1.9.2 Intellectual Property
1.9.2.1 - Patents
• Patents are basically a unique registration method that allows inventors to disclose, and freely discuss inventions, while protecting the time and effort they invested in development. They generally have 17 years to profit from the patent.
• A patent can only be given for something physically planned, or demonstratable. [Permutit Co. v. Borrowman] These inventions must also have novelty and skill [General Electric Company, Limited v. Fada Radio, Limited]
• Patent rights may be assigned or transferred legally.
• Patents may be infringed, if this occurs the patent holder may sue for damages (typically lost profit)
• Generally patent developed by employees don’t become the property of the employer. [Willard’s Chocolates Ltd. v. Bardsley] In some cases the employee is specifically paid to be creative. In these cases the employer will hold the patent rights. [British Reinforced Concrete Engineering Co. Limited v. Lind]
1.9.2.2 - Trademarks
• Small symbols, names or designs (marks) that are used to distinguish one product from others. A registered trademark uses the symbol ‘T.M.’ or an ‘R’ in a circle. This prohibits the unauthorized use anyplace else in Canada.
• Trademarks must,
- not be a name (except for deceased more than 30 years)
- not easily confused with other words commonly used for that product
- similar to already registered trademarks
• The trademark owner may permit others to use the trademark and these may also be officially registered.
• a trademark registration is valid for 15 years, but can be renewed indefinitely.
• infringement on a trademark can be dealt with by restraining orders, civil suits, or in criminal courts.
1.9.2.3 - Copyright
• A copyright is used to restrict the right to copy or perform certain creative works.
• copyrights generally exist until 50 years after the authors death (in most cases)
• copyrights can be registered (optional) but if the copyright is to be assigned or licensed to another party, it should be registered.
• engineering plans can be copyrighted.
1.9.2.4 - Industrial Designs
• This is a protected design that is novel and original and generally refers to a sculpture, shape, configuration or pattern that is esthetic. The functional components cannot be considered.
• This can be registered for 5 years and then 5 more.
• This design can be assigned to others with written permission. This typically leads to licensing the design.
• An employer owns all rights to industrial designs.
• This design is formally registered.
1.9.2.5 - Trade Secrets
• A similar device to patents except there is no public disclosure, and it may include information, or other non-patentable things. Generally a trade secret permits a business advantage over the competition (“industrial know-how”)
• If somebody is given a trade secret (and it is made clear that it is both valuable and confidential), then they expose the trade secret, they can be sued for damages.
• The legal factors to determine secrecy are,
- similar knowledge outside the business
- measures taken to guard the secret
- the competitive value of the information
- the development cost for the information
• Employers can restrain or sue former employees with regard to trade secrets. [Amber Size & Chemical Co. Ltd. v. Menzel] Although courts will be reluctant to prevent a former employee from earning a living.
• Corporations may also be liable for trade secrets if they are entrusted with them, and then disclose them.
1.9.3 TORT/NEGLIGENCE
• The basic concept of a tort is that the negligence of one or more individuals has lead to loss or damages of another. The court seeks to compensate those who suffer as a result. This is independent of any contracts that might exist.
• A tort-feasor is a defendant that has been found liable for losses.
• Jointly and severally liable - when negligence has been proven to cause damage it is often the result of more than one action, each party found negligent will be assigned responsibility and will be respectively responsible for a percentage of the compensation. If one of the parties is unable to pay a share, the other parties will be expected to cover the shortfall.
• The essential elements of a successful tort suit are,
- a duty of care - “how would your neighbor expect you to act?”
- breach of expectations
- resulting damage
• a standard of care - “what would a reasonable person do?” - reasonable is an important concept in tort suits.
• Typical torts arise from,
- negligence
- negligent misconduct
- assault
- battery
- nuisance
- interference
• “cause of action” - somebody who can demonstrate a loss or damage. Somebody too remote will not be successful
• damages can be,
- pecuniary - special damages that can be demonstrated as having a certain value
- non-pecuniary - general damages that are hard to quantify
• Thin Skull - this principle suggests that if you are vulnerable, such as a weak heart, or thin skull, this cannot be used as a defense against liability.
• assumption of risk - in some cases some risks are inherent and obvious, and thus are consented to by any party willingly participating or entering. For example, somebody swimming in the ocean would assume some risk of being caught in currents.
• volenti - assumption of risk
• an engineer is liable for services, and may be responsible for more than his fee [Dominion Chain Co. Ltd. v. Eastern Construction Co. Ltd. et. al.]
• When a consumer buys a product there is a contractual obligation but if the product is used by another (not the buyer) the manufacturer owes the ultimate consumer a duty of care. [Donaghue v. Stevenson]
• Professionals can be liable for incorrect advice [Hedley Byrne & Co. Ltd. v. Heller & Partners Ltd.], designs [Trident Construction Ltd. v. W.L. Wardrop and Assoc. et. al.] or reports [Brown & Huston Ltd. v. The Corporation of the City of York et. al.]. Also important is that a fee does not have to be paid for a professional to be liable. [Unit Farm Concrete Products Ltd. v. Eckerlea Acres Ltd. et. al.; Canama Contracting Ltd. v. Huffman et. al.]
• in some cases strict liability may make an employer/manufacturer/etc. liable regardless of negligence.
• vicarious liability - an employer is liable for the actions of employees. [Dutton v. Bognor Regis United Building Co. Ltd.]
• employees can also be held liable in tort suits. [Northwestern Mutual Insurance Co. vs. J.T. O’Bryan & Co.]
• More than one party can be found to be negligent and are thus called “concurrent tort-feasor”. [Corporation of District of Surrey v. Carrol-Hatch et. al.]
• product liability is determined by the courts,
- if damage results when the product is used normally, and the manufacturer could have reasonably foreseen the results.
- there are some statutes (e.g., The Sale of Goods Act in Ontario) that provide certain conditions and warranties for sold goods.
- this area is a mixture of both tort and contract law [Donaghue v. Stevenson]
• Manufacturers are obliged to warn consumers when there are potentially dangerous uses of a product. [George Ho Lem v. Barotto Sports Ltd., and Ponsness-Warren Inc.]. This duty to warn is stricter than normal. [Lambert v. Lastoplex Chemicals Co. Limited et. al.]
• In tort cases, economic losses (e.g. lost business) can be counted as damages. [Rivtow Marine Ltd. v. Washington Iron Works et. al.] But, these tend to be limited economically [MacMillan Bloedel Ltd. v. Foundation Co.] and in delay. [Bethlehem Steel Corporation v. St. Lawrence Seaway Authority]
• The categories of economic loss may change in the future [Junior Books Ltd. v. Veitchi Co. Ltd.]
• There are time limitations between when a cause of action occurs and when the suit can be started (6 years in Ontario, 20 years if the contract is signed with a seal). If a suit is started after the limitation period it is called “statute barred”. This can be changed by a clause in a contract.
• There are also other limitation periods possible. For example, the Engineers Act of Ontario limits lawsuits to 12 months after the date the engineering work was done (or should have been). But the court may extend this in some situations. [Attorney-General of Canada v. Libling et. al.]. Note that this is different from general negligence where the limitation period is measured from the “cause of action” (e.g., when the house fell down, not when it was built). [Sparham Souter et. al. v. Town & Country Developments (Essex) Ltd. et. al.] Although the courts are still dealing with the ramifications of Sparham-Souter. [Robert Simpson Co. Ltd. v. Foundation Co.] [Viscount Machine and Tool Ltd. vs. Clarke] [Pirelli General Cable Works Ltd. vs. Oscar Faber and Partners] [City of Kamloops vs. Nielsen et. al.]
• The tort of defamation involves an untrue statement that damages a reputation. If it is written it is called libel, or if it is verbal it is called slander.
• Occupiers’ Liability - anybody occupying property is responsible for anybody coming onto the property. Guests and trespassers should be protected against dangers the occupier is aware of. Business guests generally receive a higher duty of care and the occupier is expected to safeguard them against dangers that should be reasonably recognized.
• The Tort of Nuisance - an occupant should be able to enjoy their land without interference. In some cases this will result in a lawsuit. [Newman et. al. v. Conair Aviation Ltd. et. al.] [Jackson et. al. v. Drury Construction Co. Ltd.]