Unlike in the United States, patent legislation in Canada only protects subject matter having a utilitarian application. Protection for the aesthetic features of products are granted pursuant to the Industrial Designs Act (R.S.C. 1985, c. I-9) and should therefore be referred to as “industrial designs” instead of “design patents”.

Patents granted pursuant to the Patent Act (R.S.C. 1985, c. P-4) in Canada offer inventors exclusive rights to their inventions for a limited period of time. To be eligible for patent protection, an invention must be new, useful, and inventive. A one-year grace period is granted by Canadian patent legislation with respect to disclosures made by or with the authority of the owner of the invention. Claims to subject matter that is merely of intellectual or aesthetic significance and does not pertain to a particular functionality will not be allowed. The same applies to abstract concepts, laws of nature and mental processes. The patent application process involves filing a detailed description of the invention, along with drawings and claims defining the scope of the invention. The Canadian Intellectual Property Office (CIPO) examines the application to assess patentability criteria. Examination of a patent application must be formally requested. Such a request must be made within four years of the filing date. Once granted, a patent provides the owner with the right to prevent others from making, using, or selling the invention in Canada for a period of 20 years from the date of filing. This will change as of January 1, 2025, as a result of the Canada–United States–Mexico Agreement (CUSMA). Patent owners will be compensated for “unreasonable delays” in the processing of their Canadian patent applications. A delay is unreasonable under CUSMA when the patent office does not grant a patent within five years after a patent application is filed or within three years after a patentee requests ‎examination of the patent application, whichever is later. ‎This new regime will only apply to patent applications filed after January 1, 2020.

To maintain patent rights in Canada, annual maintenance fees are required, starting from the second year of the filing date of a patent application. Failure to pay these fees can lead to the patent’s abandonment.

Canada is a member of the Patent Cooperation Treaty (PCT). The deadline for entering a national phase in Canada is 30 months from the earliest priority date or, if no priority claim was made, from the international filing date (the date on which the application met the requirements under the PCT). It is possible to enter a national phase in Canada after that deadline, provided the failure to proceed was unintentional, by paying a reinstatement fee and complying with other formalities.

Industrial design protection in Canada safeguards the aesthetic features of a product, such as its shape, pattern, or ornamentation, including color. There are no unregistered design rights in Canada. Protection must be obtained by filing an application under the Industrial Designs Act, which grants the owner of a registered industrial design the exclusive right to use and license the design for a period ending on whichever is the longer of 10 years from the date of issuance of the registration and 15 years from the date of filing of the application. A maintenance fee must be paid five years after registration to maintain the protection. To be eligible for industrial design protection, the design must be novel and pertain to features of shape, configuration, pattern or ornament in a finished article. Novelty is not appreciated by performing a side-by-side comparison with articles found in the prior art, but rather on the basis of an imperfect recollection. The design must be substantially different in its aesthetic features from the prior art. A design cannot consist only of features that are dictated solely by a utilitarian function of a finished article. A one-year grace period (calculated using the priority date) is granted by Canadian industrial design legislation with respect to disclosures made by the owner of the design or by someone who obtained knowledge of the design from its owner. CIPO is responsible for examining and registering industrial designs in Canada.

To obtain industrial design protection in Canada, applicants need to file an application with CIPO, including drawings or photographs of the design, along with any necessary disclosures or disclaimers. The application is then examined to ensure compliance with registration requirements. Color may be claimed in an industrial design application. The representation of a design must, taking into account the nature of the finished article, be sufficient to fully disclose the design. They must be of sufficient quality to permit the features of the design to be identified clearly and accurately. Once registered, the owner can prevent others from producing, selling, or importing products that bear a design that is substantially similar to the registered design. It is important to note that industrial design protection in Canada is territorial, only applicable within the country.

Canada has been a member of the Hague Convention since 2018, which facilitates international protection. Do note that Canadian requirements for registration of designs are more stringent or different than in several other jurisdictions and it is not uncommon that an office action will be issued, requiring rectification of the drawings included in the application.

Trademark protection in Canada exists both at common law and through registration. Many entities carrying on business in Canada do not apply to register their trademarks and rely on rights acquired through use.

The Trademarks Act (R.S.C. 1985, c. T-13) provides exclusive rights to signs that distinguish the goods or services of one business from those of others. It codifies the common law tort of passing off but also provides for the registration of trademarks. A trademark can be a word, phrase, logo, taste, texture, moving image, mode of packaging, hologram, sound, scent, three-dimensional shape, color, or a combination of these used to distinguish the goods or services of one person or organization from those of others. Some of these trademarks are much more difficult to register than others. To be eligible for trademark protection, the mark must be distinctive, not clearly descriptive, and must not conflict with existing trademarks. Since 2019, it is possible for Canadian trademark applications and registrations to be jointly owned by more than one party, but in such a case the joint owners must have entered into an agreement stipulating that they do not have the right to use the trademark in Canada except on behalf of all joint owners. CIPO is responsible for examining and registering trademarks in Canada. Canadian trademark legislation allows a party having trademark rights acquired through use to oppose registration by a party that has applied for a confusingly similar mark or to cancel its registration after issuance, except if the application was made without knowledge of the prior user’s rights and five or more years have lapsed since the registration was issued.

To obtain trademark protection in Canada, applicants need to file a trademark application with CIPO, including a clear representation of the mark, a list of goods or services, and the filing fee. The application then undergoes an examination process to determine whether the mark meets the criteria for registration. There is currently a significant backlog in examinations. CIPO hired a large number of examiners in 2023 and 2024 and expects that this backlog will be substantially reduced within two years. If approved, the mark is published in the Canadian Trademarks Journal, allowing others to oppose the registration. Once registered, the owner of a trademark enjoys exclusive rights to use the mark across Canada in connection with the registered goods or services for a period of 10 years, which can be renewed indefinitely. There is no requirement to show use at the time of renewal. Trademark registrations are subject to cancellation for non-use. An administrative non-use cancellation proceeding is available if a registered trademark has not been used for a period of three years following the issuance of the certificate of registration and no exceptional circumstances justify non-use. These types of proceedings do not involve discovery.

CIPO will issue a refusal if a trademark corresponds to a geographical location. If the goods or services originate from that location, the refusal risks being maintained, even if that location is not known for the type of products or services at issue or is unknown to most Canadians. If a trademark corresponds to the names and surnames of individuals, an objection will generally be issued, even if the name or surname is fairly rare. When a trademark registration is refused on the basis of descriptiveness, lack of distinctive character or name or surname significance, it is possible to prove acquired distinctiveness in Canada to secure a registration. Proof of acquired distinctiveness must be made as of the Canadian filing date and must show distinctive character in each province and territory of Canada. If that condition is not satisfied, the resulting federal registration will be limited to the provinces and territories where distinctiveness has been shown to CIPO’s satisfaction.

Canada has been a member of the Madrid Protocol since 2019. It has chosen to issue office actions within 18 months of receipt of notification of the International Bureau of the designation. There are no significant disadvantages to applying for trademark protection in Canada using the Madrid Protocol, other than the usual risk of central attack on the base application.

Copyright protection in Canada grants creators of original works exclusive rights to control the reproduction, performance, communication to the public by telecommunication (which includes the right to make available), importation, adaptation, and distribution of their works, as well as several other rights. Originality in Canada requires that there be an exercise of skill and judgement on the part of the authors, there is no need to show a spark of creativity. The Copyright Act provides automatic protection for literary, artistic, musical, and dramatic works, as well as for other categories of subject-matter like sound recordings, communication signals and performer’s performances. Canadian copyright legislation does not grant any explicit protection for subject matter generated by artificial intelligence, and whether a work generated by artificial intelligence can be protected by copyright is the subject of debate. Registration is not required for copyright protection in Canada, as it is granted upon the creation of the work or other subject matter. However, registering a copyright with CIPO can serve as evidence of ownership and subsistence of rights in the work or other subject matter and can be beneficial in legal disputes. The failure to register copyright does not limit the remedies available to its owner. CIPO does not conduct any substantive review of applications to register copyrights. The Copyright Act does not include a “work for hire” regime that will deem a legal person to be the author and owner of a work.

The duration of copyright protection in Canada varies depending on the type of work. For literary, artistic, musical, and dramatic works, copyright protection generally lasts for the lifetime of the creator plus an additional 70 years from the end of the civil year during which the last surviving coauthor has passed away. In the case of sound recordings and performances, protection typically lasts for 70 years from the end of the civil year in which the sound recording or performance was first published.

The Copyright Act includes numerous exceptions. It does not, however, include a general exception allowing fair use. A narrower series of exceptions allowing fair dealing are included, but they are limited to certain purposes only: research, education, parody, satire, personal study, criticism or review, and news reporting.

Another notable exception found in section 64 of the Copyright Act is that copyright cannot be used to prevent the manufacturing of a useful article if more than 50 copies have already been made by the owner of copyright or with their permission. If the articles are sold in sets, the threshold is the manufacturing of 50 sets by or under the authority of the owner of copyright. Clothing has been held to constitute a useful article (Magasins Greenberg Ltée v. Import-Export René Derhy (Canada) Inc., 2004 CanLII 15460). Some articles of jewelry may be “useful articles”, but the Federal Court of Appeal has indicated that there is no blanket rule to the effect that they are all “useful articles” simply because they can all be worn (Pyrrha Design Inc. v. 623735 Saskatchewan Ltd., 2004 FCA 423). There are exceptions to this exclusion of copyright protection, including, for example, for trademarks, knitted or woven patterns and graphic, photographic representations applied to the surface of an object and representation of a real or fictitious being, event or place that is applied to an article as a feature of shape, configuration, pattern or ornament.

There is no requirement to include a copyright notice in copies of works or other subject matter that is disseminated. These can nonetheless be useful to refute a defendant’s claim that they did not believe that the particular content was still protected by copyright.

Trade dress refers to the distinctive visual appearance and overall image of a product or its packaging, which can serve as a source identifier for consumers. In Canada, trade dress can be protected under trademarks law both through registration and on the basis of rights acquired through use. Trademarks law recognizes that the overall look and feel of a product, including its packaging, can acquire distinctiveness and become associated with a particular brand or business. To obtain redress by way of legal action it must be proven that the trade dress has acquired distinctiveness in the Canadian marketplace and is capable of distinguishing the goods or services of one business from those of others. This may prove challenging in many circumstances.

To establish a valid claim of trade dress protection, a business must submit evidence of the distinctiveness of its trade dress, such as consumer surveys, sales figures, advertising, and media recognition. This evidence should demonstrate that the trade dress has acquired distinctiveness, indicating to consumers that the specific trade dress identifies the goods or services with a particular source. Registering trade dress as a trademark with CIPO can provide useful protection. It should be noted that for many types of trade dress, CIPO will require evidence of distinctiveness at the time of filing of the Canadian trademark application. Distinctiveness must be shown in each Canadian province or territory to obtain a federal registration having national scope. If distinctiveness is only shown in some provinces or territories, the exclusive rights resulting from registration will be limited to those specific provinces or territories.

Canadian law does not recognize a “right of publicity” per se. Protection is provided by legislation or the common law to certain aspects of the personalities of individuals. The scope of protection and the criteria to enforce the rights granted vary from one province or territory to another.

Common law courts in Ontario and Alberta have come to recognize a tort of appropriation of personality which allows an individual to control the commercial use of their name, image, likeness, voice, reputation or other unequivocal aspects of their identity (see Krouse v. Chrysler Canada Ltd. (1974)1 O.R. (2d) 225 (C.A.); Athans v. Canadian Adventure Camps Ltd. (1977) 17 O.R. (2d) 425 (H.C.J.)). This tort requires that the exploitation clearly and primarily captured the plaintiff, in other words the individual must be recognizable, and that the exploitation was carried out for a commercial purpose. There is no need for the individual to demonstrate that they are famous. The rights survive the death of an individual, however it is unclear for how long.

Privacy legislation in several other provinces has created a statutory recourse for misappropriation of personality. The British Columbia Privacy Act (RSBC 1996, c. 373), for example, creates a recourse that applies only to the name and portrait (defined as a likeness deliberately disguised to look like the plaintiff or a caricature) and lies where there is unauthorized use in connection with advertising or promoting the sale of, or other trading in, property or services. Proof of an intention to refer to the plaintiff or exploit the plaintiff’s name and reputation is required or, failing that, proof that the context in which the use was made made it clear that the plaintiff was being targeted. This right does not survive the death of the individual. The approach varies from one province that has created a statutory claim to another.

In Quebec, the right to control one’s name and likeness is provided by Articles 35 and 36 of the Quebec Civil Code which prohibits the invasion of privacy and includes within this notion the use of a person’s name, image, likeness or voice for a purpose other than the legitimate information of the public except with the consent of the individual or to the extent permitted by law. This right does not survive the death of an individual, however, pursuant to section 625 of the Quebec Civil Code, the heirs of the individual may take proceedings to obtain redress for a violation that occurred during the deceased individual’s lifetime. A person needs to be recognizable in the image to succeed in a claim for breach of privacy — Aubry v. Éditions Vice-Versa Inc., [1998] 1 R.C.S. 591, par. 53; if it is possible to deduce the identity of the individual by referring to other elements of the image (including other individuals who are recognizable), this may make the person recognizable (see, for example: Pia Grillo v. Google Inc., 2014 QCCQ 9394; Hammedi v. Cristea, 2014 QCCS 4564, permission to appeal denied: Cristea v. Hammedi, 2014 QCCA 1936).

A trade secret is defined as confidential and valuable business information that provides a competitive advantage. In Canada, trade secrets are protected primarily through common law and contract law. One statutory exception is section 1612 of the Quebec Civil Code which states that the loss that can be claimed by the owner of the trade secret includes the investments made for their acquisition, development and exploitation, which loss can be compensated by way of a royalty. See also section 1472 which indicates that there will be no liability for the disclosure of the trade secret if considerations of general interest prevail over keeping the secret and, particularly, that its disclosure was justified for reasons of public health or safety. While trade secret protection does not require registration, businesses must take reasonable measures to maintain the secrecy of their confidential information. Trade secrets can encompass a wide range of valuable information, including formulas, processes, customer lists, marketing strategies, and manufacturing techniques.

To protect trade secrets in Canada, businesses must implement proper safeguards, such as non-disclosure agreements (NDAs), confidentiality agreements, and restricted access to sensitive information. These legal agreements can help establish a framework for maintaining secrecy and provide recourse in case of unauthorized disclosure or use of trade secrets. Additionally, businesses should have internal policies and procedures in place to ensure employees are aware of their obligations to maintain confidentiality.

In case of trade secret misappropriation, Canadian law provides remedies for the rightful owners. They need to show that reasonable measures have been taken to protect the confidentiality of the trade secret, that the trade secret was communicated in confidence to the recipient and that it was misused by this party. Damages can be sought to compensate for any losses suffered as a result of the misappropriation, including the loss of business opportunities or competitive advantage. As mentioned, under Quebec law damages can be awarded to compensate the investments made in connection with the trade secret. Canadian courts may order the disgorgement of profits illegally made by the defendant in connection with a trade secret (see, for example: XY, LLC v. IND Diagnostic Inc., 2016 BCCA 469). Injunctions may also be obtained to prevent further disclosure or use of the trade secret. Canadian courts have accepted to grant in appropriate cases worldwide injunctive relief to prevent the appropriation of trade secrets (see Google Inc. v. Equustek Solutions Inc., 2017 SCC 34). It is important to note that trade secret protection requires continual efforts to maintain secrecy, as once the information becomes publicly known, it loses its status as a trade secret.

Moral rights are an important aspect of copyright law in Canada and are protected under the Copyright Act (see sections 14.1, 14.2, 17.1, 28.1 and 28.2 of the Copyright Act). Moral rights are the non-economic rights that authors hold in relation to their works, which include the right of attribution and the right to integrity. These rights are aimed at recognizing and safeguarding the personal and reputational interests of authors in their works. It is difficult in Canada to avoid the application of moral rights using a “work for hire” stipulation as this concept is absent in Canadian law and Canadian courts have generally refused to defer to foreign law regarding ownership and authorship (see, for example: GE Renewable Energy Canada Inc. v. Canmec Industrial Inc., 2024 FC 322).

Under the Copyright Act, moral rights exist independently of economic rights and cannot be transferred. They can only be waived. The right of attribution allows creators to be identified as the authors of their works and to have their authorship acknowledged, subject to practices applying in the relevant field. The right to integrity grants creators the authority to prevent any changes, modifications, or distortions of their works that may harm their reputation. Moral rights have the same term of protection as economic rights.

The Copyright Act provides remedies for the infringement of moral rights in Canada. If a creator’s moral rights are violated, they can seek remedies such as injunctions to prevent further infringements, damages for harm to their reputation, and orders for the removal or alteration of the infringing work.

Licensing

All intellectual property rights existing in Canada (other than moral rights) can be the subject of licenses and it is quite common in practice for license agreements to be concluded. Recording the grant of licenses in the relevant intellectual property register is not mandatory in Canada, however for exclusive patent licenses the Patent Act gives precedence to the party that first recorded its license in the event of conflicting grants (see Patent Act, section 49; Copyright Act, section 57). It is not usual to record licenses with CIPO.

Under the Copyright Act, licenses are not subject to any particular formalities with the notable exception of exclusive licenses which must be made in writing and signed by the owner of copyright (Copyright Act, section 13(4)). It is possible to grant a license for only some of the rights granted by copyright and to introduce limitations based on territory, medium, sector of the market or other limitations. An exclusive licensee is deemed to have an interest in the copyright and may take legal action in its own name for infringing acts occurring within the scope of the exclusive grant.

Neither the Patent Act nor the Industrial Designs Act impose any particular formalities for the grant of a patent or industrial design license. An important aspect to consider when negotiating a patent license is that under Canadian law a licensee is, in principle, estopped from contesting the validity of the patent subject to the grant (see, for example: Bayer Aktiengesellschaft v. Apotex Inc., [1995] O.J. No. 141 (Gen. Div.), rev’d on other grounds [1998] O.J. No. 3849 (C.A.)). Moreover, in several cases Canadian courts have accepted that a licensee is bound to continue to pay the same amount of royalties even if one or more patents covered by the license have expired or have been invalidated, however this will ultimately turn on the language used in the patent license (contrast 7158548 Canada Inc. v. Desbiens, 2016 QCCA 306 and Lauren International, Inc. v. Reichert, 2008 ONCA 382).

An important consideration in Canadian trademark practice is that the licensor must at all times have control over the quality and character of the goods and services marketed by the licensee in association with the trademark (Trademarks Act, section 50). Mere ownership of the majority or even the totality of the outstanding shares of the licensee by the licensor is insufficient to meet this requirement, except for pharmaceutical products. If notice is given to the public that the use of the trademark is under a license granted by the owner of the trademark a rebuttable presumption of control will be applied. Aside from requiring control by the licensor, the Trademarks Act does not require any particular formalities to be complied with to grant a trademark license.

There are no particular statutory requirements for trade secret licensing, however the key aspect is to ensure that the licensee takes all reasonable steps to protect the confidentiality of the trade secret. Failing this, trade secret protection will be lost. Relying on verbal or implied trade secret licenses is therefore a dangerous approach.

Enforcement

Infringement

Intellectual property infringement litigation in Canada can generally occur in both the Federal Court and the superior courts, depending on the type of intellectual property at stake. A notable exception is trade secret litigation, which must be instituted before the superior court of a province. Cases that can give rise to claims under other common law torts or provisions of the Quebec Civil Code cannot be instituted before the Federal Court of Canada. The Federal Court has jurisdiction over copyright, trademark, industrial design and patent matters. In trademark matters parties acting before the Federal Court to enforce unregistered trademark rights must invoke the protection granted under the Trademarks Act which codifies the common law tort of passing off. There are several key differences between litigation in the Federal Court and the superior courts, including procedural rules, expertise, and remedies available.

The Federal Court has an intellectual property and competition chamber which includes judges who possess expertise in intellectual property matters, ensuring that cases are heard by judges with a deep understanding of the legal and technical aspects involved. The Federal Court also has streamlined procedures for case management and discovery, which can lead to quicker resolution of intellectual property disputes. Remedies available in the Federal Court include injunctions, damages, and accounts of profits, as well as the option to request the destruction of infringing goods. The Federal Court may order the transfer of infringing domain names and social media accounts. It should be stated that the Federal Court applies a higher standard for the grant of interlocutory orders to prevent the use of an intellectual property right. It generally requires clear and convincing evidence of irreparable harm, which can be challenging. Orders issued by the Federal Court of Canada cover all Canadian provinces and territories, which is advantageous.

On the other hand, litigation before the superior courts, which are the provincial courts of general jurisdiction, follows the applicable provincial rules of procedure. Unlike the Federal Court, judges in superior courts may have more diverse areas of expertise, as they handle a wide range of civil litigation matters. Superior courts often have more extensive case management procedures and longer timelines compared to the Federal Court. Remedies available in superior courts for intellectual property infringement include injunctions, damages, and accounts of profits, but the availability and scope of these remedies may differ from jurisdiction to jurisdiction. Several superior courts apply a more flexible approach to the grant of interlocutory injunctive orders and some will presume that irreparable harm arises from the infringement of intellectual property rights, particularly in trademark cases. In principle, orders issued by a superior court apply only within the particular province or territory, except that many courts are open to forbidding a party domiciled in the province or territory from committing infringing acts in other parts of Canada or even abroad.

In general, the choice of whether to proceed with intellectual property infringement litigation in the Federal Court or the superior courts depends on various factors, such as the type of intellectual property involved, the complexity of the case, and strategic considerations.

Passing off and trade secret litigation

Litigation pertaining to passing off in Canada involves several key aspects. Passing off refers to a situation where one party misrepresents their goods, services, or business as being associated with another party, leading to confusion and potential harm to the reputation or goodwill of the latter. To succeed in a passing off claim, the plaintiff must establish three elements: goodwill or reputation in the relevant market, a misrepresentation by the defendant that causes or is likely to cause confusion, and actual or potential damage to the plaintiff’s goodwill. Courts will sometimes presume the existence of goodwill if the appropriation of the mark by the defendant is shown to be deliberate.

In passing off litigation in Canada, the court will examine the plaintiff’s goodwill, which refers to the positive reputation and recognition associated with the plaintiff’s goods, services, or business. The plaintiff needs to demonstrate that they have developed a substantial reputation and goodwill in the marketplace, usually through evidence of sales, advertising, and consumer recognition. The court will assess whether there is a likelihood of confusion between the plaintiff’s offerings and the defendant’s misrepresentations, considering factors such as the similarity of the marks, the nature of the goods or services, and the degree of resemblance between the parties’ overall branding.

If successful in a passing off claim, the plaintiff may be entitled to remedies such as injunctive relief to prevent the defendant from continuing the misrepresentation, damages to compensate for any harm caused to the plaintiff’s goodwill, and an order for the delivery or destruction of any infringing materials. It is important for the plaintiff to gather strong evidence of the misrepresentation and its impact on their reputation, including customer testimonials, market research, and expert opinions. The drawback of resorting to passing off litigation is that the order issued by the court will be limited to the geographical areas in which the plaintiff is able to show goodwill. Instituting litigation before the Federal Court of Canada under section 7 of the Trademarks Act, which codifies the tort of passing off, will not give rise to broader relief.

Trade secret litigation typically arises when there is an alleged misappropriation or unauthorized disclosure of confidential information. It can only be litigated before the superior court of a province or territory. To initiate a trade secret lawsuit in Canada, the plaintiff must establish that they have taken reasonable measures to maintain the secrecy of the information and that the information holds economic value. It is essential to have evidence demonstrating the steps taken to keep the information confidential, such as NDAs, restricted access, or security measures.

During trade secret litigation, the court will assess whether there has been a misappropriation of trade secrets. Factors considered may include whether the defendant had access to the trade secrets, whether the information was subject to reasonable confidentiality measures, and whether the defendant used or disclosed the information without authorization. The court may also examine the defendant’s actions and intentions, such as whether they acted in bad faith, breached a duty of confidence or a fiduciary duty.

Unfair competition

Unfair competition litigation in Canada involves legal actions against deceptive or anti-competitive practices that harm the interests of businesses or consumers. Unfair competition laws in Canada are governed by provincial statutes and common law principles, as well as under provision of the Competition Act (R.S.C., 1985, c. C-34) which covers behavior such as misleading advertising. The main goal of unfair competition litigation is to promote fair and honest competition in the marketplace and protect consumers from deceptive practices. In the common law provinces, there is no general tort of unfair competition. Parties need to rely on more specific torts. Likewise, in Quebec there is no general provision in the Civil Code prohibiting unfair competition. It is possible, however, in appropriate cases to make a claim under the general provision pertaining to civil liability for unfair acts made by competitors.

Common types of unfair competition include false advertising, misleading marketing practices, and trade libel. Businesses or individuals who believe they have been harmed by unfair competition can initiate litigation to seek remedies for the harm caused. Unfair competition litigation may be brought before the provincial Superior Courts, as they have jurisdiction over civil matters, including commercial disputes. The Federal Court of Canada will only have jurisdiction to the extent that provisions of the Competition Act are being invoked.

Remedies available in unfair competition litigation may include injunctions to stop the deceptive practices, damages for economic losses or harm to reputation, account of profits, and corrective advertising to rectify the misleading information.

One particular form of unfair competition claim has developed in Quebec jurisprudence (see Groupe Pages Jaunes Cie v. 4143868 Canada Inc., 2011 QCCA 960). Litigation concerning parasitic claims before the Quebec Superior Court involves actions brought against individuals or businesses for engaging in unfair business practices that parasitically exploit the efforts and investments made by others. In Quebec, the concept of parasitic competition, also known as unfair competition by imitation, is recognized as a cause of action covered by the general provision of the Civil Code pertaining to civil liability.

Parasitic claims in Quebec typically arise when a defendant takes advantage of the plaintiff’s investments, reputation, or efforts to derive undue benefit. The Quebec Superior Court considers several factors in determining whether parasitic competition has occurred, including the similarity of the defendant’s conduct or product to the plaintiff’s, the proximity or overlap of the businesses involved, and the potential harm or confusion caused to consumers. Evidence of copying, imitation, or free riding on the plaintiff’s investments can be crucial in establishing a parasitic claim.

In litigation concerning parasitic claims before the Quebec Superior Court, the plaintiff may seek remedies such as injunctive relief to stop the defendant’s parasitic practices, damages for harm suffered as a result of the parasitic acts, and corrective measures to rectify the unfair conduct.

Other causes of action

Domain names

Domain name arbitration under the Canadian Internet Registration Authority (CIRA) rules provides a streamlined dispute resolution process for resolving conflicts related to .ca domain names in Canada. CIRA is responsible for managing and governing the .ca domain name registry. The CIRA Domain Name Dispute Resolution Policy (CDRP) sets out the framework for resolving disputes over the registration and use of .ca domain names through arbitration.

Under the CIRA rules, domain name disputes are resolved by independent and qualified arbitrators who are experienced in intellectual property and domain name issues. The arbitration process is conducted online and follows a defined set of procedures outlined in the CDRP. The complainant needs to demonstrate that the disputed domain name is confusingly similar to a trademark, trade name, or other protected rights in which they have a legitimate interest, and that the respondent has registered or is using the domain name in bad faith.

CIRA rules that a legitimate interest may be shown if the domain name was a trademark, the registrant used the trademark in good faith and the registrant had rights in the trademark. A legitimate interest also arises if the domain name was either generic or clearly descriptive in Canada in the English or French language of the character or quality of the wares, services or business, the conditions of, or the persons employed in, production of the wares, performance of the services or operation of the business, or the place of origin of the wares, services or business. A registrant who used the domain name in Canada in good faith in association with a non-commercial activity including, without limitation, criticism, review or news reporting is also deemed to have a legitimate interest. If the domain name comprised the legal name of the registrant or was a name, surname or other reference by which the registrant was commonly identified this will legitimize the registration of the domain name. Finally, if the domain name was the geographical name of the location of the registrant’s non-commercial activity or place of business this will establish a legitimate interest.

The CIRA arbitration process is designed to be cost-effective and efficient. If the complainant is successful in their claim, the arbitrator can order the transfer or cancellation of the disputed domain name. However, it is important to note that CIRA domain name arbitration is limited to resolving disputes involving .ca domain names. For disputes involving other domain extensions, different dispute resolution procedures may apply.

There are no laws in Canada that specifically govern domain names or cybersquatting.

Social media/takedowns

Social media takedown requests in Canada are a function of the terms of use of the various social media services. When faced with objectionable or infringing content on social media platforms, individuals or businesses can make requests to have the content removed. These terms normally aim to implement copyright law, trademark law, privacy law, and defamation law, amongst others. Canadian copyright legislation does not include a notice and takedown mechanism that exists in some foreign legislation. That being said, many online service providers having a presence in the United States will take down content when faced with a credible allegation of copyright infringement. The Canadian Copyright Act includes only a “notice and notice” regime, which requires an online intermediary to notify the user of the complaint and preserve information regarding the user and its behavior during a specific time period (see Copyright Act, sections 41.25 and 41.26). Individuals who believe their privacy rights have been violated can request the removal of content that infringes on their privacy. In cases of defamatory content, individuals can seek legal remedies through defamation laws, which may involve requesting the removal of false or harmful statements.

When making social media takedown requests, it is important to carefully consider the potential impact on freedom of expression and ensure that the request is supported by valid legal grounds. Social media platforms typically have their own policies and procedures for addressing takedown requests. Understanding the platform’s terms of service and guidelines is essential to navigate the takedown process effectively. It is important to note that Canadian courts have sanctioned parties that have falsely accused others of infringing behavior on online platforms (see, for example: Keezio Group, LLC v. The Shrunks’ Family Toy Company Inc., 2024 BCSC 64).

Grey marketing 

It can be challenging under the Trademarks Act and in the context of the tort of passing off to contest grey marketing activities. In the Consumers Distributing Co. v. Seiko case, the Supreme Court of Canada found that there was no misrepresentation arising out of the resale in Canada of Seiko-branded watches originally marketed in a foreign country. The fact that repair and servicing under the warranty services for those watches would not be available in Canada failed to convince the Court.

An attempt was made to use provisions of the Copyright Act in Canada to prevent grey marketing in connection with the resale of chocolate bars imported from a foreign country that bore a copyrighted logo (Euro-Excellence Inc. v. Kraft Canada Inc., 2007 SCC 37). A majority of the Supreme Court of Canada would potentially have been open to forbidding the importation of those chocolate bars had the owner of copyright in Canada and the foreign country been different legal entities. An exclusive license was in place, but this was held that it did not prevent the owner from distributing its products in Canada. Using copyright could, therefore, be an option to prevent grey marketing but this would involve in many cases restructuring the ownership of intellectual property rights, which can present its own challenges.

The most promising avenue so far has been to use contractual exclusivity provisions as a basis for making claims against grey marketers. This works well for brands that have an exclusive network of resellers for their products. The Supreme Court of Canada established early on that a party involved in the resale of goods outside of this exclusive network can be liable for either breach of contract or for tortious behavior by contributing to the breach of the contractual exclusivity (Trudel v. Clairol Inc. of Canada, [1975] 2 SCR 236). A condition precedent of this recourse against the party not bound by the contractual restriction is that it be aware of or could not reasonably ignore the stipulation of exclusivity. There are recent examples of the application of this rule that involve cross-border grey marketing (see, for example: Costco Wholesale Canada Ltd. v. Simms Sigal & Co. Ltd., 2020 QCCA 1331). 

IP disputes process

Intellectual property litigation in Canada does not involve the same level of discovery as in the United States, but litigation before superior courts and the Federal Court does include a discovery phase. How discovery proceeds depends upon the applicable rules of procedure, which vary from one court to another. While it would be technically possible to try an intellectual property case before a jury in some courts, this never occurs in practice. A judge accepted in one motion that a jury trial would not be appropriate in an intellectual property trial because, under applicable procedural rules, it would involve matters that are intricate or complex (Ruloff Capital Corporation v. Hula, 2023 BCSC 1171).

Intellectual property litigation before the Federal Court of Canada involves several steps, depending on whether it is an action or an application. Actions are a more fulsome type of proceeding that involves a discovery phase and a trial on the merits with live testimony of witnesses, while applications are more streamlined proceedings that do not include a discovery phase where evidence is tendered by sworn declarations of witnesses and where, except as ordered by the court, the hearing of the matter does not involve the testimony of witnesses. 

In an intellectual property action before the Federal Court, the initial step typically involves the filing of a statement of claim outlining the details of the dispute and the relief sought. The defendant then has an opportunity to file a statement of defense, responding to the claims made by the plaintiff. An affidavit of documents is then tendered by each party which is intended to disclose documents relevant to the case and kick off the discovery phase. The second part of the discovery phase is the examination out of court of a representative of each party. If the case proceeds to trial, evidence is presented, witnesses are examined and cross-examined, and legal arguments are made before the court. The court then renders a decision, which may be subject to appeal before the Federal Court of Appeal and, subsequently, before the Supreme Court of Canada.

Applications before the Federal Court are useful to limit cost in cases where discovery is less of an important consideration, for example, when all the key facts are of public record. The applicant initiates the process by filing a notice of application setting out the relief sought and the legal basis for it. Sworn witness statements are exchanged by the parties. They can then be cross-examined on their affidavits (witness statements). The affidavits, the transcripts of those affidavits and the written representations of each party are then filed in a record for the benefit of the court. The court then schedules a hearing, during which the parties present their arguments and discuss the evidence of record. The court makes a decision on the application based on the submissions and evidence provided. The timelines and procedures for applications are generally more expedited compared to actions and there is much less leeway for motions.

Intellectual property litigation before the superior courts in Canada involves several key steps, but it is important to note that the rules of procedure can vary across provinces. Generally, the process includes pre-trial procedures, the trial phase, and potential appeals. However, it is crucial to highlight the significant differences that arise for claims brought in Quebec under the Quebec Code of Civil Procedure (RLRQ c C-25 (the “Code of Civil Procedure”)).

In general, the steps for intellectual property litigation before superior courts start with the initiation of the lawsuit by filing a statement of claim, which sets out the details of the dispute and the relief sought. The defendant then has an opportunity to file a statement of defense, responding to the claims made by the plaintiff. Pre-trial procedures typically include examinations for discovery, where parties exchange relevant information and gather evidence, as well as the exchange of expert reports to present specialized opinions. Mediation or settlement discussions may also be encouraged or required before proceeding to trial.

The trial phase involves presenting evidence, examining witnesses, and making legal arguments before the court. The judge or jury then renders a decision based on the evidence and arguments presented during trial. If either party is dissatisfied with the outcome, they may have the right to appeal the decision to a higher court.

In Quebec, intellectual property litigation follows the procedures outlined in the Quebec Code of Civil Procedure, which has its own distinct rules and practices. The process may involve case management conferences, voluntary conciliation conferences, and examinations on discovery.

Appeals are generally heard by the relevant provincial or territorial court of appeal. It is then possible to appeal these decisions to the Supreme Court of Canada, provided the matter presents a national interest.

IP assignments

The assignment of intellectual property rights entails the transfer of ownership from one party to another, and each intellectual property category has specific rules regarding the validity and requirements of assignments.

Under section 13(4) of the Copyright Act, a valid assignment of trademark rights must be in writing, signed by the assignor. Assignments of copyright can be recorded with CIPO. Recording an assignment protects the assignor in the event there is a subsequent assignment of the same rights to another party, failing this the subsequent assignee for consideration that has no knowledge of the earlier assignment may have priority if they record their assignment first (Copyright Act, section 57). There is no requirement under the Copyright Act that the agreement make explicit reference to copyrights. Most substantive rules regarding the validity of an assignment are addressed by the laws of the province, territory or foreign state designated by the contract. 

In the case of patents, the Patent Act does not specify any particular formalities for the assignment of rights in an invention, section 9 of this legislation simply stipulates that rights in inventions are transferrable. The law applicable to the contract will address substantive requirements. Once a patent application has been filed and when a patent issues, the applicable rules are those set out in the Patent Rules (SOR/2019-251) and the Manual of Patent of Patent Office Practice (MOPOP). Requirements vary depending on whether the assignment is being recorded on behalf of the assignor or assignee. When the assignee makes a request, the following four types of evidence of the transfer will be normally satisfy the patent office: either a signed statement from the transferee stating that to their knowledge, the document effecting the transfer has been signed and executed by all parties, or a sworn declaration from a witness stating that to their knowledge, the document effecting the transfer has been signed and executed by the assignor, or the signature of a witness or the presence of a corporate seal on the document effecting the transfer or, finally, a document showing that the transfer was registered in a patent office of another country. Section 9 of the Patent Act provides that the transfer of a patent that has not been recorded is void against a subsequent transferee if the transfer to the subsequent transferee has been recorded.

In the case of industrial designs, the Industrial Designs Act does not specify any particular formalities for the assignment of rights in a design, section 13 of this legislation simply stipulates that rights in inventions are transferrable. The Industrial Designs Regulations (SOR/2018-120) also fail to specify any substantive requirements for the transfer of industrial designs. Substantive requirements will therefore be governed essentially by the law stipulated to be applicable to the contract. Section 13 of the Industrial Designs Act provides that the transfer of an industrial design that has not been recorded is void against a subsequent transferee if the transfer to the subsequent transferee has been recorded.

The Trademarks Act includes very little substantive requirements for the transfer of trademark rights. Section 48 of the Trademarks Act does clarify that both registered and unregistered trademarks are transferrable, with or without the goodwill associated to the trademark. A transfer of rights in the same or a confusingly similar trademark to the different entities can result in the loss of distinctiveness which can then lead to the invalidity of one or more registrations (Trademarks Act, section 48(2)). There are no specific requirements regarding the form of document required to recognize a transfer. Generally speaking, an assignment made in writing signed by the assignor that identifies the trademark to be assigned will be sufficient to record an assignment. Other documentation can be tendered, including a sworn declaration, if such an assignment document is unavailable.

Works for hire

In Canada, it is important to note that the concept of “work for hire” does not exist. The closest rule that exists is found in the Industrial Designs Act, which provides that if the author of the design executes the design for another person for a good and valuable consideration, that other person will be the first proprietor. This does not have the effect of giving this third-party authorship of the design.

Section 13(3) of the Copyright Act creates a similar mechanism but only for employees acting within the scope of their duties and provided there is no contrary contractual provisions. There is a particular limitation for employees working in the field of periodicals. Indeed, where the work is an article or other contribution to a newspaper, magazine or similar periodical, there shall, in the absence of any agreement to the contrary, be deemed to be reserved to the author a right to restrain the publication of the work, otherwise than as part of a newspaper, magazine or similar periodical. If a person is retained outside the scope of this provision, there is a need to assign the copyright by a written and signed contract.

The Patent Act does not include any work for hire provisions. A line of jurisprudence has developed in Canada that attributes beneficial ownership of inventions to the person hiring others to invent (see, for example, Techform Products Ltd. v. Wolda, 2000 CanLII 22597). This rule applies both to employees and contractors. A variety of factors are considered by courts, including whether there was an express stipulation that the person was hired to invent, whether the person had previously made inventions, whether the employer had an incentive plan encouraging product development, whether the conduct of the person after creating the invention suggested that it recognized ownership by the employer, whether the invention at issue arose as a result of instructions to solve a problem the employer wanted to resolve, and whether the project involved dealing with the employer’s confidential information.

Non-competes

Amendments to the Canadian Competition Act (R.S.C. 1985, c. C-34) have introduced significant changes regarding non-competition agreements pertaining to employees (Competition Act, section 45(1.1)). The amendments aim to promote competition and protect consumers by addressing potential anti-competitive practices. Agreements between unaffiliated employers to not solicit or hire each other’s employees are prohibited. This also extends to all forms of agreements between employers that limit opportunities for their employees to be hired by each other. Examples of such limitations include restricting the communication of information related to job openings and adopting hiring mechanisms, such as point systems, designed to prevent employees from being poached or hired by another party to the agreement. There is an exception for non-compete and non-solicitation provisions in the context of the purchase of a business, a so-called ancillary transaction. A similar approach may exist in the context of joint ventures and strategic alliances.

Under the revised provisions, non-competition agreements between businesses must meet specific criteria to be considered valid and enforceable. These criteria include a limited duration and geographic scope, as well as being reasonable in relation to the legitimate interests of the parties involved. Additionally, the amendments emphasize the importance of allowing individuals the freedom to pursue their livelihoods and careers without undue restrictions. Businesses are encouraged to review and update their non-competition agreements to ensure compliance with the revised provisions and to seek legal advice when necessary. By aligning non-competition agreements with competition principles, these amendments aim to create a more competitive and fairer marketplace in Canada.

These amendments to the Competition Act do not prohibit the incorporation of non-competition covenants in employment agreements. The enforceability of such non-compete provisions depends on their reasonableness. Courts typically evaluate whether the restrictions are necessary to protect legitimate business interests, such as trade secrets, confidential information, customer relationships, or specialized knowledge. The duration and geographic scope of the restriction must be reasonable, taking into account the specific circumstances of the industry, the position held by the individual, and the potential impact on their ability to earn a livelihood. Generally, overly broad or excessive non-compete provisions may be deemed unenforceable by the court. In common law provinces, a non-compete covenant may not be enforceable if no consideration has been given to the employer.