Recent Copyright Decisions
In this blog entry we deal with copyright developments in the last few months.
The General Term of Protection
The general term of protection has been amended. Section 6, in effect December 30, 2022, provides that the term for which copyright subsists, except as otherwise expressly provided in the Act, is the life of the author, the remainder of the calendar year in which the author dies, and 70 years following the end of that calendar year. The amended term does not revive the copyright in any work in which the copyright had expired before December 30, 2022. Other sections dealing with the term of protection for specific types of works were previously amended.
In Crocs Canada, Inc. v. Double Diamond Distribution Ltd. 2022 FC 1443 the court said if a portion of an expert’s evidence is found to be inadmissible because the expert strayed outside the scope of their mandate, depending on the circumstances, the balance of the expert’s evidence was not necessarily tainted.
Industrial Design Infringement
In Crocs Canada, Inc. v. Double Diamond Distribution Ltd 2022 FC 1443 the court concluded that a comparative analysis to determine whether infringement has occurred made from the perspective of the informed consumer must involve, at least, a consumer familiar with the market field, considering the scope of protection. The court considered the multiplicity of points of differentiation raised by the defendant but concluded that when considered in the context of the broad protection that the design was entitled to, they could not avoid a finding of infringement. This was a case where notwithstanding the alleged differences the designs were the same.
Because of the rebuttable presumption of originality, the defendant who raises invalidity based on prior art will bear the onus of proving through admissible evidence the existence of prior art that invalidates the design.
A successful plaintiff may elect to seek an accounting of profits in lieu of damages. When seeking an accounting the plaintiff need not establish, they were damaged by the defendant’s infringing activity. The plaintiff only needs to establish a causal link between the infringement and resultant unjust enrichment, and it is not an error for a trial judge to award an accounting of profits absent compelling reasons. Since it is an equitable remedy there is an element of discretion potentially involved and the remedy is not “as of right”. The burden is on the defendant to prove it has incurred deductible expenses.
In Worthware Systems International Inc v. Raysoft Inc. 2022 FC 1492 the plaintiff unsuccessfully sought to obtain a Norwich order against the president and sole director of the defendant to disclose the names and addresses of the defendant’s customers alleged to be infringers. The plaintiff’s previous motion relating to the defendant’s discovery requesting the same information had been dismissed because the customers were not parties to the action and that the discovery process was not intended to obtain the names of potential witnesses solely to start an action against them. The court said that a core element of the test for obtaining a Norwich order is that the party seeking the order must show it is necessary because the party named is the only practical source of the information. This is an ironclad element of the test, and it requires more than showing that the party against whom discovery is sought is the most convenient or easiest source of access. The plaintiff should have framed its action differently such as claiming against unknown “John Doe” defendants as direct infringers. In addition, a Norwich order is not intended to be used to circumvent the normal discovery process.
Accounting of Profits
In Nova Chemicals Corporation v. Dow Chemical Company 2022 SCC 43 the Supreme Court of Canada conceptualized an accounting of profits as a three-part process:
Step 1: Calculate the actual profits earned by selling the infringing product — i.e., revenue minus (full or differential) costs.
Step 2: Determine whether there is a non-infringing option that can help isolate the profits causally attributable to the invention from the portion of the infringer’s profits not causally attributable to the invention — i.e., differential profits. It is at this step that judges should apply the principles of causation. Causation need not be determined with scientific precision and is essentially a practical question of fact which can best be answered by ordinary common sense.
Step 3: If there is a non-infringing option, subtract the profits the infringer could have made had it used the non-infringing option from its actual profits, to determine the amount to be disgorged.
A “non-infringing option” is any product that helps courts isolate the profits causally attributable to the infringement from the profits which arose at the same time the infringing product was used or sold, but which are not causally attributable to the infringement. Whether there is a relevant non-infringing option that can assist the court in this calculation is a question of fact. The infringer has the onus of establishing that there is a relevant non-infringing option.
The court also confirmed it was permissible to include springboard profits casually attributable to the infringement in the profits awarded to the plaintiff.
Review of the Execution of an Anton Piller Order
In Bell Media Inc. v. Macciacchera 2022 FC 1602 the court provides a detailed review of the execution of an Anton Piller order and the contempt of the defendants.
Dynamic Site Blocking Order
In Bell Media Inc. v. John Doe 1 2022 FC 1432 a dynamic site blocking order was quietly made relating to all matches of the FIFA World Cup Qatar 2022 broadcasted by any of the plaintiffs.
The Federal Court continues to consider motions seeking summary trial. In Libra Voyage Limited v. NA 5501 (Barge) 2022 FC 1311 the actions involved a complex factual matrix that required findings of fact, which will go to key issues in the trial with a web of interrelated facts and issues. It was inappropriate to grant summary trial. In Steelhead LNG (Aslng) Ltd. v. Arc Resources Ltd 2022 FC 998 it was said if the motion for summary trial is allowed the burden and onus of proof in the underlying action may apply. The parties to a motion for summary trial also must put their best foot forward regardless of where the onus lies.
Toronto, March 2023.
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These comments are general in nature and not intended to provide legal advice as individual situations will differ and should be discussed with a lawyer.