Industrial and Intellectual PropertyPr.: GoldTuesday and Thursday: 11:35-12:55Office: Room 201, 3661 Peel-Tel: 398-6636-Email: Richard.Gold2@McGill.ca-Hours: by appointment-No final exam: 24 hour take-home, 5 pages typed, double-spaced

Introduction

-IP constitutes today, in many cases, the primary assets of most corporations. Interest in IP has developed in the mid-1990s.-IP space includes: books, paintings, how one plans the day, list of friends etc. The primary criteria is that the thing to be protected has an intangible mental aspect.-Overlapping spheres within IP space:

1. Copyrights: authenticity of an idea, painting, song etc.2. Trademarks: control over use and commercialization of symbols, names, color

scheme, that are related to a product or service etc.3. Patents: over use and exploitation of computers, cars and all inventions, etc.

-NOTE: lots of stuff is not protected in IP space, there are many things that do not fall in the three spheres. The question is therefore why is no protection afforded? Is it out of neglect, impossibility, purpose?-NOTE: there is also significant overlap between the three spheres: computer programs can be both patent and copyright, phrases such as 'Here’s Johnny' [Carson] can fall in more than one sphere.-NOTE: patents and copyrights are competitive schemes: cannot be in both at the same time. Consequently we need to consider what are the advantages of one over the other.-We will look at the three spheres/regimes separately, then we will look at them comparatively:

Differences, Similarities, Limitations, History of IP, Need/purpose of IP law and the regimes, National and international aspects, Cross-influences

-One significant sticking point is who governs IP, who resolves IP issues. Acts are present, but who decides on issues of infringement: govt, courts, private actors?-NOTE: Another means of protecting IP is K law. A definition that is useful in this context is that of property rights: relationship between a person and everybody else, a right of exclusion, an absolute veto on activities that does not require justification: this is to some extent the same for K and property law.-NOTE: patents, trademarks and copyrights are local and not international; must get patents, trademarks and copyrights in all countries in order to have intl protection. Thus, for example, a US TM means nothing in Canada.

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Passing Off and Trademarks Essence of both PO and TM is to protect goodwill as it is embodied in a mark Passing Off: Protecting the goodwill that is embodied in the use of the mark

(mark is in relation to a product or service, and the impression of the product or service that is conjured up in the mind of the consumer when he/she sees the mark is the goodwill). PO is a CML notion that operates within a statute when it becomes a TM

Trademarks: Protecting the goodwill – present, future and to some extent past – embodied in the use of a mark, TMs afford protection via registration.

What constitutes a mark: any word, name, symbol, phrase, colour scheme, design etc. that connects a product or service with a manufacturer— anything that invokes a name or service or thing.

Goodwill is the recognition/association made in the minds of consumers between a name (producer) and a product or service. This is acquired over time with the use of a mark.

Distinction between TM v. R: R is registered trademark, TM is the CML passing off action (i.e. it is not registered). Both essentially cover the same things, both it is easier to prove a R than it is to prove a TM, simply because it is registered.

Marks and Guises: In both PO and TM, the marks can be a variety of things: works, phrases, designs,

shapes, “get-up” (packaging via which the product or service is advertised and sold), colours?, sounds?

There is also something called a certification marks or “extended passing off”: this is connected to a class of goods, the standard of quality of products (ex: protection of word 'champagne' in opposition to mere sparkling wine, ISO companies)

Passing off: An Overview

-CML notion incorporated into federal law-No person shall:

(b) direct public attention to his wares, services or business in such a way as to cause or be likely to cause confusion in Canada, at the time he commenced so to direct attention to them, between his wares, services or business and the wares, services or business of another (s. 7 (b) of the TMA)

There is some issue of constitutionality in this: civil rights and property are a provincial jurisdiction, not a federal one.

This section provides both the advantages of PO and TM, one need not choose between the two

What passing off prevents: Use of name or get-up directly used to sell competing products Dilution of distinctiveness of name PO is only valid in regions where product or service is recognized, not in regions

where the product or service is unknown.

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Essentially it prevent people from using your mark or a similar mark such as to cause confusion about the product or service being consumed (confusion is terms of origins, quality etc)

Dilution: making the word become generic

Remedies afforded by PO: Damages:

o Lost profits Loss of trade Damage to reputation Harmful association Loss of opportunity to licence Inability to expand

o Accounting of profits : what the other person gained (person guilty of the PO), not necessarily what the person lost (person subject to PO).

Injunction

Elements of passing off: Must have goodwill or reputation attached to goods or services There must be misrepresentation by defendant to the public leading or likely to

lead to conclusion that goods or services are those of plaintiff The above must result or be likely to result in damages from belief engendered by

misrepresentation

Origin of the Mark: Need not prove that the reputation in goods derives from its origins in a particular

supplier but simply that goods have the same origin even if unknown (consumer must believe that the goods are from same origin [producer], even if they don't know who or where the supplier is).

No need to show who controls the mark, no need to determine who the legal entity that owns the mark is, simply need to show that there is a common origin

Ex: Coca-Cola products are all associated to the name and are believed to come from the same place. This is all that is necessary; there is no need to demonstrating who actually owns Coca-Cola in Canada

Distinctiveness vs Descriptiveness: Normally, descriptive word cannot be protected but where word acquires a

secondary meaning distinguishing one’s goods or services from that of others, one can obtain protection. In other words, the mark must be either distinct or its use have acquired a secondary meaning above and beyond the mere descriptive role it provides.

When used to distinguish rather than functionally describe, can give rise to PO action.

EX: Camel hair belts: belts made out of camel hair (this is an actual case) (became distinctive thru time and use)

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Becoming Generic: If a name used too broadly, it loses its distinctiveness and becomes generic, at

which point one cannot argue that it is distinct but rather has become descriptive. EX: Thermos, shredded wheat

Duration: As long as you use it, the mark is valid. Accordingly, must first use it before can claim protection under PO. Basic rule: “use it or lose it”

Who must be confused? Whose confusion counts for passing off? Presumable those of the average

consumer, not those of the average distributor. And here we refer to the 'average' consumer, not the professional or learned consumer (professional buyer for ex, who is likely to be more aware of the origins of a particular product or service)

Trademarks: An Overview

-Affords legislative protection, as opposed to the CML concept of PO. A trademark is a signifier: we do not care about it for its own sake, but rather for what it refers to.

Same core concept: o Goodwillo Distinctiveness

But these are expressed thru the TMA

Trademarks: definition “Trade-mark” means:

a) a mark that is used by a person for the purpose of distinguishing or so as to distinguish wares or services manufactured, sold, leased, hired, or performed by him from those manufactured, sold, leased, hired, or performed by others

b) a certification mark,c) a distinguishing guise, or d) a proposed trade-mark”

Distinctiveness: names and surnames: 12 (1) Subject to section 13, a trade-mark is registrable if it is not

a) a word that is primarily merely the name or the surname of an individual who is living or has died within the preceding thirty years

Note that this does not necessarily mean that a name cannot become a TM: it can if it has acquired a secondary meaning and no longer is merely the name or surname of an individual.

Distinctiveness: descriptive or misdescriptive: 12 (1) Subject to section 13, a trade-mark is registrable if it is not

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b) whether depicted, written or sounded, either clearly descriptive or deceptively misdescriptive in the English or French language of the character or quality of the wares or services …

Distinctive over time? S. 12(2): names and descriptive marks might be registrable if they become

distinctive

Never distinctive: S. 12(1) Subject to section 13, a trade-mark is registrable if it is not [(c)- (h)]:

o A name in any language (table, spoon etc.)o Confusing with a registered TMo Prohibited & official marks (s. 9) & generic (s. 10)o Geographical indications (ex: Toronto water not allowed)

Official Marks: “No person shall adopt in connection with a business, as a trade-mark or

otherwise, any mark consisting of, or so nearly resembling as to be likely to be mistaken for,

o (n) any badge, crest, emblem or marko (iii) adopted and used by any public authority, in Canada as an official

mark for wares or services, (s. 9 (1) (n) of the TMA)

Non-use of a TM: 45 (3) where … it appears to the Registrar that a TM, either with respect to all of

the wares or services specified in the registration or with respect to any of those wares or services, was not used in Canada at any time during the 3 year period immediately preceding the date of the notice and that the absence of use has not been due to special circumstance that excuse the absence of use, the registration of the TM is liable to be expunged or amend accordingly(s. 45 (3) of the TMA)

TM last 15 years but is renewable (s. 46(1) of TMA) Person holding a TM may be forced to demonstrate that it is in use (s. 45 TMA)

Use:-"Use", in relation to a trade-mark, means any use that by section 4 is deemed to be a use in association with wares or services;(s. 2 of the TMA)

Use: wares:4. (1) A trade-mark is deemed to be used in association with wares if, at the time of the transfer of the property in or possession of the wares, in the normal course of trade, it is marked on the wares themselves or on the packages in which they are distributed or it is in any other manner so associated with the wares that notice of the association is then given to the person to whom the property or possession is transferred.s. 4(1) of the TMA

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-Warhol paintings of Campbell soup: no use, because the use of the name Campbell was not in association with the goods. But on the can of soup itself, the mark was/is used.

Use: services:4 (2) A trade-mark is deemed to be used in association with services if it is used or displayed in the performance or advertising of those services. s. 4 (2) of the TMA

Infringement of TM: One does not necessarily need to prove literal copying; rather the test is the

likelihood of confusion S. 19: literal infringement (Mr. Sub case): using the same mark on similar goods S. 20: non-literal infringement: using a similar mark (ex: Xerox, Xerex). S. 22: depreciation of goodwill: distinctiveness of the mark is reduced but not

necessarily its value: essentially means invoking a mark in a way that makes it less distinctive. The value of the link between the mark and what it refers to is being devalued: this does not mean that the product is made to look bad, but rather that the link is weakened between the mark and the product it refers to in the minds consumers. It may, however, also result in a reduction of the esteem in which the mark is held.

Confusion: when people use famous/recognizable marks: What the appellant seeks to do is profit financially from the goodwill associated

with the Respondent’s trade name. The appellant anticipates that the average consumer will associate its products with the name Pink Panther and be more apt to buy them. (MacDonald J. in Pink Panther)

The above involved the use of the name ‘Pink Panther’ for hair care products: products had nothing to do with the films themselves, but in the minds of the consumer the association would be made. This is an infringement of the TM.

Infringement of Trade-Mark Where a court is satisfied, on application of any interested person, that any act has

been done contrary to this Act, the court may make any order that it considers appropriate in the circumstances, including an order providing for relief by way of injunction and the recovery of damages or profits and for the destruction, exportation or other disposition of any offending wares, packages, labels and advertising material ….(s. 53.2 of the Trade-Marks Act)

Grey Marketing: What is grey marketing? How important are difference in ingredients between products? Ownership vs. licensing of trade-mark Affiliated companies

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-Ex: buy a TM product in a different countries, product is also TM in Canada, and sell purchase here. Is there a violation? YES, there is a violation if the Canadian TM holder is different from that of the US. But if both TM holders are the same, there is no violation cause product was legally purchased in the US.

Becoming Generic: 18. (1) The registration of a trade-mark is invalid if

(b) the trade-mark is not distinctive at the time proceedings bringing thevalidity of the registration into question are commenced,

Abandonment of a TM: • S.18(1) TMA: The registration of a trade-mark is invalid if …

(c) the trade-mark has been abandoned….• “The practical test to be applied is order to resolve a case of this nature is to

compare the trade mark 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.”Pratte J in Honeywell Bull

Distinguishing Guises:-s. 2 of the TMA: "distinguishing guise" means

(a) a shaping of wares or their containers, or(b) a mode of wrapping or packaging wares the appearance of which is used

by a person for the purpose of distinguishing or so as to distinguish wares or services manufactured, sold, leased, hired or performed by him from those manufactured, sold, leased, hired or performed by others

Distinguishing Guises: 13. (1) A distinguishing guise is registrable only if

(a) it has been so used in Canada by the applicant or his predecessor in title as to have become distinctive at the date of filing an application … and

(b) the exclusive use by the applicant of the distinguishing guise in association with the wares or services with which it has been used is not likely unreasonably to limit the development of any art or industry.

Distinguishing Guises:-s. 32(1) of TMA:

(1) An applicant who claims that his trade-mark is registrable under … section 13 shall furnish the Registrar with evidence … establishing the extent to which and the time during which the trade-mark has been used in Canada …

Registration to be restricted:

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(2) The Registrar shall …restrict the registration to the wares or services in association with which the trade-mark is shown to have been so used as to have become distinctive and to the defined territorial area in Canada in which the trade-mark is shown to have become distinctive.

Certification marks:S. 2 of TMA: "certification mark" means a mark that is used for the purpose of distinguishing or so as to distinguish wares or services that are of a defined standard with respect to

(a) the character or quality of the wares or services,(d) the area within which the wares have been produced or the services performed,

from wares or services that are not of that defined standard

S. 23 (1) & (2) of TMA:23 (1) A certification mark may be adopted and registered only by a person who is not engaged in the manufacture, sale, leasing or hiring of wares or the performance of services such as those in association with which the certification mark is used.

23 (2) The owner of a certification mark may license others to use the mark in association with wares or services that meet the defined standard, and the use of the mark accordingly shall be deemed to be use thereof by the owner.

Patents: An Overview

-In a way, patent regime is a response to trade secrets, which are both CML and CVL tools of protection to keep info confidential.

Trade Secret at CVL:-A trade secret is:

Information (consumer lists, business plans, charging scheme etc.) That is not generally known in the industry or easily accessible (does not mean

that the information is unknowable, but rather only that it would be very difficult to obtain said information)

With a commercial value In respect of which the owner takes precautions to maintain its secrecy (meaning

that one does not advertise it, try to keep it confidential, only tell a few people).-All the above conditions have to be met for a trade secret to be recognized. -NOTE: a trade secret can be eternal (Ex: recipe for KFC)

Use of Trade Secret at CML: Confidential information:

o Cannot be completely in public domain although can be application of thought to info available to the public

Was communicated in circumstances indicating its confidential nature

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The receiver may only use the info for purposes for which it was conveyed.

Remedies: Damages/ lost profits Injunction Accounting of profits Restitutionary award

-Trade secrets do not protect from fortuitous discovery: it only works for those involved in confidential relationships. Thus if someone discovers the trade secret without any divulgation from those privy to it, then tough luck to the holder.-Trade secrets are what people use to protect information, blocks off access to information. But of course this necessarily means that the info remains secret, that it is not made public. In this sense trade secrets to not have a limited life span and are not to be understood as a deal between society and creator: no quid pro quo: protection is not in response to divulgation. -To solve this issue of blocking access to information, patent regimes were developed: the use of the thing is still protected, but the info concerning it is made public. The advantage is that it is easier to produce, market and sell it (requires fewer safeguards if the info is public).-PA covers inventions, and represents a right to exclude others from manufacturing and selling or importing the thing protected (exclude right to make, use and sell)

-If human intervention is required, then it is an invention for the purposes of patent law. Something in natural state cannot be patented, but one can patent the same thing if it is in an unnatural state. Ex: gene in body cannot be patented, but if take out DNA and make copies of it, then can get patent, or again if bring changes to it.-Basic question is: was human intervention required to make the thing or could it exist naturally without human intervention? If the former, can get a patent, if the latter, cannot get a patent.-IN USA: if it is in an unnatural state, it can be patented. Not so in Canada for policy reasons. Thus the general definition is subject to different interpretation.

Patents: S. 42 PA: Every patent granted under this Act shall contain the title or name of

the invention, with a reference to the specification, and shall, subject to this Act, grant to the patentee and the patentee's legal representatives for the term of the patent, from the granting of the patent, the exclusive right, privilege and liberty of making, constructing and using the invention and selling it to others to be used…

Term of Protection:• Subject to section 46, where an application for a patent is filed under this Act on

or after October 1, 1989, the term limited for the duration of the patent is twenty years from the filing date.(s. 44 of the Patent Act)

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• 46 (1) A patentee … shall, to maintain the rights according by the patent, pay to the Commissioner such fees … as may be prescribed.

(2) Where the fees payable under subsection (1) are not paid within the time provided by the regulations, the term limited for the duration of the patent shall be deemed to have expired at the end of that time.

(s. 46 of the Patent Act)

Obtaining a Patent: File an application with Commissioner of Patents (s. 27 of PA) Application must contain:

o A specification correctly and fully describing the invention and its operation or use (s. 27 (3) of the PA)

o Claims defining distinctly and in explicit terms the subject-matter of the invention (s. 27(4) of the PA)

When applying for a patent, one always wants to give the fewest details possible in order to get the greatest protection possible: the more language that is used, the more specific the protection is. Of course the flipside is that the application can be rejected if it is not specific enough.

Review of Patent Application: File application with CIPO

o Full applicationo Provisional application

Examination of patent Issuance of patent

International Protection: No such thing as an international patent. To have absolute intl protection, one

could file applications in every single country, but obviously time and energy consuming. SO:

Thru Paris Convention: entitled to apply for patent in member state, and the date of filing in those other countries is the date of filing in the original

o Right to apply in any country that is a member of this Convention as if citizen of that country: access to the patent system of that country

o Date of filing in first country is accepted as date of filing in all other countries so long as the filing is actually done in the other countries within the following 12 months.

Thru Patent Cooperation Treaty (PCT), can apply for intl search and examinationo Somewhat of an alternative to the Paris C.o File in one country, within 12 months can file an intl application: this is

followed by a preliminary examination that will take a while (up to 3 years) during which you need not immediately apply in every country right away: essentially a means of getting some breathing space in order to prepare applications.

o Best to go with PCT if seeking a patent that is recognized worldwide.

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In the end, patents are granted on a country by country basis (For ex: in Euro Community, can be issued by community but is subject to national law)

Secrecy and Patents: Until patent application laid open, its contents are secret. On day it is filed, it is a

private communication and is not made public. Can still claim trade secret. Lasts for 18 months (priority date is the date of the first filing).

Once laid open (at 18 months after priority date), secrecy is lost. This is true everywhere in the world except USA (and even there +/- true): if

filing only in the US, then patent application is secret until one obtains patent (no limit of 18 months). If file intl, then same 18 month rule even in the US.

Mere act of filing means that application will eventually end up in the public domain. 18 months provides enough time to think about retracting application and retain trade secrecy protection. If application retracted, then as if never filed.

Scope – Literal vs. Non-Literal How do we protect patents from minute alterations that would appear not to be

protected in the patent?o Purposive approach: Canada, India, UK, Australia: look at the words of

the claim thru the eyes of the skilled reader (person that possess all the technical skills of the particular field involved). Skilled reader will:

Interpret the words in the claim using the vocabulary of the field. Fill in the blanks. The day the file is opened (18 month after the filing date), he will

look at the literature and determine the essential and non-essential elements so as to determine what changes will be permissible and which will not be. In other words, he/she will eliminate characteristics that need not be included in the patent for it to be viable and will extend to it characteristics that need be there.

Accordingly, the first step in order to sue for infringement will be to define the scope of what is covered by the patent, and then look at what might infringe it.

For an infringement to occur, all characteristics of the thing protected need not be present, one just need that the elements of the invention that are essential to it be substantially the same as seen thru the eyes of the skilled reader.

o USA: Test to determine infringement is more difficult in the US:

Compare the two items. Need not define the scope of what is covered as a first step as in Canada.

If one element is missing, not an infringement; if all elements are there, then there is an infringement .

Doctrine of equivalents in the USA: if all elements are not all present, skilled reader comes in and asks: are the elements substantially the same? Element by element rule. Here we don’t care if the element under investigation is essential or non-essential.

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Patent prosecution estoppel: In a patent application: always ask for more than less, so that one has leverage, stuff to negotiate with, things that can be withdrawn if the application is rejected. But there is a price to doing this: when one reduces claims, one reduces the ability to sue for things that are substantially the same: lose ability to expand the scope of what one can sue for under the doctrine of equivalence: estoppel from claiming doctrine of equivalents

-So in the USA, there is no defining of the scope of the patent, just a comparison of the constituent parts of the patented product and the 'infringing' product, whereas in Canada we first define the scope to determine what can and cannot constitute an infringement.

Patent Criteria: To obtain a patent, an invention must satisfy all of the following criteria:

o The invention must be new (novelty)o The invention must be inventive (non-obviousness)o The invention must be useful

• “Invention” means any 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”(s. 2 of the Patent Act)

• The subject-matter defined by a claim in an application for a patent in Canada must be subject-matter that would not have been obvious on the claim date to a person skilled in the art or science to which it pertains….(s. 28.3 of the Patent Act)

Failure to Satisfy Criteria:• 48.1(1) Any person may request a re-examination of any claim of a patent by

filing with the Commissioner prior art…• 59. The defendant, in any action for infringement of a patent may plead as matter

of defence any fact or default which by this Act or by law renders the patent void … (might not get patent or will fail to enforce it)

• 60(1) A patent or any claim in patent may be declared invalid or void by the Federal Court at the instance of the Attorney General of Canada or at the instance of any interested person.

• (s. 48.1(1), 59 & 60(1) Patent Act)

Novelty:

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• 28.2(1) The subject-matter defined by a claim in an application for a patent in Canada … must not have been disclosed

(a) more than one year before the filing date by the applicant, or by a person who obtained knowledge, directly or indirectly, from the applicant, in such a manner that the subject-matter became available to the public in Canada or elsewhere;

(b) before the claim date by a person not mentioned in paragraph (a) in such a manner that the subject-matter became available to the public in Canada or elsewhere;

(c) in an application for a patent that is filed in Canada by a person other than the applicant, and has a filing date that is before the claim date; or

(d) [same but for foreign application]

(S. 28.2 (1) of Patent Act)

What is an anticipated claim?• What must be disclosed in prior art?

Test in Reeves Brothers• What constitutes publicly available prior art?

Display of inventionLecture at conferenceInstalled at home where others can see it

Concept of obviousness:-Trying to prevent people from getting a patent on something that is already a given. One should not be able to obtain a monopoly over knowledge that is already in the public domain. Thus obviousness fulfills a similar purpose to novelty:

o s. 28.3 of PA: The subject-matter defined by a claim in an application for a

patent in Canada must be subject-matter that would not have been obvious on the claim date to a person skilled in the art or science to which it pertains, having regard to:• (a) information disclosed more than one year before the filing

date by the applicant, or by a person who obtained knowledge, directly or indirectly, from the application in such a manner that the information became available to the public in Canada or elsewhere; and

• (b) information disclosed before the claim date by a person not mentioned in paragraph (a) in such a manner that the information became available to the public in Canada or elsewhere.

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• So the question is: Was the invention practicably within the grasp of others skilled in the art?

Test for NON-Obviousness Modified Cripp’s question: Would the skilled unimaginative worker, in light of

his/her common general knowledge and armed with the available prior art be led "directly and without difficulty" to the claimed invention? If yes, no protection, if no, protection

In general, not a difficult step in the process of getting a patent: usually a ‘spark’ of genius is found to be necessary.

What is knowledge of prior art?• Narrower than test for novelty: General knowledge + Narrow definition of prior

art

General Knowledge• Knowledge that is established, sufficiently disseminated and accepted within the

art so as to be generally known and understood by the real life equivalents of the unimaginative skilled technician in the art.

• Not the same as common knowledge• Must be known and widely accepted without question by the bulk of practitioners• Knowledge that practitioners may be expected to have as a part of their technical

equipment

Meaning of Prior Art• Cannot determine what constitutes prior art with hindsight only, so the factors to

consider are:• Would the researcher have found the prior art after a diligent search?• Prior art must be sufficiently disseminated and accepted within the art• Prior art includes written documents such as patents (or published patent

applications), scientific/technical articles, and prior use

Some indicia of non-obviousness includes: Commercial success Long-felt need Attempts by others to solve problems Acceptance by relevant public Contemporaneous development

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European approach to inventive step:• “Problem and solution approach”:

• Identify the technical problem to be solved• Is the technical solution to this problem obvious to unimaginative

skilled person?• Problem of invention of purely scientific interest• Thus here we care why the invention was in fact invented: was it an obvious

answer to the question that it means to resolve? This is not a question we ask in Canada or USA.

Statutory Basis for Utility Requirement• “Invention” means any 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”(s. 2 of the Patent Act)

Different standards of utility: Canada: actual and ultimate utility: thing does not have to be good at what it does,

just needs to do it. Euro: if it can be made and someone might want to use it, then it is useful US: specific, substantial, and credible utility: specific (must do and be used for

what it was designed), substantial (people must want to use it) and credible (claim that invention will work must be credible on the day claim is filed).

Utility in Canada:• Invention must work for purposes for which it was designed, but it need not work

well• Invention must serve some positive purpose• Judged using perspective of someone skilled in the art• Benefit to society is not relevant• Invention must either work as of date of publication (18 months after priority

date) or inventor must be able to make a ‘sound prediction’ of utility• If utility claim based on sound prediction, must lay out reasons for that prediction• Prediction must ultimately prove true• Similar test to prediction in USA

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Utility in US• Brenner v. Manson: set up the basis for specific utility:

• Applicant claimed three forms of utility, including a specific utility in researching if the thing could perhaps fight tumours

• Rejected by Patent Office for lack of evidence (projected utility did not count, since only thing that the isolated steroid served was to do further research to see if it would indeed fight tumours).

• “a patent is not a hunting license. It is not a reward for the search, but compensation for its successful conclusion.”(per Fortas J. in Brenner v. Manson)

• Specific utility: a utility that is specific to what makes the invention “inventive”• Substantial utility: not a “throw away” utility, but a real, substantive use• Credible: the claim of utility must be credible given the state of knowledge in the

art

Industrial application in Europe• European Patent Convention requires that the invention have an industrial

application• Can be made; or• Has an industrial use• European Patent Office has signalled that may add requirement that

someone would actually want to use the invention

Statutory Requirement for Disclosure-There are two parts to a patent application:

Claim Description

Description:• “The specification of an invention must

(a) correctly and fully describe the invention and its operation or use as contemplated by the inventor;

(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 connect, to make, construct, compound or use it;

(c) in the case of a machine, explain the principle of the machine and the best mode in which the inventor has contemplated the application of that principle; and

(d) in the case of a process, explain the necessary sequence, if any, of the various steps, so as to distinguish the invention from other inventions.”(s. 27(3) of the Patent Act)

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• Description of the invention must be complete• No need to explicitly describe how the invention is useful• Adopt the point of view of someone with ordinary skill in the art

• Cannot require any knowledge other than obvious steps falling within common knowledge of someone skilled in the art

• Would such a person understand the description to describe all instantiations of the claimed invention?

• If not, claim is over-broad• If there is evidence that some instantiations of the invention do not work, then

claim must be rejected• This flows from utility requirement• See Minerals Separation

• Would this person understand that all instantiations of the invention would likely work?

• “If it is possible for the patentee to make a sound prediction and to frame a claim which does not go beyond the limits within which the prediction remains sound, then he is entitled to do so.”(Pigeon J. in Monsanto v. Canada citing Graham J. in Olin Mathieson Corporation v. Biorex Laboratories Ltd.)

US disclosure-Harder test to meet than the Canadian test: US highest utility and enablement requirement. The specification must satisfy two requirements:

• Description: what is to be protected• Enablement: how to make it

US Description Requirement-Two parts to this requirement

• Specification must describe the invention fully: o Does the description given in the specification include all claimed

instantiations of the invention? o If not, invention is not fully described

• Specification must describe how the invention operates• In most cases, a showing that invention does operate is sufficient• In other cases (e.g., pharmaceuticals) must provide some scientific evidence to

support claim that works• Similar to test in Monsanto v. Canada

US Enablement Requirement• To be enabled, the specification must give instructions to someone skilled in the

art on how to make and use the invention

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• If not all instantiations of the invention work, then the invention is not enabled• Cannot require undue experimentation• Apply a reasonableness standard

Invalidity:• “A patent is void if any material allegation in the petition of the applicant in

respect of the patent is untrue, or if the specification and drawings contain more or less than is necessary for obtaining the end for which they purport to be made, and the omission or addition is willfully made for the purpose of misleading.”(s. 53(1) of the Patent Act)

-Fact that one gets a patent does not necessarily mean that the patent is legally good: it can subsequently be challenged. Although just obtaining a patent may be legally good in practice since going to court is costly (others might respect the patent just because they want to avoid legal proceedings)-Patent is evaluated on the reasonability of the claim, but it is not tested per se.

Failure to identify inventors:-In terms of who is an inventor, one does not have to have physically made the thing, rather one must have contributed to the creation of the idea.

• In Canada, the failure to list all inventors does not lead to invalidity• Not a material allegation• See Apotex v. Wellcome Foundation (Fed.C.A)

• In US, failure to name an inventor leads to invalidity unless innocent error• See 35 U.S.C. § 256

Infringement-NOTE: unintentional use is still an infringement: infringement does not depend upon intention. One and only exception to this rule: when one was not aware of the existence of the thing and did not want to take advantage of the thing: hard test to meet.

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-An infringement constitutes: • Making, using, selling or importing invention in Canada• When the invention may be embedded in a larger object (car, plant) (refer to

Monsanto)• ‘Use’ includes furthering a business or commercial interest (this is an SCC

definition)• Unintentional use still infringement unless truly ‘innocent’

Remedies-Pretty much the same as those of TM or Passing-Off:• Injunction• Damages

• Lost profits to patent holder• Accounting of profits• Based on actual gain due to use of invention

-Once one has shown one utility and obtained a patent, one can also claim all other possible utilities.-NOTE: multiple patent rights to the same property is possible-NOTE: patent, copyrights and trademarks are based on the notion of a right to exclude, not the right to use (in CML, there is no such thing as a right to use, just a complete freedom and a right to exclude others).-Patents give you no right to use your invention. It simply allows you to impose constraints on other from using your invention. You have a liberty to use the patented invention to the extent that nothing else stops you. That’s true of all IP, not just patents. -Each IP right holder gets to exclude others, but it doesn’t give a right to use the object of the right.

Copyright: An Overview

What a copyright gives you-It’s a right to prevent others from:

Producing or reproducing work Performing work in public Publishing work Engaging in or authorizing above acts

Expression Expression vs content: patent deal with concrete ideas, trademarks are protecting

marks, copyrights protect expression. Copyright protects only the expression.

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Example: a recipe. Which activities can you prevent if you’ve authored a recipe book:

o You can’t prevent people from reading it. You can’t prevent people from lending it. You can’t prevent people from cooking the recipe. You can’t prevent people from selling the book. You can’t prevent people from telling the recipe to others. Use is not part of copyrights.

o You can prevent someone from writing out the recipe in full and giving it to someone else.

o When you’re copying the recipe, you’re reproducing the expression. But the steps taken in the recipe and the contents aren’t part of the copyright.

o So you can’t copy the recipe word for word and you can’t copy the way it was expressed, but you can convey the information contained in the expression.

Fixation vs. corporeality-The work must be fixed, must have a concrete physical form. The work itself isn’t the concrete form. At some point in its life, the work has to be captured in physical form, it has to be fixed. This requirement is so that you can prove the existence of the work.

Originality “what is worth copying is prima facie worth protecting”, University of London

Press Traditional view: must be original in the sense that the work originated with the

author Feist and progeny: a higher standard for originality, at least with respect to

compilations. Originality is the statutory heart of copyrights. Copyrights protect original

expression. Originality doesn’t require some threshold of creative genius. Copyright applies

to people who write computer manuals. The courts don’t really want to get into a discussion about whether something is creative or not.

The originality requirement goes back to the idea that it originates with the author. The source of the expression must be the author; the author mustn’t have taken it from somewhere or someone else.

However, there’s an implication: two people might have come up with the exact same text, or music, whatever. Both of them originated with their own author. Therefore, both author has a copyright, and each one can exclude the rest of the world from using their work. Each copyright holder can use his own work, but not the other’s work, even if both guy’s work are identical. (Although one wonders if this could ever really happen: identical expression of an idea seems unlikely)

There has been some debate as to whether you can claim something is original to you if it requires absolutely no mental power, it only requires brute force. For instance, a telephone book. I.e. how do we deal with something that’s completely uncreative? The U.S. has introduced a tiny little spark of creativity requirement. Europe doesn’t require that, they just go back to originality, and in Canada, we’re undecided (sitting on the fence again).

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Categories of works

i) Artistic works

-“‘Artistic works’ includes paintings, drawings, maps, charts, plants, photographs, engravings, sculptures, works of artistic craftsmanship, architectural works, and compilations of artistic works” (section 2 of the Copyright Act)-This is a non-exhaustive list.-What happens if your work doesn’t fall in that list? If you’re not on this list, how do you decide if it’s artistic?

Word “artistic” identifies phrase “artistic work” and used to qualify “artistic craftsmanship”

Does the use of the word “artistic” in the phrase import any requirements of artistic-ness on the object?

Artistic means it falls within the “plastic arts”, it’s a formal definition, not a substantive one. It need not to be artistic to be an artistic work.

ii) Literary Works

-“Literary work” includes tables, computer programs, and compilations of literary works” (s. 2 of the Copyright Act)-“Literary” means pertaining to the use of words rather than to literature-Characters? Possible, but difficult

iii) Titles

-“work” includes the title thereof when such title is original and distinctive (s. 2 of the Copyright Act)-We’ve seen distinctiveness in trademarks. So, to be protected as a separate thing, the title has to be quasi-trademark, it has to distinguish your work from that of someone else. That means that the great bulk of titles aren’t protected as separate works. -That doesn’t mean that the title isn’t protected at all because the title is part of the whole book/movie/play/etc. It’s protected as part of the overall work. -The separate protection means that the title is protected as a distinct and separate work. -2 ways to protect titles:

As part of overall work When original and distinctive, as separate work (extremely difficult…)

iv) Computer programs

-“‘Computer program” means a set of instructions or statements, expressed, fixed, embodied or stored in any manner, that is to be used directly or indirectly in a computer in order to bring about a specific result” (s. 2 of the Copyright Act)

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-This is a closed definition, it says “means” and not “includes”. -Computer program usually refers in our mind to ideas rather than expression, and it is often found that they don’t really fit in copyrights.

v) Dramatic Works

-“dramatic work” includes(a) any piece for recitation, choreographic work or mime, the scenic

arrangement or acting form of which is fixed in writing or otherwise(b) any cinematographic work; and(c) any compilation of dramatic works. (s. 2 of the Copyright Act)

Fixation of dramatic work

-It’s the one instance of specific requirement of fixity in the Copyright act. As dramatic work is often spontaneous, it can be hard to fix it. So, some notes of what you’re planning to do fulfils the “fixity” requirement. -Improvisation isn’t a “dramatic work” until it’s recorded somehow.

vi) Musical work

-“Musical work” means any work of music or musical composition, with or without words, and includes any compilation thereof.” (s. 2 of the Copyright Act)-Can have a single copyright in combined music and lyrics to a song.-This is about the music itself and not the performance of music. -You can have a copyright in the separate lyrics, the separate music, and in the two together. -What are the various parts of a musical work?

Melody Harmonic structure Rhythm Hook

-Usually, the part that is recognized about the music is the part that’s protected.

vii) Compilations and Databases

-“Compilation” means(a) a work resulting form the selection or arrangement of literary,

dramatic, musical or artistic works or parts thereof; or(b) a work resulting from the selection or arrangement of data” (s. 2 of the

Copyright Act)-So, you get a copyright in the manner that you compile the date, the order you give it. Our casebook, the prof. didn’t write the materials, but he did put it together. Some thought went into the structure of the casebook. So, the professor has some protection in the way he put the casebook together.

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Assignment vs. License

-The most straightforward way to make money off your copyright is to make it and sell it yourself. -However, if you don’t want to get into that, you can either assign your copyright or license it.-Assignment changes ownership of underlying copyright (in whole or in part)-License involves contractual relations only you keep to copyright but you chose against whom you’re going to exercise your right to exclude. You tell someone, give me some consideration, and I won’t sue you should you use the object of the copyright. The license can be exclusive or not.

Reproduction-“Copyright” … means the sole right to produce or reproduce the work or any substantial part thereof in any material form whatever…”(section 3(1) of the Copyright Act)-That’s wrong again, you have the right to prevent other people from reproducing the work. -In Theberge: Reproduction requires the creation of new copies. This was a 4-3 decision with all Québec judges dissenting. The case reveals the split between common law approach and civil law approach. The civilist approach was a more abstract notion of what reproduction is and doesn’t require additional copies to be made.

Non-literal Reproduction-Copyright holder can prevent not only literal copying, but non-literal copying as well. Degree of similarity between works is the key but is also hard to measure (“Nobody has ever been able to fix that boundary, and nobody ever can”: Learned Hand in Nichols v. Universal Pictures Corporation)

Substantial part-Even if portion copied is quantitatively small, may be qualitatively significant.-Must assess work as a whole and determine importance of elements that are similar-Use of stock elements does not contribute to copying-The copy of even a small but substantial part can constitute copyright infringement. For instance, if you copy only a few notes of music and you’d know immediately where it’s from, that would be infringement

Criteria for copyright protection: expression has been fixed somehow originality requirement: started with the author, not necessarily that it is

completely original-Extent of the right: prevent others from reproducing the work in whole or in parts: substantive amount of infringement in terms of quality or quantity

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Copyrights protect expression and not ideas: this is the central concept: perhaps not only of copyrights but also of patents (idea vs. invention) and TMs (mark vs. product)Limits on Copyright: Fair Dealing • Fair dealing: copying for the purpose of research or private study does not

infringe copyright(s. 29 of the Copyright Act)

• Fair dealing: copying for the purpose of criticism or review does not infringe copyright …(s. 29.1 of the Copyright Act)

• Fair dealing for the purpose of news reporting does not infringe copyright(s. 29.2 of the Copyright Act)

Limits on Copyright: Fair Use • Fair use is wider, more open and flexible concept• Balance of interests of copyright holder against those of the public• Almost any commercial use is presumptively unfair• Non-commercial use only unfair if strong evidence of likely future harm

Copying Sound Recording• “…[T]he act of reproducing all or any substantial part of

(a) a musical work embodied in a sound recording, … onto an audio recording medium for the private use of the person who makes the copy does not constitute an infringement of the copyright in the musical work…(s. 80(1) of the Copyright Act)

Parody???• Kinds of parody?• Is any or all of them fair dealing?• Would it be fair use in the US?

Moral Rights• “The author of a work has … 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.”(section 14.1(1) of the Copyright Act)

Attribution• “The author of a work has … the right to … to be associated with the work as its

author by name or under a pseudonym and the right to remain anonymous.”(section 14.1(1) of the Copyright Act)

-NOTE: In US: there is no such thing as a moral right.

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Integrity of the Work• “The author’s right to the integrity of a work is infringed only if the work is, to

the prejudice of the honour or reputation of the author,(a) distorted, mutilated or otherwise modified; or(b) used in association with a product, service, cause or institution.”(s. 28.2(1) of the Copyright Act)

• Does the right extend to a copy of the work?

Deemed Prejudice• “In the case of a painting, sculpture or engraving, the prejudice referred to in

subsection (1) shall be deemed to have occurred as a result of any distortion, mutilation or other modification of the work.”(s. 28.2(2) of the Copyright Act)

• Why single out painting, sculpture and engraving?

Prejudice to Honour or Reputation• How do we apply this test to works that are not paintings, sculptures, or

engravings?• Must distortion, mutilation, modification, or association be objectively

prejudicial or must it be only subjectively prejudicial?? (refer to Prise de Parole v Guerin)

• Does test depend on why we protect moral rights?

Waiver• Copyrights can be assigned or licensed • Moral rights cannot be assigned not licensed: “Moral rights may not be assigned

but may be waived in whole or in part.”(s. 14.1(2) of the Copyright Act)

• Accordingly, moral rights cannot accompany copyrights when these are transferred. NOTE that moral rights can be inherited however.

• NOTE also that moral rights can be waived in the sense that one may choose not to exercise them.

• Can the holder waive her moral right in a work before the work is created? There is no answer to this question.

Effect of Waiver• “Where a waiver of any moral right is made in favour of an owner or a licensee of

copyright, it may be invoked by any person authorized by the owner or licensee to use the work, unless there is an indication to the contrary in the work.”(s. 14.1(4) of the Copyright Act)

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Obtaining Copyright• Copyright protection in Canada is automatic on the creation of the work• Nevertheless, can register copyright with the Canadian Intellectual Property

Office to obtain a presumption of validity• “The Register of Copyrights is evidence of the particulars entered in it….” (s.

53(1) of the Copyright Act)

Term of protection• “The term for which copyright shall subsist shall, except as otherwise expressly

provided by this Act, be the life of the author, the remainder of the calendar year in which the author dies, and a period of fifty years following the end of that calendar year.”(s. 6 of the Copyright Act)

-Date of creation does not matter, it is irrelevant to the duration of the Copyright. The only relevant date is the year of death of author.

Eldred Case • USSC: upholds the Sonny Bono Copyright Extension Act (7-2)• Life plus 70 years• 95 years for some cartoon works (because of Mickey Mouse)

Exceptions to term• For anonymous works: lesser of 50 years from date of publication or 75 years

from the making of the work• For posthumous works: 50 years from publication• Joint authorship: 50 years from end of year in which last author dies

International Copyright• Berne Convention for the Protection of Literary and Artistic Works, 1886 up to

Paris Revision of 1971– Universal protection throughout member states– National treatment– Absence of formalities– Term of protection

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Universal Copyright Convention• For non-signatories of the Berne Convention• States entitled to retain certain formalities• Term of protection defined by reference to term of years• Less detailed than Berne Convention

TRIPs under the WTO• Agreement on Trade Related Aspects of Intellectual Property Rights under WTO

Agreements• Requires compliance with Berne (1971)• National treatment• Most-favoured-nation treatment• Protection of computer programs and compilations of data• Protection of performers and broadcasting

Obtaining International Copyright Protection• For Berne members (including all WTO members), once one obtain a copyright in

one member country one obtains a copyright in all other member countries according to their copyright laws

-For non-Berne but UCC members, may have to register to obtain copyright in that member state

Roderick A. MacDonald “The Suisse Army Knife of Governance” (2002) Choice of governing instruments:

-SAKnife is an instantiation of the logic of plural modes and multiple sites of governance.-The gadgets of the knife are hypotheses of action-Two hypothesis:

oFinding an appropriate mean to an end: I have to regulate the right of inventors, writers and image, how do I do that? The end constrains the choice of means.

oFinding an appropriate end attainable by the means available: I have an IP regime, what can I do with it? The mean constrains the choice of end.

-Problems: 1- Too many tools. “What should I use?” -There isn’t necessarily a single best tool in any given situation. -Moreover, different users might have preferences for one or another tool.-Sometimes, less obvious solutions might actually prove to be more effective.2- Over-inclusiveness. “I just want a knife. Can’t I get a model without all the other stuff?”-Although a tool is flexible and highly varied, sometimes, a certain problem requires a totally specialized and different tool. -Conceptualising the problem at the outset is important, with a specific end in mind. Clears out what type of means to use.3- Wrong tool. Some problems require a totally different tool altogether. None of the available ones are intended to solve this issue.4- Intended use, Unforeseen problems. Collateral damage from poorly-designed regulatory solutions.5- Creative Use, Unforeseen Problems. Don’t expect too much from your instrument. Don’t use the Tax Act for something more.

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6- Design Redundancies: Couldn’t we merge a few steps together in order to have a more effective IP system?7- Specific-Use tools. Micro-regulation tends to sell people short, by denying the creative role that citizens can have in solving their own problems.8- Design Tradeoffs: sometimes, a liability rule might be most suited for the task.-The criterion used to evaluate the regulatory solution is important9- Cultural Limits : Some countries don’t consider copying an infringement on CR. Cultural predispositions limit at the outset the possible range or character of regulatory solutions available.10- Preconceptions of use : Patents are used to solutions certain problems, and CR others; but couldn’t we switch around?-Issues to be considered when deciding on what tool to use:

oPrimary v. Secondary characteristics: the end helps decide which characteristics are primary, and mandatory in picking the type of tool.

oRelations between uses: sometimes, by the force of habit, it is difficult to make a tool adapt to another problem: like patents on life.

oPolitical Ideology helpsoAdministrative cost-benefit analysis: new technologies require more sophistication in order

to deploy them properly.oMultiple regulatory sites: sometimes, if you can get certification in USA, it does not

guarantee a certification in CAD. Different criteria in Europe and North America.-Is IP the right tool to be used? Or should a liability rule be used instead? To what extent does IP considers efficiency in its allocation of rights?

Theory of utilitarianism: Notion of efficiency = justification of the regime Is that an appropriate description of IP or should we let Moral Rights play a larger role? Compulsory licensing for medication to generic companies might be one way of

including moral rights….but, NAFTA and TRIPS consider that this approach would limit research, and therefore place pressure to limit this practice.

Compulsory licensing still used in Europe, as it carries historical valuesPolitical Ideology:

What is the ideology behind each scheme? Which theory justifies IP?

Cost Benefit Analysis: How about pressure to use the tool because of tradition? Conviction vs. Convention. How about practical difficulties with the system? Are people overusing the system? Patent offices, whom do they represent? A ghost in the machine, with a quota to allow a certain

number to pass and others not to? You can get a faster read in the US if you pay more. Does that create a conflict of interest? Does it matter that they are not neutral?

Is the system flexible enough to adapt to new technology? (patenting life-mice). Who is going to make the changes? The legislative? Regulatory agencies? Judge-made law?

-Discussion of McD's article: All about how we use legal tools. Which is the best instrument to achieve a

particular policy? All tools have effect on behaviour. State might want to direct our choice of

instruments in order to affect our behaviour. Analogy of the Swiss Army knife: an instrument with multiple tools that may

serve numerous purposes. Sometimes too many choices are available, as in the Swiss Army Knife 5 different IP regimes (PO, TM, Copyright, Patents, Trade Secrets): is this too

many? Can we achieve our goals with fewer regimes? Do they really accomplish the ends that we want?

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Modalities of Ordering IP Space:

A) What is included?

Copyrights:

Nichols v. Universal Pictures Corp., 1930, p. 20:Facts: Pf wrote a play called ‘Abie’s Irish Rose’. Def wrote a motion picture play called ‘The Cohens and the Kellys’. Pf says that def copied her play and violated her copyright.Issue: where is the line to be drawn between original ideas for the purposes of copyrights and general themes that are not protected under copyrights?Held: In favour of def, case dismissed.Ratio:-Copyright cannot be limited literally to the text, else a plagiarist would escape by immaterial variations.-When the plagiarist does not take out a block in suit, but an abstract of the whole, decision is difficult.-While storylines are protected, there is a limit beyond which general patterns will not be protected. What one must focus on are substances. To draw the line is difficult and arbitrary, but drawn it must be.-As respects plays, the controversy chiefly centers around characters and sequence of incident, these being the substance.-Here stories are quite different, and so are characters: only matter common to the two plays is a quarrel between a Jewish and an Irish father, the marriage of their children, the birth of grandchildren and a reconciliation.-These are general themes that cannot be afforded protection under copyrights: themes are too general, and characters are prototypes. -A comedy based upon conflicts between Irish and Jews, into which the marriage of their children enters, is no more susceptible of copyright than the outline of Romeo and Juliet.Comment:-Point of the case: what is protected is not the idea (here a family quarrel between Jews and Irish) but rather the expression of that idea (particular description of the quarrel)

-Essential question: what is it that you get when one gets a copyright: expression, but not ideas. What does this mean: what is expression, what is idea?

Allen Rosen, ‘Reconsidering the Idea/Expression Dichotomy’, p. 24-It is an elementary principle of copyright law than an author has no copyright in ideas but only in his expression of them. His copyright is confined to the literary work in which he has expressed them. The ideas are public property, the literary work his own.-Idea/expression dichotomy is a conspicuously central yet manifestly unclear principle of copyright law.-One of the difficulties lies in the vagueness and lack of definition for the terms ‘ideas’ and ‘expression of ideas’.Purpose of Idea/Expression Dichotomy:-Canadian traditional rationale for copyright protection: that it is intended to strike a balance between ensuring that authors, artists and other creative individuals receive just rewards for their labours, and encouraging progress in the arts for the benefit of the public at large.-US rationale: copyright and patents protection is to promote the Progress of Science and the useful Arts, by securing for limited times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries. More of a utilitarian perspective (encourage work) than a just rewards principle (Canadian: merit compensation for work).-Task of copyright law is to balance two factors: one, the public’s interest in having access to new works, new ideas, and the progress that may be expected to result from their general dissemination; the other, to provide incentives – or rewards – for continued creativity. -The idea/expression dichotomy fits very nicely into this traditional picture.-NOTE: test of infringement of copyright in Canada, England, and the US is the ‘substantial similarity’ or

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‘substantial part’ test-Look at the various characterization/explanation of the idea/expression dichotomy:

1. Style/content contrasta. Idea means the content of an idea and expression means the style in which an idea is

presented.b. Problem is that the more abstract and nonrepresentational a work of art, the more the

creator’s style tends to merge with the content or subject matter of the work2. Fixed/unfixed idea:

a. Idea must be fixed in a material form before they can receive copyright protection. b. Fixation is an important requirement of copyright law, for unless ideas are anchored in

some more or less enduring form they cannot readily be identified for copyright purposes.c. But this explanation only serves to remove one set of ideas, those that are fixed, from

public use (as they are protected), and therefore does not serve the purpose of advancing society.

3. Ideas & Language: The Lockean Storya. Ideas become ‘embodied’ in language and then are susceptible to copyright protection.b. Comparison does not hold because it presumes that ideas are essentially non-linguistic

and are only incidentally embodied in linguistic form.4. General & Specific Ideas

a. Copyright does not extend to ‘mere unelaborated notion’ or ‘general concept’, but rather only to elaborated complex ideas.

b. Problem is: when is an idea complex enough? At what point does it cease to be a general idea and become a specific idea? How do we draw the line (refer to Nichols)

5. Merger Doctrinea. Where the idea can only be expressed in one form and the form adds nothing to the

original idea, the idea is said to ‘merge’ with its expressionb. Problem: very rarely will an idea only be expressible in one form.

-Ultimately, of these only 4 is useful to the purpose of copyrights: Highly specific and well developed ideas should be likely candidates for copyright protection because extending protection to such ideas provides incentives for additional creativity without unduly impeding the free flow of ideas.

Trademarks:

Frank I. Schecter, “The Rational Basis of TM Protection”, p. 34:-Unlike in the past when TMs were used to both or either identify the author of a goods or to whom it belongs, modern TMs do not accomplish this: most often consumer has no idea where good was made, and certainly is not used to identify the good as his.-Purpose of modern TM: mark indicates that the goods in connection with which it is used emanate from the same - possibly anonymous - source or have reached the consumer thru the same channels as certain other goods that have already given the consumer satisfaction, and that bore the same mark.-Yet this is not the whole story: the mark actually sells the goods. Purpose of a TM is to identify a product as satisfactory and thereby to stimulate further purchases by the consuming public. To describe a TM merely as a symbol of good will, without recognizing in it an agency for the actual creation and perpetuation of good will, ignores the most potent aspect of the nature of a TM and that phase most in need of protection.-Creation and retention of custom, rather than the designation of source, is the primary purpose of the TM today, and that preservation of the uniqueness or individuality of the TM is of paramount importance to its owner.-Holding TMs to identify origin or ownership, the law unfortunately only intervenes in situations where it is necessary to prevent the misuse of that mark only where there is an actual confusion created by such misuse, resulting in either diversion of trade or other concrete financial liability or injury to trade repute. In other words, two identical TMs, if not leading to any confusion on the part of customers (lets say because on totally different products, apples and chairs), would be unproblematic. -This is indeed problematic, because it results in the gradual whittling away or dispersion of the identity and hold upon the public mind of the mark or name by its use upon non-competing goods. In essence, the

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more distinctive or unique the mark, the deeper is its impress upon the public consciousness, and the greater its need for protection against vitiation or dissociation from the particular product in connection with which it has been used (refer to Pink Panther)-Conclusion: preservation of the uniqueness of a TM should constitute the only rational basis for its protection.

-There are 2 ways of looking at the purposes of TMs (as per Schecter); Protecting the consumer: this is a consumer oriented perspective: provides

consumers with a vague sense of where a particular products came from: knowing that the product comes from a particular producer/manufacturer is a consumer controlled quality mechanism: trust the brand because in the past had a good experience. (this is one of the traditional views of TM, the other being identifying to whom the good belongs via the mark)

TM as creating markets: companies invest in TM to make consumers feel good about their products (focusing on the TM holder, this is more of a proprietary perspective). TM creates a capital asset, that is to say the loyalty of the consumer

Patents:

-Patents: remember that these cover inventions, products and processes requiring human intervention. -Patents emerged in the 60s, particularly out of the then burgeoning chemical industry: the purifications of chemicals were some of the first patents (patenting the process)-NOTE: In this context, remember that pure knowledge cannot be patented, but applied knowledge can (EX: distinction between law of gravity [not patentable] and a pendulum that uses the law of gravity [patentable]). This may parallel the idea/expression dichotomy (idea/pure knowledge not protected, expression/applied knowledge protected)

Tennessee Eastman Co. v. Canada (Commissioner of Patents), [1974] SCR, p. 45:Facts: Patent claim is not about the making of a particular adhesive but rather its use in medical treatment: can be used to join or bond living tissue. Issue: Can one consider the use of the adhesive in the medical context an art or process within the meaning of the PA?Held: Appeal dismissed, patent claim is no good.Ratio:-The subject-matter of the claimed invention is the discovery that this particular adhesive is nontoxic and such that it can be used for the surgical bonding of living tissues as well as for a variety of inert materials. -The basic claim is not in regards to the adhesive or even the making of the adhesive, but rather in regards to a new use for surgical purposes of a known substance. Can be claimed as an invention?-In opinion of court, the therapeutic use cannot be claimed as a process apart from the substance itself. Otherwise, it would mean that while the substance could not be used except when prepared by the patented process; its use however prepared could be claimed as a method of treatment.

-NOTE: s. 41 was the basis of the court's decision, but it no longer exists: products that are pharmaceutical are not patentable: this is no longer true, but was so at the time of the case.-Ultimately, we have only vague zones in terms of what is protected by our systems:

Copyright: vague notion of expression (expression v. idea, and where the line is drawn between the two is not very clear)

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TM: distinctiveness Patent: something that requires human intervention (not pure knowledge but

applied knowledge)-The vagueness, to some extent, is required because we want the regime to be flexible

Schlumberger Canada Ltd. v. Canada (Commissioner of Patents), 1982, CA, p. 51:Facts: Applicant's application discloses a process whereby the measurements of boreholes used to find oil and gas are recorded on magnetic tapes, transmitted to a computer programmed according to the mathematical formulae set out in the specifications and converted by the computer into useful info in human readable form.Issue: The invention, applicant maintains, is not the computer program used to make the calculations, it is the complex process, which is effected by computer, of transforming measurements into useful info.Held: Appeal rejected, patent claim is no good.Ratio:-What is new here is the discovery of the various calculations to be made and of the mathematical formulae to be used in making those calculations. If those calculations were not to be effected by computers but by men, the subject-matter of the application would clearly be mathematical formulae and a series of purely mental operations; as such, it would not be patentable. A mathematical formulae must be assimilated to a 'mere scientific principle or abstract theorem' for which subsection 28(3) of the Act prescribes that 'no patent shall issue'. (this is an attempt to patent pure knowledge in the forms of mathematics, not an application of pure knowledge)-What the appellant claims as an invention here is merely the discovery that by making certain calculations according to certain formulae, useful info could be extracted from certain measurements. This is not an invention within the meaning of section 2.

-Here we note that the various calculations could have been done by human beings, so the thing sought to be patented was really just abstract pure knowledge. As there can be no patent over scientific knowledge (now s. 27(8) of PA), claim must fail.-Computer programs per se are not patentable: but the line between pure and applied knowledge is difficult. Cannot patent a computer program that does something or other, but can patent a process that achieves a practical result. Accordingly can patent a process that is carried on by a computer.-Case is about how you write your patent application, and not a rule of what can or cannot be patented.

B) Criteria

Copyrights:

-In terms of copyrights, something is eligible for protection because it is expressive, but this is not the end of the investigation. There is a need for originality as well, and also a need of fixation. Note however, that fixation is usually not a problem-A few observations in terms of copyrights:

o Originality not the same thing as noveltyo Originality: work must originate with me: if I am the source, then OK, if I

copied it, no good.o Novelty: some spark of human genius (refer to Feist)

Feist Publications v. Rural Telephone Services, US SC, 1991, p. 53:

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Fact: Feist publishes a 'white-page' telephone directory using, in part and without approval, Rural's own 'white-page' directory. Issue: Can Rural claim a copyright over the date (names, addresses, phone #) in its directory used by Feist?Held: NO, there can be no copyright of data, and Rural's directory does not meet the originality requirement for a valid copyright.Ratio: -The sine qua non of copyright is originality. Original, as the term is used in copyright, means only that the work was independently created by the author and that it possesses at least some minimal degree of creativity.-Accordingly facts and data cannot be copyrighted, simply because facts and data do not owe their origin to an act of authorship: they exist independently of being collected by someone. (NOTE: alternative was the 'sweat of the brow' theory that allowed for copyrights of facts based on the effort one had to expand to acquire, collect and compile facts: no longer in use).-Note that the originality requirement is not particularly stringent: in terms of date and facts, originality requires only that the author make the selection or arrangement independently. -For infringement to exist, two elements must be proven:

Ownership of a valid copyright, Copying of constituent elements of the work that are original.

-Here the second element is not met, since neither Rural's data nor its arrangement were original (essentially, its 'white pages' is entirely typical).Principle: As a constitutional matter, copyright protects only those constituent elements of a work that possess more than a de minimis quantum of creativity.Comment:Point of the case: originality means that the work originated with the author-One cannot have a copyright over pure date or information (lacks the creativity requirement), but one can have a copyright over the way in which the data or information was selected, organized and presented, because these do involve some creativity, even if its negligible creativity (remember the casebook example: can be copyrighted because involve creativity in terms of organization)-Case considers the 'sweat of the brow' theory but rejects it: time and effort is not sufficient, there must also be a spark of genius, some non-mechanical effort

CCH Canadian Ltd. v. Law Society of Upper Canada, 2003, SCC, from WebCT:Facts: The respondent publishers commenced copyright infringement actions against the Law Society, arguing that the Law Society had infringed copyright when the Great Library reproduced a copy of each of the works. The Law Society denied liability and counterclaimed for a declaration that copyright is not infringed when a single copy of a reported decision, case summary, statute, regulation or a limited selection of text from a treatise is made by the Great Library staff or one of its patrons on a self-service photocopier for the purpose of research.Issue: whether the Law Society has breached copyright by either (1) providing the custom photocopy service in which single copies of the publishers' works are reproduced and sent to patrons upon their request or by (2) maintaining self-service photocopiers and copies of the publishers' works in the Great Library for use by its patrons.Held: NO in both cases: although the works in question were "original" and thus covered by copyright, the Law Society's dealings with the works were for the purpose of research and were fair dealings within s. 29 of the Copyright Act. Ratio:-Copyright law protects the expression of ideas in these works; it does not protect ideas in and of themselves. The law of copyright does not give him any monopoly in the use of the ideas with which he deals or any property in them, even if they are original.-Binnie J. recently explained in Théberge, supra, at paras. 30-31, that the Copyright Act has dual objectives:

The Copyright Act is usually presented as a balance between promoting the public interest in the

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encouragement and dissemination of works of the arts and intellect and obtaining a just reward for the creator . . . .

The proper balance among these and other public policy objectives lies not only in recognizing the creator's rights but in giving due weight to their limited nature.

-The headnotes, case summary, topical index and compilation of reported judicial decisions are all works that have originated from their authors and are not mere copies. They are the product of the exercise of skill and judgment that is not trivial. Thus all of the work of the respondent are subject to copyrights.-Under s. 27(1) of the Copyright Act, it is an infringement of copyright for anyone to do anything that the Act only allows owners to do, including authorizing the exercise of his or her own rights. The publishers argue that the Law Society is liable for breach of copyright under this section because it implicitly authorized patrons of the Great Library to copy works in breach of the Copyright Act.-A person does not authorize infringement by authorizing the mere use of equipment that could be used to infringe copyright.-For several decades, the Law Society has maintained self-service photocopiers for the use of its patrons in the Great Library. The patrons' use of the machines is not monitored directly. Since the mid-1980s, the Law Society has posted the following notice above each machine: "The copyright law of Canada governs the making of photocopies or other reproductions of copyright material. Certain copying may be an infringement of the copyright law. This library is not responsible for infringing copies made by the users of these machines."-Conclude that the Law Society's mere provision of photocopiers for the use of its patrons did not constitute authorization to use the photocopiers to breach copyright law: courts should presume that a person who authorizes an activity does so only so far as it is in accordance with the law. And even if there were evidence of the photocopiers having been used to infringe copyright, the Law Society lacks sufficient control over the Great Library's patrons to permit the conclusion that it sanctioned, approved or countenanced the infringement.-The fair dealing exceptions to copyright are set out in ss. 29 to 29.2. In general terms, those who deal fairly with a work for the purpose of research, private study, criticism, review or news reporting, do not infringe copyright. -The purpose of the dealing, the character of the dealing, the amount of the dealing, the nature of the work, available alternatives to the dealing and the effect of the dealing on the work are all factors that could help determine whether or not a dealing is fair.-Although the retrieval and photocopying of legal works are not research in and of themselves, they are necessary conditions of research and thus part of the research process. There is no other purpose for the copying; the Law Society does not profit from this service.-Finally: Educational institutions, libraries, archives and museums are specifically exempted from copyright infringement in certain circumstances, and this would be one of those circumstances, although thanks to the previous conclusion, it was not necessary to determine the issue.Principles:-Court concludes that an "original" work under the Copyright Act is one that originates from an author and is not copied from another work. That alone, however, is not sufficient to find that something is original. In addition, an original work must be the product of an author's exercise of skill and judgment. The exercise of skill and judgment required to produce the work must not be so trivial that it could be characterized as a purely mechanical exercise. While creative works will by definition be "original" and covered by copyright, creativity is not required to make a work "original".Comments:-Court specifically rejects the 'sweat of the brow' approach.-Case is all about the meaning of fair dealing.-Contrast with Feist. This is a Canadian case, whereas Feist is USA.

Trademarks:

Linoleum Manufacturing v. Nairn, 1878, Chancery Division, p. 102:Facts: Pf is inventor of linoleum and sells it under that name. Def begins to sell linoleum as well. Pf argues

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that def has not right to call its product linoleum.Held: Appeal dismissedRatio:-Pf invented a new subject-matter, but they used merely the name distinguishing that subject-matter, but do not use a name distinguishing that subject-matter as made by them from the same subject-matter as made by other persons.-Word 'linoleum' is descriptive of the product (oxidized oil), and only secondarily means the manufacture of the pf, and has that meaning only so long as the pf are the sole manufacturers. It would be extremely difficult for a person who has been by right of some monopoly the sole manufacturer of a new article, and has given a new name to the new article, meaning that new article and nothing more, to claim that the name is to be attributed to his manufacture alone after his competitors are at liberty to make the same article.Comment:-In this case we see that a non-descriptive/original name (mark) can lose its distinctiveness over time, become diluted or generic.

Reckitt & Colman Products Ltd. v. Borden Inc., 1990, House of Lords, p. 104:Facts: Pf had for years sold lemon juice in lemon shaped plastic containers and the consuming public had come to associate the container with the company. Furthermore pf had a virtual monopoly by threatening competitors with passing off actions if they sold similar containers containing lemon juice. US company decides to sell lemon shaped containers.Issue:Held:Ratio:Lord Oliver of Aylmerton:-Passing Off: no man may pass off his goods as those of another. 3 elements need be proven in a successful passing off action:

Establish a goodwill or reputation attached to the goods or services which he supplies in the mind of the purchasing public.

Demonstrate a misrepresentation by the def to the public (whether or not intentional) leading or likely to lead the public to believe that goods or services offered by him are the goods or services of the pf.

Demonstrate that he suffers or is likely to suffer, damage by reason of the erroneous belief engendered by the def's misrepresentation.

-Here the two products could be differentiated on the basis of the label, but first instance judge recognized that nobody (or very few people) read the label when purchasing the products. Thus first instance judge concludes that the competitor's product, in light of the virtual monopoly that the pf previously had (goodwill is here established) and in light of the fact that nobody reads the labels, is likely to cause confusion because it is not sufficiently distinctive.-Normally, one cannot claim a monopoly in the use of a container which is common use. However, in this case the lemon-shaped container has acquired, by virtue of monopoly, a secondary meaning, namely that it is associated with the pf's product.-Thus def's argument is rejected on the basis that the plastic container is not sold as an object in itself but rather as part of the get-up under which the pf's produce is sold. It was not 'common to trade' at the time, since the pf's enjoyed a virtual monopoly.-The essence of passing off is a deceit practiced upon the public and it can be no answer, in a case where it is demonstrable that the public has been or will be deceived, that they would not have been if they had been more careful…Comment:-If the public is accustomed to rely upon a particular brand name in purchasing goods of a particular description, it matters not at all that there is little or no public awareness of the identity of the proprietor of the brand name.-Case concerns the possibility that a get-up (packaging) can become a mark for a product deserving of protection. This might create problems in terms of granting what would essentially be a patent over a container.-Note also that if the pf was to have a TM over the lemon shaped plastic bottle, there might be an issue of

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distinctiveness.-This is a passing off case, not a case of TM-Test for passing off is: (1) goodwill, (2) misrepresentation, (3) damage/potential damage. -Question: can yellow plastic lemon shaped bottles be a mark? Why could it not be a TM? -To some extent, 2 and 3 were supported: there was survey data that showed that consumers would be confused in the marketplace: would mistake the one product for the other, and this would definitely result in economic losses to the pf. The problem is with 1: argument of def is that to recognize the plastic bottles as a mark would essentially mean giving a patent to the pf over said bottle. This would be giving them too much. Yet since there is survey evidence that consumers would be confused, this can help the pf argue that lemon plastic bottle is part of the get-up of their product, that people now associate the lemon plastic bottle with the pf's product (lemon juice)-This is a similar situation to the one in Linoleum Manufacturing: is the signifier [the lemon shaped plastic bottle / the name 'Linoleum'] pointing to the general product or to the manufacturer's product? [pointing to lemons or to the Jiff juice / pointing to linoleum in general or Linoleum's linoleum?] -Here the court comes to an opposite result from Linoleum Manufacturing: the most important signification is the connection of the lemon plastic bottle to the manufacturer and not to the general product.-Lets say Jiff decided to sell shampoo in the same bottle, and then hand cream: could they still claim a right over lemon shaped plastic bottles? NO, this would be too much, as they would essentially have a patent over lemon shaped plastic containers. Here all the court wants to do is recognize that the lemon shaped bottle is associated in consumer's minds with Jiff's product, that the lemon shaped bottle is part of that particular product's get-up, but NOT that Jiff has right over all lemon shaped bottles.-The main difficulty of this case is that what Jiff wants the court to protect not the distinctiveness of a word or symbol, but rather that of a physical container as a signifier of its product. This creates significant tension because one cannot have a TM over a non-distinct container [cannot, for example, have a TM over cardboard boxes generally]; one could, however, have a TM over a particular 'get-up'. So all of this comes down to the distinctiveness requirement.

Barton Beebe, Search and Persuasion in TM Law, 2003, p. 117:-Irony of TM: TM pf is often placed in the awkward position of arguing for the commonness of her goods and the ignorance of her consumers, while the def begs to differ.-Discusses spatial model of TM: two axes, one for TMs, one for possible products. In essence, the closer a particular product with a specific TM is positioned to either another product very similar OR another TM very similar, the greater the confusion will be in the minds of consumers. In order to prevent said confusion, TM law typically grants the owner of a TM combination exclusive rights over more than simply a point in TM space, but rather a scope, a region.-In this process, pfs and apologists of TMs argue for a low degree of search sophistication (providing the wider scope of protection and greater power to TM persuasion), while defs and reductionists argue for a high degree of search sophistication (reducing the scope of protection and minimizing the TMs persuasion ability).-Search sophistication refers to the consumer's capacity during search to distinguish between similar but not identical TM uses. -TM law rarely confronts a situation where the entire relevant consumer population is confused, nor does the law seek to disabuse all relevant consumers of confusion when it enjoins a def's confusing use.

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-In cases involving professional buyers, courts typically limit the scope of protection they afford to pfs. More common are cases where the court assumes a very low degree of search sophistication, with the effect that the pf's scope of protection balloons out to exclude even dissimilar competing TMs.-It is an article of faith in TM doctrine that the more distinctive a mark is, the more likely it is that consumers will confuse other marks with it.-In TM law, persuasion sophistication may be defined as the consumer's capacity during search to resist the 'selling power' of differential distinctiveness, the power of distinctiveness to alter preference.-While persuasion knowledge describes the consumer's ability to cope with all forms of commercial persuasion, persuasion sophistication describes the consumer's ability to cope with only one, namely the persuasive 'selling power' of TM distinctiveness. -Children and ados are invoked as a class of consumers especially susceptible to the persuasive power of distinctive brands. Professional buyers are the archetype of consumers with high persuasion sophistication.-Received orthodoxy is that TM law exists to minimize our search costs. Dominant view conceives of TM law as designed to facilitate search, and of the consumer as sovereign over the market and over TMs.-All of this eschews the question: is the consumer a 'king' in terms of having a high ability to choose, or do TMs determine the ability of consumers to choose thru their persuasive power, making them fools?

Patents:

-Patent requirement: novelty, non-obviousness and utility. Unfortunately, not many cases on the subject, most are litigated in the USA because that is the most interesting market.

Novelty: s. 2 of PA: invention has not previously been known in a single source anywhere in the world in any kind of literature. Onus is on the person attacking the validity of the patent: must find a single source/document that shows that the thing patented was known so that the novelty requirement is killed. Idea: no patent over something that we already know about. Refer to Beloit.

Obviousness: In Canada, similar to the Euro standard, but different from that of the USA: again refer to Beloit

o Test is a technician skilled in the art that has no indicia of genius.o In Europe, the test is "what is the technical purpose of the thing?" Given

this purpose, would any unskilled worker have come to the same product to solve this technical problem?

Utility: not saying that this invention is better than any other on the market, rather saying that it accomplishes the task that the inventor created it for, it actually does what it is supposed to, it works.

-NOTE: when one is filing, one does not have a positive obligation to prove that the thing does what it is supposed to; the only obligation is to provide the specifications of the thing so that the register can conclude that the thing will in fact work. In a sense, when one is applying for a patent, it is the register that has the burden of proving that it will not work if he wants to reject the application.-This is the same principle for TM regime: the register has to demonstrate why the TM or the patent should be rejected on the basis of …

Beloit Canada Ltd. v. Valmet Oy, 1986, FCA, p. 140:Facts: Case concerns 2 patents granted for the same invention to 2 different parties. Invention is for the press section of a paper machine. Each party claims infringement of its patent and the invalidity and expungement of the other's patent.Issue: Trial judge found that the patents granted to both pf and def should be expunged on the grounds of obviousness or anticipation. Was this an error?

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Held: Yes, pf's patent is good.Ratio:-Obviousness is an attack on a patent based on its lack of inventiveness. Attacker essentially says: 'Any fool could have done that'.-Anticipation, or lack of novelty, in effect assumes that there has been an invention but asserts that it has been disclosed to the public prior to the application for the patent, essentially asking: "Your invention, though clever, was already known".Obviousness: -Test is not to ask what competent inventors did or would have done to solve the problem. Classical touchstone for obviousness is the technician skilled in the art but having no scintilla of inventiveness or imagination. The question to ask is whether this technician would, in light of the state of the art and of common general knowledge as at the claimed date of invention, have come directly and without difficulty to the solution taught by the patent? Here the answer is no.Anticipation:-Para 28(1)(b): asks whether the claimed invention is "…described in any patent or in any publication in Canada or in any other country more than two years before presentation of the petition…"-Inquiry is directed to the very invention in suit and not, as in the case of obviousness, to the state of the art and to common general knowledge. Anticipation must be found in a specific patent or other published document. One must, in effect, be able to look at a prior, single publication and find in it all the info which, for practical purposes, is needed to produce the claimed invention without the exercise of any inventive skill. Here there was no such single document. -Finally, patent is not void for misrepresentation, because "none of the errors had been made with fraudulent intent and they resulted from carelessness."Comment:-A patent once issued is presumed valid and the burden of demonstrating its invalidity is always on the attacker.-Case is about the inventiveness (novelty) and non-obviousness requirement of patents in Canada.

C) Scope of Right

-In all the following cases, we are trying to determine the scope of what is covered by patents, TM and copyright. But this is a battleground, and the case-law is not always clear on the issue: narrower or larger scope of protection?-Fuzziness in scope creates economic problems: people stay away from the boundaries (afraid of being sued), and so might not be able to use the things to make advances: the balance of the rights of the holders and those of the public are not well served by fuzziness in scope, and the balance is tipped in favor of the holder.

Scope of copyrights : -See Nichols v. Universal Pictures Corp, above.-Refer to Nichols: expression v. ideas concept: expression susceptible of copyrights, but not ideas.-Refer to parody article and particularly Rogers v Koons: copyrights do not protect ideas but rather expression. This is why Koons sculpture was an infringement: the expression was the same (or substantially the same), it was the idea behind the expression that was different (but ideas are not protected, expressions are). -Are the works the same? This may be irrelevant and the more appropriate question is: are the expressions the same? Koon argues that they are not: he wanted to make fun of media that distributes these kinds of images, whereas Rogers wanted to show typical American folk scene.

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-Are the changes significant enough to bear this out (fact that it was in a different medium is irrelevant)? There must be some differences, otherwise somebody could just copy the work and say: "I had a different meaning, so there is no infringement": this would be way to easy.-Case raises the issue of what is of substance in the work such that minor alterations are insignificant? From a visual point of view, there is substantial similarity, particularly from the point of view of the average person (this is the vintage point we must adopt, not, as Koon suggested, from the point of view of the educated art lover)

Rogers v. Koons, US CA 2d cir, 1992, p. 148Facts: Rogers is photograph. Makes a picture of friends and wife holding some puppies. Picture is made into a postcard. Koons sees postcard and reproduces the image almost exactly in a sculpture.Issue: Whether Koons sculpture is an infringement of Rogers' picture, and if so can Koons argue fair use?Held: NO, no fair use, infringement.Ratio:-Pf must prove 2 things for infringement:

1. Ownership of a copyright: Rogers has a valid copyright, and def argument that subject-matter and expression of it is not original fails. Work is original in positioning of subjects, lighting, film used etc.

2. Def copied protected material without authorization: Koons continuously instructed studio to mould the sculpture as per photo. This was copying that was unauthorized.

-Def claim of fair use: equitable doctrine that permits other people to use copyrighted material without the owner's consent in a reasonable manner for certain purposes. Factors involved in this determination

1. Purpose and character of the use: here the sculpture was not to benefit the public at large, but exclusively for commercial benefit of Koons. This does not help finding of fair use. Parody argument is no good, cause the sculpture in no way directly refers to the photo, and cannot parody something without referring to it.

2. Nature of the copyrighted work: not a work of facts, and so fair use is more difficult to sustain under this aspect.

3. Amount and substantiality of the work used: look at the expression rather than the facts expressed: here expression is copied nearly in toto.

4. Effect on the use on the market value of the original: most significant factor: here copy prejudices the photo.

Comment:-This is one of the seminal cases that one must understand, cause conceptually it really sets out the idea/expression dichotomy, which is, by analogy, applicable in all three regimes (CR, TM, Pat)

Michael Spence, "IP and the Problem of Parody", p. 159:-Parodist is both a 'user' and a 'creator'. Accordingly this raises problems for IP protection of work.-Parody here defined as "the imitation of a text for the purpose of commenting, usually humorously, upon either that text or something else". Very inadequate definition, but workable for the purposes of legal analysis.-Parody may raise difficulties in many of the regimes protecting IP:

Copyright: parody will constitute an infringement if the parodist has taken a 'substantial part' of a protected work. Possibility that a parody could be fair dealing for the purposes of criticism or review is recognized, provided that a work of criticism or review must be accompanied by 'sufficient acknowledgement'. It will be sufficient if there is some identification of a person and 'any reasonably alert member of the relevant audience could identify that person as author'.

Moral rights: liability for false attribution of authorship or right to object to derogatory treatment. Passing Off and TM: If associated with the original author or infringed the mark of said author.

More difficult cause to some extent rests on the confusion of consumers, which presumably a

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parodist is not relying on. Registered design: if parody is not substantially different from a registered design.

-Because parody is legally problematic, maybe it should be afforded special protection. Justification of this:1. Parody as a distinctive genre: Parody is special use of another's work and as such

deserves protection. Problem: what makes parody 'distinctive' such that it should be protected where other forms of uses are not?

2. Parody as a problem of market failure: owner of a work has a strong motivation for refusing to license, such as to protect his honour or reputation, he may not be prepared to license a socially desirable use and the licensing system may no ensure that the work is most efficiently exploited. Problem with market failure theory: fostering the dissemination of text may be the primary goals of Copyrights, but certainly not of passing off and moral rights.

3. Parody as a problem of transformative use: Parody ought not to constitute infringement if the parody itself constitutes an original work for the purpose of disseminating new texts. Same problem as in 2.

4. Parody as a problem of free speech: in order to comment upon a particular text or its creator, to draw from that text itself. Problem: a text protected by an IP right has become shorthand for a range of meanings for which no adequate alternative means of expression exists (EX: Barbie to refer to objectification of women's bodies). Of course, this raises issues in terms of protection of a person's reputation. May give rise to counter-claims of freedom of speech from the original author (EX: Barbie as a doll or a word used in a crusade over bulimia)

-Blanket protection of parody raises problems: what is parody, and should free speech prevail over IP?-See p. 166 for argument that IP is not inconsistent with free speech.-Might need to re-read the final section of this article, pp. 169-

Scope of TM:

Pink Panther Beauty Corporation (appel) v. United Artists Corporation (resp), Fed Ct Can, Ct Ap, 1998, p. 173:Facts: Resp is owner of TM "The Pink Panther", the film name and cartoon image associated with the Peter Sellers films. Been in use for over 30 years and is well-known by the public at large. Appel wants to use the name "Pink Panther" for beauty and hair care products.Issue: How far the TMA will go to protect famous TMs where those marks are used in relations to completely different wares or services.Held: Allow appeal, no TM infringement.Ratio:Linden J.A.: -Keeping in mind that what is important is that the TM be associated in the minds of the public with the goods produced by the TM owner (i.e. the association of the TM with a particular source), the decision rests on s. 6 of the TMA, which is the section dealing with the likelihood of confusion of consumers v-a-v similar or identical TMs.-Six factors to consider in this analysis:

1. The inherent distinctiveness of the TM or trade-names and the extent to which they have become known

2. Length of time in use3. Nature of the wares, services or business4. Nature of trade5. Similarity in appearance, sound and idea suggested6. All the surrounding circumstances.

-The weight given to these factors will vary according to circumstances.-AS the ultimate test is confusion, where one product does not suggest the other it will be a strong indication that confusion is unlikely.-here there is no likelihood of confusion: gaping difference in the nature of the wares and in the nature of

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trade.McDonald JA (dissenting):-Believes that it is precisely because of the fame and goodwill associated with the name "Pink Panther" that the appel has chosen that name for its business. What the appel seeks to do is profit financially from the goodwill associated with the resp's trade-name.-When dealing with a widespread, distinctive TM it is not always necessary that the mark in question be used for similar wares or in a similar industry for confusion to exist.Comment: -The question posed by the existence of IP regimes has been defined as one of where to draw the line between the right to copy and the right to compete.-What is being protected thru TM is not the exclusive right to any mark that a person might think of, but the exclusive right to prevent others from using in association with certain products or services.-Remember that the registration of a TM does not grant the registrant ownership of the words or images in that mark, but the right to associate that mark with particular products or services.-While I disagree with the outcome, I can see the majority's argument: if, lets say, the company had used the name Pink Panther in relation to tires, or plumbing equipment, would there really be a chance of confusion? However, I think the minority also has a point, def obviously chose name Pink Panther because of goodwill associated with the films. So case is difficult to decide either way.-This case is all about the status of a famous mark and how wide the scope of protection can be depending on how well-known the mark is. Should the protection of the goodwill that is attached to a famous mark be extended to products or services that are not directly related to the present object of the goodwill (here should the goodwill associated with the film Pink Panther be extended to whatever other products the holder of the Pink Panther TM might get into, such as shoes, or lipstick or whatever)?-PF United Artist argued: we have invested our mark with goodwill thru serious effort, and we should be rewarded with the greatest/widest protection possible.-The statute (TMA) talks of confusion with respect to consumers, and this is what the court bases its decision on: the end consumer, will or could s/he be confused about the origin of the product? Would or might s/he associate it with the film, even if the products are beauty products? -Court states that the more famous the mark, the likelier the confusion will be, but here it was decided that there would be no confusion, the ultimate consumer would not believe that the product was somehow connected to the film. Why? Because with respect to the Pink Panther film, the mark is not just the name, but also the cartoon and the music that accompanies it. Accordingly, because the beauty product company just wants to use the name Pink Panther, the end consumer would not be confused. At least that's what the majority says, but the minority disagrees, and in fact recognizes that the beauty company chose the name Pink Panther precisely because it is well-known and people would think of the film when they saw the beauty products (while I agree, one has to wonder why the beauty company would want people to associate beauty products to Peter Sellers??)-NOTE: the consumer confusion standard is a floating standard, and it is difficult to predict how court will apply it.

-What type of activities can one prevent when one has a mark? Refer to Michelin and BCAA

Compagnie Générale des Établissements Michelin-Michelin & Cie v. National Automobile, Aerospace, Transportation and General Workers Union of Canada (CAW - Canada) and Basil Hargrove and Larry Wark, Fed Ct, 1996, p. 192:

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Facts: Case about infringement of copyright and trademark. CAW tries to get workers of the Michelin plant in Nova Scotia to unionize. Uses the image of the Michelin marshmallow-like figure on flyers and other literature.Issue: Does the use of the name 'Michelin' and of the figure constitute an infringement of copyright and or TM?Held: NOT an infringement of TM, but an infringement of copyrightsRatio:-Pf argued that word 'use' should be interpreted broadly and beyond the definition given to it in the seminal case of Clairol. -'Use' is defined in the TMA (ss. 19, 20, 22 in conjunction to ss. 2 and 4): in essence, to 'use' a TM is to associate the TM with wares or services for the purposes of distinguishing the wares or services from those of others. An infringement is therefore to use someone else's TM in a way that will lead to confusion on the part of consumers and that will associate wares and services with the owner of the TM even if said wares and services are not those of the owner of the TM.-Meaning of 'use' is designed so that not all users of TM belonging to another person are caught within the threads of the infringement provisions.-The questions to ask are:

1. Did the def associate their services with the pf's TM?2. Did the def use the mark as a TM for the purpose of distinguishing or identifying the def's services

in connection with the pf's wares or services?-Here the CAW's 'use' of the name 'Michelin' and of the figure were not associated with the sale of wares or services, and so the use was not 'use' in the sense of the word as defined in the TMA.-Pf also argued that the use by CAW would depreciate the goodwill of the mark: rejected because the use was restricted to employees of the plants, and not the public at large.-Court found that the use of the name and the figure did violate Copyright of the pf.Comment:-Case is about the meaning of the word 'use' in the context of a TM: to use is to associated the mark with a product or service. If used in another way, then not 'used' in the sense of the TMA.

British Columbia Automobile Association v. Office and Professional Employees' Intl Union, Local 378, 2001, BCSC, p. 203:Facts: BCAA claims that the Union established websites in the process of a strike that violated TM and copyrights, and that also constituted passing-off and depreciated the good-will associated with its TM. Violation is concerning website design, shape, structure, colour scheme and lay out of the website, placement of CAA logo, format, lay-out and colour scheme, meta-tags etc. Note that there were 3 different Union websites.Held: Violation of copyright, not infringement of TM, passing-off only for the first version of the Union's website, no depreciation of goodwill, only nominal damages awarded.Ratio:-Def's rationale was to make their site similar to that of the pf so that search engines would make it popular for those looking for the pf's site; it would attract them to visit the def's site thereby publicizing its strike. This is precisely why the pf is upset: diverted traffic from its own site and also potential customers.-Passing off: 2 possibilities:

either def has named, packaged or described its product or business in a manner likely to lead the public to believe that the def's products or business is that of the pf, OR

def has promoted his product or business in such a way as to create the false impression that his product or business is in some way approved, authorized or endorsed by the pf or that there is some business connection.

-For a claim of passing off:1. Existence of reputation or goodwill2. Misrepresentation leading to belief in business connection. Actual proof of confusion is not

required, all that is required is the possibility of such confusion.3. Damage or potential damage.

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-Current website: no misrepresentation that the Union site is a site of the pf or that it is endorsed, affiliated with or connected to the pf. Fact that the site is not associated with the BCAA is quickly apparent from looking at the site. Lack of competition (two are not in the same trade) was also significant.TM:-s. 22 TMA: no person shall use a TM registered by another person in a manner that is likely to have the effect of depreciating the value of the good will attaching thereto.-For claim to be successful, must prove:

1. Validly registered TM,2. That the def has 'used' the TM3. That such use is likely to have the effect of depreciating the goodwill attached to the TM.

-1: TM is validly registered. -2: use is defined in s. 4 (wares and services). Statute requires that the offending use be a use in association with wares and services and that contemplates an element of commercial use as identified in Clairol and Michelin. Here this was not the case-Idea behind 3: third party's use of a registered TM is likely to render the mark less extensive and thus less advantageous by otherwise diluting the TM's effectiveness as a TM. Again here this was not the case.-First Union site was found to be an infringement of copyright and a passing-off. But because no actual damage or assessment of damage was shown, nothing but nominal damages are awarded.Comment:-Again case is about the meaning of the word use in the context of TMs.

-Both the above cases involve the use of the logo of an employer by a union in the context of a strike. In Michelin, the logo was used on flyers (character Bibendum). In BCAA, use of the meta-tags that are like those of the employer (also use of the imagery scheme [colors, patters and so on] on the website)-Same issue is involved: what kinds of activities constitute TM infringement? The TMA says that the mark must be 'used'. But what is meant by the term 'use' in ss. 19, 20, 22? More particularly, what is meant by the expression 'use in the context of a good or service'? -In both cases the court decides that there was no use of the marks. Why? Because the unions were not attempting to sell a product or a service; rather they were trying to communicate info on some event that was happening. This was a 'use' in terms of speech, not a commercial use of the mark. This is not TM infringement, otherwise the mere saying of the words Coca-Cola would constitute infringement.-Thus the conclusion is that the simple invocation of TM words or images is not 'use' as used in the TMA.-This means that as long as one is not using the mark in a commercial context, one is OK. And even if one is using the mark in a commercial context, this does not necessarily mean that that 'use' constitutes infringement. There needs to be a depreciation of the goodwill because the mark is associated with a product that is not in fact a product of the owner of the mark. This does not mean that one cannot 'diss' a product, but rather that one cannot dilute the association of the product and the mark in the minds of consumers.-EX: Pepsi - Coca Cola: if one of them does a positive comparison (my product is as good as…) with the other product and in doing so uses the other's mark, then one is diluting the mark and there is infringement. BUT if one does a negative comparison (my product is better than…) then there is no dilution, because the product remains distinct, the mark remains distinctive, the goodwill between the mark and the product is not affected.-NOTE: TM is commercial in nature, non-commercial use is excluded from the operation of TMs.

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-NOTE: copyright does not care about commercial/non-commercial distinction: mere copying of the copyright, for whatever purpose, triggers infringement. This is why the use of the Bibendum and other Michelin logos was an infringement of copyright but not of TM.-In all of this there is a concern with freedom of expression: the court does not want to go so far as restricting people's right to express themselves (same concern is present in Pink Panther). This may be one of the most significant reasons why TMs are inherently commercial, and non-commercial uses are not infringements.

Scope of patents:

-Both of the following cases were decided by the SCC on the same day. Both involved the same issue, namely what does one get when one has a claim for an invention with parts A, B, C?-To answer the above, in Canada we ask: what does the claim include, what is the scope of the claim beyond A, B, C. To do so, we use the skilled reader (which is obviously a legal fiction: a person that is deemed to have knowledge in the field, a person that understands the particular technology involved). The pretense is that it is not the court that is interpreting the claim. Of course this IS a fiction, and so what really happens is that the court tries to put itself in the shoes of the skilled reader (someone skilled in the art). The court does this thru expert testimony (which of course in many instances will be contradictory).-When the claim says A, B and C, what does this actually mean?

Use of the skilled reader as a dictionary: what would the skilled reader understand A, B and C to mean?

Beyond A, B and C, did the claim also include D? Would the skilled reader interpret the claim as including D? Is D unmentioned but implicit? SK fills in the blanks.

Thus the SK provides meaning to the terms and interprets them. SK essentially determines the essential and non-essential elements, and reads the

latter out so as to retain only what is necessary for the claim. Similarly, the SK also reads-in elements that are not explicit in the claim but essential. Thus he conducts a process of reading-in and reading-out. What the SK determines to be essential to the claim is what may be subject to infringements.

This is called the purposive approach.-Remember that a patent is a communicative device: it is used to tell people what they can or cannot do with respect to an invention. A patent essentially says "this is the extent of my invention"; anything that falls within the boundary of the description is no go, but everything that is beyond is OK. This is done thru the eyes of the SK.-In this context, note that there are 3 schools of thought, or 3 approaches to interpreting a patent infringement:

Europe: what did the inventor think the claim covered? Spirit of the invention approach

Canadian, India, Australia and other Commonwealth countries: purposive approach as per above.

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USA, China, Japan: doctrine of equivalence: look at the language of the claim and the device that is supposedly infringing: are they essentially the same, are all the elements the same or so near as they seem to be the same? If one element is missing, then there is no prima facie infringement. Court would then look at the various elements to see if the inventions are substantially the same Here there is no discussion of essential and non-essential elements.

-NOTE: the SK is frozen at the time the application is open to the public, that is to say 18 months after the submission of the claim. This is because after the patent is disclosed, SK's knowledge is modified.

Free World Trust v. Électro Santé, SCC, 2000, p. 221:Facts: Free World 2 patents over apparatus that bombards different parts of the human body with low frequency electro-magnetic waves. Patent is over the method of controlling the amplitude and frequency of the electromagnetic waves by 'circuit means' with desirable and beneficial effects. Electro Sante's apparatus achieved similar results but employed somewhat different technology.Issue: Electro Santé argues that (1) Patents not valid by virtue of anticipation, (2) No infringement of the patents even if valid.Held: (1) Patent is valid, but (2) there was no infringement.Ratio:(1) There was no anticipation, no document found 2 years prior to patent application that would allow a person of ordinary skill and knowledge in the field to understand, without access to the 2 patents, 'the nature of the invention and carry it into practical use without the aid of inventive genius but purely by mechanical skill.'(2)-Essence of this case is the extent to which a patent monopoly protects the substance or the spirit of an invention, as distinguished from what is literally described in the written claims.-Appellant concedes that the respondent's machine is not precisely as described in the written claims of its patent. Argues that the resp have stolen the substance of its invention.-Predictability is achieved by tying the patentee to its claims, fairness is achieve by interpreting those claims in an informed and purposive way.-How to solve the tension between literal infringement and substantive infringement: this is where the court must make a distinction between essential and non-essential elements based on the skilled reader's test.-For an element to be considered non-essential and thus substitutable, it must be shown that either (i) that on a purposive construction of the words of the claim it was clearly not intended to be essential, or (ii) at the date of publication of the patent, the skilled reader would have appreciated that a particular element could be substituted without affecting the working of the invention.-Here the patent lies not in the identification of a desirable result but in teaching one particular means to achieve it. The claims cannot be stretched to allow the patentee to monopolize anything that achieves the desirable result. Patent was over a magnetization coil being stationary during treatment; this was explicitly stated in the claim. As the resp's apparatus incorporates a coil that is not stationary, there is no infringement.Comment:-Patent protection rests on the concept of a bargain between the inventor and the public. In return for disclosure of the invention to the public, the inventor acquires for a limited time the exclusive right to exploit it.-Patent system is designed to advance research and development and to encourage broader economic activity. Achievement of these objectives is undermined however if competitors fear to tread in the vicinity of the patent because its scope lacks a reasonable measure of precision and certainty.-Case deals with the purposive approach to interpreting patent claim: determine the essential and non-essential elements of a claim, and consequently the extent of it.

Whirlpool Corp v. Camco Inc (appel), 2000, SCC, p. 234:Facts: In 1970s, Whirlpool developed an ingenious dual action agitator for clothes washing machines. Led

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to obtaining 3 patents, the latter two being for a part of the machine that was fixed and one for the same part but flexible.Issue: Appel argued that: (1) patents 2 and 3 constituted double patenting because the invention set out in its intermittent drive claims corresponded with the invention set out in the claims of the earlier patent. (2) Alternatively, the second patent is not valid because the modification was an obvious and non-inventive variation.Held: Appeal is dismissed.Ratio:-(2) First step in a patent suit is to construe the claims. The 'purposive construction' approach is adopted for both validity and infringement issues. This requires the identification by the court, assisted by the skilled reader, of the particular descriptive words or phrases in the claims that describe the 'essential' elements of the invention. This advances the objective of an interpretation of the patent claims that is reasonable and fair to both patentee and public. Here the trial judge did find that the patents were good, and that the 'fixity' requirement in patent 2 and the 'flexibility' requirement of patent 3 were essential elements of the claims.-(1) Prohibition against double patenting: 2 possibilities:

1. How identical the claims must be in the subsequent patent to justify invalidation: sometimes called the "same invention" double patenting. Here subject matters were not the same.

2. "Obviousness" double patenting: more flexible and less literal test that prohibits the issuance of a second patent with claims that are not 'patentably distinct' from those of earlier patent. Trial judge was not given sufficient proof to displace the presumption of validity in the PTA

Comment:-Again case is about the scope of patents and the purposive approach. Also deals with the 2 possibilities involved in double-patenting.-In this case, the holder of the patent, Whirlpool, is presenting an argument that is contrary to the usual one: instead of arguing that the scope of the patent should be greater, it is arguing that the scope should be limited to the words used in the claim. Why? Because there is an issue of double patenting; the limited scope of the first patent would allow the second patent to be valid. Why does it want this? Because the first patent had expired. Def was saying that the second patent was essentially the same as the first, that the second was therefore double patenting and not valid. If this was the case, then since the first patent had expired, they would not be infringing.

Monsanto Canada Inc v. Schmeiser (appel), 2004, SCC, p. 258:Facts: Resp are the licensee and owner of a patent that discloses the invention of chimeric genes that confer tolerance to glyphosate herbicides. Canola containing the patented genes and cells is sold by resp. Appellant grows canola commercially in Sask. Never obtained permission to plant resp's canola. Test shows that appel's canola crop is 95-98% that of resp.Issue: Resp bring action for patent infringement.Held:Ratio:McLachlin CJ and Fish (with 3 others):-Patent is valid. Resp did not claim protection of the genetically modified plant itself, but rather for the genes and the modified cells that make up the plant. -To determine if the appel 'used' the resp's patent as per s. 42 of PTA, ask: whether the def's activity deprived the inventor, in whole or in part, directly or indirectly, of full enjoyment of the monopoly conferred by law.-It is not bar to a finding of infringement that the patented object or process is a part of or composes a broader unpatented structure or process (here the plant).-Possession of a patented object or an object incorporating a patented feature may constitute 'use' of the object. Possession, at least in commercial circumstances, raises a rebuttable presumption of 'use'.-Here the appel's saving and planting the seed, then harvesting and selling plants that contained the patented cells and genes was a use within the meaning of the term in s.42.-Case law shows that infringement is established where a def's commercial or business activity involving a

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thing of which a patented part is a component necessarily involves use of the patented part. Infringement in this case therefore does not require use of the gene or cell in isolation.-Resp chose accounting of profit remedies: since profit of appel was not higher than they would have been without the use of the patented cell, resp gets nothing (this is the part of the appeal that was allowed).Arbour J (and 3 others) dissent:-Plants as higher forms of life are not patentable. Purposive approach leads to the conclusion that the 'essential elements' of the claim cover the genes and plant cells but not the plant and its offspring.-Use: is limited by the subject-matter of the invention, and that any acts for a purpose whether foreseen or not by the inventor may constitute an infringing use. Knowledge element should not be incorporated in the definition of 'use' since it is a settled issue in Canadian patent law that intention is irrelevant to infringement. If the person's acts interfere with the exclusive rights granted by the patent, then there is infringement.-Lower court erred in construing 'use' to include the use of subject-matter disclaimed by the patentee, namely the plant.-Appel, as user was entitled to rely on the reasonable expectation that plants, as unpatentable subject-matter, fall outside the scope of patent protection.-Accordingly, the cultivation of plants containing the patented gene and cell does not constitute an infringement.Comment:-Plants and other forms of life cannot be subject to a patent. -Patent right provides right to exclude others from the use of the patent in whatever form, even if the patent is incorporated into something else.-NOTE: for policy reasons, one cannot claim a patent over plants or animals.-This case, much like Whirlpool and Free World Trust, is about the scope of patents. Here however, there is also a consideration of the role of the SK.-The patent claim, Monsanto argues, covers anything that contains/incorporates the patent (would cover a plant if said plant includes the genes) even if the patent is not on the thing itself (not on the plant itself). Majority accepts this, which results in significant tension since one cannot patent a plant.-Dissent argues that the SK would be aware that a plant cannot be patented, and so would not allow a claim to effectively, even if not officially, cover a plant. This is the only reasonable conclusion the SK could reach. Such a conclusion by the dissent is pushing the boundary of the role of the SK, cause the SK is no longer limited to interpreting the elements included or excluded in the patent, but to what can be patented or not.-As a result of this case, with a patent one gets coverage for everything that is the patent itself or which incorporates the patent. -Court also observes that in terms of using something patented, intention is irrelevant: if one uses the patent, whether intentionally or not, one is guilty of infringement. There is one caveat: if one can demonstrate that one never wanted/intended to use the patent, that one did not know about the patent and the fact that one was using it, and that when one became aware that it was using the patent and took positive steps to get rid of the patent, then one could not be held to have used the patent. This is the only narrow situation where intention would be considered in determining the use of the patent.

Judith Robinson & Sébastien Jetté, "La protection des secrets commerciaux en dehors de la relation employeur-employé", p. 290:-Droit exerce une emprise curative sur la protection des secrets commerciaux: a posteriori remède.-Au Québec:

CCQ ne définit pas la notion de secrets commerciaux. Définition ne se limite pas qu'aux secrets de fabrique, car ce serait trop restrictif. Par exemple,

exclurait les informations commerciales stratégiques secrètes.

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Personne victime peut recourir à art 1458 ou 1457 Droit à la protection des secrets commerciaux: découle droit à la vie privée, devoir de bonne foi,

droit de la propriété de l'information elle-même. Responsabilité contractuelle: au stade des négociations (entente de confidentialité qui est elle-

même un K), durant la vie du K (clause de confidentialité incorporée au K) ou encore après la vie du K (clause non-disclosure)

2 articles qui ont attrait aux secrets commerciaux: arts 1472 (exonération sur base de l'intérêt public) et 1612 (facteurs à considérer lors de l'évaluation des dommages pour divulgation de secrets commerciaux)

Responsabilité X-K: lors d'espionnage industriel, lors de négociations non gouvernées par entente de confidentialité (découle alors de la bonne foi et de la loyauté, voir Lac Mineral)

Cour dans Tri-Tex a décidé qu'il n'est pas possible de faire une saisie d'un secret commercial avant jugement comme si c'était un bien.

Exceptions:

-How do we understand the boundaries defining the scope of a right? -Recall CCH Canadian Ltd: in this case one could argue that we are looking into the justifications for taking away part of a right, but the court disagrees with this perspective. Fair dealing defense is not taking away from the holder part of his/her right of protection, but rather suggests that what is covered by fair dealing was never part of the right given to the holder; his/her right never included what is in the sphere of fair dealing.-This leads to conclusion that the rights granted are inherently limited because what is given is only what is useful for the particular objective sought. Limitations are not taking away from what was granted to the holder, but rather looking at what was never given.

Fair dealing:-How do we assess what is fair dealing, how can we justify fair dealing (criterions are in CCH Canadian Ltd case, at para 53):

Purpose of the dealing (research, criticism), Character of the dealing (how did you use it, multiple copies or just one?), Amount of the dealing (trivial or substantial?) Alternatives to the dealing (get to same result without copying, alternatives that

are as good?) Nature of the work (published or not?) Effect of the dealing on the work (interfered with mostly economic interest of the

holder? This is one of the most significant factors of consideration)-Court also considers question of standing: who can claim fair dealing defense, and against whom can the claim be made? Remember CCH Canadian Ltd: here the library was not doing the copying, its customers were. Can the library be held responsible for the actions of its users? In this context, also refer to Society of Composers.-NOTE: fair dealing involves not only the people doing the copying, but also those that assist them. This is the logic why the library could perhaps have been held responsible.-Here the library could not be held responsible for infringement (if there were in fact any, which was not admitted) because its dealing with the material was fair: providing the material for research.

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- NOTE : Fair use : an equitable doctrine that tries to determine when a use ought to be allowed. This is discussed in Rogers v. Koons. Essentially an American equivalent to fair dealing.-Fair use is a USA doctrine, but note that since decision in CCH Canadian Ltd, the American and Canadian doctrines are becoming closer to each other.-There is no inherent limit to fair use, but fair use is disallowed when more of the work is copied than is necessary. Also consideration of the economic impact that the use of the work entails.-Criterions in USA and Canada are fairly similar in determining if a use/dealing is fair, except in USA don’t have specific factors outlined.-Fair use/dealing is one kind of exception.

Society of Composers, Authors and Music Publishers of Canada v. Canadian Association of Internet Providers, 2004, SCC, p. 295:Facts: Respondent (Society) is a collective society which administers in Canada the copyright in music of Canadian members and foreign members of counterpart societies. Want to collect royalties from Internet Service Providers (ISP) located in Canada because, it argues, they infringe the copyright owner's exclusive statutory right to communicate the work to the public by telecommunication and to authorize such communication. Appellants argue that they neither communicate nor authorize anyone to communicate musical works because they are merely a conduit and do not regulate the content of the Internet communications which they transmit.Issue: Who should compensate musical composers and artists for their Canadian copyright in music downloaded in Canada from a foreign country via the Internet. Can ISPs be held responsible for the music that is freely downloaded?Held: Unanimous (9 member court) on the outcome, 1 disagreement on some justification: NO, ISP cannot be held accountable.Ratio:-In 1988, Parliament added what is now known as s. 2.4(1)(b) to the CA which provides that persons who only supply "the means of telecommunication necessary for another person to so communicate" are not themselves to be considered parties to an infringing communication.-ISPs other than content providers did not constitute 'a communication' for the purpose of the CA and thus fall within the protection of s. 2.4(1)(b)-By enacting s. 2.4(1)(b) Parliament made a policy distinction between those who use the Internet to supply or obtain content such as 'cheap music' and those who are part of the infrastructure of the Internet itself. Parliament decided that there is a public interest in encouraging intermediaries that make telecommunications possible to expand and improve their operations without the threat of copyright infringement. ISPs are not 'users' for the purposes of the CA.-So long as an Internet intermediary does not itself engage in acts that relate to the content of the communication, but confines itself to providing a conduit for information communicated by others, then it will fall within s. 2.4(1)(b).-NOTE, however, that ISPs are no immune from copyright liability: if it acts as a conduit (content-neutral) for communication, then it is OK, but if it somehow plays around with the info it is communicating, then it is not OK.-An ISP's knowledge that someone might be using content-neutral technology to violate copyright is not necessarily sufficient to constitute authorization, which requires a demonstration that the def did give approval to, sanction, permit, favour, or encourage the infringing conduct.LeBel: agrees with outcome save this comment: "given that Parliament did not intend the Act to have effect outside Canada, an Internet communication only occurs within Canada where it originates from a host server located in Canada."-The essential question was: can ISPs be held responsible for what people download? Can they be held responsible for their user's infringements on the basis that they provide

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the conduit thru which users might infringe? (Note also that to copy a work of music on personal storage device may not be an infringement: refer to s. 88)-s.2.4(1)(b): this is an explicit exception in the Copyright Act for purposes of telecommunication: if one is merely providing the means for the telecommunication, then one is not actually communicating and therefore cannot be held to infringe.-NOTE: for internet purposes, if the communication originate or if the end user is in Canada, than we are dealing with communication in Canada and Canadian copyright laws apply.-This case reinforces the notion that limitations/exceptions are not after-thoughts, they are part of the reason/logic why the right was given in the first place. The rights must be read in conjunction to the exceptions/limitations in order to define the scope of the right: this does not involve taking away from the right of the holder, but rather is all about balancing the interest of society and the holder of the right.

Kirkbi AG v. Titvik Holdings Inc. (Lego), Fed CA, 2003, p. 327:Facts: Lego blocks: patent for 50 years. After patent expired, Lego attempted to acquire another form of protection thru the law relating to TMs. This is referred to as the "Lego Indicia TM": argues that the shaping of the knob configuration of Lego products constitutes a 'distinguishing guise' and thus a TM under the Act. Note that the TM is not registered.Issue: whether a TM which is primarily functional in nature can sustain an action for passing-off under para 7(b) of the TMA?Held: don’t know.Ratio:-Issue of functionality: "it would be unfair to the public if a patentee could, after the expiry of its patent, use the TMA to give itself a monopoly over the shape of its invention when that shape is so closely related to the invention as to be for all practical purposes an element essential to making full use of the invention"Sexton JA: (dismiss appeal)-No question that the TM, even if it is valid, is purely functional. But refer to issue:-Does not believe that to be a valid TM within the Act, the mark/distinguishing guise can be primarily functional.-Purpose or policy behind applying this doctrine of functionality is to ensure that no one indirectly achieves the status of patent holder thru the guise of a TM. Since a TM has the potential of being perpetual, then person would have essentially perpetual patent: this would be unfair to consumers and competitors.-That a mark is functional in some aspect is not a problem: it must not, however, be primarily functional (from Pizza-Pizza)-Argues that this applies to both registered and unregistered TMs, no reason to make a distinction between the two, and in this case TM is no good, cause primarily functional.-Appellants are trying to do exactly what the policy choice tries to prevent: perpetual patent thru TM.Pelletier JA: (allow appeal)-Disagrees that because a distinguishing guise is functional it cannot serve as a TM: it can indeed do so but only for unregistered TM, and not registered one. This comes from the difference in action/remedy/purpose between registered and non-registered TMs.

Unregistered TM: Protects only the exact copy of the TM. If other elements are present such that it becomes obvious that the source of the product/service is not the owner of the TM, then no problem. This is essentially an action in passing-off.

Registered: Protects the use of the TM, no matter if other elements are present, if there is possible confusion, then its no go. Registering also facilitates evidentiary burden.

-For unregistered TM, we can accept that the functionality of a distinguishing guise is not an impediment to the validity of guise as TM since only exact copies that have no element whatsoever of distinction would be subject to an action of passing-off. This in itself would not lead to evergreening (extension of patent monopoly by successive registrations of minor improvements, or, in this context, the extension of patent rights by the use of TM law)-Accordingly, an action in this case can be brought under s. 7(b) of the TMA, as all the elements of

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passing-off in are present: 1) existence of good-will, 2) misrepresentation, 3) actual or potential damage to pf.Comments:-Case discusses the notion of conversion of patent into TM, unregistered/registered TM, functionality as an impediment to TM.

-Same logic with TM as above with copyrights: the right is inherently limited, the right only extends to what is granted, and in order to define the scope of the right, one must determine what the exceptions/limitations are.-Argument was that the interlocking parts of the Lego block constituted a TM: identified in the minds of consumers with Lego company. The interlocking parts are a distinguishing guise, so Lego argues, and are therefore subject to unregistered TM.-This is, to some extent, the same kind of argument as in Linoleum, although in the latter case there was the additional problem that the name of the particular product was also the name of the product in general.-Dissent accepts that there was confusion on the parts of consumers, and that passing-off had occurred. This is based on the recognition of an unregistered TM over the interlocking system.-Majority disagrees essentially on the issue of functionality: interlocking system is not a random signifier, it is used for a purpose. Accordingly, if we allow Lego to have TM on that system, then we are effectively granting them a patent. They once had a patent, but it had expired. To allow them to have another one would be abusive and unfair to consumers and competitors, and would breach the essential K purpose of patents: exchange of info for absolute protection but only for a limited time.-NOTE: Mark must be primarily functional, not just functional in some respect, to disallow a TM.-From this case it becomes obvious that patents and TMs can sometime covers the same goods (remember again Linoleum): problem is that patents are inherently limited in time, whereas TM are possibly perpetual.-In response to the above, court says that when the thing is primarily functional, then it falls under patent law, not TM law.

Public Policy limitation/exception:

-Does public policy impose limitation on licensing? Refer to Gillat-Compulsory licensing is when a state grants itself a right to grant use: normally a fee is payable for compulsory licensing, but this fee is not always keeping in proportion to the actual revenues an innovator could make by not licensing and selling product by him/herself.-NOTE: when granted a patent, one can choose not to use or produce or sell or license the right to do so. Compulsory licensing is in response to this.-Compulsory licensing can be v-a-v patents, copyrights and TMs-Canada has a compulsory licensing scheme-Reasons for CL:

Anti-trust concerns: competition, at times, is unfair, and so granting the right to produce to greater number of producer re-stabilizes the market.

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National emergency/concern: such as national defense: may be necessary to force the hand of an innovator for greater good.

If one product is dependent on another, where the first product is useless without the use of the second.

Intl emergency: Aids crisis in Africa for example (v-a-v treatment) More generally, CL is about striking a balance between public access and the

rights of innovators.-Here, unlike in the case of fair dealing, the exception/limitation, i.e. public policy, is external to the scheme of the acts themselves.-Another example of CL: it is permitted, prior to the end of a patent, for generic producers to study and produce limited quantities of the product patented in order to make sure that the generic versions will meet standards once the patent is over (cannot produce on large scale however, as was decided by WTO)

Adi Gillat, "Compulsory Licensing to Regulated Licensing: Effects on the Conflict between Innovation and Access in the Pharmaceutical Industry", p. 350:-Balancing public interest and private property rights on one hand, and the interest in affordable public access to products of innovation on the other hand, is one of the most basic conflicts underlying innovation policy. Compulsory licensing is perhaps the most dominant mechanism that is expressly allowed under the current international patent protection standard set in the Agreement on Trade Related Aspects of Intellectual Property (TRIPS), as ex-post limitation of valid patent rights for the purpose of achieving such balance.-Traditional proposition under American patent law is that the patentees are not obliged to license their patents, or even use them.-American law, however, traditionally is hostile to the idea of compelling use or licensing of patent rights because of the adverse effects such schemes have on innovation.-Variation on the compulsory licensing theme is the concept of 'regulated licensing'.-Compulsory licensing is a right granted by a govt agency to exploit a patent without the patentee's authorization. This serves the purpose of balancing public interest in access to innovation with private concerns in patent rights and the public interest in providing incentives for innovators in the form of such private property rights. Hostility of American law to compulsory licensing is based on an awareness that imposing a duty to license on an entity who invested resources into the innovation that has given rise to its market advantage might serve to chill innovation and development. Note however, that despite this hostility, US law does apply several constraints on a patent owner's prerogative in using and licensing its rights, or refusal to do so.-Compulsory licensing acts to shorten the exclusivity period granted to the patent owner, thus limiting the potential economic gains expected in the case of an innovation's technical and commercial success. On the other hand, compulsory licensing decreases prices, and thus enhances public access to the innovative product.-An alternative to compulsory licensing may be regulated licensing, but only in cases where the existence of barriers to competitive entry other than patent protection diminishes the dependency of the innovating entity on the exclusivity granted under a patent right. For example, where the costs of getting into a particular industry is such that not many actors will enter, regulated licensing would make the product more readily available at a lower price (because there would be more than one provider), but will not rob the innovator of profits (because not that many producers will be around), and so a balance of the interests of the public and the innovator will be struck.-Thus the existence of barriers to competitive entry, other than patent protection, diminishes the dependency of the innovating entity on the exclusivity granted under a patent right. In such cases where alternative entry barriers exist, intrusion upon the patent right will have a less harmful effect on incentives to innovate.Conclusions:

Regulated licensing may be an appropriately cautious tool, enabling both restoration of

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competition and maintenance of affordable public access to innovation, while not seriously threatening innovation incentives.

Regulated licensing, involving the consent of the innovator and his participation in determining the royalties to be paid under the licensing scheme, largely mitigate the sensitivities of compulsory licensing, while achieving lower prices and affordable public access to the inventions.

Jan Thompson, "Report of the Committee on Inquiry on the Case Involving Dr. Nancy Olivieri, the Hospital for Sick Children, the University of Toronto, and Apotex Inc.", p. 380:-It is in the public interest that physicians be obligated to inform their patients of possible harm from treatments, whether experimental or not, and that clinical researchers be free to communicate findings of unexpected risks to trial subjects and others with a right or need to know.-The present case shows that existing policies are inadequate to protect these interests from improper pressures by industrial sponsors of research. In this case, a drug manufacturer, Apotex, attempted on the basis of a K to prevent a clinical professor of medicine, Dr. Olivieri, from fulfilling her obligations and exercising her rights.-Apotex's legal warnings were issued principally on the basis of the confidentiality clause in the K for the randomized comparison trial, which had a one-year post-termination communication ban.-Professor Soberman (prof of law at Queen's), argues that in light of the jurisprudence: "to the extent that it prohibits a physician from disclosing to a patient information that the physician has acquired pursuant to her research (or otherwise), the clause is illegal and void if there is material or significant risk to the patient."-The documentary record shows that Dr. Olivieri had a reasonable basis for her concerns. Thus it appears unlikely that any court would have enforced the confidentiality clause Kin the circumstances central to this case: disclosing identified risks to patients being treated with the drug.-Nevertheless, the protection afforded to Dr. Olivieri on the basis of public policy was inadequate, and we see the tension between public policy as a limitation/exception to IP rights.

Report of the Committee of Inquiry on the Case Involving Dr. Nancy Olivieri, the Hospital for Sick Children, the University of Toronto, and Apotex Inc, p. 384:SKIPPED

-Both of the above address the issue of public policy limitation to licensing and more generally IP rights. Should the well being of society override IP rights? Should significant advantages that could accrue to society should the licensing be restricted override IP rights? In both cases, I would say yes, and thus public policy can serve as a limitation device on IP rights.-From all of this it is clear that there are various forms of limitation/exceptions that exist.

Remedies:

Cadbury Schweppes v. FBI Foods, 1999, SCC, p. 432:Facts: Appel and predecessors manufactured Clamato for sell in Canada under license from USA respondents. Resp terminated license. Appel thereafter misused confidential info related to the Clamato recipe obtained during the license period to continue to manufacture a rival tomato-based drink.Issue: Appropriate remedies for breach of confidence in a commercial context.Held: Ratio:-NOTE: appel did not receive the confidence from the resp, but from a now defunct third party. The receipt, however, was burdened with the knowledge that its use was to be confined to the purpose for which the info was provided, namely the manufacture of Clamato under license.

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-NOTE: court observes that the nature of the info may have significant influence on the appropriate remedy.-NOTE: this is a case about unauthorized use as opposed to unauthorized disclosure.-In Lac Minerals, court characterized an action based on breach of confidence as sui generis.-Resp argue that the policy objectives underlying patent protection apply to breaches of confidence in a commercial case, where trade secrets constitute the subject matter of the wrongful use or disclosure.-Court does not believe that a reliance on IP law is of much assistance here: it ignores the bargain that lies at the heart of patent protection. A patent is a statutory monopoly which is given in exchange for a full and complete disclosure by the patentee of his or her invention. The disclosure is the essence of the bargain between the patentee, who obtained at the time a 17 year monopoly on exploiting the invention, and the public, which obtains open access to all of the info necessary to practice the invention. If a court were to award compensation to the respondents on principles analogous to those applicable in a case of patent infringement, the respondents would be obtaining the benefit of patent remedies without establishing that the invention meets the statutory criteria for the issuance of a patent, or paying the price of public disclosure of their secret.-Thus with respect to an action based on a breach of confidentiality, it may not be appropriate to have a proprietary remedy.-Ultimate finding: calculate the amount of compensation required to restore to the respondents what the respondents have lost as a result of the appellants' breach of confidence.Comments:-Case is really about what is the kind and nature of the remedy afforded to a breach of confidence, as this is not covered under IP law (patent, copyright, trademarks).

Property and its Limits:

A) Property

John Moore v. The Regents of the University of California et al., Supreme Court of California, 1990, pp. 109-119.Facts:-Moore had hairy cell leukemia and had cells removed as part of the treatment. Cells were then used by doctors, without Moore’s permission, to do research. This research led to a patent and was sold lucratively. Moore is alleging (1) the breach of a physician’s disclosure obligations – his fiduciary duty and (2) conversion – the wrongful possession of another’s property as if it were his own (détournement de bien). Issue: Are Moore’s cells his property, thus allowing him to claim conversion (a Common Law tort that protects against interference with possessory and ownership interest in property)? Held: Moore did not have a claim for conversion, but did win with respect to Gold’s breach of fiduciary duty.Ratio:-Appellant did not expect to retain possession of his cells following their removal. To sue for conversion he must have retained an ownership interest in them. Majority arguments:(1) once something is removed from one’s body, one no longer retains an ownership interest in it. (2) the policy argument states that if usage of cells constitutes a property violation, research will be significantly hindered (3) California Statute limits patient’s control over removed cells, (4) The cell line are an invention and consequently, legally distinct. Minority : Says what if the cells had been stolen by another research facility, conversion could be claimed by UCLA. So majority can’t say that cells are not property. The patient does have the right to decide what to do with body part once removed (taken from the Uniform Anatomical Gift Act which allows you to choose what to do with organ).Comments:

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-In Quebec, this could have been solve using art 22: the article aims for the protection of the integrity of the person.-In the context of this class, this case is significant for its discussion of what is property, what may qualify as property and what may not.NOTE: DID NOT READ, USED CIVIL LAW PROP SUMMARY

Gould Estates v. Stoddart Publishing, 1996, Ont Ct Gen Div, p. 451:Facts: In 1956, Glenn Gould has conversation with Jock Carroll (who also took pictures of Gould) for the purposes of an article in Weekend Magazine. 40 years later, after Gould is dead, Carroll publishes a book on Gould using some of the pictures and notes of the conversation.Issue: Estate of Gould seeks damages, claiming: 1) use of the pictures amounts to the tort of appropriation of personality, the cause of action for which may be asserted by the estate, and 2) copyright in the oral conversations recorded by Carroll rests with Gould (and now the estate) and as such the conversations may not be used without the permission of the estate.Held: both claims dismissed.Ratio:-NOTE: it is undisputed that Carroll has the copyrights over the pictures.-1) Estate argues that Gould was always a private individual and secretive about is private life, and as such would never have authorized the subsequent use of the pictures.-Tort of misappropriation of personality also exists in the USA under name 'right of publicity'.-Since the pictures are used in a book and the act of selling the book is commercial exploitation, then use of pictures of Gould constitutes appropriation of his personality.-Essential issue (from USA point of view): "the purpose of the portrayal in question must be examined to determine if it predominantly serves a social function valued by the protection of free speech. If the portrayal merely serves the purpose of contributing info, which is not false or defamatory, to the public debate of political or social issues or of providing the free expression of creative talent which contributes to society's cultural enrichment, then the portrayal generally will be immune from liability. If, however, the portrayal functions primarily as a means of commercial exploitation, then such immunity will not be granted."-In this context, if the work only uses the personality of the celebrity for commercial purposes, then it amounts to exploitation. BUT if the work is about the celebrity (such as biography), then it is protected under free speech. Here the book is about Gould (the man and his music), and so does not fall in the ambit of the tort.-NOTE: this right of publicity outlives the death of the celebrity, as it is a form of intangible property, akin to copyright or patent. But this comment is obiter.-2)-Pf submits that spoken words are contemplated within the definition of 'literary works' of s. 5(1) of Copyright Act.-This argument runs counter to judicial decisions which have held that for copyright to subsist in a work, it must be expressed in material form and having a more or less permanent endurance.-A person's oral statements in a speech, interview or conversation are not recognized in that form as literary creations and do not attract copyright protection. The person who makes notes or report of the speech is the author of the report and obtains copyright in the report.-Here Gould was making offhand comments that he knew would make their way to the public domain. Conversation was casual, and this is not the type of discourse the CA was intended to protect.

Gould Estates v. Stoddart Publishing, 1998, CA, p. 458:Facts: Same as above.Issues: Whether the resp Carroll was entitled, for his own exclusive benefit, to later exploit commercially the photographs he took of Gould in 1956 and to use his notes and tapes of his interviews at that time to write other articles on Gould notwithstanding that such later use of the photographs and interviews had never been discussed with or agreed to by Gould or his successors or assigns.Held: Agrees with the outcome in lower court, but for different reasons. Appeal dismissed.Ratio:

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-NOTE: lower court never took into consideration that there existed a K between Gould and Carroll-Court decides the case on conventional principles relating to copyright. The motion judge addressed Gould's right to preserve his privacy and exploit commercially his own fame, whereas I would address the proprietary rights Carroll had in the photographs and other material created by Carroll in 1956 and again in 1995.-Focus of this court is on copyrights. In this context, Gould clearly consented to the pictures being taken and to the continuing interviews with Carroll. There was no K, implicit or explicit, between them. Only question is whether Gould or his agent imposed any limitation on that consent. Record does not disclose any such limitation.-NO evidence that the material that came out of the encounter between Gould and Carroll would be limited to the article written for Weekend Magazine.-Carroll is the author of the pictures, and also the captions under them. Since this essentially is the book, there remains no issue to deal with.-Conclusion: Once Gould consented, without restriction, to be the subject-matter of a journalistic piece, he cannot assert any proprietary interest in the final product nor can he complain about any further reproduction of the pictures nor limit the author of the journalistic piece from writing further about him.-The above two cases deal with the limit of proprietary rights: how extensive are they, what happens when they are assigned, does one retain right to decide the way in which property is subsequently used when right is ceded etc.

B) Entitlements and Enforcement of Entitlement

Guido Calabresi & Douglas Melamed "Property Rules, Liability Rules, and Inalienability: One View of the Cathedral", p. 464:

-Whenever a state is presented with the conflicting interests of two or more people, or two or more groups of people, it must decide which side to favour; the fundamental thing that law does is to decide which of the conflicting parties will be entitled to prevail. This is done thru entitlements.

I. Three types of entitlements:1) Entitlement protected by property rule: whoever wishes to remove the entitlement from its holder must buy it from him/her in a voluntary transaction in which the value of the entitlement is agreed upon by the seller. State intervenes only to determine to whom the entitlement will go. Least amount of state intervention. 2) entitlement protected by liability rule: may destroy the initial entitlement if he/she is willing to pay an objectively determined value for it. Additional stage of state intervention; value is determined by state, not by parties.3) inalienable entitlements: transfer is not permitted between willing buyer and seller. State intervenes to determine who is entitled, the compensation if the entitlement is taken or destroyed and to forbid its sale under some or all circumstances. -Issues: (1) Under what circumstances should we grant a particular entitlement? (2) In what circumstances should we decide to protect that entitlement by using a property, liability or inalienability rule?

II. Entitlements are set for reasons of(1) Economic efficiency (2) distributional preferences (3) other justice considerations.

1) Economic efficiency: Simplest reason for granting a particular entitlement: minimizing administrative costs of enforcement. Pareto optimality: economic efficiency asks that we choose the set of entitlements which would lead

to that allocation of resources which could not be improved upon in the sense that a further change would not improve the condition of those who lost the entitlement and those who gained it. No matter what the distribution is within the group; as long as those who are better off could theoretically compensate the less-favoured, then Pareto optimality has been reached

It is argued that, if there are “no transaction costs,” i.e., perfect knowledge and the absence of any impediments or costs of negotiating (no freeloaders, etc.), then Pareto optimality – economic

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efficiency- will occur regardless of initial entitlement; (Based on assumption that people are able to set a value on the good and have the money to pay for it;

so: the optimal situation has been reached even if A has $0 and lives on the street, as long as B lives on top of the mountain in a mansion with lots of capital.)

Distribution of wealth may affect a society’s choice of entitlements. In field of accident law:

1) Econ efficiency alone dictates the entitlements that favours choices between social benefits and social costs of obtaining them, and the social costs of avoiding them;

2) When the worth of a benefit to society is in doubt, the cost of the activity should be put on the party best-located to make a cost-benefit analysis,

3) In accidents or pollution, the costs should therefore be put on the party which can most cheaply avoid them,

4) When unclear who that party is, cost should be put on the party which can act in the market to correct an error in entitlement with the lowest transaction costs, and induce the party who can avoid social costs most cheaply to do so,

5) Mkt does not work perfectly in this area; so, there are transactions costs.

2) Distributional concerns: -2 types (1) distribution of wealth and (2) distribution of (merit) goods. all societies have wealth distribution preferences; can be on basis of arbitrariness or morality or

efficiency or worthiness or some other organizing principle. cannot be on the basis of equality for that is impossible: not enough to start everyone off with the same

amount of money; other entitlements will make some richer than others. how to compensate for all the differences and the various individual valuations of various things? If perfect equality is impossible, a society must choose what entitlements it wishes to have on the basis

of criteria other than perfect equality. In doing this, a society often has a choice of methods, and the method chosen will have important distributional implications. A society may force everyone to serve in the military. It could also entitle people to be free of the military and induce them to join up, or require all to serve but enable each to buy his way out.

If the choice of entitlements affects wealth distribution generally, it also affects the chances that people will obtain what have sometimes been called merit goods.

“a society which prefers people to have silence, or own property, or have bodily integrity, but which does not hold the grounds for its preference to be sufficiently strong to justify overriding contrary preferences by individuals, will give such entitlements according to the collective preference, even though it will allow them to be sold thereafter”

3) Other justice reasons:

-They are reasons which would influence a society’s choice of initial entitlements that cannot be comprehended in terms of efficiency and distribution.-Example: two neighbors, one likes noise, the other silence. In case of no transaction costs, we know that Pareto Optimality- economic efficiency- will be reached regardless of whether, say, we chose an entitlement to make noise or to have silence.-From a distributional point of view, we are also indifferent as to what the initial entitlement is, because we do not know whether it will lead to greater equality or inequality.-This leaves us with 2 reasons on which to base our choice of entitlement. The first is the relative worthiness of silence lovers and noise lovers. The second is the consistency of choice, or its apparent consistency, with other entitlements in the society. But how to choose who is worthy? Depending on how they impact 3rd parties? Is it different from economic efficiency or distribution? Not really. Treat like cases alike? Choose silence lovers because we choose people who are not violent? -Thus it may come down to economic efficiency and distributional reasons. For instance, there are good distributional reasons for this; simplifies task of obedience.-Justice reasons are ultimately all the reasons; economic efficiency and distributional reasons are a kind of justice

III. Rules for Protecting and Regulating Entitlements

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-Whenever society chooses an initial entitlement, it must also determine whether to protect the entitlement with a property rule, a liability rule or an inalienability rule.

Property and liability rules: -Liability rules exist because often the cost of establishing the value of an initial entitlement by negotiation is so great that even though a transfer of the entitlement would benefit all concerned, such a transfer will not occur. If a collective determination of the value were available instead, the transfer would occur.-Ex., Guildacres. A tract of land owned by 1000 owners in 1000 parcels would benefit a neighbouring town. Each of the 100 000 citizens of the town would be willing pt pay $100 to get it. Transaction would be econ efficient if owners of land valued it at less than $1000 a tract (what they would get at above price). But even then, if some of the owners hold out for more b/c they think the buyers will pay more, they will not get it and transaction will not happen. Sellers will have an incentive to hide their true valuation and the market will not succeed in establishing it.-Or, maybe buyers cannot raise enough b/c some are freeloading, expecting others to make up for what they won’t pay. Will lie and hope others will value it more and be willing to pay more. Market will not cause people to express their true valuations again, desirable results cannot be achieved.-Liability rule allows society to decide the value collectively and impose it: no more holdouts. -Also, can charge benefits tax on collective valuation of each citizen’s desire to have a park: no more freeloader.-Are also problems with liability rules: may be lying when we say what value s/t has for us. “objective” liability rules may result in over or under compensation. Benefits tax: value of an entitlement to each individual cannot be determined accurately.-Accidents: if we were to give victims a property entitlement not to be accidentally injured, we would have to require all who engage in activities that may injure individuals to negotiate with them before an accident, and to buy the right to knock off an arm etc…such pre-accident negotiations would be extremely expensive, often prohibitively so. -Nevertheless: “the most common [reason] for employing a liability rule rather than a property rule to protect an entitlement is that market valuation of the entitlement is deemed inefficient, that is, it is either unavailable or too expensive compared to a collective valuation.” -Efficiency not the only reason: “may allow us to accomplish a measure of redistribution that could only be attained at a prohibitive sacrifice of efficiency if we employed a corresponding property rule.”

Inalienable entitlements: -Also efficiency and distributional goals underlying use-Limitations on right to engage in transactions may serve efficiency when there would be a high cost to 3rd parties-Ex. in cases of sale of land to polluters: neighbour doesn’t want me to sell land to polluter, pays me. But if there are many neighbours, freeloader and information costs make this practically impossible. State could protect neighbours and let land be sold by letting neighbours prevent sale to polluter by employing liability rule. But costs could be high: eg. Excise tax on all sales of land to polluters equal to the estimate of the external cost to the neighbours of the sale. -Barring the sale to polluters is most efficient because it is clear that avoiding pollution is cheaper than paying its costs.-Or external costs can’t be measured in acceptable way. Such costs are called moralisms . -One person can’t be allowed to sell himself into slavery b/c of the cost to the other members of society. Can’t be valued in monetary terms. -Other reasons for forbidding sale: self paternalism and true paternalism

- Self paternalism : decision of individual (or group) not to engage in economic activity; based on notion that no one knows better than the individual what is best for him or her. May require certain conditions to exist before allowing a sale, or may explain inalienability, like invalidity of K’s entered into when drunk or under coercion.

- True paternalism : activities of minors. Others know better than the individual what is good for the individual.

-Distributional goals also play role: e.g. “prohibiting exculpatory clauses in product sales makes richer those who were injured by a product defect and poorer those who were not injured and who paid more for the product because the exculpatory clause was forbidden. Favouring the specific group that has benefited

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may or may not have been the reason for the prohibition on bargaining. What is important is that, regardless of the reason for barring a contract, a group did gain from the prohibition.” E.g. 2, Prohibiting the selling of babies. -Pollution rules: balancing of costs and values can achieve econ efficiency; but often transaction costs are too high and the market place cannot adjust the balance-t/f likely to use liability rules when we are uncertain whether the polluter or the pollutees can most cheaply avoid the cost of pollution. -inalienability could be used in such cases: moralisms against pollution: expectations of future generations, etc. This ground for inalienabilty could be strengthened by self-paternalism. State could also restrict pollution on paternalistic grounds. -Why criminal liability for theft? Why not liability rule? Because society needs to keep all property rules from being changed at will into liability rules. “We impose criminal sanctions as a means of deterring future attempts to convert property rules into liability rules.”

Comments Presumption that property rules are the most efficient way of enforcing claim; Property requires no state role; it is up to the person with the entitlement to say how valuable it is; state

would set an arbitrary value, either under- or over-valuing If, however, property is inefficient (too difficult, expensive, etc.) move to liability rule If this is inefficient b/c it affect the interests of too many others (if morally problematic) move to

inalienability rule Above article does not address initial distribution of entitlements; assumes initial entitlements are

there; Also ignores moral weight of the protection of an invention ; there is no right or wrong; if leg’re

decided to change © protection to 5 years, they would have no opinion. Dessert/Lockean view of asserting personal o’ship: makes no sense in C & M context

Public interest in IP-Protection by liability rule: E.g. © on music: royalties: thru leg’n, © societies exist to which a musician belongs. Radio can play their songs for a fixed tariff, and funnel the money for royalties to the relevant society; avoids transaction costs of negotiating; musician gives up veto right.-Or: Compulsory licensing: can’t prevent people from copying medications; product can be manufactured on payment of r’ble royalty to patent owner.-© or patent right to reproduce can also be protected by a property rule: injunction.-moral rights are also inalienable rights in IP; in Canada, they are not assignable although they can be waived (inalienable right combined with liability rule).SKIPPED CAUSE COULD NOT UNDERSTAND, ASK SOMEONE ABOUT IT

C) Contract

ProCD, Inc. v. Zeidenberg, 7th Cir, 1996, USA, p. 481:FACTS: ProCD (pf) compile extensive phone directory that it sold on CD-ROM. Charged higher for commercial users than for personal users (price discrimination). Terms of use/license are inside box and not readily available/readable when one buys the CD (this is called a shrinkwrap license case). Zeidenberg bought CD as a personal user, but then made info available on the Web for a price (thus used it in context of business). Issue: Is Z bound to pay higher price even if conditions could not be read until after the CD was purchased and opened? This is really a question of K law.Held: Yes, Z is bound, injunction is granted so that Z stops re-selling ProCD info.Ratio:-Terms of the license pup up every time the user uses CD, so Z aware of the terms of the license. Furthermore, terms are written inside box. Question is, should Z be bound by those terms if he could only be aware of them after purchase?-Z argues that K was complete when he purchased the CD (offer was putting the CD on shelf, his acceptance was his purchase of the CD). Accordingly, any terms included inside the box cannot be part of

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the K, cause could not know them before acceptance.-One problem: Z aware that the use of the CD was subject to license agreement prior to purchase. Furthermore, unrealistic to require software merchants to put the entire license agreement on outside of box, as would have to be in microscopic size.-Here the court interprets the factual situation as follows: ProCD proposed a K that a buyer would accept by using the software after having an opportunity to read the license at leisure. This Z did. He had no choice, because the software splashed the license on the screen and would not let him proceed without indicating acceptance. So although the district judge was right to say that a K can be, and often is, formed simply by paying the price and walking out of the store, the Uniform Commercial Code permits Ks to be formed in other ways. ProCD proposed such a different way, and without protest Z agreed.-Note also that ProCD extended an opportunity to reject if a buyer should find the license terms unsatisfactory; Z inspected the package, tried out the software, learned of the license, and did not reject the goods. As such, he is bound by the terms of the license.Comment:-Case is about how IP rights can be protected by traditional K law.

Nimmer, "Breaking Barriers: The Relation between K and IP", p. 488:-It is often argued that by bringing K to the context of info transactions, Ks will be used to stifle free speech and comment or to block access to materials that are otherwise in the public domain. This premise, i.e. that K law and IP are in conflict, is flawed, and the article is aimed at dismissing this premise. -Essential conclusions:

Most significant insight that one can take from reviewing the relationship of K and IP is that, rather than fields in newly-found conflict, these are 2 areas of law that have long co-existed.

Copyright and other forms of IP law cannot, and have never been able to, foster active development and distribution of info products in society without relying extensively on Ks.

Commercialization, which depends on contractual relationships, constitutes one of the core mechanisms by which info is developed and distributed. It is a central part of the IP law 'bargain' and should be recognized as such.

-Looks at the myth between K and IP: that K encroaches on IP’s private domain; that it tilts the balance between private domain and public domain by allowing people to tilt the balance in favour of the private domain (eg. Clause: “do not use for educational purposes”).-In response to this concern, Nimmer offers: the K is an integral part of IP, the main justification of IP is on the economic efficiency basis: namely, giving people IP rights provides incentive for creation and innovation and K is the way the IP holder realises these benefits: selling or licensing. It is not enough to have an IP, you want to use it, and the only way tot use it is with K. K is already limited: Unconscionability, Competitive law, -Politicians argue that by bringing contract to the context of information transactions, contracts will be used to stifle free speech or to block access to materials that are otherwise in the public domain. The fundamental premise is of this view is flawed: K & IP law have always co-existed peacefully and in interaction between mutually supportive fields. -“Ks provide the means for the development and commercial exploitation of information assets.” -The underlying property rights are often relatively unimportant in the bargaining process. They tend to be treated as ‘default rules;’ those rules that state a legal position that exists between the contracting parties unless the parties otherwise agree. Contract law provides other default rules. -All of the relationships and distribution choices involved in commercialization of information assets involve contracts. -One way to distribute info assets is open form: non-K: involves giving away information and a willingness not to assert rights, at least to some extent under some conditions.-Commercialization use (e.g. contracting for) informational assets is another primary means by which information is distributed. -It represents that portion of the matrix that yields financial and similar incentives for the creation of new, and the distribution of existing, information assets. In that sense, the so-called IP bargain does not exist in the absence of contract law and practice.-How contract and property interrelate: the 2 bodies of law differ in how they regulate a party’s conduct; the impact of a property right in a marketplace shaped by K’al relationships is most often indirect, with the

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rules of property being filtered and adapted through contractual and other relationships; in this marketplace setting, IP law provides ‘default rules’ for K’al relationships. -These are default rules in that by their own terms, the effect of the rule can ordinarily be altered by contract.-Contract Law is a party choice regime, emphasizing with few exceptions the ability of the parties to define their own relationship. In contrast, IP law (with the possible exception of trade secret law) is a vested rights regime. It defines the relationship of persons to an identified corpus of information in the absence of a contractual relationship altering that established or vested right.-K law does not mandate outcomes in a contract relationship. It has three primary functions:

(a) it established when an agreement becomes enforceable in law between the parties;(b) it provides background or default rules which indicate what the terms of the relationship

are in the event that the parties do not otherwise agree; and, (c) in limited situations, it provides that particular terms may be unenforceable on the grounds

for example that the term is unconscionable.-K law relies on the premise that parties, rather than laws, create (or decline to create) a relationship. Negotiation over the terms seldom occurs in either a mass market or a commercial marketplace: one party (the vendor or the purchaser) proposes terms and the other party assents or refuses (ex. DuPont offers cleaning product to janitorial company at specific price with disclaimer of warranties. If janitorial company is willing to purchase the product, the terms are fully enforceable).-W/ few exceptions, standard form contract terms are enforceable (consistent w/ K theory), the decision to market (or offer to purchase) is the vendor’s and in the seller-dominant scenario, the buyer chooses to accept the product and terms or to reject them and purchase something else or nothing at all. The phrase most commonly associated with standard form contracts is “contract of adhesion”. These are routinely enforced.-A common but not completely accurate image of property or vested rights law is that the rules define a party’s relationship to a corpus (the “property”) in terms independent of any relationship between the rights owner and a third party. -Conclusion:

K and other forms of law have never been able to foster active development and distribution of information products in society without relying extensively on contracts.

Commercialisation, which depends on K relationships, constitutes one of the core mechanisms by which information is developed and distributed. It is a central part of the IP law bargain and should be recognised as such.

Points of tension have always been resolved by contextually nuanced analyses of particular cases and particular claims of abuse.

Comment: Article essentially maintains that K law and IP rights are complementary, not opposite. This seems logical considering that in the IP regime that we looked at, the foundation of the right that is granted to the holder is a K/bargain between himself (right to exclude) and the public/society at large (right to benefit from the invention/work of art.)DID NOT READ

-Nimmer takes a slightly different approach as compared to Easterbrook J. in ProCD. He does not tell us that property is irrelevant; rather, that the only way IP rights work is when we contract them through licensing, or by selling them altogether. -Contract law is what is going to define what can and cannot be done in IP space to a much greater degree than property law. -His view is that property sets out a starting point, but contract fills up IP space. -Says IP only makes sense in K context. Says that our focus should be on K Law and not IP-K allows you to alienate your IP rights. When Property allows alienability, then the market will set who will get it = he who thinks it is highly valuable.-Nimmer says that Ks are very flexible and enhance freedom. Eventually, only K will govern.

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J.H. Reichman and Franklin “ Privately Legislated IPR: Reconciling Freedom of Contract with Public Good Uses of Information” (1999), p. 496:Synopsis:-Thinks that courts should play a more active role in discriminating and scrutinizing the K-Although adhesion Ks are advantageous because of their low transaction costs, they have a lot of disadvantages: can prohibit public good uses (education uses, Technological innovation (ProCD), Freedom of speech, reduce competition-The purpose of this article is to formulate and develop minimalist doctrinal tools to limit the misuse of adhesion contracts that might adversely affect the preexisting balance of private and public interests. -There is a need for a uniform set of default rules to validate non-negotiable licenses as a mechanism for minimizing transaction costs. However, routine validation of non-negotiable constraints on users would likely convert standard form licenses (contracts of adhesion) into the functional equivalent of privately legislated IP rights. This would ignore the balance between incentives to create and free competition recognized in IP laws. -Author concedes that entrepreneurs should have more contractual powers to control the online exchange of downstream products without encountering excessive premature gov. regulations.-It does not follow however that entrepreneurs should have equal autonomy to restrict use of the information when used for education and science.-R & F propose a set of countervailing doctrinal tools, collected under a “public interest unconscionability” rubric that courts could apply case-by-case rather than invoking the pre-emption doctrine (see ProCD) from IP law or the public policy exception from standard contract law. -They advocate public interest checks on standardized access contracts and on non-negotiable terms and conditions affecting users. They try to preserve the maximum degree of freedom of contract:-All mass-market contracts, non-negotiable access contracts, and contracts imposing non-negotiable restrictions on uses of computerized information goods must be made on fair and reasonable terms and conditions, with due regard for the public interest in education, science, research, technological innovation, freedom of speech, and the preservation of competition…Affirmatively negotiated terms falling into above-mentioned categories shall enjoy a presumption of validity. -This presumption may be rebutted whenever the cumulative harm to the public interest from use, including repeated use, of the term or terms in question seem likely to outweigh the private and public benefits flowing from the specific transaction.”-By allowing licensors wide leeway in the name of freedom of contract, we remain confident that market forces will generate an abundance of information goods and drive them to their highest values. -However, mindlessly tolerating abuses of that freedom to contract under a model of formation that dispenses with the requirement of mutual assent could produce unprecedented anticompetitive effects detrimental to the public interest.Class Notes: R & F see the relationship between contract and property quite differently from the Easterbrook J. and

Nimmer. R & F = property law is the ideal. Property law is the state saying who ought to have what. The

statutory schemes are designed to endure that we allow some commodification so that people can profit from it but has inherent limitations on it such as fair dealing. K law virtually ignores this balance between incentive and access. The information holder extends the reach through contract and tries to get more than what copyright law would give them by making the consumer into the licensee.

All contracts are to be evaluated against the private interest to make money and the public interest to gain access (see the statement of claim dealing with the anti-virus software on each of our computers).

All of this assumes the centrality of contract. It is not the IP right that matters; it’s how you use it.The property right defines when you can use a right and what rights you have and the contract depends on the property rights. Property law comes first in order to set up the initial distribution but then contract law comes in to formalize the rules. DID NOT READ

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Justification for Ordering of IP Space:Economic Efficiency and Distributive Justice

-Justification for Ordering IP Space: In terms of IP, justification is relatively light-Basic premise: property needs to be justified, we need to justify the rules governing property in order that the playing field is leveled for all. The underlying issue is fairness, what is a fair justification for property?-Main justification is economics, but there are other justifications.

Economic Efficiency

-Economic justification causes the most difficulties, at least much more than other justifications. Economists can't even agree on the basis of the economic justification of IP space. The usual argument in terms of economic efficiency is that economic incentives spur innovations.-Some terms/definitions/justifications for IP space:

Market failure: The type of goods that IP regimes protect are non-rival (more than one person can be a user at the same time: this is opposite to traditional notion of property where use is rival) and non-exclusive (absent a legal rule an idea cannot be stopped or limited or one cannot exclude another from using the idea). IP regimes were designed to respond to the failure of markets to protect the ideas of, and provide incentives to, creators/investors.

Public goods problem: Legal rules where developed to deal with the above, but this creates problems in terms of public goods: not all IP should be subject to private ownership, as this will detrimentally affect the public good. Thus IP must also provide incentives for people to develop public good remedies

Incentive-access paradigm: IP rights are monopoly rights: can charge more than would otherwise by virtue of monopoly (just like in any other type of monopoly). In IP, however, the monopoly is judicially and legislatively limited (only for a certain pre-defined period of time). This is in response to the need to balance incentive for creator/inventor with public access to goods.

-Problems inherent in the economic justification of IP: Mistaken assumptions : if we go thru the economic literature, we can see that

economists disagree as to what the protection for IP should be: there is no agreement on the level of incentive that is needed. They seem to agree that incentives [should] change according to the type of industry under consideration (in terms of length of patent right for example), but this is not presently the case.

Of course, to require various standards of protection for various industries is problematic: how far can the logic take us: industry by industry standards, product by product standard? Economic justification has its problems.

Institutional competence : At design level (how to design IP systems) and at implementation side (how can we expect judges to make informed decisions).

Robert Couter & Thomas Ulen “Law and economics 3r Ed”, p. 5 (II):-A property right to the author/creator of an idea helps her to appropriate its value. This comes to the cost of exclusiveness. There is therefore a tradeoff between the breadth of the scope of the right granted and its

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duration and social utility: the greater the breadth and/or the greater the duration, the greater the incentive on creators, but the higher the costs on society.Patents: broad or narrow?-The big question in patents is what is the optimal combination of breadth and duration: Broad patents encourage fast, duplicative research (by definition a single patent can cover several different claims), whereas narrow patents encourage slower but complementary research.-A complication is that the stand-alone value of a pioneering invention may fluctuate. But a pioneering invention with little stand-alone value might eventually have great commercial value. There is therefore an incentive problem for pioneering inventions with little stand-alone value.-Therefore, patent protection for pioneering inventions with little stand-alone value should be broader (more incentive if cover more things) than patent protection for pioneering inventions with large stand-alone value (incentive, even if does not cover many things, is already present).Patents: duration-In the absence of substitutes, the longer the patent monopoly persists, the greater the social cost. The benefit is the increase in creativity stimulated by the patent. Extending the life of the patents increases the amount of investment activity, but at a diminishing rate.-While it is impractical to grant a different patent life for each invention, the market can approximate the result: in Germany for instance, patent holders must pay to maintain their patents, and the fee goes up as time goes by.-Copyright: There is no reason in principle to limit the duration of a copyright. What limits it are the costs of tracing the copyright holder-CR grants writers, composers and other artists a proprietary right in their creation upon demonstration that their work is an original expression.-Tracing costs increase with time, as the author becomes more difficult to locate: thus the most significant limitation may not be in terms of scope but rather duration.-TM-The principal economic justification for granting property rights to TM are that they lower consumer search costs and create an incentive for producers to supply goods of high quality. Can we make the same economic argument for limiting the duration of the property rights in TM as we did in the case of patents and copyrights? The answer is no. Limits on the duration of patents and copyrights were justified as attempts to minimize the social costs of monopoly and tracing. However, TMs encourage competition and do not impose tracing costs.-TM are inherently good, they reduce the cost of searching, they also encourage companies to keep quality high, because a TM is as good as the market goodwill that supports it-Therefore there are no real reasons to limit TM.

Landes and Posner: “TM Law: An Economic Perspective", p. 11:-TM law is best understood as increasing economic efficiency. Failure to enforce TMs would impose 2 distinct costs - one in the market for TM goods and the other in the distinct (and unconventional) market in language.-TM goods:

TM decreases consumer search costs by promoting easy identification (distinction) This is based on notion that satisfaction consumer gets from product will lead consumer to search

for the TM. This in turn encourages expenditures on quality by producer to start ball rolling or make sure it keeps rolling.

-TM language: TM increases pool of new words. TM increase language in 3 ways: a) increase the stock of names

of things, thus economizing on communication and info costs, b)create new generic words, words that denote entire products, not just individual brands, c) enrich the language, by creating words or phrases that people value for their intrinsic pleasingness as well as their info value.

Above are small benefits. What is more important is that the goal of communication system is to minimize the sum of the cost of avoiding misunderstanding and the costs of communicating. This TM does.

-Therefore TM have a self-enforcing nature that is economically beneficial

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-TM a good thing because they add to the amount of language to the world, color our environment with additional vocabulary. -That TM law economically efficient because of the above is not a great argument. The economic argument that it equals the playing field for manufacturer and retailer is more valid.

Polk Wagner, "Info Wants to be Free: IP and the Mythologies of Control", p. 17:-Essay challenges a central tenet of the recent criticism of IP rights: the suggestion that the control conferred by such rights is detrimental to the continued flourishing of a public domain of ideas and info. This criticism overlooks the contributions that even perfectly controlled intellectual creations make to the public domain.-Core contention: critics understate - perhaps dramatically - the contribution that even 'perfect' control of intellectual creations makes to the public domain, just as they overstate the current and potential effectiveness of this control. Combining this understanding with the dynamic incentive-effects of IP rights suggests that such rights (even in strong forms) are likely to increase the content of the public domain rather than decrease it. Thus, while there are perhaps other reasons to limit the scope and enforceability of IP rights, concern about the withering of the public domain seems not to be one of them.-Essentially argues that info cannot be controlled effectively, that even control info generates additional information which itself is not subject to right of control, that there are circumstances under which people who control info might choose to make it available, situations were it is impossible or too costly to enforce control etc. to reach conclusion that IP rights cannot (at least in the foreseeable future) restrict info that is in public domain: info is free and wants to be free.-Separates info in 3 types: Type I is mostly appropriable: it is the information created: the actual work of authorship or

creativity or the actual invention in the patent context. Well delineated and IP laws are at their most potent there.

Type II is partially appropriable: it is in some way directly derived from the underlying creation. Typically described as follow-on innovations or cumulative innovations.

Type III is not appropriable: it is only indirectly associated with the underlying creation: that there exists a class of information that is in some sense “derivative”, but falls outside the reach of the intellectual property laws. The relationship between Type I and Type III thus consists of a “but-for” causal link, but the relationship is generally sufficiently indistinct and removed so as essentially to preclude appropriation by the Type I creator and indeed, nay not even be conceived as appropriable. In other words, Type III is “open” information, available for widespread use, as an inherent consequence of the creation of the underlying Type I information. Type III is a direct contribution to the total public knowledge.

-Author argues that type III info is always generated, so is type II, and as such any IP private right over a particular info (type I) will be balanced or surpassed by a public right over other info (type II, III).-Info is stimulative in nature: information begets more information. -Where Reichman finds that the Public Domain is shrinking, Wagner says that having type I info actually increases public domain (via type III). The more you innovate, the more Type III you will have.-There are two benefits of control that seem likely to create conditions wherein additional information can be created for the public benefit.1. Fostering Flexibility2. Reconciling the Market power and incentives-Adding to the Public Domain: control and coordination:The extent that the control of int’l property allows owners to coordinate the uses of their works to restrict access, it also enables those owners to coordinate in such a way as to enhance access: two examples: open source software development and outright dedications to the public domain.-The idea that the public domain is always increased by IP law is problematic: perhaps this is true quantitatively but not necessarily so qualitatively.

James Boyd White “The Language and the culture of economics” in Justice as

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Translation, p. 38 (II):-Doesn’t like economic analysis in particular because of its cultural consequences.-In North America, economic language is often the basis of decisions re intellectual property. The dominant view seems to be that use of economic analysis and language will yield the best intellectual property regimes.-But at the center of economic analysis is the idea that things are convertible into money, and widespread economic talk conveys in the culture the belief that everything is fungible and reducible to economic interactions: all individuals are rational economic actors that act in their self-interest, and all resources are individualized as susceptible of monetary evaluation and are only used in economic transfers. This ignores values, motivations, purposes, and notions of community where individuals do not act out of self-interest.-Economists retort that notions like “self-interest” or “rich” are only analytical tools with technical meanings, and are only to be used as a model to predict behaviour, NOT as a statement of the be all and end all of actual reality. White suggests however that such a characterization of talk only reinforces ordinary selfishness and greed by depriving terms of their actual meaning. He also argues that as with any other language and tools of analysis, their use reinforces the notion that they describe reality, and are thus not just used as models but rather perceived as the way things really are (essentially the economist argument that language used is merely model is disingenuous).-Also problematic is the idea that values are reducible to agent preferences, thereby suggesting that moral choices are sheer matters of taste and just as disposable or subject to change. In fact, the very value-neutrality claimed by economics is in itself problematic, because all the greatest questions and the greatest human endeavours are value-driven. For example: the decision to set up democratic institutions is based on perception of inherent worth of all individuals, which is not reducible to economic terms. In this context, note that economic perception of behaviour would destroy institution of democracy since it is blatantly clear that not all actors are economic equals. Furthermore, economics is not devoid of values, cause it sets up a perception of the way human beings are.-Economics claims to be fair because it presumes democracy, equality and freedom of choice. But real people are not equally free in their capacity to make choices, and democracy is based on the equality of individual rights, not on the equal purchase value of a dollar.-Even as an economic tool, economics doesn’t have much to say. Economists are interested in the exchange of value, but value can change thru the influence of non-economic factors like culture. The non-economic background is not stable. It is also very difficult to explain using economic terms why economic model is to be used: better description of reality? Based on what?-Further, the end of life is not exchange. Exchange is merely a way to accomplish those ends.-Some questions should simply not be answered through economic analysis.

Distributive justice

-This section is about the distributive consequences of allocating intellectual property rights. In other words, what are the effects on the public of those property rights?-Boyle observes that the protection of intellectual property rights is increasing (e.g. computer programs were originally not protected, then they got protected by copyright, and now they are protected by patents, patents are granted on biological material, etc.). -The prevalent discourse appears to be that increasing the privatization of intellectual property space means better protection. He criticizes the prevalent discourse.-Main question is how do we protect the right of the holder and the right of access to info for the public? Right of property holders and IP rights must be balanced with those of society at large.-3 ways of thinking about property:

No property right Private rights: right to exclude Common right: right not to be excluded

-In terms of distribution, the axes upon which we should analyze distributive justice are:

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Right's holder v. Users Right's holder v. Personal Property

-NOTE: utilitarian and economic justification of IP is very North American

James Boyle “The Second Enclosure Movement and the Construction of the Public Domain”, p. 54 (II):-Complains of the “anti-commons effect” of increasing the allocation of intellectual property rights. Intellectual property gets developed thru collaboration and sharing, and granting more property rights increases the chance of such collaboration and sharing.-Thinks that the PD is shrinking: European Database directive is granting rights for indeterminate time for databases and for that reason, there is an encroachment (in CAD, only an arrangement); IP is progressively allowing for the appropriation of ideas; Patent holders are starting to get proprietary interest in math formulas-Looks at arguments that people make in favour of this movement: these are the traditional economic arguments: incentive to creation, property induces innovation-Argues that we are experiencing a second enclosure movement: like the one in England, this enclosure is limiting access to what was once in the public domain, and this is negative because it restricts people's freedom and might have significant consequences (like the one in England). Here Boyle observes that greater IP rights might actually be counterproductive to the purpose of greater IP rights: limiting access will reduce creativity since most innovations are incremental. -Boyle notes that enclosure of IP is different from pasture enclosure in a number of respect:

Info in IP is non-excludable: one that possesses common knowledge cannot bar another from possessing it as well, simply because it is common knowledge.

Info in IP is also non-rival: different people can make use at the same time (many uses of the land are mutually exclusive but an MP3 file may be used by multiple parties at the same time)

There is also no risk of depravation with overuse. On the other hand, if info is non-excludable and non-rival, it increases your ability to distribute

and makes it easier for people to make money out of it. It is therefore of no advantage to IP. This is connected to above.

Individual Property:-English enclosure movement: the process of fencing off CM Land and turning it into private property: the conversion into private property of land that had formerly been common property, or outside of the property system altogether.-Advantages of privatization:

o Allowed the expansion of productive possibilitieso Allowed the control over exploitationo Insured that the resources could be used more efficientlyo Strong property rights and single entity control avoid the tragedies of overuse and under-

investment ( tragedy of the commons)-Although protection of the info commons was the fundamental goal of IP, the new vision is that the info should be protected for the benefit of the creator of the info, not for people at large (longer CR, expansion of patentable items).-The concern is with the ability to exclude: the same tools that allow for swift copying (internet) also allow us to detect illicit copying (search engines).-NOTE: when marginal cost of production and marginal cost of transmission approach zero, infringement are more likely, and, so the argument goes, protection should be greater.Alternative:-IP is now generally more important than before: your info output is someone else’s input: reducing access to your info raises the costs and places roadblocks in the way of subsequent innovations.-Open source software is an example of an alternative system of 'property'.-New collaborative methods of production are created. For Example: GPL: General Public License in software: users may add to or modify the code, may build on it and incorporate it into their work, but if they do so, then the new programme created is also covered by GPL: the result is not only a free gift of the programme, or a contribution to the public domain, but a continual accretion in which all the gain and the

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benefit of the program goes back to the public domain. -Economists and IP rights enthusiasts would say: there is no adequate incentive to ensure continued production, yet! “e pur si mueve”. Motivations may lie with: love of invention, hope and joy of doing a better job, joy of solving puzzles-For the GPL (open source) to work, it depends on K: for distribution, way it grows, way it is binding to future innovations. Does this suggest that best means of IP protection is not property basis but K law?-NOTE: Propriatization is a vicious cycle: once a new IP has been created over some info good, the only way to ensure efficient allocation of the good is to give the rights holder still more control over the user or consumer in the after market so as to allow for “price discrimination”: need to get rid of anonymity and need to locate and identify users in order to exert control and to be able to sanctionRecognizing the public domain-Boyle views the public domain as a zone of controlled freedom rather than as a free-for-all. The public domain also needs to be controlled—“systemic” measures must be in place—so as to ensure that the public domain is perpetuated and the freedom that sustains it is maintained.-Therefore, the public domain is not a mere left-over, a kind of ‘vacant space’ that is there. The notion of “public domain” is something that must be ‘created’ to bring together disparate interests and people. - Boyle likens “public domain” to the notion of “environment”, which he says is a construct that helps addressing disjointed issues that would otherwise remain disjointed, in an increasingly coherent way. Just as “the environment” creates a space for new discourse, so public domain brings about a space that would not otherwise exist

-Regulation of this space does not have to come from granting property rights. It is fine to make ideas available freely, as long as the “public domain” space that offers these free ideas has a means of avoiding free-riding problems. Perhaps in this context K law?-Because, Boyle argues, the open-source movement is successful, it shows that intellectual goods production can be fostered without granting property rights and their anti-commons effect. This is what he calls “positive property rights”-Boyle also cites the internet as an example of a “space” where innovation happens without there being monopolistic property rights, and where the quality of innovation comes very close to what big corporations do—without, once again, the externalities of a property system-As evidenced by the success of the open-source movement, it is wrong to assume that people are only motivated to produce intellectual property goods for economic reasons. Therefore, creation doesn’t necessarily need economic incentives. What matters is that people’s own reasons for creating receive some measure of outside protection so that people keep creating. Licensing is one way to do it—at any rate it works well in the open source movement.-The more we encourage this organized ‘sharing’ the more development will occur, the better the public domain will be protected (that’s the “positive reinforcement effect” mentioned above) and the more new opportunities will be created.

Personhood

-For Hughes, the ‘personality theory’ for justifying property stands as the main alternative to the labour theory of justification.-Existing law support the credibility of different theories and these theories, in turn, support the validity of existing laws.-The main alternative to labour (Lockean) theory is a personality theory that describes property as an expression of the self (Hegel)

-NOTE: right to ideas is rooted in personal right in Europe, it is a question of self-actualization and control of the external environment. The latter require dominion over tangible and intangible objects. In this context, it is easier to justify IP than property rights, since what could be more personal than writing a novel?

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-This second/European justification gives rise to issue of moral rights (remember Snow v. Eaton Center):

Right of attribution: name associated with the work for EX Right to integrity of the work: mostly a copyright issue.

-Moral rights cannot be assigned even if right of copyright or patent can be. One can waive moral rights however.-Personhood justification: the 'objects' created are an expression of one's personality: this is where we get the moral right. Question, how far can we take this justification: assuming the premise that we need control over the object, how much control should be allowed? Should some IP rights be protected more than others? Is it fair to make some distinctions such that some rights deserve more protection than others (rights of artists more protection than rights of individuals, or those of artists more than those of patent creators)?

Justin Hughes, "The Philosophy of IP", p. 85 (II):-Generally, property makes the property owner risk-averse, avoiding decisions that might diminish his property. It is a conservative concept which stabilizes society. Persons with property are protected from non-propertied people of greater natural ability or talent.-Intellectual property, however, is far more egalitarian, in that it is of limited duration and obtainable by anyone. It shifts power/prop rights to those with more natural ability and talent. On the other hand, property/wealth still plays a role, cause much IP is produced only after considerable financial investment (labs, technology, education).-Thus while IP shares its origins with other types of property, it is more neutral in that its limited scope and duration tend to prevent the accumulation of wealth inherent with other types of property.-Different IP legal systems in different nations are more representative of countervailing social policy than a different conception of IP. -Universal definition: IP is nonphysical property which stems from, is identified as, and whose value is, based upon some idea or ideas, with some additional element of novelty (‘idea’ being shorthand for the unique product of cognitive effort).-IP, like all property, is an amorphous bundle of rights.-IP rights are subject to limitations, such as fair use (copyright), and judicially created exceptions for patent.-Limitations serve the primary purpose of IP, which is to promote the progress of the science and useful arts.

A HEGELIAN JUSTIFICATION & HEGELIAN IP

-The personality justification sees property as a mechanism for (a) self-actualization, (b) personal expression, (c) dignity and recognition as an individual person.-Margaret Radin posits that to develop as a person, we need some sort of control over resources in the external environment – property rights fulfill this need for control.-In IP, the personality justification best applies to the arts.-For Hegel, the individual’s will is at the core of his existence, constantly seeking actuality and effectiveness. Personality is identified with the will’s struggle to actualize itself.-The will interacts with the external world. For Hegel, the true purpose of property is to allow the will to seek to appropriate the external world, and impose itself upon it. This is the first step in a person’s self-actualization.-However, it is not enough to impose our will on the physical world – society must acknowledge our property claims based on some objective social will.-For Hegel, abandonment occurs easily because the relationship b/n person and property lasts only as long as the person’s will manifests itself in the object. Absent constant reaffirmation, the right is lost. Also, the will can be actively withdrawn by the individual (alienability).-Labour is often a means by which the will occupies an object, but labour is not necessary. [Hughes gives

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the example of a souvenir rock from a beach – the will occupies the object without use or labour].-There are objective indicia of the will’s occupation. A non-exhaustive list includes (1) physically seizing the object, (2) imposing a form upon it, and (3) marking it. For example, using an object in a manner which preserves it could count as ‘marking it’, as it indicates a desire for continues utilization and enjoyment of the object.-IP does not need to be analogized to physical property. -You cannot alienate yourself from IP because an intellectual/artistic product is a ‘universal element of one’s self’, thus unalienable. You can, however, alienate yourself from copies of that product. -Hegel admits that IP is ‘the purely negative, though primary, means of advancing the sciences and arts’. It is a ‘capital asset’ in that it that it provides some economic security.

Problems in Applying the Personality Justification to Intellectual Property.

-The main problem with the idea that property protects personality is that it is difficult to tell when someone has a particular ‘personality stake’ in a given object. Also, if such a stake is recognized, to what degree does the object manifest the personality of the individual? Does more personality warrant more property protection? -The personality justification seems to offer little protection to intellectual products which reflect little or no personality from their creator. Poems, sculptures, paintings, novels, etc. are what Hughes calls ‘receptacles for personality’ – the personality stake in such objects is obvious.-The problems for the personality justification arise when dealing with intellectual objects which are not easily described as a manifestation of the individual’s self. For example, computer software, or other more technical areas of intellectual property. We think of these items more as utilitarian solutions to specific needs or manifestations of generic insight, not as manifestations of someone’s personality.-Note however that it can be argued that even the most technical products may involve some aesthetic vision, albeit minimal. If there are ten ways to write a computer efficiently, for example, making the choice could demonstrate personality and thus property rights are justifiable. Thus, no one genre of intellectual property is devoid of personality. -The object expresses personality, but also the association people make between object and creator is an expression of the personality – it creates a persona. (i.e. Edison = light bulb, the association expresses Edison’s persona more than the physical light bulb). -Logically, for Hegel, alienation occurs when the individual ‘removes’ his will from an object. It is equivalent to abandonment. We abandon X for Y when we feel that Y better expresses our personality, thus increasing actualization.-Alienation of intellectual property can take on two forms: (1) entire alienation [selling all rights at one time], and (2) partial alienation of the property [ex: limitations on how copies may be used].-A problem with alienation is that, in most cases, alienation involves some degree of determining the object’s future, even though the personal link to the object is no more. It is difficult under the personality justification to justify a right to dictate the future of an object, which is theoretically no longer a manifestation of one's personality.-Hughes calls this the paradox of alienation under the personality model of property. -Hegel feels you can alienate yourself from copies of your work, however, while maintaining the ‘whole’ of the property and yourself.-Also, income allows further expression, and alienation of copies allows further exposure to one’s ideas, which leads to non-economic recognition (honor, respect, admiration).-Two conditions are essential for alienation: (1) the creator of the work must receive public identification, (2) the work must receive protection against any changes unintended or unapproved by the creator. -The 2 conditioned mentioned above are recognized in some IP regimes as ‘moral rights’. There are no such provisions in American law.

Civil Rights Support for a Personality Justification

-People often try to bridge U.S. Law with IP protection through defamation claims, such as a playwright suing a director who ‘degrades’ the play.-Hughes posits that civil rights approaches are a better way to protect IP, and elaborates on 2 of them.The privacy right argument

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-Right to privacy should allow people to prevent publication of private documents, even when a would-be publisher is recipient (letter, for example). Even when part of a work is in the public arena, the creator should be allowed to keep the rest private. If an author produces a final edited version, the omitted material should remain private.-Dicta in many cases has suggested that dissemination of a work under an author’s name against the author’s wishes may infringe privacy rights.-It follows that those who wish to remain anonymous or prevent publications of intimate details about themselves should have that right. The freedom of expression argument-First Amendment freedom of expression is often portrayed as the enemy of IP rights, in that free speech is often used, for example, as a reason for limiting copyright.-However, counterargument is that freedom of expression is meaningless without assurances that the expression will remain unadulterated. Free speech demands that speech be guaranteed some integrity – a guarantee that the speech will not be divorced from the intention of the speaker. The speaker’s expression must therefore be protected from distortion.-When the speaker is powerless vis-à-vis the distortion, such as a novelist upset with a publisher’s version, the legal system can establish protective mechanisms to deal with possible frustration of the speaker’s intent.-Thus, increased property rights such as copyright protection can be justified on the basis that a speaker’s expression should not be distorted (this is the free speech argument).-Note that it is from this conception of IP that moral rights originate: work as extension of the artist's personality, possessing a dignity which is deserving of protection (integrity and origin/authorship). Also note in this context the difference in terminology: copyright (which suggests control of the reproduction of a work) and droit d'auteur (which suggests not control of reproduction, but some other rights that are special to the artist).

Labour/desert

Justin Hughes, "The Philosophy of IP", p. 188 (II):-article looks at the Lockean theory of property, and argues essentially that this theory is particularly apt at justifying IP regimes in light of the non-exclusive and non-competitive nature of IP products.-Lockean justification of property: 2 interpretation (subsumed under notion of avoidance of labor)

Instrumental interpretation: Society rewards labor [which is unpleasant] with property purely on the instrumental grounds that we must provide rewards to get labor done (knowledge of reward before the act encourages the act)

Normative interpretation: says that labor should be rewarded period (after the act, we recognize the unpleasantness of labor and so reward it with property)

-Locke theory of property is based on: Notion of "enough": there is enough property out there for everyone to acquire Notion of "as good": while not every product is equally available to all, alternatives are out there

such that the inability to acquire one product is compensated by the ability to acquire an equivalent.

Non-waste condition: it is morally wrong to waste products, because it is depriving another of the ability to meet his need.

In light of the above, IP is particularly suited to Locke's theory, because Enough: one can always come up with new ideas, As good: there are always more than one way of doing things, Non-waste: ideas cannot be wasted, since one person's non-use of an idea does not prevent another

from using the same idea.-Can justify propertizing ideas under Locke's approach with three propositions: first, that the production of ideas requires a person's labor, second, that these ideas are appropriated from a common which is not significantly devalued by the idea's removal, and third, that ideas can be made property without breaching the non-waste condition.-Another interpretation of Locke's labor justification can be called the 'labor-desert' or 'value-added' theory

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(not same as those under notion of avoidance of labor). This position holds that "when labor produces something of value to others - something beyond what morality requires the laborer to produce - then the laborer deserves some benefit for it." The labor-desert theory asserts that labor often creates social value, and it is this production of social value that deserves reward, not the labor that produced it.-The creativity we perceive in an intellectual product may be either in the core idea or in the core idea's execution. I suggest that when we readily can separate the two, execution always seems to involve labor, but it is not always clear that the creation of the idea involves labor. Ideas often seem to arrive like Athena- suddenly they are there, full and complete. (this brings us back to the idea/expression dichotomy, and explains why it is the expression and not the idea that is protected under IP regimes)-NOTE therefore that the idea/expression dichotomy is the same as the idea/execution dichotomy, and thus in all 3 IP regimes we look at (copyright, TM and patents), the ideas are not protected, it is the efforts that go into their materialization, their actualization, their creation that is.-IP systems also are more suitable for a Lockean justification than are physical property systems because a growing set of central ideas are never permitted to become private property and are held in a permanent common. Ideas that are privatized are in between the two extremes of common and extraordinary ideas: the extremes are never propertized.

Case Study

Théberge v. Galerie d'Art du Petit Champlain, 2002, SCC, p. 136:Facts: T is a well-established artist (painter). Seeks to stop the appellants from transferring authorized reproductions of his artistic works from a paper substrate (or support) to a canvas substrate for purposes of resale. Appels used a chemical process that allowed them to lift the ink layer from the paper (leaving it blank) and to display it on canvas. Issue: Determine the extent to which an artist, utilizing the statutory rights and remedies provided by the CA can control the eventual use or display of an authorized reproduction of his or her work n the hands of a third party purchaser.Held: Appeal is allowed: T cannot limit the resp's right to use/sell his work on a different support.Ratio:Binnie J. (majority):-In my opinion, appels did not reproduce the work.-process used was within their rights as owners of the physical posters. At the end of the day, no new reproductions of the resp's works were brought into existence.-Believes that Gonthier gives to little scope to the property rights of the purchaser who owns the poster, i.e. the physical object incorporating the copyrighted expression, and excessive rights to the artist who authorized the printing and sale of the poster purchased.-CA provides resp with both economic rights and moral rights.-Resp made it clear in his evidence that his real complaint is more properly characterized as the alleged infringement of his moral rights and its potential impact on the market for his works.-Main argument is that to recognize the process used by the appellants as copying gives to many rights to the copyright holder and not enough proprietary rights to the holder of the material manifestation of the work. This would be contrary to the purposes of copyrights: balancing of the right of the author of the work with those of society to use the work to further learning.-Accordingly, according to Binnie, since the process did not entail that the number of copies of the work were increased, there was no reproduction per se, and so copyright was not violated.-the image 'fixed' in ink is the subject matter of the intellectual property and it was not reproduced. It was transferred from one display to another.-Reproduction defined as the act of producing additional or new copies fo the work in any material form. Multiplication of the copies would be a necessary consequence of this physical concept of reproduction.-Recognizes the possibility of 'metaphorical copying': transformation to another medium: e.g. books to films, but this is not the case here, for dealing with a case of mechanical transfer of the work from one support to another, not a reproduction of the work itself-France recognizes the right of destination (droit de destination): gives the author or artist the right to control to a considerable extent the use that is made of authorized copies of his or her work. This is not recognized in our CA: the copyright holder does not by virtue of his or her economic rights retain any

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control over the subsequent uses made of authorized copies of his work by third party purchasers.Gonthier J. (dissent):-Disagrees with Binnie J that reproduction can only occur if there is multiplication.-It appears that the primary and essential meaning of the word reproduce as it appears in s. 3(1) CA is 'produce a copy' of or 'cause to be seen again' or 'give a specified quality or result when copied'. In order for a work to be reproduced, there is no requirement whatsoever to establish that there has been an increase in the total number of copies of the work. -Way to understand what Gonthier is saying: for Binnie, reproduce means make a copy. For Gonthier, reproduce means create again. In this sense, to reproduce need not result in additional copies, simply means to go thru process of creation to get to same product.-Producing a work refers to the initial materialization and reproducing it refers to any subsequent material fixation that is modelled on its first fixation. Reproducing a work in any material form whatever therefore simply means rematerializing what already existed in a first, original material form. Reproducing a work therefore consists mainly of the subsequent non-original material fixation of a first original material fixation. It does not matter if the reproduction results in additional copies or even if it destroys the original, all that matters is that a new act of fixation occurs.-thus to determine reproduction, must not count the number of copies of the work in existence after the rematerialization, but the number of materializations that occurred over time.Comment:-Both agree that with respect to the CA, moral and economic rights are distinct rights and are to be treated separately. This is, to some extent, why they are subject to different articles in the Act.-This is a case that involves a conflict between title holder of a physical thing and a copyright holder-According to both Binnie and Gonthier, the moral rights of Theberge are not an issue.-There is some discussion about the K arrangement between Theberge and the company that ultimately sold the posters to the appellants, but again this is not an issue, cause the 'infringement' was by the appellants, not by the licensee (middleman).-The only issue: balance of rights between the holder of the copyright and the holder of the physical manifestation of the copyright.-Interest in the case stems from:

Gonthier focuses on a doctrinal issue: meaning of the word reproduction in s. 3 (technical analysis)

Binnie focuses on a policy analysis: how to interpret the statute in light of the policy objective of copyrights

In all of this theory is left unsaid.-Core doctrinal issue is the meaning of reproduction (in whole or in part) in s. 3. 2 views:

1. Binnie: CML approach, look at the case law to conclude that copyright is about making additional copies. Multiplication of the work is what is essential. How to do this? Count number of copies before, count the number of copies after, and if there are more copies after, then there has been some reproduction.

2. Gonthier: CVL approach: uses a more textual approach; get to the heart of the CA, analyze the use of the words in the context of the act. To reproduce means to 'recreate', or cause to be seen again. Accordingly, to determine that a work is reproduced there is no need to show an increase in the total number of the works. The issue is the rematerialization of the work, and so there is no need to count the total number of works before and after, just count the rematerialization.

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-Policy level: Gonthier does not go to policy explicitly, but Binnie does. He is very explicit on the issue of policy: all property rights involve a balance, because giving a right is to limit the liberty of another. Balance of competing property interests: those of copyright and those of holder of physical thing. This is the overriding policy objective: must not give Theberge a veto over all possible use of the physical object by the holder of the object.-The normative plane for Binnie is a utilitarian analysis combined with an economic approach: the question is really not about moral rights: the focuses on the economic implications of copyrights.-Because Gontier did not go beyond the doctrine, it is difficult to determine what motivated his judgment about and beyond an analysis of the doctrine. However, it seems clear that some of the motivation for Gonthier came from the personality justification of IP: the copyrighted work is an expression of the self, a self-actualization, which deserves protection in of itself.-Conclusion: both judgment are consistent as far as they went, but if we take the arguments of Gonthier outside of the artistic context, the argument might fall (what would the parallel of reproduction for Gonthier with respect to a painting be in the context of a patent). Gonthier's judgment also seems to blur the line between the idea/expression of the work and the physical manifestation of it.

Origins of IP Regimes

Sherman and Bentley, "The Making of Modern Intellectual Property Law", p. 162-Primary focus of the article is on those factors within the law that helped to shape the particular form that IP law ultimately took.-Point: modern intellectual property law was neither natural nor inevitable, nor was it an example of the law coming to occupy its proper philosophical position. Rather, the separation of IP law into its now familiar categories was the product of a complex and changing set of circumstances.-Article looks at the literary property debate: question of the status of perpetual common law literary property. Argument centred on the idea that both literary works and patents were incorporeal property that should be afforded the same protection (but authors argued for the perpetual protection of their works even if patents had a limited lifespan).-proponents of literary property took position that patents and literary works were different in nature, which explained why they should be treated differently. Means to distinguish:

Amount of mental labour embodied in the work: patents less, literary works more: more of work means the object is individualized (associated with author), and so the less property rights could be diluted by other concerns. Accordingly scale of protection according to the level of mental activity involved in the creation of the object.

What it took to imitate or copy the intangible property: less effort is required for literary works, more for objects of patents, so latter already some protection.

-Article then looks at the patent controversy of the middle of the 19th century: question of whether patents should be abolished. If yes, then patents apologists suggested that copyrights should also be abolished.-This was a repetition of the literary property argument, but answer provided was somewhat different. Answer focused on how an invention should be characterized. Pro-patents argued that invention was a creative process, while anti-patents said it was just a discovery of pre-existing info waiting to be discovered. As such, protection should not be afforded for long, cause if particular inventor did not come up with invention, somebody else would have at some point, while if author did not write a particular story, unlikely that someone else would have.-While the attempt to abolish patents was ultimately unsuccessful, the juridical nature of patents was

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irrevocably changed: invention recast as a form of discovery rather than as a unique creation of an individual. This establish the opposition: non-creative patents vs. creative copyrights.-This perception also had a bearing on how infringements were defined: for copyright (since act of creation), only means of infringing is copying. But for patents and inventions more generally (since only discovery and not creation), then possible for two individuals to come up with the exact same invention without copying each other. Thus to afford protection, patents had to cover fortuitous discovery, while copyright focused on intentional action.-There seems to be an assumption that IP regimes were always the way they now are. This is completely wrong. IP law in its modern form is a very modern notion, just over 100 years. -IP regimes emerged at different times in history in light of different needs.-Copyright started off as a quasi-patent law: exclusive right to publication, only people that held copyrights were allowed to publish. This entailed no concern about the writer or the quality of the work: all that society was concerned about was the right to publish. Notice in this context term used: copy-right.-Concern about the author came later: 1690: Lockean theory of labour.-1710: Statute of Anne, statutory basis of copyright law.-1774: Donaldson and Beckett: put an end to the debate of the existence of natural right in CML v-a-v copyright: while such natural rights existed, the statute of Anne precedes them, and thus supersedes them. Accordingly copyrights only extend for 21 years. NO more consideration of the natural right of authors (although this was just in England, debate about natural rights of authors continued in continental Europe, including in the work of Hegel.) -Utilitarian base copyright regimes exist and are in effect is all ex-brit colonies.

A) Copyrights

Sherman and Bentley, "The Making of Modern Intellectual Property Law", p. 171-by admitting that copying need not imply that the works be identical, the law necessarily moved from the concrete to the abstract, from the relative security of the text or the external appearance of the design and the machine to the shadowy ephemeral world of the essence of the creation.-One of the primary tasks that confronts IP law is that of recreating or locating the essence of the creation. So, for example, before being able to determine whether the property interest has been appropriated the law first ahs to locate and identify the essence of the intangible property.

Gilliam v. American Broadcasting Companies (1976) Fed Cir., p. 172Facts:-Monty Python agreed to allow BBC to license the transmission of its programs overseas.-Monty Python retained all CR, and requested that any modification of its shows be submitted to them for approval. BBC licensed ABC / Time Life to broadcast shows in USA. ABC edited the program before airing, without the approval of MPIssue: Can MP get an injunction to stop airing of edited shows? Held: yesRatio:-Ability of CR holder to control his work remains paramount in CR law-CR in underlying script survives intact, despite the incorporation of that work into a derivative work.-Although licensees are entitled to some degree of latitude, they may not mutilate the work while presenting it to the public.-"If the proprietor of the derivative work is licensed by the proprietor of the copyright in the underlying work to vend or distribute the derivative work to third parties, those parties will, of course, suffer no liability for their use of the underlying work consistent with the license to the proprietor of the derivative work. … One who obtains permission to use a copyrighted script in the production of a derivative work,

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however, may not exceed the specific purpose for which permission was granted." For this reason, claim that BBC when it licensed the episodes to ABC gave it right to edit is no good: BBC was not entitled to make unilateral changes in the script and was not specifically empowered to alter the recordings once made: a grantor may not convey greater rights than it own.-The cause of action which seeks redress for the determination of an artist’s work finds its roots in the continental concept of droit moral, or moral right, which may be summarized as including the right of the artist to have his work attributed to him in the form in which he create it. Note that such moral right does not exist in USA, so MP cannot claim it.-Here, misrepresentation is used in lieu of moral rights: negative passing off was used: edited version by ABC misrepresented MP to the public. This allows people, like MP, to still obtain protection from distortion in absence of moral right.Comments:-Negative Passing Off: the artist has the right to be linked to his work in its original form bc it otherwise this would be a misrepresentation: quality of the work might be substantially different and as such, the artist might be deprived of a potential market. -This case allows the US to say that they have incorporated the notion of droit moral in their law, and therefore are in accordance with the Berne convention. However, all this case does is equate the droit moral with misrepresentation.-ABC cut out scenes that they thought would offend sensibilities of American viewers. MP objected and tried to get an injunction and then sought damages: breach of copyright, mutilation of the work, distortion of the work. -What did the court do in the USA (since at time no recognition of moral rights)? It reframe moral rights into economic rights: goal of artist is to make money; need to have sufficient control of the work to get an audience; must have in the copyright the right to ensure that the quality of the work is not altered in such a way that would misrepresent work to potential audience; ABC has breached economic right to accurate representation for the purposes of gain an audience/following.-Berne Convention: discussion of the moral rights of authors; Canada is a signatory and so a moral rights provision was written into our statute. USA has refused to sign the Berne for a long time (precisely because of the recognition of moral rights), but TRIPS convention required signatories to comply with Berne convention, so now USA complies with it, even if it has not amended its CA.-USA argues that Gillian proves that they comply with Berne convention.-Gillian is about what is included in the copyright protection, Theberge is about what is meant by an infringement.

Prise de Parole v. Guerin (1995) Fed. Court Justice, Canada, p. 181:Facts: Author write North Ontario story in French for gr. 9 students and assigns copyright to Prise. Guerin incorporates 1/3rd of his story in a book for gr. 8 and publishes. G never got permission from P, so there is an infringement. In addition, author says that the editing was done in such a way that he felt appalled and disturbed and did not want to be associated with the work. His sales plummeted but not his speaking engagements.Issue/ Held: Is there a breach of CR? Yes, they published the extract without permission of P or the author.Ratio:-Injunction and exemplary damages awarded S. 34 ( see BCAA)- Is there a breach of Moral rights? No, although the author showed that his novel was substantially modified without his knowledge, he has not shown, objectively, any prejudice to his honour and reputation = his number of speaking engagements did not plummet, he was not ridiculed by peers etc.-In this context, author, even if assigned CR, could still claim against G for infringement of moral rights, cause these cannot be assigned (can be waived, however, which was not the case here).-Test: To have a case, author must show, objectively, under s. 28.2 (1) that

The work was distorted, mutilated, or otherwise modified

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To the prejudice of the author’s honour or reputation-Clearly, he was subjectively hurt, but that is not enough to find moral right violation.

Computer Associates v. Altai (1992) Fed Cir., p. 186:-Issue: How similar are the two computer programs? More generally, how to determine infringement of a copyright over a computer program? Difficulty lies in that certain commands are necessary or common to all computer programs, so need to distinguish what exactly is covered by the copyright.-Ratio:TEST:

Determine whether the object is entitled to CR as a whole Then determine whether the allegedly infringing product is equivalent or represents a substantial

part of the CR program. Process is abstraction → filtration → comparison (Applied in Delrina) In ascertaining substantial similarity under this approach, a court would first break down the

allegedly infringed program into its constituent structural parts. Then by examining each of these parts for such things as incorporated ideas, expression that is necessarily incidental to those ideas, and elements that are taken from the public domain, a court would then be able to sift out all non-protectable material. Left with a kernel or possible kernels, of creative expression after following this process of elimination, the court's last step would be to compare this material with the structure of an allegedly infringing program.

Step1: Abstraction test: Upon any work a great number of patterns of increasing generality will fit equally well, but there is a point in this series of abstractions where they are no longer protected, since otherwise the author could prevent the use of his 'ideas' to which, apart from their expression, his property is never extended. Accordingly, the court should dissect the allegedly copied program's structure and isolate each level of abstraction contained within.

Separate idea from expression Begin with the code and end with the articulation of the program’s ultimate

function

Step 2: Filtration: Process entails examining the structural components at each level of abstraction to determine whether their particular inclusion at that level was 'idea' or was dictated by other considerations. Serves the purpose of defining the scope of the copyright in weaving out unnecessary elements.-Sift out all unprotected material: These are

Elements taken from the public domain (Incorporated ideas and Expressions that are necessarily incidental to those ideas (Nichols))

Elements dictated by efficiency (there is only one way of expressing those ideas)- Merger doctrine

Elements dictated by external factors (can the consumer use my program if written otherwise?)

Step 3: Comparison: Compare what remains of the allegedly infringed program with the program that

allegedly infringes. The result of this comparison will determine whether the protectable elements of

the programs at issue are substantially similar to warrant a finding of infringement.

-1980 saw the extension of copyrights to cover computer programs. Delvino case was decided recently, but it is not clear where the case (note that it does seems to follow the US approach).-Case in US: how was copyright modified in order to accommodate computer programs? Nichols notions developed: court must do 3 things:

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Abstract: look at the program not just at literal code level, but also at basic functions: map out the different axes of analysis

Filtration: Get rid of stuff that any other program would include: remove the more obvious levels by looking at the nature of computer programs. Ask what particular elements involve creativity? If any other computer program would have used code, then get rid of it.

Comparison: compare the infringing and original program: is there substantial similarities?

-If did this to other works (such as paintings), copyright would be overprotective: this analysis only applies to computer programs.-Note that it does look a lot like what we do for patent infringement: use of person trained in the art to define the contours of a patent claim.

B) Trademarks

Sherman & Bently, “The Making of Modern IP Law”, p. 194:-When modern IP law first took shape in the 1850s, TM law was not recognized or indeed even considered as a possible candidate for inclusion.-Over the second half of the 19th c, TM law came to take shape as a discrete and recognized area of law. A number of factors provided the impetus for the crystallization of modern TM law:

Growing recognition and use of marks in commercial practice led to increased specialization in this field.

The above heightened the call for recognition of TMs as a separate area of law and for the introduction of a registration system.

Growing importance of foreign markets to Brit industry required that law be set out in greater details.

-With the dev of TM law came arguments that it should be included in IP regime of copyright, patents and designs. 2 reasons were given why this should not be the case:

TM dealt with pre-existing subject matter rather than the creation of new material TM law is more concerned with regulating fraud than property

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Frank Reddaway Co. v. Georges Banham, 1896, House of Lords, p. 198Facts: “Camel Hair Belting” is what Reddaway calls his products made out of camel hair. In the trade, it is now well received that “camel hair belt” refers to Reddaway’s products. R therefore has Goodwill and reputation. Banham, ex-employee of R, now makes his own camel hair belts and calls them by that name. Issue:

Is Banham passing off his product as Reddaway’s with the purpose of benefiting from it? Yes

Is ‘camel hair belt’ a generic name (i.e. descriptive): no, might have been at first but acquired secondary meaning over time.

Held:-there is ample evidence to justify that, amongst those who were purchasers of such goods, the words “Camel Hair” were not applied to belting made of that material in general, but belting made by the particular manufacturer: Reddaway.Ratio:-Passing-off is an issue of Commercial Morality -Test:

When the term is new or the term has acquired secondary meaning, only proof of misrepresentation/ confusion (passing off ) is necessary

When the term is generic, proof of goodwill is necessary otherwise, you cannot prohibit others from using the same term if said use is not intended to mislead the public.

-Focus on the end user (the consumer) to make sure that they are not misled and recognize that the trader has an interest as well.-“The name of a person, or words forming part of the common stock of language, may become so far associated with the goods of a particular maker that it is capable of proof that the use of them by themselves without explanation or qualification by another manufacturer would deceive a purchaser into the belief that he was getting the goods of A when he was really getting the goods of B”.-“a word may acquire in a trade a secondary signification differing from its primary one, and that if it is used to persons in the trade who will understand it, and be known and intended to understand it in its secondary sense, it will nonetheless be a falsehood that in its primary sense it may be true.”Comment:-Case establishes that ordinary words that would not normally be susceptible of protection thru TM law can acquire secondary meanings over time, i.e. become distinctive as opposed to merely descriptive, and thus become susceptible of protection.

Institut National des Appellations d’Origine des Vins et Eaux de vie v. Andre Wines, 1987, CA Ont, leave to appeal to SCC refused, p. 203 :Facts: Pf (Institut) is suing because the def is selling a sparkling wine called ‘canadian Champagne’. Pf argues that the appellation champagne is specific to the region of France where it is produced, and denotes a particular product of a particular quality. By calling the product ‘Canadian Champagne’, the def is passing off a product that, in the minds of consumers, will be assumed to be of the same quality and process as that of France. Thus this is not a traditional issue of PO, since the def is not saying that its products are that of the pf, but rather a modified PO, whereby the def is using a term the pf believes it has exclusive rights to use. What pf is seeking to distinguish is a particular source, mode of production, origin, and quality over another; pf fears dilution of label “Champagne” and confusion.Issue/Held: Are the defs liable for the tort of passing off pursuant to the use of the name “Champagne” on their product? No.-Ratio:-To succeed the pf must establish that the def :

Misrepresented their products as being sparkling wines known as “Champagne”. The misrepresentation is calculated to deceive the public into thinking the Cdn

product is champagne. The conduct has or will injure the goodwill of the pf.

-Factual considerations:-“CAD champagne” is marked in accordance with Canadian policy (Food and Drug Act 1970 sec 5(1,2))

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-Consumer unlikely to be mislead: 100 years of sale of CAD champagne: it has developed its own reputation and

goodwill Cheaper: Price difference (its competing with other CAD producers, not French) Consumer more educated now than ever before Consumer never complained

-Sale of Can Champagne has not hurt the trade of French Champagne There is no demonstration of actual financial loss Their sales have increased alongside those of CAD champagne

-The CAD have no intention to pass off their produce as another one. That is evidence of good faith.-Finally, there has been some dilution of the name champagne already (market in the USA and other place sometimes used to word: ‘champagne’ is not consistently used as an appellation specifically referring to the product of the pf)-So essentially, the court concludes that there has been no confusion on the part of consumers, and so the pf failed to prove one of the elements of PO.Comment:-There is some discussion in the case of the notion of ‘shared goodwill’, which is now accepted by the courts.-CAD admitted benefiting from the reputation of Champagne-Much like there is no evidence of confusion, there is no evidence of a lack of confusion-Case stands for the idea that passing off is not just a question of advertising one’s products as that of someone else: it really is about the intentional confusion that is likely to result in the minds of consumers in terms of thinking that they get one product but in fact obtain a different one, regardless of how this confusion is achieved. Also about the idea that passing off can be recognized in the depreciation of the goodwill attached to a particular product when the depreciation is the result of confusion caused by def.

Eli Lilly v. Novopharm, 1997, Federal Court of Canada, Trial Division Ont, p. 224:Facts: Lilly sells Prozac in capsules that are green and cream coloured. Patent expires, and Novapharm starts selling Prozac (not the actual one, but a substitute) as a generic replacement of Lilly’s drug, in capsules that are of the same colour and size. Lilly sues arguing that the colour and size of the capsule are a TM and that Novapharm is PO.Issue: Essentially, is Lilly’s claim of PO valid?

Has Lilly established that it had goodwill in its product (i.e. that the colour of its pill became associated in the minds of consumers with its product)?

Is there or would there be confusion if Novopharm was allowed to sell its capsules?Held: Lilly has failed to prove that it had goodwill, and in any event there would be no confusion between Lilly and Novopharm’s capsule.-Lilly has not established that the appearance of its capsule has acquired the requisite reputation in the market place as a distinguishing feature of its product. The appearance of the def’s capsule does not operate to lead a customer to request the products of the def rather than those of the pf. The capsule’s similar appearances do not increase the likelihood of confusion.

Ratio: 1- Establish Good Will 2- Establish P-O

-Which user might be confused? The physician? The pharmacist? The consumer? Only the consumer in this case might be confused, but there is no such likelihood as the consumer very often is not aware who the manufacturer is, and cares even less.-Lilly failed to provide any kind of statistical evidence showing confusion-There is also little evidence that the colour of the capsule is associated with the particular product (medication contained therein). Even if it had been so associated, the defs chose to use the same capsule colours as the pfs, and they did so for a marketing reason but that reason is to identify the medicine as one that is therapeutically equivalent to the def’s product, not to represent to the public that their products are the pf’s products. This speaks to intent (despite the fact that intention to deceive need not be proven in a case of PO, all that needs to be proven is the likelihood of confusion).

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Comment:-Case is about TM over get-up (recall Lego and the Reckitt), and in the case of prescription drugs, colours and shapes of the pills do not qualify as distinctive. Case is also about the consideration of the appropriate consumer market in order to establish confusion: here it was the ultimate consumers, cause doctors, pharmacists and nurses are not likely to confuse one drug for another. But the court found that the ultimate consumer, in terms of prescription drugs where he/she has very little choice in terms of what he/she purchases (drug is prescribed by doc and stocked by pharmacists), was not likely to be confused cause most likely would not even know (or care) about the drug company.

C) Patents

Edward Coke, “The third part of the Institutes of the Laws of England”, p. 244-Monopolies are contrary to “the ancient and fundamental laws”, and are punishable by law-Recognition that a balance must be struck in rewarding privileges to inventor/new manufacturer (so that the inventiveness may be rewarded and so to encourage others to be inventive) and the public (so that the public can benefit from the invention) -The protective period should not be too long to protect the private privilege-Coke lists 7 terms for the manufacturer to comply with in order to obtain a patent: If any of these are missing, the patent will be declared void pursuant to the Act Against Monopolies

1. Must be for 21 years or under2. It must be granted to the first and the true inventor3. It cannot be an invention which is already protected by patent4. The privilege cannot be contrary to law. This means it must be a new invention. One cannot

obtain a patent for a mere improvement or addition to a patented invention. The invention must be completely new (NOTE: this is no longer the case in Canada: one can patent an improvement over an invention).

5. The invention cannot be harmful to consumers. (Prof. Gold states this is usually never enforced)6. The invention cannot be harmful to the trade

SKIPPED CAUSE OLD ENGLISH

Sherman & Bently, “The Making of Modern IP Law”, p. 248:-Creativity and IP-Although it was not until the early part of the 19th c that the language of creativity was used with any degree of consistency, the common denominator which untied patent law, literary property and indeed all areas of law which granted property rights in mental labour was a shared concern with creativity.-In addition to being unified by a common concern with creative labour, another important feature of pre-modern IP law was that the various areas of law also came to embody and share a particular image of what it meant to create.-In the same way as literary property law distinguished between ideas and their expression, patentable inventions were juxtaposed against non-patentable discoveries.-Webster: a discovery is one thing, an invention another. The discoverer is one who discloses something which exits in nature, such discovery never was and never ought to be the subject of a patent. It is not possible to invent a law of nature or a general rule of physics, they can only be discovered.-What then was required in order to move from the realm of discovery to that of invention? The simple answer was that it was necessary to show that abstract principles had been reduced to practice, that Nature had been individualized or activated.-While philosophical or abstract principles could not on their own be patented, their embodiment in a material or practical form could. In these circumstances it was clear that in law it was the artificial or created nature of the final product, its distance from Nature, which ensured that an object became an invention rather than a mere discovery.-IN essence, what IP law protected was the creative or human element embodied in the resulting product.Comment:-Article talks about the perception that what is patentable is the creative application of general principles, not the principles themselves. Much like in copyright, what is protected in patents is the

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creative aspect, the expression of the principle if you will, not the principle/idea itself.

Sherman & Bently, “The Making of Modern IP Law”, p. 250:-A fear of judgment:-While in its pre-modern guise the law had been more than willing to differentiate between different works on the basis of their quality, and to exclude what it regarded as trivial or undeserving, over time the law grew wary of such evaluative processes.-If we take the case of patents, there were many situations in the 18th c and first half of the 19th c where the law explicitly passed judgment as to the quality of inventions and where it tried to exclude from its ambit what were seen as non-deserving creations.-In the 19th c it was the quality of what was registered that mattered most. -Similar processes were at play with copyrights and designs.-It was then asked during the middle of the 19th c whether it was appropriate for the law to engage in such speculative activities. This grew over time into a fear of passing judgment and a fear about making qualitative decisions. It was argued that the law should defer from making decisions of this sort completely. IP law thus came to echo modernism’s fear of being tainted by politics, morality and judgment.-One of the reasons for this change in attitude was the growing belief that the law was ill equipped to engage in subjective and qualitative decision-making.-Instead of the law passing judgment on the quality of particular subject matter, such evaluative decisions were left to entities such as the public and the market.Comment:-Why is it that the law no longer considers the quality aspect of an invention (or even a work of art) in order to determine if it should be subject to legal protection? Cause the law is not equipped to do so. Who’s to say something is useful or artisitic?

NO READINGS DONE BEYOND THIS POINT.

Courts and Institutional Competence

Skipped this entire sectionClass Notes: Friday 18 November 2004:-moving on to introduction of Diamond -Parker: cannot patent a computer program. 1978-1981: policy change: can patent a computer program in USA.-key case between Parker and Fluke (?): Charkrabardy: biological living organism is susceptible of patenting: bacteria : found pre-existing DNA that had characteristic of eating oil: put all these characteristics in one bacteria: did not create the DNA, all he did was take the characteristics and put it in one product.-Funk Brothers: case from the 50s: family of bacteria to be patented: mixture of bacteria that could ??? : tried to patent: NO: court says that inventor did not create the bacterias, they are products of nature, and no matter how you organize them, cannot be patented.-in both above cases, there is a technological difference in terms of what human intervention was, but in both cases the action is reorganizing the bacteria that already existed. Supreme Court decided that C could be patented. Court got around Funk Brothers: object of PA is to promote invention, by definition Congress cannot know what the invention will be (otherwise no novelty), and so the PA contemplates inventions that are unknown, so cannot use legislation to prevent patents: unless legislation expressly says no patents for this, then one can patent.

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-Point of this: unless legislation expressly prohibits a patent over something, then one can patent as long as human intervention is needed. This was undoing Funk Brothers.-Diamond: 70s: case deals with DNA: scientific community declare moratorium on genetic research-case of C put much pressure on other jurisdiction to reform this aspect of patent law: this resulted in the development of biotechnology industry.-Europe started issuing patents over the same material (DNA)

-Harvard College case: application in USA OK, but in Europe no go, cause cannot patent form of life. This decision reversed by European Patent Office cause can patent life-forms if not unethical and useful: this is subject to a number of safeguards.-examiner issued patent, but opposition by Greenpeace: -US patent: 1986-8, Europe refuses but then Board of Appeal: 1990: can patent under European Patent Convention. Examiner issues patent 1992 in Europe, but opposition by Greenpeace 1992-1993, 1998: Directive passed by EU to be implemented by 2000, 2002: opposition decision released: patent is valid but only over rodents, not over all mammals as in initial claim (accepted the opposition by Greenpeace but only over non-rodents: argument was that this was unethical and hurtful to the animals).

-In Canada: decided the issue in 2002: Canada initially rejected the patent (cannot patent a lifeform: policy decision). Harvard College appealed: lost at trial, won at court of appeal. SCC decides: December decision: 4-5 split with all civilians on the same side and common law judges on the other: majority (Bastarache): this is complicated issue, not for the court, only Parliament can make a judgment call (cause not just a question of whether or not can patent, but rather if patent under what terms) and so court is not competent to decide the issue. -Minority (Binnie): biotechnology is big business, all partners (USA, Japan, Europe) have allowed this, so should we: allow patents over high forms of life. Note that the fine determinations should be left to Parliament, but we can decide whether or not life forms can be patented.-2 resignations : Lamer and L’Heureux-Dube (both part of the majority). Following resignations, majority became minority and vice versa (this is Schmeiser).

Alternatives to IP Regimes

A) Formal Regulation -Competition law: seeking to ensure that no one abuses his powers in the market place. This is not the concern of IP, but when IP is seen as regulating IP commercialization, then commercial regime comes into play.-Competition Law has been part of patent law since the very beginning. There used to be a distrust of monopolies (any property right) – refer to the statute of monopolies. -Change in attitude; competitions bureau came to understand that IP can be seen as pro-competition: it creates a market for similar products. But in certain circumstances, it can do the opposite: you can use your IP right in such a way as to prevent competitors from entering the market. The goal of the competition law is to prevent the illegitimate use of market power.

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-Thus competition law can come into play when granted IP rights are used in un-competitive and unfair manner, when the rights are abused.

-s. 77 of Competition Act regulates IP, but does so only generally as it does any other regime. Another more pertinent section is section 32: deals specifically with IP: exercise of exclusive rights by virtue of Copyrights, Patents, and TM. The mere exercise of your right to license or not are OK (so says the Competition Office); something that would go against competition has to go beyond the mere exercise of exclusive rights. Competition Office looks for something more to give effect to s. 32: have to really interfere with the market. Not much case law on the subject (Nutrasweet, Time): this is because it is not often that the exercise of IP rights has an effect on the market such that the Comp Bureau would intervene. -Reason why the Competition bureau does not interfere frequently: s. 32 was enacted in early 20th c: Bureau concerned, at the time, about any monopolies. In 80 and 90s: exclusive right is seen as promoting competition: innovation increases competition, and innovation is the cornerstone of IP law: thus allocation of exclusive IP rights is pro-competition.-What the bureau looks at is the end result on the market: is there competition in the final market? If so, then the possession of an exclusive IP right should not be of concern to the Bureau.-Note that the perception that exclusive IP rights encourage innovation and competition is an assumption: there is no empirical evidence that it does so in actuality.

Trebilcock, “Competition Policy and IP Rights, p. 315: Conclusions: -p. 316: “The IPR awarded under patent law attempts to strike the appropriate balance between these competing concerns by limiting the scope and duration of exclusive rights, and therefore the innovator’s reward, by restricting certain practices involve IPRs.”-p. 316 : Simply put, the IP grant seeks to protect property rights, and, in so doing, limits competition. In recent years, this short-run view of competition authorities has gradually been replaced by a longer-term approach that acknowledges that technological progress contributes at least as much to social welfare as does the elimination of allocative inefficiencies from non-competitive prices.-p. ???: IPR and competition policy and complementary ways of achieving efficiency.-p. 336 : “Competition policy should not be based on whether licensing generates too much or too little reward for the innovator’s research efforts, but rather on the efficiency merits of the practice.”-p. 336: “Just as competition law should not attempt to take on the mandate of patent policy in encouraging innovation, patent law should not attempt to rule on anti-competitive practices”-p. 337 “Based on the fact that the two policies (should) strive to strike the efficient balance between dynamic and allocative considerations, this framework recognizes that patent rights promote, rather than hinder, competition. Consequently, unlike the old approach, which undermined patent rights by placing constraints on contractual arrangements, this framework recommends that competition policy work with patent policy to provide adequate incentives for innovators to share their discoveries with others when it is efficient.”o Competition policy should be based on the efficiency merits of the practice as opposed to whether

licensing generates too much or too little reward for the innovator’s research efforts. The basic exclusive rights provided by the patent grant should be respected at all points of the analysis.

o IP differs from other property in its public goods nature – which leads to a different application of competition law in certain instances.

o In many cases the application of the law may be the same as in non-patent cases but certain criteria characteristic of innovations (ex. uncertainty & specific investments) may justify the use of restrictive practices. IP cases may get more leniency than non-IP cases when applying the same laws

o Competition law should not attempt to take on the mandate of patent policy in encouraging innovation.

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Nor should patent law attempt to rule on anticompetitive practices.o Competition policy should work w/ patent policy to provide adequate incentives for innovators to share

their discoveries w/ others when this is efficient. Patent & competition laws should be complimentary to strike a balance b/t dynamic & allocative efficiencies.

-Gold: The only thing authorities should look at is whether there is still competition. As long as there is competition in that market, then the use of IP rights should not concern us from a competition point of view.

Volkswagen Canada v. Access International Automotive, 2001, FCA, p. 338:-Case is about the use of TM by Volkswagen to prevent Access from selling Volks parts with the logo on it. Essentially, the argument of Access is that the use of CR and TM by Volks Canada is a restriction on trade contrary to Competition Act, s. 32(1). Court decides that Access can make this claim in its statement of defense.-Here s. 32 is involved in an indirect way: Volks Canada is a subsidiary of Volkswagen German Company. Volks Canada has exclusive right to sell car in Canada, including parts. All IP property belongs to German Volks. Another company, Access Imports, went overseas to buy Volks parts in sealed boxes, and imported the parts in Canada to sell them at a lower price than Volks Canada sold them. -Volks Canada: obtained a transfer of the CR from German company and sued under copyrights. S. 27(2) CA: infringement of copyright for any person to import in Canada X to sell into Canada. -Note that Access is not reproducing the work, but is importing parts that use the logo, and if they made use of this logo in Canada, it would be reproduction. -Access says: this is abusive, and this is not permitted by the CA: unfairly limiting competition thru the CA, so violation of Competition Act. At Federal Court of Appeal: Access is not allowed to plead Competition act because of procedural requirements, but here we are in the territory of equity. And so if in breach of competition act, if action is anti-competitive, under clean hands doctrine, Volks Canada cannot come to court to have a ruling in its favour. -Note that Access argued that the only reason for the transfer of the ownership of copyright from German to Canadian Volks was to limit competition in Canada.-This is the best case we have on the issue (interaction of IP rights and competition law), and yet it is still pretty poor.-Another ex: CRTC regulates Canadian content on TV and Radio: this is limitation of exclusive rights? Incentive effect on Canadian artists wishing to get their start: incentive to create: not property or exclusivity rationale

-Volks is also a case about gray marketing: buy a legitimate product in a particular market, and then sell product in another jurisdiction where one does not necessarily have the right to sell (this comes from the fact that IP regimes are nationally based): the product is legitimate, but the act of selling might be infringement of right holder in the other country. In the casebook, cases dealing with grey marketing are approached under TM. This is a big issue in terms of pharmaceuticals.

Heinz Canada v. Edan Foods Sales, 1991, Fed Ct Canada, p. 352:Facts: Heinz Canada produces ketchup using a different recipe than Heinz USA. They have tailored their recipe to Canadian taste through huge expenditure. Even the packaging is designed differently, with the CAD consumer in mind. Edan foods bought shipments from the US and distributed them in CAD at cost

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saving, in the same stores where Heinz CAD distributes. Heinz CAD is suing for TM infringement and asking for an interlocutory injunction: it claims that Heinz US is not licensed by Heinz CAD to use Heinz Trademark in CAD. Heinz CAD buys 40% of Canadian tomatoes.Issue: Can the exclusive CAD license block the sale of that product in this country? YesHeld: The TM was under the control of Heinz CAD already (distinction with VW CAD) Ratio: TM infringement granted because Edan was using Heinz’s goodwill to sell its products in CAD.

-Edan purchased ketchup in the USA from retailer that purchased it from Heinz USA, and then brought it to Canada and sold it despite TM right of Heinz Canada. Heinz Canada sued: saying we are the TM holder, should not be selling Heinz ketchup in Canada: Egan has no license to sell it. The Court agrees.-The situation would have been different if the Canadian TM had been held by Heinz USA: in such a scenario, there might not have been a problem. But as the Canadian TM was held by a Canadian subsidiary of Heinz USA, then the import of the ketchup was an infringement of the TM.

Breck’s Sporting Goods Co. v. Magder, SCC, 1976, p. 345:Facts: Brecks is the registered TM owner of fishing lures. He has exclusive distribution rights to the lures in CAD. Imports them from France and sells them under the name of “Mepps”. Magder sold Meppes lures in Canada in competition with the appellant, obtaining lures elsewhere than from appellant or from the French manufacturer. Breck brought an infringement action. CAD transferred goodwill and TM of business to US in 1955. The US transferred back the goodwill to CAD in 1959.Held: the TM lacked distinctiveness within the terms of s. 2 (f) and s. 18 (1) (b). His wares could not be distinguished from competitor’s wares and the French manufacturer’s wares at the relevant date.Ratio: - it is not enough for the pl to rely on its registration mark. At the material date the wares were not identified with Breck’s name but rather still associated with the French manufacturer.-According to Gold: the goodwill/ distinctiveness belonged in France, so the Magder, by importing the product from France, was not infringing it. Would the same have been ruled in the VW case had they brought an action in TM?-Magder imported products in Canada despite the holder of the TM in Canada. -The case was decided in 1976: court said: Breck’s was selling the products without being TM holder until 1959. Product was linked to French company, not Canadian company that imported the product. Nothing changed in 1959 when the Canadian company acquired the TM: product in mind of consumer was still associated with French company. -When Magder started importing the products from the French company, no confusion was created in the minds of consumers, because they though the products they were buying came from French company, which ultimately was the case. This case exists, but the tendency of the courts is to go the Heinz way, not the way of this above case.

K LAW AS AN ALTERNATIVE TO IP REGIMES: EX: Domain Names: -Central problem: the can be only one “X.com” in the entire world, but one can have the same TM used in different countries by different actors: because TMs are national in scope. What is the consequence of this on the Internet? From an advertising perspective, the domain name identifies the source and so there is a problem if more than one person wants to register the name “X.com”.

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-Domain name is subject to the same logic as TM: passing off of a similar name that leads to confusion. Problem is that there is no intl jurisdiction over domain names on the Internet.-Scheme proposed: “.com” or “.ca” can only be administered by one agency. One entity has control over the “.whatever”. -ICAN is an agency that regulates the “.com” domain name: one has to be on ICAN’s list of registered owners for people to access a site that ends with ‘.com’. If problems arise, they are solutioned thru K law: ICAN licenses the right to use the domain name, and people can sue for breach of allocation.-This is K law because it is a K that allocates the IP rights, not govt regulation. All that governs the use of the ‘.com’ or ‘.ca’ is the K between the individual and the agency controlling and compiling the domain names.-Note that this is a K of adhesion: if a person wants the name, then that person must agree to the K; there is no means of negotiation. Note also that the process of getting approval for the domain name is usually quite fast.-Thus thru technology, a private agency can regulate the internet, and there is no real need of IP to govern domain names. This may however be problematic in terms of monopoly.

ICANN: Uniform Domain Name Dispute Resolution Policy- Private K using similar terminology and invoking similar notions as the TM Ct- DN names facilitate this: there can only be one person who controls/ administers

the DN: a central registry allows the people who control the registry to impose K-ual obligations: they impose the same ones on everyone else.

- If you DN conflicts with a TM, then the TM owner can complain to an arbitrator at ICAN: and they will issue a decision.

- This K-ual regime is a fabricated regime.- The parties were able to take it out of the hands of the state and lobbying groups- They have instituted provisions to prevent cybersquatters.- A form of Private control: if you control an access point that everybody has to

pass, you can control Domain Names.

ACPA & IP: The Regulation of Domain Nameso Domain names are unique & are to be used by one party to the mutual exclusion of

another party.o Corinthians.com cannot be used in the US to post Biblical messages & used in Brazil

for the promotion of a soccer team.o ICANN: not-for-profit corporation that administers the domain name systemo Cybersquatting : individuals register Internet domain names in violation of the rights

of TM owners.o Reverse domain name hijacking : TM owners abusively assert their TM rights to strip

domain names from rightful owners. Some TM owners find accusations of cybersquatting a convenient way to bypass legit disputes over TM rights.

Uniform Domain Name Dispute Resolution Policy (UDRP)

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o Governs allegations by 3rd party TM holders asserting that a registrant has engaged in ‘cybersquatting’

o Registrant is req’ed to submit mandatory administration proceeding in the event that a 3rd party …asserts, to an ICANN-approved administrative dispute resolution service provider1. The registrant’s domain name is ‘identical or confusingly similar to a TM or

service mark in which the complainant has rights’2. The registrant has no rights or legit interests in the domain name3. The registrant’s domain name has been registered & is used in bad faith

-Complainant wins under the UDRP if all 3 aspects listed above are established.

Sallen v. Corinthians Licenciamentos Ltda., 273 F.3d 14 (1st Cir. 2001), p. 357-Dispute b/t Sallen & CL over Sallen’s registration & use of the domain name corinthians.com. WIPO ruled under UDRP in favour of CL.Issue: Can Sallen invoke US law to reverse the WIPO decision regarding the use & transfer of his registered domain name? YesNotes: o Should a federal crt declare that Sallen is in compliance w/ the ACPA, that declaration would undercut

the rationale of the WIPO panel discussiono There is a long discussion of US law & subject matter jurisdiction debating whether US law can quash

the WIPO panel.o “a domain name registrant whose name is suspended in an extra-judicial dispute resolution procedure

can seek a declaratory judgment that his use of the name was, in fact, lawful under the TM Act. This clarification is consistent w/ other provisions of the reported bill that seek to protect domain name registrants against overreaching TM owners.”

o “balance the rights of TM owners w/ the interests of Internet users” & “to preserve the rights of Internet users to engage in protected expression online & to make lawful uses of others’ TMs in cyberspace.”

o The applicable US law here serves to create a protection for registrants to counteract abusive behaviour by TM holders. Abuses includes administrative dispute resolution proceedings under the UDRP where the proceedings are intended to strip a domain name from a registrant who has lawfully registered & used the domain name.

o District Crt’s decision is reversed (had decided that the court had no jurisdiction to hear the case, but did not decide on the issue of Sallen’s claim that his domain name did not violate ACPA) & the case is remanded.

o The Anti-Cybersquatting Act says that you can always challenge the decision of a dispute panel through private means

o The goal of the Act is to protect US DN from foreign arbitration and preserve DN in US.

-Some courts have enacted legislation to regulate the various agencies overseeing the attribution of domain names, but of course such courts and legislation only have jurisdiction over the agencies that are located within their territory. Accordingly, an agency cannot be compelled to do something by a foreign govt (so if Canadian tribunal orders ICAN to remove a domain name, ICAN does not have to do it. But if US govt orders the same, since ICAN is in the US, then ICAN has to obey)-In the above case, what was the issue is whether a court has jurisdiction to hear a case involving parties from different jurisdictions. It was also about whether a national court can overturn a decision by an intl body. All that was settled in the case was that the court granted itself the right to hear the case (said it had jurisdiction).

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Browne v. Bluebird Industries, 2002, Domain name Resolution Policy, p. 368:Fact: Browne has created goodwill attached to name Brown. A competitor registered the DN: Browneco.ca. Issue: Is the domain name registered by the competitor confusingly similar to the TM used by Browne such that the DN is likely to be mistaken for the mark?Held: The competitor has registered the DN in bad faith, for the purpose of disrupting the business of Brown.Ratio: -Passing off does not protect the name itself, passing off protects the business reputation, among customers and others dealing with the business, which has become attached to the name through actual use of that name in business activity.-Use is therefore essential to a passing off action-It has been concluded that Brown has used his TM and therefore has a right to it.-Requirements for the complainant to succeed under Domain Name claim:The complainant must prove, on a balance of probabilities that:1- The DN is confusingly similar to the TM.2- DN has to be registered in Bad Faith.3- The person who registers has no legitimate interest in the DN.-The DN is confusingly similar to a Mark if the DN so nearly resembles the mark in appearance, sound or the ideas suggested by the mark as to be likely to be mistaken for the mark.-Interpretation of Confusingly similar:a) Similar: to the mark or name or products or businessb) Confusingly: i) recognizing the wrong of passing off one’s product or business for someone else’s. ii) Statute speaks of the likelihood of causing confusion in the mind of the target consumer.-In passing off law, the inherent lack of distinctiveness of a mark tends to be the threshold question of whether the complainant can establish any rights in the mark.Distinctive in passing off or TM law is the capacity of a mark or name used in the marketplace to point to one, particular product source or business, and so the capacity to distinguish those products or the business from the products of other businesses or from other businesses.-If a mark is inherently not distinctive, complainant may adduce evidence of distinctiveness acquired throughout use: evidence of secondary meaning of the mark (the inherently not distinctive term)-Secondary meaning in this case overcame inherent non-distinctiveness: the relevant group of internet users are likely to associate the Registrant’s domain name with the complainant’s business.-The competitor is in bad faith. Does he have an interest in the domain name? Was not used for the purpose of non-commercial criticism, so he had no legitimate interest in it.

-Competitor of Brown decided to get domain name ‘brown.ca’ on the idea that people who would normally go to brown would end up on its site (competitor’s). That’s a non-no. Rules that are outlined in the case (for a claim of confusing domain name):

1. The domain name must be confusingly similar to the mark being used by the pf2. The party that registered the TM must have done so in bad faith3. The registering party must have no legitimate interest in the domain name.

-All three elements have to be proven for a successful claim. Here the court decided that all three elements were met: court took the domain name away (prevented the def from using it) and gave full use to the pf.

B) Informal Regulation

Jeanne Clark, “Patent Pools: A solution to the Problem of Access in Biotechnology Patents”, p. 384

People’s practice:

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o ICANo Clearing House example

In the music industry, you go to SOCAN (a clearing house). SOCAN licenses to everyone! Good for the industry because it gets the music on the radio and good for the radio because it reduces the transaction cost of going from singer to singer to obtain the permission to air their song without infringing their CR.

o Patent pools Specifically wrt the biotech industry The technology that anyone needs in the industry in order to compete is

placed at the disposal of everyone. The holders of the these important patents obtain royalties, regardless of

how important their patent is in comparison with the rest, they will not obtain more money for it.

A 3rd party expert decides Essence: in US: most agricultural biotech research is done in universities,

and universities don’t grant licenses. KEYPRO: a quasi-private regime: manages all the patents of the

universities and licenses to researchers who want to use the technology for humanitarian purposes

KEYPRO is extra institutional. Other Examples:

o Roosevelt’s intervention during WWII when he threatened all sides with compulsory licensing if they didn’t pull their act together and made airplane technology available to everyone for a basic license fee.

o Same for the radio: under pressure o Same for MPEG and DVD technology: they learned from the VHS and BETA

models: Sony produced BETA and Panasonic produced VHS. It was of lower

quality than BETA. Sony refused to license, but Panasonic widely licensed. Accordingly most consumers got VHS and it killed the market for BETA.

o With MPEG and DVD, it was decided that the approach would be that of Panasonic with VHS:

Everybody placed everything in the patent pool, All got access to everybody else’s technology because Those in the pool had an obligation to licence to all

This system is not done through IP, but again, through private means, like ICAN and SOCAN.

It is premised on the fact that you can still compete even while sharing info (competition is based on the variants that distinguish your product from that of your competitor, even if both products use the same technology).

The advantage is increased and widespread production and sales (presumable for all). The control is by the patent pool owners (administered by a 3rd party) ICAN is formal because it involves formal K-law Patent pooling is highly informal Legal guidelines of the regime which are pro-competitive

o Integrates complementary technologieso Reduces transaction costso Clears blocking positionso Avoids costly infringement litigation and o Promotes the dissemination of technologyo Increases the likelihood that a company will recover some, if not all, of its costs of

research and development effortso Patent pooling is an institutionalized exchange of technical information not covered

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by patents: by fostering lines of communication between members, trade secrets would become less prevalent.

YET patent pools can be anti-competitive as well:o The excluded firms cannot effectively compete in the relevant market for the good

incorporating the licensed technologieso The pool participants collectively possess market power in the relevant market and the

limitations on participation are not reasonably related to the efficient development and exploitation of the pooled technologies

-Conclusion of article: “The use of patent pools in he biotechnology field could serve the interests of both the public and private industry. Public would be served by having ready access with streamlined licensing conditions to a greater amount of proprietary subject matter. Patent holders would be served by greater access to licenses of proprietary subject matter of other patent holders, the generation of affordable pre-packaged patent ‘stacks’ that could be easily licensed, and an additional revenue source for inventions that might not otherwise be developed. The end result is that patent pools, especially in the biotechnology area, can provide for greater innovation, parallel research and development, removal of patent bottleneck, and faster product development.”

-p. 386: Concern over granting patents on biotechnology: “potential lack of reasonable access to that technology for the research and development of commercial products and for further basic biological research.” Possible solution: patent pool-p. 368: Public concerns:

“Many feel that by allowing genetic information to be patented, researchers will no longer have free access to the information and materials necessary to perform biological research.”

“Further, if a single patent holder has a proprietary position on a large number of nucleic acids, they may be in a position to “hold hostage” future research and development efforts.”

“an owner of a patent is likely to make business decisions based upon profitability, and one element of such is the ability to obtain licenses.

-p. 388: “A ‘patent pool’ is an agreement between two or more patent owners to license one or more of their patents to one another or third parties.”-p. 389: Law of patent pool: “Department of Justice and the Federal Trade Commission have recognized that patent pools can have significant procompetitive effects and may improve a business’ ability to survive this era of rapid technological innovation in a global economy”-p. 392 – 394 Benefits of patent pools:

“Elimination of problems caused by ‘blocking’ patents or ‘stacking’ licenses “Potential to significantly reduce several aspects of licensing transaction costs “Distribution of risks” “Institutionalized exchange of technical information not covered by patents”

-p. 394 – 395 Criticisms of patent pools: “Inflate the costs of competitively priced goods” “Shield invalid patents” “Eliminate competition by encouraging collusion and price fixing”

Transnational Aspects of IP Governance

A) Jurisdictional problems-What is the effect of a country’s IP on another country?-We have international conventions, but obligations under them are fairly minimal.-TRIPS is one convention that goes pretty far, and allows countries to give substance to factors that have not been looked into before. For instance, it allows countries to attach a different meaning to novelty requirement etc…-LDC (least developed countries ) recognize that in the short term, IP rights are a harm (because limitation effects on markets and other evils that they create: see for example

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lack of cheap generic drugs to cure illnesses in LDCs), but in the long run, it is better to have IP.-Developing countries make a lot of money off their patents: have much market power since there are few competing products.-Say we have 2 countries, and in one the courts find an infringement, and in the other no infringement, whose country’s regime is going to triumph?

John Perry Barlow, “A Declaration of the Independence of Cyberspace”, p. 396:-Basically argues that cyberspace and the internet is the new frontier, it is not governable in the same way that other territories are, it is in fact impossible to govern it thru traditional means of legislation since it does not exist in one jurisdiction in particular but rather cuts across political and territorial boundaries. -p. 397: “Cyberspace consists of transactions, relationships, and thought itself, arrayed like a standing wave in the web of our communications.”-p. 397: “Your legal concepts of property, expression, identity, movement and context do not apply to us.”

-Barlow asks if there is anything different about cyberspace, and concludes that information wants to be free, that the Internet/cyberspace market will regulate itself so there is no need (nor possibility of) to regulate it. This is part and parcel of the utopian visions of the internet. Few people would accept this vision now, because of the kind of stuff that actually is on the Internet: child porn, online gambling etc require, call for, some regulation of this space, regulation cannot be left to users as some objectives have to take priority.

David R. Johnson, “Law and Borders: The Rise of Law in Cyberspace”, p. 399:-In opposition to Barlow, argues that it is possible to regulate Cyberspace, just that it cannot be done thru the same traditional territorial/physical regulations.-Intro: “Global computer-based communications cut across territorial borders, creating a new realm of human activity and undermining the feasibility, and legitimacy of laws based on geographic boundaries. New rules will emerge to govern a wide range of new phenomena that have no clear parallel in the nonvirtual world”.-p. 399: “Creating a new realm of human activity and undermining the feasibility – and legitimacy – of laws based on geographical boundaries.”-p. 399: “This new boundary defines a distinct Cyberspace that needs and can create its own law and legal institutions.”-p. 399: “New rules will emerge to govern a wide range of new phenomena that have no clear parallel in the non virtual world. These new rules will play the role of law by defining legal personhood and property, resolving disputes, and crystallizing a collective conversation about online participants’ core values”-Conclusion: “The law of any given place must take into account the special characteristics of the space it regulates and the types of persons, places, and things found there. [so it will be with laws that will govern cyberspace].”

“the law of the Net must be prepared to deal with persons who manifest themselves only by means of particular IP, user account, or domain name.”

“Traditional concepts such as ‘equality,’ ‘discrimination,’ or even ‘rights and duties’ may not work as we normally understand them.”

“The boundaries that separate persons and things behave differently in the virtual world but are nonetheless legally significant.”

“If the rules of Cyberspace thus emerge from consensually based rule sets, and the subjects of such laws remain free to move among many differing online spaces, then considering the actions of Cyberspace’s system administrators as the exercise of a power akin to ‘sovereignty’ may be inappropriate.”

“Law, define as a thoughtful group conversation about core values, will persist. But it will not, could not, and should not be the same law as that applicable to physical, geographically-defined

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territories.” If Cyberspace is to recognize the nature of its subjects, it cannot rest on the same doctrines that

give geographically based sovereigns jurisdictions over whole, locatable, physical persons. Similarly, the types of properties that can become the subject of legal discussion in Cyberspace will differ from real world real estate or tangible objects.

The newly emerging law challenges the core idea of a current law-making authority – the territorial nation state, with substantial but legally restrained powers.

When the persons in question are not whole people. Then their property is intangible and portable, and when all concerned may readily escape a jurisdiction they do not find empowering, the relationship between the citizen and the state changes radically.

-Johnson essentially says: if you are going to use the same tools and concepts that are used in the real world, then don’t even try to regulate because the Internet is all over the place, you can’t really pinpoint anybody down in a particular place, and so traditional forms of regulations would be ineffective. However, it is possible to regulate the Internet if we develop appropriate/independent/special rules that take into consideration its nature and scope, the way it functions and operates. Thus it is possible to regulate, just need to figure out how.J. Goldsmith, “Regulating of the Internet: Three Persistent Fallacies” (1998), p. 417: -Article looks at three myths that exist about cyberspace in the int’l context and the challenges these pose to national regulationFallacy 1: Cyberspace is a separate placeo Territorial govs should not regulate internet transaction since internet providers cannot control their

information flow in territorial space b/c information on the net appears simultaneously in all national jurisdictions. Problems of spill-over contributes to the argument for self-regulation of the internet.

o BUT, the net is NOT a separate place: “The problem is that the Net is not a separate place, and Net users are not removed from our world. They are no more removed than telephone users, postal users, or carrier-pigeons users” Real-space communication can cause real-world harms. Moreover, the people harmed by these internet transactions often do not have a voice in the transaction and cannot exit from the private ‘rule-sets’ that facilitate it.

Fallacy 2: Territorial governments cannot regulate the non-territorial neto Claim that restrictive CR will be ineffectual when applied to digital goods on the net. Because

territorial governments with restrictive CR regimes cannot prevent the import of cheap digital goods made offshore in permissive CR territories (because of high traffic over the internet and difficult inspection), the restrictive regimes’ CR restrictions will become useless. Information produces in the restrictive regimes will be forced to lower their prices in order to compete with the offshore goods

o Says that Dan Burk thinks that territorial governments cannot regulate offshore content producers who are beyond the state’s physical control. Second, they think that because territorial governments cannot stop the flow of information packets across territorial boundaries, they cannot regulate the flow of net transactions within their boundaries.

o Sees that Burk is underestimating the many ways that nations can regulate the net.o A nation does not have to inspect every item crossing its borders to effectively regulate the flow of

items within its borders. Instead, it can achieve a great deal of regulatory control over illegal foreign imports by imposing costs on persons and property within its territory. To the extent that these local regulations raise the cost of obtaining foreign content, they regulate the foreign content even though the source of the content is beyond the nation’s control and the nation cannot stop broadcast signals at its borders.

o Nations regulate grey marketing the same way: they wait for it to cross the border and then strike. o Not suggesting that enforcement strategies will eliminate illegal digital imports, but rather that it is

possible to regulate certain aspects of it: the consumers, the providers in the territory. Will not be 100% effective, but then all regulation is imperfect.

o The relevant question is whether these regulatory strategies will heighten the cost of transmitting, obtaining, copying and using digital goods sufficiently to achieve acceptable control over them.

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o How much control is acceptable control? Depends on several factors:1. The normative commitment of the regulating gov: the importance to the gov. of achieving this

type of control.2. The costs the gov is willing to pay to achieve regulation.

o Can regulate thru technology: can block the signal from coming in – tech gives you a basis to regulate.-“Once one recalls that the Net consists of people using equipment in a territory, it becomes clear that the territorial government can exercise force over these people and their equipment to regulate both territorial and extra territorial transactions.”Fallacy 3: Optimism about cheap, plentiful informationo Some say that the internet will foster tolerance, promote democracy, redistribute wealth, improve

writing skills, destroy trade barriers, & bring world peace! [get real]o Just because the access to court decisions and legal doctrine from all over the world is now easier, it

doesn’t mean that this will facilitate the harmonization and the enforcement of international private and public law.

o Harmonization = convergence on a single substantive standard for a particular issue by courts and lawmakers in different territorial jurisdictions.

o While the internet may promote partial harmonization it is by far not going to establish complete harmonization

o Note that judicial decisions are not made in a vacuum. Thus while some states may join in creating a global uniform legal system, national interest will still play a role in judicial decision making.

o Judges will be moved by personal or national biases. While some judges are immune from political pressure, others are sometimes legally barred from following a foreign precedent

o It will not harmonize customary international law (CIL): it is too complex and changing in nature to ever be harmonized by hundreds of actors – internet has probably made the problem worse not better

o Note also that there is the issue of who has access, who connects, and the fact that most users are from developed or nearly developed countries (e.g.: not many users, proportionally speaking, are from sub-Saharan Africa). Also, internet may be used for both legit and illegitimate purposes (ex: use of internet to copy work for a class: not really helping the individual get educated or develop research and writing skills).

-Goldsmith goes against both of the above articles: cyberspace is NOT special, and it should be subject to the same kind of regulatory process as anything else. -While he argues that it would probably not be possible to regulate all the aspects of cyberspace, this is not a justification for not trying: regulation is always difficult, but not impossible. -For example, with respect to illegal imports, the fact that we cannot catch all transactions is not sufficient reason not to try and regulate/prevent their occurrence. The question is can we catch enough of the transactions so that they become more costly (protective measures taken to avoid being caught)? The possibility of increasing the cost of doing things we want prohibited means that the Internet can, even if imperfectly, be regulated. -All 3 authors agree that there is some role for the state and intl agreement and harmonization of cyberspace. -Note that market pressures and the desire to expand in different markets (thinking globally is more significant now because of the existence of the Internet) also forces regulation of Internet: easier to expand if the rules are standardized or harmonized.

-Digital Millennium Copyrights ACT (USA): was enacted in response to the ease in copying digital media: those that want to prevent the copying may be able to use technical innovation to prevent the copying (here penalty is imposed for multiple copies of same product).

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-With respect to the Digital Millennium Copyright Act (USA): govt, in early 1990s, was quite supportive of the music and film industries, and a ‘White Paper on the Internet’ suggested the DMCA to increase the rights of CO holder. Govt tried put forward equivalent of DMCA but failed.-The USA govt eventually managed to get DMCA passed as part of an international agreement implementing WIPO. Why? Cause as a trade agreement, Congress has to accept the entire package, not just bits and parts of it. Initially failed (DMCA) cause opposition by academics and students and universities and others, but since passed as part of intl agreement, then the voice of dissent was lessened.-This brings back into play the issue of fair use and fair dealing: if technology does not allow one to make fair use or dealing, then one is limiting the right of the public and offsetting the balance/convention that is supposed to be at the heart of the relationship between the copyright holder and the public.-Speedbump analogy: one does not have to make laws to limit speeding to 30 km/hour if there are speedbumps along the way. By analogy, this rule applies to IP: no need to make a law if there are technological speedbumps that affect the same purpose as the law would (such as the inability to copy material for the purposes of fair dealing or fair use thru technology). In other words, one does not have to worry about the law as long as there are effective technological barriers that can affect the same ends. This is really, however, a half-ass approach that in the long run is not that effective, since technological advances one way are usually counterweighted by advances in the opposite direction.

Graeme B. Dinwoodie, “A New Copyright Order: Why National Courts Should Create Global Norms”, p. 423:Intro:-p. 424:

“But what does it mean to develop international solutions, and how is such internationalization to be achieved?”

“First, copyright law must accommodate and respond to technological developments; second, copyright law is an essential instrument of national cultural and information policy; and, third, copyright law affects an ever larger and more diverse set of societal interests.”

“I conclude in Part II that although classical public international copyright lawmaking affords great latitude for national heterogeneity, and does not inherently or affirmatively exclude diverse perspectives, it fails adequately to reflect the first of these concerns [responsiveness/pro-activeness]. As a result, its backward-looking character, public international lawmaking adopts a codifying rather than dynamic character.”

-p. 425: “I argue, however, that an affective use of WTO dispute settlement proceedings, or more

importantly the adoption of an activist interpretive philosophy by parcels that are convened under WTO auspices, would be counter-productive. It might supply the dynamism missing from the classical model, but it would do so at the cost of other relevant concerns, namely national diversity and pluralistic perspective.”

“In particular, I stress that the internationalization of copyright law may take forms other than formal declarations of binding rules of public international law, and suggest that the properly confined role of public international copyright lawmaking should consciously be supplemented by private international copyright lawmaking.”

-p. 426: “I conclude that the use of cybercontractual arrangements in the supply of copyrighted works

makes arbitration based on ex ante agreement a more likely resource for copyright development than was previously the case because such arrangements create contractual privity between copyright disputants typically not found in the breaks-and-mortar world.

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“I propose that courts should decide international copyright cases not by choosing an applicable law, but by devising an applicable solution. […] National courts should thus be free to decide an issue in an international case using different substantive copyright rules that reflect not only a single national law, but rather the values of all interested systems (national and international) that may have a prescriptive claim on the outcome.’

Conclusion:-p. 478

“We need a broader understanding of international copyright lawmaking.” “These include not only the traditional public lawmaking vehicles of the WIPO and other

international copyright institutions, but also private law mechanisms.” “National courts have a role to play in the creation, recognition, and enforcement of global

norms.”

Wendy A. Adams, “Intellectual Property Infringement in Global Networks: The Implications of Protection Ahead of the Curve”, p. 479:Intro:-p. 480:“The TRIPS Agreement sought to harmonize intellectual property norms by imposing universal minimum standards of protection to be implemented within the domestic legal systems of Member states.”“The TRIPS Agreement exerts a harmonizing influence, but does not mandate uniform law.”“A Member state […] cannot compel other Member states to recognize heightened levels of protection when domestic goods are subsequently exported to foreign states.”“The result would be to return to a Member state to a pre-TRIPS position.”-p. 481: “The equally rapid place of technological development, however, particularly in relation to online commercial activity, calls into question to relevancy of the TRIPS Agreement.”-p. 482: “In applying domestic intellectual property norms to protect the interests of local commercial interests, an excess of jurisdiction would overcompensate local innovators at the expense of foreign imitators, while a jurisdictional deficit would reach the opposite result.”“The first objective is to refocus attention on a question left unanswered when the TRIPS Agreement was promulgated […] The second objective is to assess the alternatives available within both private and public international law to address the adverse impact of regulatory diversity in virtual markets.”-p. 483: “Part II of this paper sets out the relationship between territorial intellectual property rights and minimum standards of protection, demonstrating that in circumstances of jurisdictional ambiguity, conventional wisdom concerning the efficacy of open-ended standards and viability of protection ahead of the curve is displaced.”-p. 484:“Part III examines supporting illustrative cases wherein new technologies are accorded heightened levels of protection relative to prescribed international norms with mixed results. “Part IV considers the viability of private international law to address this perceived enforcement gap whereby innovators attempt to create conditions of legal certainty in multi-jurisdictional intellectual property transactions, notwithstanding the presence of regulator diversity.”“In Part V, arguments are presented in favor of the WTO as the preferred institutional framework to address international intellectual property enforcement issues in the context of online commercial transactions.”Conclusion: -p. 524:“[T]he TRIPS Agreement established comprehensive minimum standards of protection binding on Member states [… but …] the prescribed minimum standards do no equate to global law.”“Thus innovators could protect against competition locally, but could not rely on heightened levels of protection to establish comparative advantage internationally.”-p. 525:“Domestic courts lack the necessary institutional competence to address the complexities introduced by the integration of intellectual property within international trade law.”

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“These multi-lateral arrangements nonetheless do possess the necessary institutional competence to balance the competing interests involved in a manner that both protects the proprietary entitlements of private actors and addressed the concerns of states located on the less privileged side of the digital divide.”-One countries IP regime may have negative effects on someone else’s (high protection afforded, inability to enter the market). Conversely, one’s IP rights can also have a positive effect on someone else’s rights, one can benefit from another country’s IP regime (higher protection, less chance of reverse engineering).

B) Regulatory institutions

J.H. Reichman, “Compliance with the TRIPS Agreement: Intro to a Scholarly Debate”, p. 526:

Michael P. Ryan, The Function-specific and Linkage-bargain Diplomacy of International Intellectual Property Lawmaking”, p. 537-p. 538: “though many observers opined that the TRIPS agreement at GATT indicated that function-specific intellectual property diplomacy at WIPO was dead, within two years two new treaties were signed at WIPO, offering excellent contemporary opportunity to assess the function-specific and linkage-bargain diplomacy of international intellectual property.”-p. 562:

“Function-specific diplomacy contributes learning capacity to international lawmaking.” “Linkage-bargaining diplomacy contributes multiple policy issues to international lawmaking.” “Function-specific diplomacy is the grist of the law-creation mill; linkage bargain diplomacy fixes

the breakdowns.” “They will consider both their bargaining rules and technical, functional expertise when planning

future multilateral negotiations.”

Laurence R. Helfer, Regime Shifting: The TRIPs Agreement and New Dynamics of International Intellectual Property Lawmaking, p. 563Intro:-p. 563: “It contains detailed, comprehensive substantive rules and is linked to the WTO’s comparatively hard-edged dispute settlement system in which treaty bargains are enforced through mandatory adjudication backed up by the threat of retaliatory sanctions.”-p. 564:

“as part of a WTO package deal in which developing countries receive freer access to the markets of industrialized nations in exchange for their agreement to protect the intellectual property rights of foreign nationals.”

“‘The relevance of TRIPs is highly questionable for large parts of the developing world’”-p. 565:

“It grants least developed countries an additional ten years before they must protect pharmaceuticals, and it reaffirms the principle of balanced intellectual property protection already embedded in various clauses of TRIPS.”

“I argue that the expansion of intellectual property lawmaking into these diverse international forum a is the result of a strategy of ‘regime shifting’ by developing countries and NGOs that are dissatisfied with many provisions in the TRIPs or its omission of other issues and are actively seeking ways to recalibrate, revise, or supplement the treaty.”

-p. 567: “Part II […] describes the substantive, institutional and relational components of a regime and

explains the diverse constituent principles, norms, and rules by shifting from one discrete regime to another or between for a within the same conglomerate regime.”

“Part III analyses the unexpected growth of intellectual property lawmaking in four international

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regimes: biodiversity, plant genetic resources, public health, and human rights.” “Part IV first revisits the public choice dimension of regime shifting, identifying the domestic and

transnational interest groups who are pressing developing states to engage in intellectual property regime shifting.”

“Part V assesses the empirical evidence of this integrationist regime shifting strategy.” “Part VI considers the broader consequences of a world in which the principles, norms and rules

of intellectual property protection are created and contested in multiple international regimes.Conclusion:-p. 603:

“It argues that the recent expansion of intellectual property lawmaking into new international venues is the result of regime shifting by state and nonstate actors who are dissatisfied with many of the intellectual property treaty bargains negotiated by WTO members and are actively seeking ways to revise or supplement them.”

“In particular, the division of authority and competition among for a regime shifting may engender creates both opportunities and risks. It opens up lawmaking and dispute settlement to new perspectives and avenues or influence […] but increases the likelihood of conflicting or incoherent legal obligations for states and private parties.”

Implications of Changes

Robert K. Paterson and Dennis S. Karjala, Looking Beyond Intellectual Property Resolving Protection of the Intangible Cultural Heritage of Indigenous Peoples, p.605:Intro:-p. 605 :

“In this case commodification can be defined as the conversion of intangible cultural property into items of economic worth that can be traded for commercial gain by such means as license, rental or sale.”

“The catch-22 is that indigenous property are either forced to commodify their own cultural property and thereby perhaps appropriate its position in the indigenous community or renounce commodification, thus allowing other non-indigenous people to appropriate indigenous cultural traditions.”

“We conclude that, in many cases, legitimate concerns of indigenous people can be accommodated without going to the extreme of recognizing new intellectual property rights, either through modest reinterpretations of existing legal regimes concerning contract, privacy, and unfair competition law, or through carefully tailored but general statutory amendment or incrementally developed common law principles aimed at leveling what might otherwise be seen as an unfair playing field.”

“First, it affords protection not just to indigenous claimants, though it may be especially suitable to their needs, but to any person or group whose needs, arising from similar causes, justify specific legal recognition and protection. Second, it avoids the need for its claimants to define their legal rights in terms of preexisting category of property rights, thus avoiding charges of debasement and commercialization that have adhered to such claims in the past. Finally, it respects the fundamental human rights and social values that are reflected in our democratic traditions and the carefully articulated social policy balances embodied in intellectual property law for both indigenous and non indigenous people.”

Conclusion:-p. 623:

“Our proposal is to focus on those aspects of indigenous peoples’ claims that can be addressed outside the IPR regimes of patent and copyright.”

“The answer to this problem may be to seek or create legal rights that not only meaningfully protect against the perceived abuse of indigenous people’s cultural heritages, but that also protect, at least in principle, anyone who can satisfy its requirements, indigenous or not.”

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-Multiplicity of institutions and agreements now deal with IP at international level : World Trade Organization, World Health Organization, Biological Diversity Convention etc.-So what is the future of intl IP regulation:

Keep them vague enough that everyone adheres. Have a multiplicity of agreements that may overlap, contradict each other, which

will almost inevitably ensure that they are not adhered to by all parties Use WTO: once have the WTO present, then best way to protect property interest

is to use it-A marked IP trend is to push towards internationalization Why? Because harmonization reduces transaction costs (applying for rights in every single country is costly in terms of money and time, and is usually done at times where revenues are not coming in). Private intl law, public intl law and WTO are some of the mechanisms that facilitate harmonization of IP regimes-For CR: Berne Convention is applicable, so no transaction costs: automatic protection, no cost to enter new markets.-For other industries, however, particularly those that thrive on patents, there is a desire to harmonize the markets-As consumers, it is to our advantage that IP rights be low, while for those that would be the holder of rights, it is to their advantage that the rights be large and extensive (and the bigger the company, usually, the greater is the right desired).-Another trend in IP is the growing awareness that we live in an information economy: IPs are now recognized as primary assets in this new economy, and so accordingly there is a growing emphasis on the regulation of these assets-Another trend: tension between developed and developing world: this divide has consequence on the markets, and creates problems that affect an entity’s ability to sell domestically and internationally-The tension may stem from different conception of IP rights and their role. IP is a very western notion, and this can be a strain on harmonization: not everybody understands IP regimes to do the same things or be enforced the same way.-One solution to this problem is to design subject/issue specific treaties: computer program and digital media treaties

Take Home Exam:

-explain in a clear way what is going on, but use plenty of examples to illustrate that you master the documents read.-when refer to a case, can only refer to the point of the fact, what is really going on, but no need to go over the facts (assume that Gold knows about the case)-citation: Author, Vol, p#-make 3 or 4 main points (cause paper is only 5 pages long, double spaced), be succinct

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