Making the most of your Intellectual Property
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1 Making the most of your Intellectual Property Dominique T. Hussey, Partner, Trademark Agent L.E. Trent Horne, Partner, Trademark Agent Christopher D. Heer, Associate, Trademark Agent, Patent Agent Jeilah Y. Chan, Associate, Trademark Agent Chandimal Nicholas, Associate Duncan C. Card, Partner
2 Intellectual Property Overview Dominique T. Hussey
3 What is Intellectual Property? Creative ideas and expressions of the human mind Generally having commercial value Which can receive the legal protection of a property right (by virtue of statute and or arising from common law)
4 IP is an asset that can be bought, sold, licensed, exchanged, or gratuitously given away like any other form of property IP owner has the right to prevent the unauthorized use or sale of the property (if properly protected) Unlike most other property IP is intangible cannot be defined or identified by its own physical parameters (object is different from the right) IP must be expressed in some discernible way to be protectable
5 Intangible rights: separate the object protected from the IP right Copyright Trademarks Industrial Designs Integrated Circuit Topography Plant Breeder's Rights Patents Trade Secrets Other types of intellectual property
6 Recognition of the Type of Right is Critical Specialized rules Errors can result in loss of rights Registry systems Complex processes to obtain certain rights
7 Creating Opportunities and Recognizing Opportunities Buyers, Sellers and Creators Inventory of Intellectual Property S Strengths (have) W Weaknesses (need) O Opportunities (how to acquire) T Threats (what is in the way and how to avoid) Value of the Intellectual Property
8 Protection, Enforcement, Infringement, Commercialization Who will be responsible for filing, prosecuting and paying for applications? Who will be responsible for maintenance, renewal and payment of fees? What are the rights and obligations regarding infringement of IP rights? What are the appropriate designations and markings?
9 Trademarks Copyright and other IP
10 Copyright
11 What is copyright? A bundle of intellectual property rights to a work At most basic level, right to copy Time-limited monopoly The law grants to the copyright owner the sole right to do or allow other to do certain things with works IP rights are separate from any rights to the physical embodiment of the work Rights in the expression, not the ideas.
12 Copyright Copyright arises automatically from the creation of an original work that is the product of labour, skill and judgment and that is fixed in a tangible form Original means originating from the author, no novelty is required Fixation recorded on paper, disk, other recoverable means Level of creativity is low routine documents that show some level of thinking are protected random numbers, blank forms, reports
13 Copyright Comes into existence upon fixation Registration is permitted but not required
14 What is copyrightable?? Types of works protected Artistic works logos, brochures, drawings, plans, photographs, blueprints Literary works books, reports, software, poems, translations, compilations Musical works music with or without words, jingles Dramatic works plays, commercials or TV programs
15 But whereas Copyright applies to: A song A novel A play A magazine article A computer program Copyright does not apply to: - Title for a song - Idea for a plot - A method for staging a play Hamlet (a work in the public domain) - The facts in an article - The name of the program (this could be protected through trademark legislation)
16 What rights does copyright grant? Exclusive rights to: Produce and reproduce Translate Adapt to different media Public Performance Import Sell Publish Authorize others to do any of the above
17 Term of Copyright For most works life of the author plus the end of the year in which the author dies, plus 50 years Copyright notices are not necessary to create the right, but can be very useful 2012 John Doe Create rebuttable presumptions of existence of the rights Copyright registration is not necessary to create the right, but important for assignments or transfers of rights Create rebuttable presumptions of existence of the rights
18 Moral Rights Moral rights of authors of any copyright work Integrity Right : Right to not have the work modified to the prejudice of author s reputation Association Right: Right to have name associated with the work or not named or associated. Cannot be assigned, but can be waived
19 Reversionary Rights Certain interests return to estate of original author 25 years after death Assignments revert Exclusive licences (grants of interest) revert Does not necessarily affect other licences Does not apply to collective works
20 Copyright Infringement Infringement doing that which only the owner has the right to do without permission: copying changing not giving credit Broad relief available Accounting and damages Delivery up Statutory damages Wide injunction
21 Infringement = copying or all or substantial portion of a work without permission Exemptions: Fair Dealing - Private Study or Research Fair Dealing - Review or Criticism Fair Dealing - News reporting Independent Creation Insubstantial amount is taken Home copying of sound recordings for private use blank media royalty already paid
22 Key Issues Address ownership and use Document in writing
23 Copyright Ownership Ownership of copyright is a common problem in a system of automatic creation of rights Basic rules: Courts will enforce an agreement dealing specifically with ownership of copyright If no agreement: 1. Author is the first owner of the copyright 2. Exception if (a) employee and (b) work in the scope of employment then employer is owner 3. Exception if painting, engraving or portrait commissioned for value, and paid commissioner is first owner Can be assigned by agreement Can have multiple layers of rights
24 Joint Owners If each made substantial contribution towards a common design Co-authors Co-owners of copyright in whole If contribution distinct then separate copyright in contribution
25 Compilations/Derivative Works Compilations / collective works have their own copyright separate from copyright to component works Derivative works have their own copyright separate from underlying works
26 Licensing Grant of permission to use rights Key provisions include: Field of Use / application Period of use / term Area of use / Territory Exclusive or non-exclusive Performance obligations Payment for use Upfront / lump sums Royalties Value
27 TRADEMARKS
28 Trademarks Excellent branding is a critical part of your business. It allows you to distinguish your product and service from those of your competitors. Your trademark symbolizes your reputation and sets your business apart; when your customers see it, they know they need look no further. Selecting and registering a trademark can help you gain brand recognition, increase your sales and develop loyal customers and clients Important asset to licensed franchisees.
29 Trademarks Any mark that distinguishes one business (product or service) from another Can be registered or unregistered Trademark theory based on the origin of goods or services
30 Trademarks A trademark can be a design, word, slogan, shape, color, sound, smell, or any combination thereof
31 Trademarks Dual system Common law rights passing off action Statutory system Trade-marks Act Common law and statutory rights coexist Business names / trade names vs. trademarks Key concept use Use is essential to obtain and maintain rights
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40 Trademark Use In order to obtain protection the marks must be used in ordinary commercial trade Date of first use should be recorded
41 Registered v. Unregistered Benefits of Registration Canada wide protection Appears on trademark register deterrence; TMO works for you. Enforceable Licensing Facilitates registration in foreign countries Term: 15 years, renewable indefinitely if requirements maintained
42 Trademark Registration A Trademark is Registrable if it is NOT Primarily merely a name or surname of an individual Clearly descriptive or deceptively misdescriptive of the goods and services The name in any language of the goods and services Confusing with a registered trademark
43 Trademark Infringement Key issue in trademarks is likelihood of confusion of a reasonable consumer of the products or services
44 Trademark Confusion According to the Trade-marks Act, trademarks are confusing if both marks are used in the same general area and the use leads consumers to believe that the goods or services originate from the same source Test - average consumer with imperfect recollection
45 Trademarks Registration is not a total monopoly of the trademark Registration provides a monopoly only in connection with the goods and/or services provided Identical trademarks can co-exist without the likelihood for confusion, i.e., Delta (faucets) and Delta (airlines)
46 Trademarks Key Issues maximize value Consistent and continuous use Register trademark as used Do not permit 3 rd party use unless under a license Must comply with statutory requirements Control of character and quality Do not allow generic use
47 INDUSTRIAL DESIGN The exclusive right to use any original shape, configuration, pattern, or ornamentation of industrially produced articles that appeal to and are judged solely by the eye The article can be functional but not the design Must be ornamental and original Examples: a chair design; a faucet design; the shape of a car; the shape of luggage
48 Term of 5 years renewable for 5 years Exclusive right to apply the design to the article for importation, rent and sale Prevents use of other designs that are sufficiently similar to the eye
49 PLANT BREEDERS RIGHTS The exclusive right to sell and produce propagating material for registered plant varieties new, that is, not previously sold; different from all other varieties; uniform, that is, all plants in the variety are the same; and stable, which means each generation is the same.
50 Control the multiplication and sale of the seeds for up to 18 years but not for private use Few regulations No case law
51 INTEGRATED CIRCUIT TOPOGRAPHY The exclusive right to reproduce, manufacture, import or export original topographies for semi-conductor chips or chips incorporating the topography or any part of it 3-dimensional configurations of electronic circuits embodied in integrated circuit products or layout designs Exclusive right to reproduce the topography or manufacture, import or commercially exploit circuitry incorporating the topography Term of 10 years from commercialization or filing
52 Trade Secrets and Patents Trent Horne
53 What is a trade secret Any confidential information used in a business that gives it a competitive advantage, and that can be kept a secret Confidential information can be: - specific product information; or - general business information
54 Trade secrets Specific product information includes formulas devices process General business information includes customer lists supplier lists pricing business plans
55 Trade secrets Most intellectual property starts as a trade secret an intellectual creation in a person's mind that may have competitive value Issue is whether the concept can be kept as a trade secret, and if not, whether some other kind of intellectual property protection is available
56 Trade secrets Trade secrets can last forever, but only if the confidentiality is maintained this is greatest benefit of a trade secret If the trade secret is disclosed, protection is lost, and so is its value
57 Trade secrets Identify information that is a trade secret Distinguish secret material from that which is not Stamp documents (do not over mark) Place a sign on machines
58 Trade secrets Keep confidential information away from people who do not need to see it Papers in safe or locked drawer Computers password protected Conduct R&D in private Avoid use of temporary workers Do you need to share this with investors?
59 Trade secrets For those that need to see the confidential information Tell them the information is confidential Sign a confidentiality agreement Include confidentiality terms in an employment agreement Include confidentiality terms in licenses
60 Trade secrets So an Apple guy walks into a bar..
61 Trade secrets Trade secrets do not protect against: Independent creation Reverse engineering
62 Trade secrets Potential liabilities Lateral hires
63 Patents What is a patent? A set of rights granted by the government for the exclusive use of an invention for a limited period of time
64 What is an "invention"? Product Machine Process Or any improvement
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66 A patent is a bargain The owner provides full disclosure of the Invention The Canadian Government provides a grant of exclusive rights in Canada for 20 years from date of filing An invention must be new, not obvious and useful
67 How patents are granted File an application Reviewed by a Patent Examiner Country by country filing and enforcement no "international patents" In the US, 2-3 years from filing to issue $25K + for first country, less for additional filings In Canada, valid for 20 years from date of filing, regardless of subject-matter
68 A patent is not a license A patent permits the owner to sue someone else for manufacture, use or sale of the patented invention in Canada A patent is not a license to manufacture A patent is not a guarantee that the invention does not infringe another patent There is no requirement to practice the invention
69 A patent has 2 basic sections The disclosure (the patentee's part of the bargain) The claims (what is enforceable the boundaries of exclusivity)
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72 1. A recyclable, insulating beverage container holder, comprising a corrugated tubular member comprising cellulosic material and at least a first opening therein for receiving and retaining a beverage container, said corrugated tubular member comprising fluting means for containing insulating air; said fluting means comprising fluting adhesively attached to a liner with a recyclable adhesive.
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76 Choosing between patent and trade secret protection Can the invention be kept secret How easily can it be reverse engineered How likely is independent creation Cost of patent protection Is a patent likely to be granted Anticipated life span of the invention How valuable is the invention
77 "Leave your mark!" Jeilah Chan
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88 2011 Ranking of the Top 100 Brands (By Interbrand)
89 Strategies for brand creation, protection and management
90 Strategies for brand creation: Be Choosy Be Careful Beware And Where?
91 Be Choosy Not everything can be registered as a trade-mark
92 Be Careful Snoop first Clearance searches Trade-marks Trade names Domain names Directories Common law uses
93 Beware Look out for s. 9 marks
94 And where? Is your brand available for use in all countries you intend to launch your products and services?
95 Protecting and managing your brand Register your trade-mark Build your trade-mark portfolio Use it or lose it Enforce it
96 Register your trade-mark You don t have to but you should Things to consider when filing for a trade-mark registration Process Oppositions
97 Build your trade-mark portfolio Have you expanded the use of your brand? Have you changed the look of your brand?
98 Use it or lose it! Cancellation proceedings
99 Enforce it! Police the marketplace
100 Obtaining Patents and Avoiding Patent Infringement Christopher Heer
101 Overview The Patent Application Process Ownership Considerations How Not to Get Sued for Patent Infringement Why Patent?
102 Stages of a Patent Application Patentability Search (optional) Drafting Filing Prosecution Allowance & Grant Maintenance Expiration
103 Patentability Searches What is searched? What information does a patentability search typically provide? When should they be used?
104 Patent Drafting 1 of 2 Selecting a Patent Agent Invention Disclosure The Role of the Patent Agent
105 Patent Drafting 2 of 2 Strategies for Key Technologies The Importance of a Correct and Complete Description Review of Drafts
106 Deciding Where to File Your Patent Application 1 of 2 Exclusive Rights: Make, Use and Sell Make: Canada -> China -> Vietnam ->? Use: Sue Your Potential Customer or Need to Prove Inducement Sell: Focus on Largest Markets U.S., Canada, Europe, China, Japan, Korea, India, Australia, Brazil, Mexico
107 Deciding Where to File Your Patent Application 2 of 2 Priority and Deferring Corresponding Filings Paris Convention vs. PCT Costs Who Files Foreign Applications
108 Patent Prosecution 1 of 2 How Long Does It Take to Get a Patent Automatic vs. Deferred Examination Expediting Examination Confidentiality Period
109 Patent Prosecution 2 of 2 How to Minimize Costs Due to Overlapping Prosecution Divisional Applications Continuation Applications
110 Patent Grant and Maintenance Allowance and Issuance of a Patent Term of a Patent Maintenance Fees European Patents - Validation
111 PCT Patent Applications What is a PCT Application? Benefits Cost When to File a PCT Application
112 Provisional Patent Applications What is a Provisional Application? Benefits Cost Risks When to File a Provisional Application
113 Ownership Who Owns a Patent Application? Determining Inventorship Transfer of Ownership Employment Agreement Hired to Invent Assignment Documents
114 How Not to Get Sued for Patent Infringement 1 of 2 Patents are More Sword than Shield Clearance Searches Design-arounds
115 How Not to Get Sued for Patent Infringement 2 of 2 Cost of Assessing Infringement Risks Alternatives to Clearance Searches Consequences of Infringement
116 Opposing Patents and Patent Applications Impeachment Proceedings Re-examination Protests
117 Why Patent? Patent Rights are Recognized by Investors as Adding to Company Value Ability to Exclude Competitors and Employ Monopoly Pricing Patent Rights Can Be Monetized by Sale or License to Others
118 REGULATORY ISSUES Presented by Chandimal Nicholas
119 INTRODUCTION Regulatory Issues Businesses Face Government Regulation Industry Specific Questions to Ask Do regulations apply to my business? If so, what are my obligations? Other issues?
120 IS IT REGULATED? Act Regulation Guidance documents and policies Jurisdiction Federal Provincial Municipal
121 COSTS Fees Licenses/permits Administrative Compliance Generating Data (if necessary) Penalties (for Non-Compliance)
122 LICENCES AND PERMITS Is a Licence or a Permit required? Can relate to sales, manufacturing etc. Regulations, Licences and Permits Preliminary reference guide
123 HOW STRICT ARE THE REQUIREMENTS? More costs More time More information
124 TRANSFERABILITY Direct or Indirect An asset to buyers or investers Can add value if transferable or costs/time if not
125 REPORTING TO REGULATOR Industry specific Costs Resources
126 IMPORT / EXPORT Industry specific Licences Customs
127 EMPLOYMENT Workplace safety Hazardous materials
128 CONCLUSIONS Know your obligations Regulations are industry specific Can add value or cost
129 IP Commercial Exploitation Presented by: Duncan Card
130 Overview of Presentation 1. Identify the IP 2. Commercial Terms 3. IP Commercialization Structures 4. Pitfalls to Avoid
131 IP Commercial Exploitation 1. Identify the IP the more particularity, definition, description, and exploitation the better, whether narrow or broad in definition scope Patent devices, processes, status of patent TM registered? brand ID, tag line, goodwill, name, trade name, logo, brand indicia Copyright software, manuals, flowcharts, designs ICT chips, patent overlap, copyright overlap Capture Non-Statutory Knowledge Assets
132 IP Commercial Exploitation 1. Identify the IP Capture Non-Statutory Knowledge Assets contract rights can go where IP statutes do not compilations customer lists/information, ideas, concepts, inventions, designs, innovations, knowhow, order of operations, so-called "look & feel", graphic design interface, design elements, artistic "qualities", systems, processes, methods, information, data, materials, documents, records, confidential information (how to identify/designate)
133 2. Commercial Terms What uses express purpose, application, exploitation? How long use term, renewals, extensions? What jurisdictions? License limitations vs. contractual restrictive covenants. Conditions of Use: only use on ABC hardware use is maintained use if continue payments XYZ circumstance ends use Payment fixed, royalty, percentage of gross/net revenue. Exclusive vs. non-exclusive use. Personal or transferable (subcontract/outsource use rights). Create "derivative works" who owns customizations, enhancements, modifications, additions.
134 3. IP Commercialization Structures i. sell all outright and without residual rights ii. Also iii. iv. sell all with contractual reversion rights sell part assign, transfer, convey portion of IP (e.g. sections 13(4) and (5) Copyright Act) license all, part, conditions, etc. as noted v. trust special type of assignment for special purpose vi. license within agency or fiduciary capacity direct license cross license: right of set-off; tax issues; reciprocal rights, terms and conditions license associated with sale of goods (e.g. firmware)
135 4. Pitfalls & Opportunities rationalize use rights & revenues only license the specific rights being paid for, since all other rights may be the basis of additional revenue ensure "clear title", no third party restrictions or ownership interests (joint owner, collective owners, prior inconsistent rights granted, loan agreements, grant funding agreements, options to acquire rights, etc.) have an IP infringement indemnity strategy: due diligence what IP for what jurisdictions, contractual limitations; actual knowledge within the enterprise; transaction norms and reasonable practices licensors should retain use audit rights (including related to royalty calculations)
136 4. Pitfalls & Opportunities tax issues: how royalty income is treated; withholding taxes for cross-border transactions; and opportunities to structure transactions so that royalty income accrues to an IP owner in a low tax jurisdiction (consider early in IP creation process) consider continued use thresholds for continuance of commercial rights: e.g. limit use time period, but then extend if XYZ commercial targets (revenue, market share, number of licenses, etc.) achieved, rather than provide a long term contract with early termination rights. Thank you
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