but not impossible to obtain
• requires plaintiff to establish three elements:
1) serious issue to be tried (are the claims not frivolous or vexatious)
2) irreparable harm (harm that cannot be adequately compensated by damages)
3) balance of convenience (which party will be most harmed if the injunction is not
granted)
• In an infringement case in Federal Court, injunction could prevent use of the confusing
mark anywhere in Canada
• In a case for passing off, order typically enjoins defendant from misrepresenting its
goods/services/business for those of the plaintiff in the geographic area where the
plaintiff has a protectable reputation
BUDWAY: Injunction (e.g., enjoined from) using the mark BUDWAY (e.g., infringing), directing
public attention… (e.g., passing off), or using Subway’s marks in a manner likely to
depreciate… (e.g., depreciation of goodwill)
DAMAGES
•
•
Damages or an accounting of profits – alternative remedies
• Plaintiff is entitled to an award of damages which represents the actual loss
suffered and that is the natural and direct consequence of the unlawful acts of the
defendant
• Accounting of profits – plaintiff has the onus of first proving the defendant’s gross
sales of the infringing product
• Defendant must the prove its expenses offsetting the gross profits to
arrive at net profit from infringing sales
Deliver up or destroy under oath any signage, goods, packages, labels and advertising
material in accordance with s. 53.2(1) TMA
- Pay damages in the amount of $15,000
- Pay costs in the amount of $25,000
- Strategy – can you add in copyright claims for statutory damages?
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PATENT LAW
CRITERION
Is the X patentable- OPENING
A patent provides the inventor with the right to stop others from using, making or selling one’s invention
from the date the patent is granted to a maximum of 20 years after which the patent application is filed
(s.42 of the Patent Act). In Canada, in order to be patentable an invention must: fall under statutory subject
matter, be “new,” non-obviousness and “useful” (s.2). Notably, as noted in Amazon and Shell Oil
patentable “art” must also have a commercially useful result. The following are non-patentable inventions:
mere scientific principles or abstract theorems (Patent Act, section 27(8)); Fine arts or works of art that
are inventive only in an artistic or aesthetic sense (Amazon, para 58); Professional skills-methods of
medical treatment (Shell Oil, at 554; Cobalt v Bayer, 2015 FCA 116); and higher life forms (Harvard
Mouse). Given the case facts, X would not full under one aforementioned exemptions. Accordingly, we
must now demonstrate that X invention is “new”.
ANTICIPATION
Section 2 of the Patent Act, requires inventions to be “new.” Of concern to “newness” is anticipation
(section 28.2). If the invention is not new it is said to ack novelty OR to be anticipated. This is done on a
claim-by-claim basis (Zero Spill). The test for anticipation requires two elements including: (1) disclosure;
and (2) enablement (Apotex).
- Firstly, concerning disclosure (I.E., “UNFETTERED ACCESS”) the case facts at hand relate to
28.X as such the X claim must not have been disclosed [insert what it says]. Does it meet this.
*must be single disclosure and Not mosaic* Was there a duty of confidentiality? Wenzel.
 Presence of the book in a library enough to be “made available to the public”
 no
need to prove that anyone actually read book! (Wenzel FCA, para 70)
 Bauer: No public disclosure at a Test League game because the prototype skates were only
available for visual inspection, and neither testing nor close examination was possible. too
difficult for person in the crowd to study the claimed element in the skate.
- Secondly, after reviewing the prior disclosure, it must be determined whether a PSIA could/could
not perform the invention without “undue burden.” Although trial and error are allowed at this stage
it cannot be prolonged or arduous. However, if enablement requires any degree of inventiveness,
then this element of the test is not satisfied. In the case at hand,
 Bayer Held: even if disclosed, no enablement. A PSIA could not reverse engineer without
inventive ingenuity. No disclosure occurs if the prior use is experimental in nature.
Experimentation must be reasonable and necessary (Yaz at para 157) Prospective here is
the USER, would they have considered the experiment as necessary in public.
OBVIOUSNESS
Under section 2 of the Patent Act a patent must be an “invention” and under s.28.3 inventions must not be
obvious. Ask whether modifications that make invention different is obvious to PSIA. Notably, the date of
importance will depend on the type of disclosure (section 28.3). This is assessed by a claim-by-claim basis
and the perpective is the POSITA. Nonetheless, to determine “obviousness”, we must look to Sanofi
framework and factors- which in short looks to see whether the starting point and end point of the invention
could be bridged:
b) 1(a). Who is the POSITA?;
AX
c) 1(b). What is their relevant common general knowledge?
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XXXXXXXXX
d) 2. What is the inventive concept of the claimed invention?
(claim by claim) IF not apparent from claims, we can look to disclosure. LIST the thing that makes it
different
e) 3. What are the differences between the state of the art and the inventive concept?; and
Compare to past patent – CIBA: compare to prior art
Hospira: if you’re challenging a patent and you find a piece of obscure art you can cite this as being a part
of the state of the art-you can point to really anything you want. Ability to mosaic is limited.
State of the art: State of the art must be publicly available and meets the date criteria set out in section
28.3 a and b of the Patent Act. More than one year before filing date if it is an inventor derived disclosure
or 1 year before the claim date if it’s a non-inventor disclosure. Mosaic strategy can be used here.
f) 4. Without hindsight, are the differences obvious or do they require any degree of invention?
– Question of fact
– Hindsight caution
– Based on CGK
– Can mosaic, but only if PSIA has reason to do so
– Aids: Long felt want? “Teachaways”? Commercial success?
Can also ask whether the invention was “obvious to try” is appropriate (Sanofi)- NO hindsight- question of
fact, based on CGK, can mosaic, but only if PSIA has reason to do so. Date requirement: as of claim date.
FACTORS that in some circumstances can be considered under stage FOUR- these are called the
obvious to try factors (areas where a lot of experiments are necessary):
g) More or less self-evident
h) that what is being tried ought to work? Finite number of identified predictable solutions? (if you
had low expectation of success going into test this will help you)
i) How predictable was the invention a priori?
– POSITA would not know advantages of clopidogrel before separating and testing
– POSITA would eventually find method that would separate compounds
j) Motive?
– Was there a reason to perform the invention? Motivation existed to solve the problem? (May
help the patentee)
– Motivation existed to the solution claimed in the patent? (Hurts the patentee)
– General motivation to find inhibitor of platelet aggregation
– May be motivation to try to experiment with compounds disclosed in genus patent
– However, no specific motivation to separate the racemate in question
– Does motivation outweigh expectation of success (Hospira)
k) Extent, nature and amount of effort required to achieve invention by POSITA?
– How much work would be expected to achieve this result?
– Routine vs prolonged and arduous
– POSITA would know possible methods to separate compounds and to test them for activity
and toxicity
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l) Course of conduct actually followed by inventors?
– How much work was involved?
– Inventors are inventive people
– Different types of inventions
– Inspiration vs perseverance vs serendipity
– None are more worthy. Patents actually meant to incentivize primarily perseverance type
– Sanofi spent millions of dollars pursuing the racemate before it was separated into two
compounds
– Inventor spent a lot of time trying to separate racemate
OBVIOSUNESS SCC ANALYSIS ON SANOFI
An obviousness inquiry should follow a four-step approach. First, the notional “person skilled in the art”
and that person’s relevant common general knowledge must be identified. Here, that person is a trained
pharmachemist. Second, the inventive concept of the claim in question must be determined or
construed. The inventive concept of the claims in the ‘777 patent is that it is a compound useful in
inhibiting platelet aggregation which has greater therapeutic effect and less toxicity than the other
compounds of the ‘875 patent. Third, the differences, if any, that exist between the matters cited as
forming part of the “state of the art” and the inventive concept of the claim or the claim as construed
must be identified. There is no disclosure in the ‘875 patent of the specific beneficial properties
associated with the dextro-rotatory isomer of this racemate or its bisulfate salt, in contrast to the ‘777
patent, which claims the invention of the dextro-rotatory isomer of the racemate, clopidogrel, and its
bisulfate salt, discloses their beneficial properties over the levo-rotatory isomer and the racemate, and
expressly describes how to separate the racemate into its isomers. Fourth, a court must consider
whether, viewed without any knowledge of the alleged invention as claimed, those differences constitute
steps which would have been obvious to the person skilled in the art or whether they require any degree
of inventiveness.
It is at this final step that the issue of “obvious to try” will arise and the nature of the invention in this
case is such as to warrant this test. For a finding that an invention was “obvious to try”, there must be
evidence to convince a judge on a balance of probabilities that it was more or less self-evident to try to
obtain the invention. Mere possibility that something might turn up is not enough. Here, when the
relevant factors are considered, the invention was not self-evident from the prior art and common
general knowledge in order to satisfy the test. While there were five well-known methods to separate
this racemate into its isomers, there was no evidence that a person skilled in the art would have known
which of the five known separation techniques would work with this racemate. Further, S spent millions
of dollars and several years developing the racemate up to the point of preliminary human clinic trials
before it was discovered that the dextro-rotatory isomer was active and non-toxic. As the ‘875 patent did
not differentiate on the basis of efficacy and toxicity, what to select or omit was not then self-evident to a
person skilled in the art. It was also not self-evident from the ‘875 patent or common general knowledge
what the beneficial properties of the dextro-rotatory isomer of this racemate or its bisulfate salt would be
and therefore what was being tried ought to work. The course of conduct and the time involved
throughout demonstrate that the advantage of the dextro-rotatory isomer was not quickly or easily
predictable.
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UTILITY *filing date*
Under the Patent Act, a requirement for patentability includes inventions be “useful art” (s.2). As
demonstrated in Consolboard, “it is sufficient utility to support a patent that the invention gives either a
new article, or a better article, or a cheaper article, or affords the public a useful choice.” (Consolboard p
525).
The following is the current test to determine usefulness of patent (AstrZeneza)
- Courts must identify the subject-matter of the invention as claimed in the patent.
-
Courts must ask whether that subject-matter is useful — is it capable of a practical purpose-single
use is sufficient (i.e. an actual result)?” was there a demonstration or sound prediction of some
practical purpose- this doesn’t have to be how it is used commercial (enzyme inhibition is fine
when goal is healing people AZT).
AZT stated that inventors must establish utility by Canadian filing date either by having:
Demonstrated the utility OR Soundly predicted the utility Limited to the filing date (AZT at para 52)
 Demonstrated utility: the “strongly suggestive” standard
 Sound Prediction (prima facie reasonable inference): AZT/Monsanto test
-
AZT TEST: For there to be a sound prediction: Factual basis; Testing or other work done by
inventors to be support prediction; Line of reasoning; Inventor needs to have a line of reasoning
upon which the desired result (the utility) can be inferred from the factual basis (i.e. why is the
testing relevant???) Disclosure? Must the factual basis and sound line of reasoning be disclosed in
the specification?
-
Similarly, in Eli Lilly Canada prior to the filing date inventors had completed clinical trial to
demonstrate their product showed promise in inhibiting bone loss. Here the Trial Judge hel that, this
prediction was “sound.” However, since this was not disclosed in the patent it did not meet the
disclosure requirement.
Contrarily, in Teva Canada Ltd the court found that no disclosure requirement for utility (affirms
Consolboard) (paras 38-40), No “heightened” disclosure requirement if utility is demonstrated
-
MONSANTO TEST: Only two reasons for rejecting claims to “classes” of compounds- THEY
ARE UNSOUND:
(1) There is evidence of actual inutility in respect of the compounds claimed AND (2) Prediction as
to utility of entire class was not sound. Evidence of experts in field that person skilled in the art
would be able to predict that non-tested compounds would be useful
ATTACK VALIDITY
Attack Validity Opening
There are different methods to attack the validity of a patent document, we discussed six ways in class.
These include the pre-requisites to patentability: patentable subject matter, new, useful and unobvious
claim. Also includes specification as a whole: insufficiency claims, overbreadth. Lastly, there is the issue
of and fraud (section 53). Onus on those trying to prove invalidity.
CLAIM CONSTRUCITON
The first duty of the Court in patent trials is the construction of the claims at issue, in order to provide
them meaning to determine their scope. Claim construction is a fundamental issue in any patent
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infringement litigation. It is central to Canadian patent law that claim construction – the process of
interpreting what the inventor has claimed he or she should be able to stop others from copying – is to
be done before considering whether the patent is valid or has been infringed. A general rules of claim
construction (Whirpool) is that claims are to be construed before issues of infringement or validity and
are determined so that a consistent reading of the patent is applied to both.
Patentee must prove that the defendant’s activities fall within the “fences” defined by the patent’s
claims. Thus, based on the provided facts we need the claim scope to know boundary of claims – this is
done through claim construction.
 Based on question of law- judge asking “What would a POSITA understand the claim to mean?”
 See section 27(4) of Patent Act
 Claims construction is a question of law and is for the Court. To situate itself in the shoes of the
skilled person, assistance from expert evidence is almost always required
 Should this remain a question of law (correctness standard)? Bayer v Cobalt, 2015 FCA 116 at
paras 16-24. Recent shift away from use of expert evidence (e.g. Canmar v TA Foods, 2019 FC 1233
at paras 80-81)
 Two aspects to the exercise: 1) construe the words; 2) identify the essential elements
 1) What would the PSIA understand the claim language to mean?
 2) Claims contain “essential” and “non-essential” elements (Free World Trust, at paras 15, 20)
 Essential: has a material effect on the claimed invention
Non-essential: can be substituted without having a material effect on claimed invention
SUFFICIENCY
Under 27(2) of the Patent Act, Canadian patent applications must include “specification.” Of most
common issue(s) is 27(2)(a): the specification of an invention must correctly and fully describe the
invention and its operation or use as contemplated by the inventor AND b) set out clearly the various steps
in a process, or the method of constructing, making, compounding or using a machine, manufacture or
composition of matter, in such full, clear, concise and exact terms as to enable any person skilled in the art
or science to which it pertains, or with which it is most closely connected, to make, construct, compound
or use it.
In Consolboard the Court considered what is required for specification to be “sufficient”? The application
must answer: "What is your invention? How does it work?” (27.2.a) and POSITA must be able to “make
the same successful use of the invention as the inventor could at the time of his application (27.2.b).
– For 27(3)(a)
– Determine the true invention – inquiry of the inventors
– Ask, do they match?
– Cannot require a “minor research project”
– For 27(3)(b), ask if PSIA could put into practice
- Patent should be approached "with a judicial anxiety to support a really useful invention"
- Basic trial and error is permitted
Notably, this is NOT a claim-by-claim inquiry but rather related to the “specification as a whole”
(Viagara). In Viagara, the claim concerned the use of S to treat ED, a PSOA looking at cascade of claim
would know that claim 6 and 7 are the specifically claimed. But they would have to do a research project
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to determine which one worked and which didn’t (violated 273(a). If they had BOTH treated it would
have been fine with no problem regardless if it didn’t state what worked better.
Section 53
Under section 53 of the Patent Act patents will be invalid if they are found to include fraudulent omissions
of additions.
• To void a patent via section 53
• Requirements: (i) material and untrue misstatement; or (ii) addition or omission of material
information; and (iii) “wilfully made for the purpose of misleading”
– AZT (Supreme Court) - wilfully made for the purpose of misleading” is required by the
concluding words of s. 53(1) (para 109)
– Carelessness is not enough – must be akin to fraud
– Failure to name proper inventor(s)?
OVERBREADTH
• An inventor (patentee) cannot assert a claim that is broader than what was actually: (a) invented; or
(b) disclosed.
• The issue of overbreadth was used as an independent ground of invalidity in seedling, the FC held
that the claims were new, useful, sufficiently disclosed BUT nonetheless the claims are all invalid
since they are overbroad. The disclosure talked about each of those aspects as “essential to
invention” so since the claims did NOT include these essential aspects and thus are overboard.
FCA upheld SEEDLINGS
• Similarly, in the case at hand, we must determine if a a critical, or essential, aspect of the invention
missing from the claims?
ANITICIPATION-PATENT INVALIDTY
Under section 2 of the Patent Act, to be valid, the claims of a patent must disclose an
invention that is “new” (i.e., invention has not been anticipated). Anticipation is assessed
on a claim-by-claim basis and is concerned with whether the claimed subject matter was
priorly disclosed, made available to the public in Canada or elsewhere. These
requirements are codified in section 28.2 of the Patent Act.
In order for a claim to be anticipated, the DF must prove: (a) disclosure and (b)
enablement must be met.
OBVIOUSNESS-PATENT INVALIDTY
A patent claim is invalid if, based on publicly available information before the relevant date, its subject
matter would have been obvious to a relevant PSIA. To determine whether a given patent claim was
obvious at the relevant date, one must:
Non-patentable subject matter-PATENT INVALIDTY
Under section 2 of the Patent Act, “invention” only includes new and useful art, process, machine,
manufacture or composition of matter, or any new and useful improvement in any art, process, machine,
manufacture or composition of matter. Importantly, the courts have determined classes of subject
matter that are not patentable. These include, methods of medical treatment (), higher life forms
(Harvard Mouse Trial), math theories (), and fine art ().
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INUTILITY-PATENT INVALIDTY
The Patent Act requires that inventions are useful. A claim that is not useful is invalid for inutility. The
utility of a claim is based on the subject matter of the invention (demonstrated via claims).
The DF must prove whether the claimed invention is incapable of a practical purpose. However, a mere
trace of utility may suffice. The inventor must have either demonstrated or have soundly predicted the
utility of the invention at the filing date. The inventor is not required to provide evidence of
demonstrated utility directly in the patent. Demonstrated utility does not require certainty or scientific
perfection. Utility can be considered to be demonstrated based on results that are "strongly suggestive
of utility". Where the utility of the invention is based on sound prediction, there must be:
 a factual basis for the prediction;
 an articulable and sound line of reasoning from which the desired result can be inferred from the
factual basis; and
 proper disclosure in the specification of the patent.
The law is presently in a state of uncertainty as to whether, and to what extent, the disclosure in the
specification must include the factual basis and the sound line of reasoning.
INSUFFICIENCY OF DISCLOSURE-PATENT INVALIDTY
The patent specification must correctly and fully describe the invention and its operation or use as
contemplated by the inventor. In particular, the patent specification must describe the invention in such
full, clear, concise and exact terms as to enable any person skilled in the art or science to which it
pertains to practise the invention. The patent specification must enable a person skilled in the art or the
field of the invention to practise it using only the instructions contained in the specification. Insufficiency
is assessed at the date of publication of the patent.
INFRINGEMENT
INFRIGNMENT INFO
- Under section 42 of the Patent Act gives patent holders the exclusive right, privilege and liberty of
making, constructing and using the invention and selling it to others to be used
- INFRINGMENT= Deprived the respondents of the full enjoyment of the monopoly (MONSANTO)
- Accordingly, if someone, constructs, uses or sells for others to use the claimed invention, they infringe
the claims of the patent. Under section 55(1) any person who infringes a patent is liable to the patentee
and to all persons claiming under the patentee for all damage sustained via infringement.
- Notably, the burden of proof is on the patentee to provide of infringement (Monsanto v Schmeiser).
There are a three-step exercise to determine if an infringement has occurred ():
CLAIM CONSTRUCTION
The first duty of the Court in patent trials is the construction of the claims at issue, in order to provide them
meaning to determine their scope. Claim construction is a fundamental issue in any patent infringement
litigation. It is central to Canadian patent law that claim construction – the process of interpreting what the
inventor has claimed he or she should be able to stop others from copying – is to be done before
considering whether the patent is valid or has been infringed. A general rules of claim construction
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(Whirpool) is that claims are to be construed before issues of infringement or validity and are determined
so that a consistent reading of the patent is applied to both.
Patentee must prove that the defendant’s activities fall within the “fences” defined by the patent’s claims.
Thus, based on the provided facts we need the claim scope to know boundary of claims – this is done
through claim construction.
 Based on question of law- judge asking “What would a POSITA understand the claim to mean?”
 See section 27(4) of Patent Act
 Claims construction is a question of law and is for the Court. To situate itself in the shoes of the
skilled person, assistance from expert evidence is almost always required
 Should this remain a question of law (correctness standard)? Bayer v Cobalt, 2015 FCA 116 at paras
16-24. Recent shift away from use of expert evidence (e.g. Canmar v TA Foods, 2019 FC 1233 at paras
80-81)
 Two aspects to the exercise: 1) construe the words; 2) identify the essential elements
 1) What would the PSIA understand the claim language to mean?
 2) Claims contain “essential” and “non-essential” elements (Free World Trust, at paras 15, 20)
 Essential: has a material effect on the claimed invention
 Non-essential: can be substituted without having a material effect on claimed invention
Determine that the alleged infringer made, constructed, used or sold for others to use the claimed invention
- This is a question of fact, only have to prove that alleged infringer’s activites infringed one claim (as long
as that claim is valid) and have to prove that the alleged infringer took all the essential elements of the
claim.
USE: means, The plain meaning of the word “use” or “exploiter” denotes utilization with a view to
production or advantage. Ask: whether the defendant’s activity deprived the inventor in whole or in part,
directly or indirectly, of full enjoyment of the monopoly conferred by law. A contextual examination shows
that if there is a commercial benefit to be derived from the invention, it belongs to the patent holder. In this
case, the appellants’ saving and planting seed, then harvesting and selling plants that contained the
patented cells and genes appears, on a common sense view, to constitute “utilization” of the patented
material for production and advantage, within the meaning of s.42.
Making and Constructing: for any purpose (except experimental/regulatory) meaning private sale, use or
export. Less amorphous than “use.” Planting the roundup ready canola in Monsanto was not a making or
constructing-schmeiser did not MAKE or CONSTRUCT the claimed gene.
Does the DF activity (constructing, using, selling) fall within the essential elements of the patent claim as
construed if you have 10 claims in patent and you can prove that DF is infringing only 1 of them you have
succeeded and have rights to full remedies.
 Question of fact
 Only have to prove that alleged infringer’s activities infringed one claim (as long as that claim is
valid!)
 Have to prove that the alleged infringer took all the essential elements of a claim (recall: Whirlpool)
 CONTRUCTED: Similarly, as demonstrated in Procter & Gamble v Calgon the DF argued that their
infringement were NOT of essential elements. TJ relied on PSIA to determine what they would
construe their elements as.
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
USE: Governing principle is whether the alleged infringer deprived the patentee, in whole or in part,
directly or indirectly, of the full enjoyment of the monopoly (Schmeiser, para 49). Intention – (lack
of) may be used to rebut presumption of use (e.g. absence of intention to employ or gain advantage
from invention), but not to escape infringement (Schmeiser, para 58). Possession of a patented
objected – at least in commercial circumstances – raises a rebuttable presumption of use
(Schmeiser, para 58)

SELLING: in Canada or to someone abroad, exporting a non-infringing product with
knowledge that it will be used in a bad manner aboard, no infringement to sell goods
acquired from patentee, sale of components is not enough *unless inducement). If
made infringed product is made abroad and imported into Canada this is an
infringement.
Infringement by Inducement
• Test for inducement (Laboratoires Servier v Apotex Inc, 2008 FC 825, aff’d 2009 FCA 222)
(1) Act of infringement by direct infringer
(2) Act of infringement must have been influenced by “inducer” to the point where, without
influence, infringement by direct infringer would not have taken place
(3) Influence must be knowingly exercised by “inducer” (“inducer” must know that influence is
being exercised; not that the result of the influence will be an act of infringement – Hospira
FCA para 45)
Windsurfing International Inc v Trilantic Corp (1984), 8 CPR (3d) 241 (FCA) [Windsurfing
– Trilantic knew and intended that ultimate purchaser would assemble the parts into the
sailboard
• Inferences drawn:
– Induced and procured purchasers of the kit to infringe the patent
Defences to Infringement
Defenses Intro
There are a defences one can raise to allegations of patent infringement. Notably, the
burden is on the defendant to prove defences on a standard balance of probabilities. As
discussed in class the DF can raise the following defences: patent invalidity; regulatory
use; experimental use; mere possession; previous purchaser; and limitation period.
PATENT INVALIDTY INTRO
If the patent can be proven to be invalid than there is no infringement as section 42
exclusive rights and subsequent section 55(1) enforcement right are limited to VALID
patents.
Grounds for invalidity include: anticipation, sufficiency, overbreadth,
ANITICIPATION-PATENT INVALIDTY
Under section 2 of the Patent Act, to be valid, the claims of a patent must disclose an
invention that is “new” (i.e., invention has not been anticipated). Anticipation is assessed
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on a claim-by-claim basis and is concerned with whether the claimed subject matter was
priorly disclosed, made available to the public in Canada or elsewhere. These
requirements are codified in section 28.2 of the Patent Act.
In order for a claim to be anticipated, the DF must prove: (a) disclosure and (b)
enablement must be met.
OBVIOUSNESS-PATENT INVALIDTY
A patent claim is invalid if, based on publicly available information before the relevant date, its subject
matter would have been obvious to a relevant PSIA. To determine whether a given patent claim was
obvious at the relevant date, one must:
Non-patentable subject matter-PATENT INVALIDTY
Under section 2 of the Patent Act, “invention” only includes new and useful art, process, machine,
manufacture or composition of matter, or any new and useful improvement in any art, process,
machine, manufacture or composition of matter. Importantly, the courts have determined classes of
subject matter that are not patentable. These include, methods of medical treatment (), higher life
forms (Harvard Mouse Trial), math theories (), and fine art ().
INUTILITY-PATENT INVALIDTY
The Patent Act requires that inventions are useful. A claim that is not useful is invalid for inutility. The
utility of a claim is based on the subject matter of the invention (demonstrated via claims).
The DF must prove whether the claimed invention is incapable of a practical purpose. However, a mere
trace of utility may suffice. The inventor must have either demonstrated or have soundly predicted the
utility of the invention at the filing date. The inventor is not required to provide evidence of
demonstrated utility directly in the patent. Demonstrated utility does not require certainty or scientific
perfection. Utility can be considered to be demonstrated based on results that are "strongly suggestive
of utility". Where the utility of the invention is based on sound prediction, there must be:
 a factual basis for the prediction;
 an articulable and sound line of reasoning from which the desired result can be inferred from the
factual basis; and
 proper disclosure in the specification of the patent.
The law is presently in a state of uncertainty as to whether, and to what extent, the disclosure in the
specification must include the factual basis and the sound line of reasoning.
INSUFFICIENCY OF DISCLOSURE-PATENT INVALIDTY
The patent specification must correctly and fully describe the invention and its operation or use as
contemplated by the inventor. In particular, the patent specification must describe the invention in such
full, clear, concise and exact terms as to enable any person skilled in the art or science to which it
pertains to practise the invention. The patent specification must enable a person skilled in the art or the
field of the invention to practise it using only the instructions contained in the specification.
Insufficiency is assessed at the date of publication of the patent.
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SECTION 53-PATENT INVALIDTY
OVERBREADTH-PATENT INVALIDTY
Regulatory use
Under Section 55.2(1) of the Patent Act, it is not an infringement of a patent for any person to make,
construct, use or sell the patented invention solely for uses reasonably related to the development and
submission of information required under any law of Canada, a province or a country other than Canada
that regulates the manufacture, construction, use or sale of any product. As clarified in Novartis v Teva,
“In order to claim an exemption under either s. 55.2 of the Patent Act or at common law, [the
Defendant] bears the burden of demonstrating that the inventory [of infringing product] was used for
experimental or regulatory uses and that no portion of the inventory was or will be used commercially.”
The key point being that the USE must be solely for regulatory use.
Experimental use
Under section 55.3(1): an act committed for the purpose of experimentation relating to the subjectmatter of a patent is not an infringement of the patent. In Smith Kline, the SCC found that an
experimental use in the course of bona fide experiments with a patented article is not an infringing use.
The p urpose of ‘experimental use’ encompasses use with the goal of improving on the invention and
satisfying oneself that invention could be made; use for one’s “own amusement.” Importantly. This does
not extend to making commercial quantities of a product and sitting on it (“stockpiling”).
Mere Possession
Previous purchaser
Section 56(1): Every person who, before the claim date of a claim in a patent has purchased, constructed
or acquired the subject matter defined by the claim, has the right to use and sell to others the specific
article, machine, manufacture or composition of matter patented and so purchased, constructed or
acquired without being liable to the patentee or the legal representatives of the patentee for so doing.
Rationale – if patentee transfers ownership (through sale), rights are also transferred
Limitation period
Section 55.01: No remedy may be awarded for an act of infringement committed more than six years
before the commencement of the action for infringement.
REMEDIES
ALL DAMAGES SUSTAINED
55(1): A person who infringes a patent is liable to the patentee and to all persons claiming under
the patentee for all damage sustained by the patentee or by any such person, after the grant of the
patent, by reason of the infringement.
Time Period: On or after issue date, but before expiry: Must compensate all damage (s 55(1), next
slide).
• Legal remedy
• Purpose is compensatory – to restore patentee to position they would be in “but for”
infringement
– i.e. calculate patentee’s lost profits (lost sales, lost royalties, etc.)
Accounting of Profits:
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• Origins are equitable, but permitted under s 57(1)(b) of Patent Act
• Court decides whether to let patentee elect between damages and accounting of profits
• “Clean hands” required
• Calculate infringer’s profits that it would not have gained “but for” infringement
REASONABLE COMPENSATION=(NORMALLY) REASONABLE ROYALITY
55(2): A person is liable to pay reasonable compensation to a patentee and to all persons claiming
under the patentee for any damage sustained by the patentee or by any of those persons by
reason of any act on the part of that person, after the application for the patent became open to
public inspection under section 10 and before the grant of the patent, that would have constituted
an infringement of the patent if the patent had been granted on the day the application became
open to public inspection under that section.
Time Period: on or after publication date, but before issue date
• Reasonable compensation = (normally) reasonable royalty: Jay-Lor v Penta, 2007 FC
358
A ‘reasonable royalty rate’ is an estimation of damages in patent infringement cases. It is often
referred to as established royalty that a licensee would pay for the rights to the patented invention
in a hypothetical negotiation.
Things to consider:
– Negotiations between patentee (“willing licensor”) and infringer (“willing licensee”)
– Running royalty or lump sum
– Defined by the patentee’s “minimum willingness to accept” and an infringer’s “maximum
willingness to pay”
– Look to:
• Real world licenses to the technology
• The parties’ historical licensing practices for similar inventions
• Industry data on licences for similar inventions
Also, to the Allied Signal factors:
– Transfer of technology (did the defendant rely on its own technology?)
– Non-exclusive licence (if exclusive was possible, trend down for non-exclusive)
– Territorial limitations (more extensive territorial exclusivity increases the rate)
– Term (generally, longer term = higher royalty)
– Competitive technology (was there an available NIA?)
– Competition (if competitive companies, higher royalty)
– Consumer demand (higher demand = higher royalty)
– Risk of sales (if product would not sell, lower royalty)
– Extent of R&D (more research = higher royalty)
– Displacement of business (central to D’s business? Higher royalty)
– Capacity (if P cannot meet market demand supplied by D, lower royalty)
NIA Noninfringing Alternative
Non–infringing alternatives=that the infringer, without infringing the subject patent, could have
made the same product and achieved an equal number of sales using that alternative. Should the
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existence of a non-infringing alternative (NIA) affect the quantum of Merck’s damages award?
[Merck & Co v Apotex].
Lovastatin: the “could and would” test for NIA:
i) Is the alleged non-infringing alternative a true substitute and thus a real alternative?
ii) Is the alleged non-infringing alternative a true alternative in the sense of being economically
viable?
iii) At the time of infringement, does the infringer have a sufficient supply of the non-infringing
alternative to replace the non-infringing sales? Another way of framing this inquiry is could the
infringer have sold the non-infringing alternative?
iv) Would the infringer actually have sold the non-infringing alternative?
– Burden on infringer to prove NIA (Apotex’s downfall – did not establish that it could or
would have used the NIA)
Recently, in Nova v Dow, 2020, the FCA suggested IA vs non-infringing baseline (NIB), The goal is
isolating the value of the patent; look for the actual benefit received by the infringer as a result of
the infringement. As such there shall be an “apportionment” – dividing profits caused by the
infringement vs other profits.
For example, what is the value of a patented pain reliever that provides eight hours and one
minute of pain relief when there is a NIA that provides eight hours of relief? The patentee did not
invent pain relievers; the patentee only invented a drug that added an extra minute of relief…Why
should the defendant disgorge all of its profits if only a small fraction of its profits are attributable
to the value of the invention? Or what if a luxury car uses a screw in its windshield wipers. The
screw infringes a patent. The patentee’s monopoly covers the screw, not luxury cars. If the
infringer were forced to disgorge all of its profits from the luxury cars, in practical terms the
remedy would place the patentee in the position of enjoying a monopoly that it simply does not
possess. The patentee did not invent luxury cars, it only invented a screw.
Punitive damages
Rarely awarded and fact-specific (Eurocopter, 2013 FCA 219). May be awarded in exceptional cases
of high-handed, malicious, arbitrary or highly reprehensible misconduct that represents a marked
departure from ordinary standards of decent behaviour (Eurocopter, at para 163)“Where a person
infringes a patent which it knows to be valid, appropriates the invention as its own, and markets it
as its own knowing this to be untrue, punitive damages may be awarded when an accounting for
profits or compensatory damages would be inadequate to achieve the objectives of retribution,
deterrence and denunciation of such conduct.” (Eurocopter, at para 192). Increased role in world of
NIA? (Lovastatin, at para 71)
Injunction
Interlocutory: e.g., at beginning of infringement action (RJR MacDonald test, [1994] 1 SCR 311)
• Three-prong test:
(1) Serious issue to be tried;
(2) Irreparable harm;
(3) Balance of convenience.
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– Permanent: until expiry of patent (s 57(1)(a))
– Delivery up / destruction orders – aid to ensuring compliance with permanent injunction
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