Protect Your Assets: An Intellectual Property (IP) Primer
Published:
October 19, 2016
Author(s):
We updated this publication on January 17, 2023.
For many businesses, large and small, their “Intellectual Property” (IP) is one of their most valuable assets. So understanding IP rights (and who owns them and how to commercialize them) is important. Here’s a Primer on what the five main IP rights are, how they are created and how to maintain them.
1. Trademark
A trademark is a mark that distinguishes one owner’s goods and services from those of others. Major changes to the Canadian Trademarks Act that took effect in 2019 significantly expanded the scope of what can be registered as a trademark. A trademark can be any one, or a combination of, a:
- Word.
- Design.
- Three-dimensional shape.
- Hologram.
- Moving image.
- Mode of packaging goods.
- Sound.
- Scent.
- Taste.
- Texture.
- Positioning of a sign.
Registration isn’t necessary to create trademark rights; they can be created by operation of the “common law” (the law made by judicial decisions) based on use of the mark. However, these common law trademark rights are limited in geographic scope to the area in which the mark has been used and are more difficult to enforce than registered trademark rights. Registration gives the registrant the exclusive right to use the mark throughout Canada in association with specified goods and services, even in geographic areas where the registrant hasn’t previously used the mark. It also confers other advantages when it comes to enforcement, blocking and registration of the trade mark in other countries. The 2019 changes to the Trademarks Act also reduced the initial period for which registration of a trademark is valid from 15 years to 10 years after registration. Registration is renewable (for a fee) after this initial period expires. The Canadian Intellectual Property Office (CIPO) can cancel a trademark registration after three consecutive years of uninterrupted non-use and or for a number of other reasons, including loss of distinctiveness. Marking a trademark with the “TM” or “®” symbols when using the trademark isn’t mandatory in Canada, but it’s advisable because it give notice of the existence and ongoing use of the trademark.
2. Copyright
Copyright protects original expression, but there’s no protection of an idea – only of the expression of the idea in a “work”. There are four categories of works: literary (software), dramatic, musical and artistic. Originality is key to the creation of copyright in a work: the author must have exercised some effort, skill and judgement in its creation. Registration of a copyright isn’t required for it to exist; it exists upon creation of a work, but registration is available. The copyright owner has the exclusive rights to produce, reproduce, perform in public and publish a work or a substantial portion of a work in any material form. Where copyright is registered, the resulting certificate of registration is evidence that copyright subsists and the registrant is the owner.
In Canada, until December 2022, copyright generally expired after the author’s life plus 50 years. However, effective December 30, 2022, copyright was extended so it now generally expires after the author’s life plus 70 years (in the case of joint authorship, the death of the last surviving author). This change brings the term of Canadian copyright into line with key trading partners, including the U.S., the U.K. and the E.U. But this change isn’t retroactive: it doesn’t act to revive copyright protection of works that expired on or before December 30, 2022, although it does extend the copyright protection of works that were still protected by copyright on December 30, 2022 by an additional 20 years. There are no steps required to maintain the existence of a copyright, or a copyright registration in Canada; it simply expires at the end of its term.
3. Trade Secrets
Generally, a trade secret is any information used in a trade or business that’s not generally known, has economic value because it’s not generally known and is kept secret by the owner. It can include a formula, recipe, pattern, device or a compilation of information. In Canada, there’s no legislation that either defines or protects trade secrets, so registration isn’t required for them to exist. Trade secrets are only protected while they remain a secret. Secrecy is maintained by using good information security practices and agreements: take steps to ensure confidentiality of the information is maintained, including limiting access to it, effecting physical safeguards of it, marking it as confidential and making use of IP ownership clauses, non-disclosure and confidentiality agreements and other appropriate contractual provisions.
4. Industrial Design
Industrial design rights are created by registration under legislation (the Industrial Design Act) of the features of the shape, configuration, pattern or ornament. There’s no protection for solely functional features; the protection only applies to a finished article and the design elements must appeal to, and be judged solely by, the eye. The owner of the industrial design rights has the exclusive right to make, sell, rent and import for the purpose of trade or business any article in relation to which the design has been registered.The registration protection lasts for 10 years after the date of registration. There’s a single maintenance fee payment required to maintain the registration.
5. Patent
Patents protect an inventor’s right to their “invention”, if it satisfies certain criteria. To obtain a patent on an invention it must be new, useful, non-obvious and related to “patentable subject matter” (art, a process, a machine, a manufacture, a composition of matter or any improvement of one of these); if an invention doesn’t satisfy these criteria, it can’t be patented. A patent is only created by legislation (a statute): registration is required and the proposed owner must file an application for registration that fully describes the invention at the Canadian Intellectual Property Office (CIPO). The owner must be very careful not to publicly disclose information about their invention before they apply for a patent; doing so may disqualify them from receiving a patent. A patent, once granted, gives the patent-holder the exclusive right to make, use and sell the patented invention. A patent is valid for 20 years after the filing date of the patent application and there are annual maintenance fees for applications and registered patents, but there’s no requirement for the patentee to actually use the patent.
Please contact your McInnes Cooper lawyer or any member of our Intellectual Property Team @ McInnes Cooper to discuss how to best protect your intellectual property assets.
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McInnes Cooper has prepared this document for information only; it is not intended to be legal advice. You should consult McInnes Cooper about your unique circumstances before acting on this information. McInnes Cooper excludes all liability for anything contained in this document and any use you make of it.
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