Sookman tclg year_in_review_2011

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Here are the slides used in my presentation to the Toronto Computer Lawyers Group earlier today, The Year in Review: Developments in Computer, Internet and E-Commerce Law (2010-2011). It covers significant developements since my talk last spring.

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Sookman tclg year_in_review_2011

  1. 1. McCarthy Tétrault Advance™ Building Capabilities for Growth Toronto Computer Lawyers Group The Year in Review: Developments in Computer, Internet and E-Commerce Law (2010-2011)Barry B. Sookmanbsookman@mccarthy.ca416-601-7949 June 15, 2011McCarthy Tétrault LLP / mccarthy.ca 10398714 1
  2. 2. PrivacyMcCarthy Tétrault LLP / mccarthy.ca 2
  3. 3. Citi Cards Canada Inc. v. Pleasance, 2011 ONCA 3 ¬ “Personal information” is defined in s. 2(1) of the Act. It “means information about an identifiable individual.” ¬ “This is a very elastic definition, and should be interpreted in that fashion to give effect to the purpose of the Act. There can be no doubt that financial information pertaining to a debtor, collected and used by a financial institution in the course of a mortgage transaction – including the particulars of, and the balance owing on the debtor’s mortgage – is “information about an identifiable individual.” Current mortgage balances are not information that is publicly available.”McCarthy Tétrault LLP / mccarthy.ca 3
  4. 4. Leon’s Furniture Limited v. Alberta (Information and Privacy Commissioner), 2011 ABCA 94 ¬ The “identifiable individual” term has two components. Firstly, the individual must be “identifiable”. Generic and statistical information is thereby excluded, and the personal information (here the relevant number) must have some precise connection to one individual. Secondly, the information must relate to an individual. Information that relates to objects or property is, on the face of the definition, not included. The key to the definition is the word “identifiable”. ¬ “Further, to be “personal” in any reasonable sense the information must be directly related to the individual; the definition does not cover indirect or collateral information. Information that relates to an object or property does not become information “about” an individual, just because some individual may own or use that property.” ¬ Driver’s licence numbers are PI but licence plate numbers are not. ¬ “The respondent [Privacy Commissioner] is not empowered to direct an organization to change the way it does business, just because the respondent thinks he has identified a better way. So long as the business is being conducted reasonably, it does not matter that there might also be other reasonable ways of conducting the business.”McCarthy Tétrault LLP / mccarthy.ca 4
  5. 5. State Farm Mutual Automobile Insurance Company v. Privacy Commissioner of Canada, 2010 FC 736 ¬ Is the collection of evidence by an insurer acting for one of its insured in the defence of a third party tort action a “commercial activity” within the meaning of PIPEDA? ¬ “I conclude that, on a proper construction of PIPEDA, if the primary activity or conduct at hand, in this case the collection of evidence on a plaintiff by an individual defendant in order to mount a defence to a civil tort action, is not a commercial activity contemplated by PIPEDA, then that activity or conduct remains exempt from PIPEDA even if third parties are retained by an individual to carry out that activity or conduct on his or her behalf. The primary characterization of the activity or conduct in issue is thus the dominant factor in assessing the commercial character of that activity or conduct under PIPEDA, not the incidental relationship between the one who seeks to carry out the activity or conduct and third parties. In this case, the insurer- insured and attorney-client relationships are simply incidental to the primary non-commercial activity or conduct at issue, namely the collection of evidence by the defendant Ms. Vetter in order to defend herself in the civil tort action brought against her by Mr. Gaudet.”McCarthy Tétrault LLP / mccarthy.ca 5
  6. 6. Nammo v. TransUnion of Canada Inc., 2010 FC 1284 ¬ “TransUnion’s suggestion that a breach may be found only if an organization’s accuracy practices fall below industry standards is also untenable.” “There is no defence of practical necessity set out in PIPEDA.” ¬ “PIPEDA does not require that personal information be completely accurate, complete, and up-to-date; rather, it requires that personal information be as accurate, complete, and up-to-date “as is necessary for the purposes for which it is to be used.” Thus, it is the use that the information is put to that dictates the degree of accuracy, completeness, and currency the information must have... Informed, reliable and objective decisions require that the information on which the decisions are based meets a high standard of accuracy, completeness and currency.”McCarthy Tétrault LLP / mccarthy.ca 6
  7. 7. Damage Awards Under PIPEDA ¬ Nammo v. TransUnion of Canada Inc., 2010 FC 1284 “In Vancouver (City) v Ward, 2010 SCC 27, the Supreme Court... addressed the different goals of awarding damages for a Charter breach; these include compensation, for which loss is relevant, but also vindication and deterrence, for which loss is not a determinative factor.” ¬ “In my view, the same reasoning applies to a breach of PIPEDA, which is quasi-constitutional legislation.... Applying the Supreme Court’s reasoning in Ward to PIPEDA applications before this Court indicates that both the question of whether damages should be awarded and the question of the quantum of damages should be answered with regard to whether awarding damages would further the general objects of PIPEDA and uphold the values it embodies. Furthermore, deterring future breaches and the seriousness or egregiousness of the breach would be factors to consider.”McCarthy Tétrault LLP / mccarthy.ca 8
  8. 8. McCarthy Tétrault LLP / mccarthy.ca 9
  9. 9. Can claims be brought for losses arising from privacy breaches? ¬ In re Hannaford Bros. Co. Customer Data Security Breach Litigation 4 A.3d 492 (Sup, Ct. Me. 2010) (Data breach where customer data was stolen. No claim for time spent to avoid foreseeable harm w/o physical harm, economic loss, or identity theft.) Also, Paul v Providence Health System 240 P.3d 1110 (2010) ¬ Doe 1 v. AOL LLC 719 F.Supp.2d 1102 (N.D.Cal. 2010) (Data breach. “the Court is persuaded that Plaintiffs allegations are sufficient to demonstrate standing for purposes of seeking injunctive relief. The Complaint alleges that AOL engages in a practice and policy of storing search queries containing confidential information, and that it has taken no steps to ensure that such information is not disclosed again in the future.”) ¬ LaCourt v. Specific Media, Inc. 2011 WL 1661532 (C.D.Cal. Apr. 28, 2011) (Collecting browsing histories. “Ultimately, the Court probably would decline to say that it is categorically impossible for Plaintiffs to allege some property interest that was compromised by Defendants alleged practices.” ¬ Claridge v. RockYou, Inc. 2011 WL 1361588 (N.D.cal. Apr. 11, 2011) (Data breach. “although the court has doubts about plaintiffs ultimate ability to prove his damages theory in this case, the court finds plaintiffs allegations of harm sufficient at this stage to allege a generalized injury in fact.”)McCarthy Tétrault LLP / mccarthy.ca 10
  10. 10. Jones v. Tsige, 2011 ONSC 1475 ¬ The central issue in this case is whether there is a tort for invasion of privacy. ¬ “While it is certainly the case that in Euteneier, the plaintiff was not suing on the basis of an intentional tort, the extent to which privacy rights are enforceable at law was squarely before the court for purposes of determining the content of the duty of care owed by the police to the plaintiff while in custody. In my view, the inescapable conclusion, put quite plainly by the Court of Appeal in paragraph 63 of that decision, is that there is no “free standing right to ...privacy...at common law.”” ¬ “I would also note that this is not an area of law that requires “judge- made” rights and obligations. Statutory schemes that govern privacy issues are, for the most part, carefully nuanced and designed to balance practical concerns and needs in an industry- specific fashion.”McCarthy Tétrault LLP / mccarthy.ca 11
  11. 11. CTB v. News Group Newspapers Ltd & Anor [2011]EWHC 1326 (QB) ¬ “Mr Spearman argues ...that in effect privacy injunctions (and no doubt other forms of injunction also) have ceased to serve any useful purpose in the age of the Internet. Not only can information be put out on various networks from within this jurisdiction, but it can obviously be done also by anyone who wishes in other jurisdictions.” ¬ ”Should the court buckle every time one of its orders meets widespread disobedience or defiance?” ¬ ”the law nowadays is required to protect information in respect of which there is a reasonable expectation of privacy...” “It is fairly obvious that wall-to-wall excoriation in national newspapers, whether tabloid or "broadsheet", is likely to be significantly more intrusive and distressing for those concerned than the availability of information on the Internet or in foreign journals to those, however many, who take the trouble to look it up. Moreover, with each exposure of personal information or allegations, whether by way of visual images or verbally, there is a new intrusion and occasion for distress or embarrassment. Mr Tomlinson argues accordingly that "the dam has not burst". For so long as the court is in a position to prevent some of that intrusion and distress, depending upon the individual circumstances, it may be appropriate to maintain that degree of protection. The analogy with King Canute to some extent, therefore, breaks down.”McCarthy Tétrault LLP / mccarthy.ca 12
  12. 12. City of Ontario, Cal. v. Quon, 130 S. Ct. 2619 Do employees have reasonable expectations of privacy in work owned devices? ¬ “Rapid changes in the dynamics of communication and information transmission are evident not just in the technology itself but in what society accepts as proper behavior. As one amici brief notes, many employers expect or at least tolerate personal use of such equipment by employees because it often increases worker efficiency.” ¬ ”Cell phone and text message communications are so pervasive that some persons may consider them to be essential means or necessary instruments for self-expression, even self-identification. That might strengthen the case for an expectation of privacy... And employer policies concerning communications will of course shape the reasonable expectations of their employees, especially to the extent that such policies are clearly communicated.” ¬ “A broad holding concerning employees privacy expectations vis-à-vis employer-provided technological equipment might have implications for future cases that cannot be predicted.”McCarthy Tétrault LLP / mccarthy.ca 13
  13. 13. R. v. Cole, 2011 ONCA 218 “I conclude that the appellant had a reasonable expectation of privacy from state intrusion in the personal use of his work computer and in the contents of his personal files on its hard drive. However, his expectation of privacy was modified. He had no expectation of privacy with respect to access to his hard drive by his employer’s technician for the limited purpose of maintaining the technical integrity of the school’s information network and the laptop.”McCarthy Tétrault LLP / mccarthy.ca 14
  14. 14. Sparks v. Dubé, 2011 NBQB 40 ¬ Court made a preservation order and injunction compelling Erica Sparks: 1) to preserve the entire contents of her personal web page(s) on Facebook, and 2) to participate in making copies. ¬ Plaintiff’s lawyer was ordered to contact the plaintiff and, without disclosing the nature of the subject matter schedule a meeting with her at a location convenient to access and download data from the Internet and reduce it to usable form. ¬ Upon meeting with the plaintiff the solicitor had to apprise her of the terms and conditions of the order. ¬ Immediately upon disclosure of the terms and conditions of the order the plaintiff, in the presence of the solicitor, was required to create permanent tangible records of her web page(s) on Facebook. ¬ Order made ex parte!McCarthy Tétrault LLP / mccarthy.ca 20
  15. 15. Bill C-28 Fighting Internet and Wireless Spam Act ¬ FISA will impede start-up businesses from launching in Canada. ¬ FISA will impede Canadian businesses from developing new marketing models over the Internet. ¬ FISA will deter suppliers of service providers, including outsourcing and cloud service providers, from operating with or maintaining facilities in Canada. ¬ FISA will deter foreign businesses from offering their products to Canadians via the Internet, mobile and other communications networks. ¬ FISA will impose costs and restrictions on Canadian businesses that their competitors outside Canada will not have to bear. ¬ FISA contains very strong incentives for Canadian businesses to confess wrong-doing, even in cases of questionable or trivial conduct, thereby tarnishing the reputation of legitimate businesses in circumstances where the offending conduct is not significant. ¬ FISA will chill legitimate commercial speech and thereby undermine fundamental values protected by the Charter of Rights and Freedoms. See Rethinking FISA, http://www.barrysookman.com/2011/05/25/rethinking-fisa/McCarthy Tétrault LLP / mccarthy.ca 22
  16. 16. New UK Cookie Regulations ¬ Privacy and Electronic Communications Regulations put into place on May 26, 2011 to implement EU “Cookie Directive”. ¬ 6 (1) Subject to paragraph (4), a person shall not store or gain access to information stored, in the terminal equipment of a subscriber or user unless the requirements of paragraph (2) are met. ¬ (2) The requirements are that the subscriber or user of that terminal equipment (a) is provided with clear and comprehensive information about the purposes of the storage of, or access to, that information; and (b) has given his or her consent. ¬ (3) Where an electronic communications network is used by the same person to store or access information in the terminal equipment of a subscriber or user on more than one occasion, it is sufficient for the purposes of this regulation that the requirements of paragraph (2) are met in respect of the initial use. ¬ “(3A) For the purposes of paragraph (2), consent may be signified by a subscriber who amends or sets controls on the internet browser which the subscriber uses or by using another application or programme to signify consent. ¬ (4) Paragraph (1) shall not apply to the technical storage of, or access to, information (a) for the sole purpose of carrying out the transmission of a communication over an electronic communications network; or (b) where such storage or access is strictly necessary for the provision of an information society service requested by the subscriber or user.McCarthy Tétrault LLP / mccarthy.ca 25
  17. 17. New UK Cookie Regulations ¬ ICO Guidelines @ http://ow.ly/5gJnT ¬ Organizations have 12 months to phase in the new system, but are expected to take steps to comply within this period. ¬ “At present, most browser settings are not sophisticated enough to allow you to assume that the user has given their consent to allow your website to set a cookie. Also, not everyone who visits your site will do so using a browser. They may, for example, have used an application on their mobile device. So, for now we are advising organisations which use cookies or other means of storing information on a user’s equipment that they have to gain consent some other way.“ ¬ Standards may be different in other jurisdictions where company has an “establishment”. ¬ Third-party cookies create special issues – ICO requires that users be made aware of what is being collected and by whom.McCarthy Tétrault LLP / mccarthy.ca 26
  18. 18. Developments in India ¬ New privacy regs issued in April 2011 and prescribed how PI may be collected and used by virtually all organizations in India ¬ Regs appear to apply to info of both Indian residents and foreign nationals ¬ This means that transaction or sales calls must conform to Indian standards ¬ Appears to apply to controllers, processors and intermediaries touching PI ¬ Sensitive PI involves heightened obligations, including prior consent by letter, fax, or e-mail ¬ No exceptions on basis of necessity ¬ Right to withdraw consent ¬ Officer must be nominated to deal with grievances ¬ Security control measures must be documented and may be audited ¬ Subjects have right to review and correct data ¬ Failure to comply can result in jail term of up to 3 years or fine of approx. $4,500McCarthy Tétrault LLP / mccarthy.ca 27
  19. 19. Contracts and Electronic AgreementsMcCarthy Tétrault LLP / mccarthy.ca 28
  20. 20. Seidel v. TELUS Communications Inc., 2011 SCC 15 ¬ Issue: whether British Columbia Business Practices and Consumer Protection Act (BPCPA) renders arbitration clause void. ¬ The choice to restrict or not restrict arbitration clauses in consumer contracts is a matter for the legislature. ¬ Absent legislative intervention, the courts will generally give effect to the terms of a commercial contract freely entered into, even a contract of adhesion, including an arbitration clause. ¬ Section 172 is clearly designed to encourage private enforcement in the public interest. It was open to the legislature to prefer the vindication and denunciation available through a well-publicized court action to promote adherence to consumer standards. ¬ The legislature understood that the policy objectives of s. 172, would not be well served by a series of isolated low-profile, private and confidential arbitrations. ¬ All other causes of action including breach of Trade Practices Act and common law claims subject to arbitration clause.McCarthy Tétrault LLP / mccarthy.ca 29
  21. 21. AT&T Mobility LLC v. Conception, 2011 WL 1561956(U.S. Sup. Ct. 2011) ¬ Issue: whether AT&T’s consumer contracts requiring arbitration and precluding class arbitration were enforceable under the US the FAA. ¬ Court reversed 9th Circuit which held such clauses unconscionable, overruling California’s Discover Bank rule. ¬ “The overarching purpose of the FAA...is to ensure the enforcement of arbitration agreements according to their terms so as to facilitate streamlined proceedings. Requiring the availability of classwide arbitration interferes with fundamental attributes of arbitration and thus creates a scheme inconsistent with the FAA.”McCarthy Tétrault LLP / mccarthy.ca 30
  22. 22. Evans v. Linden Research, Inc., 2011 WL 339212(E.D.Pa. 2011) ¬ Validity of forum selection and arbitration clauses. ¬ “[F]or any claim related to this Agreement or our Service, excluding claims for injunctive or other equitable relief, where the total amount sought is less than ten thousand U.S. Dollars ($10,000 USD), either we or you may elect at any point in or during a dispute or proceeding to resolve the claim through binding nonappearance-based arbitration.... [T]he arbitration shall be conducted at the option of the party seeking relief, by telephone, online or based solely on written submissions.... [T]he arbitration shall not involve any personal appearance by the parties or witnesses unless otherwise mutually agreed by the parties ... [A]ny judgment on the award rendered by the arbitrator may be entered in any court of competent jurisdiction.” ¬ Clause valid because: ¬ Either party had option to elect arbitration for claims under $10k. ¬ There was no requirement to appear in the selected venue as claims could be adjudicated by phone, on-line, or by written submission. ¬ The arbitrator was not a preselected mandatory arbitrator.McCarthy Tétrault LLP / mccarthy.ca 31
  23. 23. St-Arnaud v. Facebook Inc., 2011 QCCS 1506 ¬ With respect to paragraph 3 of article 3148 C.C.Q., the grounds that a damage was suffered in Quebec would give jurisdiction to the Superior Court of Quebec even though Facebook has no link to Quebec, other than the fact that the website is accessible in Quebec. ¬ “You will resolve any claim, cause of action or dispute ("claim") you have with us arising out of or relating to this Statement or Facebook exclusively in a state or federal court located in Santa Clara County.” ¬ “It is obvious that all Users agreed to be continually bound by Facebooks Terms of Use. St-Arnaud could only gain initial access to the website by clicking on an icon labelled "Sign Up" where immediately below it was clearly written. By clicking Sign Up, Users indicate that they have read and agreed to the Terms of Use and Privacy Policy... Once St- Arnaud joined the website, every time he wanted to log into it, he would need to either remain logged in or access the website login page, which always includes a link to the Terms. Moreover, every time St-Arnaud would access the website, he would find a link to the Terms at the bottom of every page available onFacebook, including his own personal page....The Jurisdiction Clause is binding upon St-Arnaud and the Members of the Group.”McCarthy Tétrault LLP / mccarthy.ca 32
  24. 24. Grosvenor v. Qwest Communications Intern., Inc.,2010 WL 3906253 (D. Colo. 2010) ¬ “The Qwest Subscriber Agreement and the Arbitration Clause do not appear on the same scroll down box or page as the “I Accept” and the “I Do Not Accept” buttons...the Subscriber Agreement is referenced by the Legal Agreements page but it is not expressly incorporated into the Clickwrap Agreement”. ¬ “As presented, the Clickwrap Agreement does not clearly incorporate the Subscriber Agreement by reference and to reach the arbitration clause requires the user to leave the installation program, log onto the Internet (if possible), navigate to the proper page, and read the Subscriber Agreement, then return to the installation programs scroll down window to read the remaining ten pages of the High-Speed Internet Modem Installation Legal Agreement before choosing whether to agree to the terms... This creates an ambiguity regarding recourse in the event of a dispute. These circumstances demonstrate a genuine issue of fact.”McCarthy Tétrault LLP / mccarthy.ca 33
  25. 25. Roling v. E*Trade Securities, LLC, 756 F. Supp. 2d1179 (N.D. Cal. 2010) ¬ Is a term in an online brokerage agreement that permits E*TRADE to modify its fee structure at any time by posting a modified structure on its Web site and requires customers to check E*Trades website for modifications enforceable? ¬ “In sum, E*Trade is unable to cite to any case, whether under New York law or California law, that undercuts plaintiffs allegation that a contractual provision that allows a party to unilaterally change the terms of the contract without notice is unenforceable.”McCarthy Tétrault LLP / mccarthy.ca 35
  26. 26. Patco Const. Co., Inc. v. People’s United Bank, 2011 WL 2174507 (D.Me. May 27, 2011) “In addition, by virtue of the posting online of the Modified eBanking Agreement, Patco effectively agreed to monitor its commercial accounts daily. While Patco protests that it did not actually ever see the Modified eBanking Agreement and thus was never properly notified of its existence or bound by it... the Bank reserved the right, in the Original eBanking Agreement, to modify the terms and conditions of that agreement at any time effective upon publication...There is no dispute that Patco reviewed and agreed to the terms of the Original eBanking Agreement....The online publication of the Modified eBanking Agreement hence was binding upon Patco. See, e.g., Harold H. Huggins Realty, Inc. v. FNC, Inc., 575 F.Supp. 2d 696, 708 (D.Md. 2008) (unilateral modification of Internet-based service contract held effective when prior agreements permitted modification at any time and stated that modifications would be effective after they were posted for 30 days).”McCarthy Tétrault LLP / mccarthy.ca 36
  27. 27. Is violation of website terms or computer use policya criminal or civil offense? ¬ Computer Fraud and Abuse Act (CFAA) and States laws e.g. California Computer Crime Law, Cal. Penal Code §502. ¬ Accessing a protected computer (website) “knowingly” without authorization, or exceeding authorized access to a protected computer, involves a risk of violating a number of federal and state statutes creating penal sanctions and private causes of action. ¬ U.S. v. Nosal 2011 WL 1585600 (9th. Cir. Apr 28, 2011) (“under the CFAA, an employee accesses a computer in excess of his or her authorization when that access violates the employers access restrictions, which may include restrictions on the employees use of the computer or of the information contained in that computer.”) Also,United Stats v. Rodriguez, 628 F. 3d 1258, (11th Cir. 2010) ¬ Facebook, Inc. v. Power Ventures, Inc. 2010 WL 3291750 (N.D.cal.2010) (Requires something more e.g. circumvention of technical or code based barriers.)McCarthy Tétrault LLP / mccarthy.ca 37
  28. 28. Distinct Fortune Ltd. v. Hyndland Investment Co. Ltd.[2010] HKEC 2013 ¬ Does SMS message satisfy HK Conveyancing and Properties Ordinance. ¬ The plaintiff submitted that the CPO should be given an updated construction by making allowances for social and technological changes; that SMS was in a visible form and was a personal way of communication by electronic means; that the principal function of a “signature” is to demonstrate an authenticating intention of the signor and the sending of an SMS should constitute the signing of it by the sender. ¬ ”On the question of signature, I think the SMS is not a signed document... I agree with leading counsel of the defendant that there is not even the expression of “(sd.)”. If the clicking of the send button would amount to the signing of the SMS, then all SMS and emails are signed documents. This cannot be right.”McCarthy Tétrault LLP / mccarthy.ca 41
  29. 29. Contract and License IssuesMcCarthy Tétrault LLP / mccarthy.ca 43
  30. 30. De Beers UK Ltd. v. Atos Origin It Services UK Ltd.[2010] EWHC 3276 (16 December 2010) ¬ “In my judgment, the demands made by Atos, particularly in the e-mail of 2 June 2008, did not reflect its contractual entitlement and, in putting them forward, it was not undertaking to continue to perform the Contract. For a start, what Atos was willing to do was "to complete the project on a time and materials basis at our own internal standard rates". That is an expression of an intention to complete the work on different terms, not upon the terms originally agreed. Second, this offer was itself subject, amongst other things, to DBs agreement to waive any claim that it may have against Atos in relation to Atoss delivery to date. That also was something upon which Atos had no right to insist. ¬ The fact that Atos repeatedly asserted its willingness and wish to complete the project is neither here nor there. There is a very significant difference between being willing to complete a project, and being willing to fulfil a contract. Atos may have been genuinely prepared to do the former, on its own terms, but that was itself inconsistent with a willingness to do the latter.”McCarthy Tétrault LLP / mccarthy.ca 44
  31. 31. Baidu, Inc. v. Register.com, Inc., 2010 WL2900313 (S.D.N.Y.2010) ¬ Will limitation of liability clauses be effective to exclude damages resulting from cyber-attacks? ¬ “New York courts will decline to enforce a contractual limitation or waiver of liability clause when there is wilful or grossly negligent or recklessly indifferent conduct.” ¬ Baidu alleged sufficient facts to give rise to a plausible claim of gross negligence or recklessness: ¬ Register failed to follow its own security protocols and essentially handed over control of Baidus account to an unauthorized Intruder, who engaged in cyber vandalism. ¬ Register failed to follow its own security protocol. ¬ “The attack by the Intruder was reasonably foreseeable—it was precisely because these cyber attacks are foreseeable that the security measures were adopted... Baidu... did not waive its claims for gross negligence or recklessness.”McCarthy Tétrault LLP / mccarthy.ca 48
  32. 32. Patents and Trade-marksMcCarthy Tétrault LLP / mccarthy.ca 50
  33. 33. Amazon.com, Inc. v. Attonrey General of Canada, 2010 FC 1011 ¬ Commissioner had ignored “fundamental differences between the foreign and the domestic regimes” as they pertained to patents and ignored “Canadian legal principles altogether”. ¬ Commissioner has no discretion to deviate from the Canadian patent law and its interpretation by the Courts. ¬ The Commissioner erred in adopting a policy role inconsistent with established Canadian legal principles. ¬ The Commissioner’s reasons for excluding business method patents can no longer be a barrier to obtaining a patent for a business method in Canada. ¬ There is no requirement that eligible subject matter exhibit a “technical character” or that it support a “technical contribution”.McCarthy Tétrault LLP / mccarthy.ca 51
  34. 34. Microsoft Crop. V I4I Limited Partnership 564 U.S. __ (2011) ¬ The Court rejects Microsoft’s contention that a defendant need only persuade the jury of a patent invalidity defense by a preponderance of the evidence. There, tracing nearly a century of case law, the Court stated, inter alia, that “there is a presumption of [patent] validity [that is] not to be overthrown except by clear and cogent evidence”. ¬ New evidence supporting an invalidity defense may carry more weight in an infringement action than evidence previously considered by the PTO. ¬ The Court is in no position to judge the comparative force of the parties’ policy arguments as to the wisdom of the clear and convincing-evidence standard that Congress adopted.McCarthy Tétrault LLP / mccarthy.ca 52
  35. 35. Board of Trustees of Leland Stanford Junior University v.Roche Molecular Systems, Inc., 563 U.S. ___(2011) ¬ ”Since 1790, the patent law has operated on the premise that rights in an invention belong to the inventor. The question here is whether the University and Small Business Patent Procedures Act of 1980— commonly referred to as the Bayh–Dole Act—displaces that norm and automatically vests title to federally funded inventions in federal contractors. We hold that it does not.” ¬ “Stanfords reading of the phrase “invention of the contractor” to mean “all inventions made by the contractors employees” is plausible enough in the abstract; it is often the case that whatever an employee produces in the course of his employment belongs to his employer. No one would claim that an autoworker who builds a car while working in a factory owns that car. But, as noted, patent law has always been different: We have rejected the idea that mere employment is sufficient to vest title to an employees invention in the employer. Against this background, a contractors invention—an “invention of the contractor”—does not automatically include inventions made by the contractors employees.”McCarthy Tétrault LLP / mccarthy.ca 54
  36. 36. CopyrightMcCarthy Tétrault LLP / mccarthy.ca 59
  37. 37. Upcoming in Supreme Court Supreme Court granted leave to appeal: ¬ Tariff 22 – is a download a communication to the public. ¬ Tariff 22 – is an internet preview a fair dealing for research purposes. ¬ K-12 –fair dealing in the K-12 educational sector.McCarthy Tétrault LLP / mccarthy.ca 63
  38. 38. Harmony Consulting Ltd. v. G.A. Foss Transport Ltd.,2011 FC 340 ¬ Computer programs that are dictated by the operating system or reflect common programming practices are not original expression and will not receive copyright protection. ¬ Compilation of computer program elements can be protected by copyright. ¬ Minor fixes to a program which are not original are not protected by copyright. ¬ Program features developed using MS Access “wizard” not original or protectable. ¬ A nunc pro tunc copyright assignment does not satisfy the writing requirements for assignments where there was no original intention to transfer the copyright. ¬ Section 13(3) of (which vests copyright in works to employers) applies to officers, directors and employees. ¬ Use of software, without more, outside the scope of a license e.g., more seats than licensed, is not copyright infringement. ¬ Making modifications to software which include opening a file, making changes and resaving the file is not a reproduction. ¬ Making a back-up copy does not involve making a reproduction. ¬ How many errors can one court judgment contain?McCarthy Tétrault LLP / mccarthy.ca 64
  39. 39. Google v Copiepresse et al, Brussels Court of Appeal (9th Chamber) May 5, 2011 The decision canvasses many issues including ¬ the choice of law to apply to evaluate the claims of infringement, ¬ whether Google’s caching of news articles is infringement, ¬ whether the transmission of article titles and short extracts violates the reproduction and communication to the public rights, ¬ whether Google News violates the moral rights of authors, ¬ whether statutory fair dealing defenses apply, ¬ whether Google can rely on implied licenses from publishers and authors to publish Google News, and ¬ whether intermediary safe harbors are available under Belgium law for providers of these services. See, Is Google News legal? http://www.barrysookman.com/2011/05/17/is-google-news-legal/McCarthy Tétrault LLP / mccarthy.ca 72
  40. 40. Kernal Records Oy v. Mosley, 2011 WL 2223422(S.D.Fla. Jun. 7, 2011) “We hold that publishing AJE on a website in Australia was an act tantamount to global and simultaneous publication of the work, bringing AJE within the definition of a “United States work” under § 101(1)(C) and subject to § 411(a)s registration requirement. Gallefoss elected to publish AJE on the Internet and the legal consequences of that decision must apply. Plaintiff was therefore required to register AJE prior to seeking judicial enforcement of its copyright rights.”McCarthy Tétrault LLP / mccarthy.ca 76
  41. 41. Slides available @ barrysookman.com and mccarthy.caMcCarthy Tétrault LLP / mccarthy.ca 78
  42. 42. VANCOUVER MONTRÉAL Suite 1300, 777 Dunsmuir Street Suite 2500 P.O. Box 10424, Pacific Centre 1000 De La Gauchetière Street West Vancouver BC V7Y 1K2 Montréal QC H3B 0A2 Tel: 604-643-7100 Tel: 514-397-4100 Fax: 604-643-7900 Fax: 514-875-6246 Toll-Free: 1-877-244-7711 Toll-Free: 1-877-244-7711 CALGARY QUÉBEC Suite 3300, 421 7th Avenue SW Le Complexe St-Amable Calgary AB T2P 4K9 1150, rue de Claire-Fontaine, 7e étage Tel: 403-260-3500 Québec QC G1R 5G4 Fax: 403-260-3501 Tel: 418-521-3000 Toll-Free: 1-877-244-7711 Fax: 418-521-3099 Toll-Free: 1-877-244-7711 TORONTO Box 48, Suite 5300 UNITED KINGDOM & EUROPE Toronto Dominion Bank Tower 125 Old Broad Street, 26th Floor Toronto ON M5K 1E6 London EC2N 1AR Tel: 416-362-1812 UNITED KINGDOM Fax: 416-868-0673 Tel: +44 (0)20 7489 5700 Toll-Free: 1-877-244-7711 Fax: +44 (0)20 7489 5777 OTTAWA Suite 200, 440 Laurier Avenue West Ottawa ON K1R 7X6 Tel: 613-238-2000 Fax: 613-563-9386 Toll-Free: 1-877-244-7711McCarthy Tétrault LLP / mccarthy.ca 79

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