Every business, company, or individual has something that they would want to be protected – one of which would be their intellectual property. When intellectual property is stolen or infringed, the law provides for remedies which the original owner may use and the penalties to be imposed on the violator.
What is considered as intellectual property infringement in Canada?
Intellectual property infringement refers to the breach of protected intellectual property (IP) rights or the violation of the owner’s or creator’s IP rights as granted by law. It may also be called “intellectual property theft”.
Infringement of intellectual property may be committed in different forms, such as:
- the use of an IP without legal permission;
- the replicating or copying of an original creation;
- the claiming of another’s IP as theirs; and/or
- the unauthorized sale of IP of other persons
In Canada, IP infringement is governed by the different IP laws. Each covers a specific type of IP, such as:
- Patent Act
- Industrial Design Act
- Trademarks Act
- Copyright Act
While there is no federal law governing trade secrets, infringement or theft of trade secrets are governed by Canada’s common law, contracts law, and law on torts and damages.
Infringement of Patents
Under common law and the Patent Act, infringement of patents may be committed by:
- Section 42, Patent Act: Direct infringement by making, constructing, using, or selling the patented invention without the patentee's consent.
- Monsanto Canada Inc. v. Schmeiser: Possession of a patented object especially when some value or commercial circumstances are derived from this possession.
- Pfizer Canada Inc. v. Canada (Health): Use of a patented invention in a process.
- Windsurfing International Inc. v. Trilantic: Patent infringement by inducement or procurement which may constitute indirect infringement.
- MacLennan v. Produits Gilbert Inc.: Patent infringement by inducement through the manufacture or replacement of components or parts of a product, which completes the act of patent infringement.
Infringement of Industrial Design
Under the Industrial Design Act, infringement of an industrial design is committed by its use without the consent or license of the proprietor. It is committed when an unlicensed person (Section 11, Industrial Design Act) either:
- makes or imports a product whose design is substantially similar with the registered industrial design for the purpose of trade or business;
- sells, rents, or offers or exposes to sell or rent out a product whose design is substantially similar with the registered industrial design; or
- makes, imports, sells, or rents out a product, that when assembled from a kit (which consists of different parts which may be assembled to construct a finished product), would constitute infringement of a registered industrial design.
Infringement of Trademarks and Trade Names
The Trademarks Act provides that infringement of a trademark or trade name (Section 20, Trademarks Act) is committed when a product, label, or packaging that bears the infringed or confusing trademark or trade name is either:
- possessed;
- sold (including offers to sell);
- distributed;
- advertised;
- manufactured; or
- imported or exported (including attempting to export).
Infringement of Copyright
Copyright infringement may be committed in two ways under the Copyright Act:
- Direct or general infringement: when a person does any act that is within the exclusive right of the owner of the copyright without the copyright owner’s consent or license (Section 27 (1), Copyright Act); or
- Indirect or secondary infringement: where the ownership of the copyright is known (or should have been known) to a person, but still sells, rents out, distributes, or imports an original work or creation without the copyright owner’s consent or license (Section 27 (2), Copyright Act).
Theft of Trade Secrets
Infringement or theft of trade secrets is different from other forms of intellectual property infringement. Since it’s not governed by a specific federal law, it is usually committed when a person divulges a trade secret without the consent of the owner or proprietor.
The duty to keep such secret is usually contractual. This may be in the form of a non-disclosure agreement (NDA), a confidentiality agreement, or a confidentiality clause found in an employment contract.
What are examples of intellectual property infringement in Canada?
Based on these IP laws, some examples of IP infringement may be:
- the use of brand or logo, or a very similar logo, of a famous competitor;
- the copying of a secret recipe of a widely known product; or
- the production of an item that looks very similar to another product.
IP rights owners may also watch this video to know about enforcing one’s IP rights:
To learn more about trade secrets and how to keep them safe, read our guide on proprietary information.
What are the consequences of intellectual property infringement?
While each IP law may prescribe its own penalties for intellectual property infringement, there are some commonalities on the penalties or consequences among these IP laws.
Injunction
A common penalty among the above-mentioned IP laws is the issuance of an injunction by the court. Here, the court may order an injunction against the infringer, preventing or restraining them from further committing any acts that may be construed as intellectual property infringement.
Seizure of the Stolen IP
An action for intellectual property infringement may also include the seizure of the stolen IP that’s in the possession of the infringer.
The Copyright Act provides for such relief, where the court may grant an order allowing the copyright owner to recover the copies of the copyrighted work or the plates used to reproduce such work.
The court may even grant the order before judgment. On application by the copyright owner, the copies and plates may be destroyed if the court finds it just to do so (Section 38, Copyright Act).
Damages
Most of the time, litigation for intellectual property infringement requests for the award of damages as its main relief against the infringer. This relief is also a common one among the above-mentioned IP laws.
For instance, the Patent Act provides that the infringer is liable for damages for any act of infringement after the grant of the patent, and even before the grant of the patent subject to certain conditions (Section 55, Patent Act).
Recovery of Profits
The owner of an IP may also recover the profits that the infringer has obtained using the copied or stolen IP.
For example, under the Copyright Act, an infringer will be liable to the copyright owner, not only for the damages that the owner has suffered, but also for the profit earned because of the infringement (Section 35, Copyright Act). This will be applicable when the amounts of illegal profits were not considered in the computation of damages awarded to the copyright owner.
Fines and/or Imprisonment
A person who commits intellectual property infringement may be imposed with a fine and/or imprisonment. The amount of fines and the length of imprisonment will depend on the IP law which the person has violated.
The Trademarks Act, for example, outlines two types of fines and/or imprisonment (Section 51.01 (6), Trademarks Act):
- Conviction on indictment: a fine of not more than C$1,000,000, and/or imprisonment of not more than 5 years; or
- Conviction of Summary Conviction: a fine of not more than C$25,000, and/or imprisonment of not more than 6 months
Interested in pursuing a case of intellectual property infringement? Hire the best intellectual property litigation lawyers in Canada as ranked by Lexpert.