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At-a-glance: Canadian Intellectual Property Office (CIPO) Mailing address: Place du Portage I, 50 Victoria St, Room C-114, Gatineau, Quebec K1A 0C9, Canada Tel: +1 819 997 1936, Fax: +1 819 953 2476 Email: cipo.contact@ic.gc.ca Website: cipo.gc.ca With... [more]

With a new law and five cases decided by the Supreme Court, 2012 was another important year for copyright in Canada. After more than a decade of debate and three failed attempts at copyright reform, Canada's parliament passed Bill C-11 in June 2012, as many IP professionals had predicted.

The Copyright Modernization Act, as its name implies, brings copyright rules up to date and up to speed with technological developments and the digital age, while taking a balanced approach at protecting copyright owners' and consumers' rights.

"We have delivered on our commitment to modernise Canada's copyright legislation and strike the right balance between the needs of creators and users," said Christian Paradis, Ministry of Industry, in a statement at the time.

The new law protects copyright holders by prohibiting the sale or import of tools or services that enables the breaking of digital locks. Penalties related to the digital lock provisions focus on those who profit from the manufacture and sale of hacking tools and services.

The issue of fair dealing is also addressed taking into consideration consumers' needs. The Act allows businesses, educators and libraries to make greater use of copyright material in digital form; allows educators and students to make greater use of copyright material; and permits certain uses of copyright material by consumers.

The decisions handed down by the Supreme Court of Canada in five copyright cases in July 2012, are an indication of how application of the new law may shape intellectual property.

In Entertainment Software Association v SOCAN, the court ruled that the downloading of video games containing music is not considered a communication to the public and thus does not entitle the Society of Composers, Authors and Music Publishers of Canada (SOCAN) to collect additional tariffs.

Similarly, in Rogers Communications v SOCAN the Supreme Court held that music downloads are not a communication to the public and therefore not subject to public performance royalties. However, the same does not apply to streaming online music, which the Supreme Court deems a communication to the public and as such requires payment of royalties.

Making photocopies for the purposes of research or education fall under the fair dealing provision, authorising teachers to make photocopies of copyrighted material for their students, according to the decision handed down by the Supreme Court in Alberta (Education) v Canadian Copyright Licensing Agency (Access Copyright).

In Re:Sound v Motion Picture Theatre Associations of Canada, the Supreme Court held that copyright owners are not entitled to additional royalties when their music recordings that are part of a movie soundtrack are accompanied by the cinematographic work.

Finally, in SOCAN v Bell Canada, the Supreme Court held that 30-90 second music clips are not an infringement of copyright since they are part of consumers' research process before making a purchasing decision.

As a result of the new legislation and these decisions, some IP practitioners predict an uptick in copyright litigation.

Another high-profile and significant case that grabbed attention, not only in Canada but around the world, was Teva v Pfizer. In November 2012, the Supreme Court ruled in favour of the generic drug maker Teva and invalidated Pfizer's patent for sildenafil, the active ingredient in Viagra, on the grounds that the patent did not successfully disclose the invention. The patent lists nine "especially preferred compounds", but fails to specify that only one of them – sildenafil – was the one that Pfizer found to be effective in treating erectile dysfunction. The Supreme Court decision resulted in the invalidation of Pfizer's patent 18 months before its expiration and the launch of Teva's generic version of Viagra, Novo-Sildenafil.

While pharmaceutical cases have traditionally dominated IP litigation, this no longer seems to be the case, according to some IP experts. "It used to be that more than half of IP litigation had to do with pharmaceutical companies, but that is now changing," says one partner. "There is an economic shift in Canada towards the energy industry and other sectors as well."

Within the energy sector, one partner identified hydraulic fracturing, a technique used to extract oil or various forms of natural gas, as a key driver in technological developments which will in turn affect intellectual property. "The biggest change will come as a result of fracking," predicts one partner. "There'll be new technologies emerging in relation to this."