Canada's Anti-Spam Law: Will Your Business Be Ready?

On February 13th, the Communications Group hosted a breakfast seminar in the Toronto office entitled “Canada’s Anti-Spam Law: Will Your Business Be Ready?”.  David Elder briefed those in attendance on key requirements of Canada’s Anti-Spam Law (CASL), the electronic messaging requirements of which will come into effect on July 1, 2014. Among those requirements, David spoke of the obligation to obtain prior consent in the delivery of commercial electronic messages (CEMs) and the prescribed form requirements for those messages, outlined a number of the key exemptions that may be available to some senders, and reviewed the timeline for implementation of various aspects of the new law.  David also reviewed some of the particular challenges that organizations are facing in implementing the new law and discussed the work that organizations must do to be able to continue to send marketing messages to established contact lists.   

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Voltage meets resistance from Federal Court: new safeguards imposed on disclosure order to combat copyright trolling

David Elder -

In a ground-breaking order, the Federal Court of Canada has for the first time included, in an order compelling third party disclosure of subscriber information, new conditions intended to better balance subscriber privacy rights and dissuade abuse of disclosure orders by copyright owners.

In the case of Voltage v. Doe, film production company Voltage Pictures LLC had sought from internet service provider TekSavvy Solutions Inc. the disclosure of the contact information of some 2,000 internet service customers that Voltage alleged had illegally downloaded movies in which it holds copyright.  TekSavvy refused to disclose the records in question, and Voltage brought a motion for an order requiring TekSavvy to disclose the information in question.

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Budget 2014: new money for broadband, new wireless rules and enforcement tools

David Elder -

The 2014 federal budget, introduced on February 11, 2014, included several items of interest to the telecommunications industry, including plans for revisions to the regulatory framework for wireless services and a commitment of federal funding to extend and enhance the access to high-speed broadband networks in rural and Northern communities.

As part of its “consumers first” strategy, the government has proposed, in its Economic Action Plan 2014, a number of measures intended to strengthen competition in the telecommunications market.  Notably, the new budget builds on an earlier announcement of plans to amend the Telecommunications Act to cap wholesale domestic wireless roaming rates, at least until such time as the CRTC, which is currently examining the issue, makes a decision respecting such roaming rates.

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Government agencies clarify roles under Canada's Anti-Spam Legislation

David Elder and Shannon Kack -

In an effort to coordinate their potentially overlapping mandates, the three agencies charged with enforcement of Canada’s new anti-spam law have signed a Memorandum of Understanding (MOU) dealing with cooperation and sharing of information among the agencies.

On January 23, 2014, the Competition Bureau announced that the Commissioner of Competition, the Privacy Commissioner of Canada and the Canadian Radio-television and Telecommunications Commission (CRTC), have signed an MOU regarding the implementation of their respective mandates under Canada’s Anti-Spam Legislation (CASL).

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IIROC releases guidance regarding dealer outsourcing

Earlier this week, the Investment Industry Organization of Canada released guidance relating to the outsourcing arrangements commonly entered into by investment dealers.

Generally, the notice summarizes existing requirements and guidance relating to entering into and maintaining outsourcing arrangements, describes the types of business activities that may and may not be outsourced and sets out IIROC's expectations concerning due diligence procedures that must be undertaken by dealers prior to outsourcing business activities.

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Supreme Court of Canada addresses important issues in Canadian Copyright Law

Justine Whitehead and Gina Demczuk -

On December 23, 2013, a unanimous Supreme Court of Canada issued its decision in Cinar Corporation v Robinson. The decision provides clarification on a number of important issues in Canadian copyright law, including (but not limited to): (i) the appropriate test for determining if a substantial part of a copyrighted work has been reproduced; (ii) when expert evidence in respect of substantial taking should be adduced in copyright infringement cases; and (iii) several issues in respect of the calculation of damages and accounting of profits.

The Supreme Court decision is the last word in a case that has its genesis in actions undertaken decades ago. Claude Robinson began developing an idea for a children’s television show, The Adventures of Robinson Curiosity (Curiosity), in the early 1980’s. He spent more than a decade after that trying to get the project developed. During this time, Robinson shared his work (which included detailed sketches, storyboards, scripts and synopses), with several of the individual and corporate defendants (including Cinar Corporation).

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Bringing trademark infringement proceeding by application may have effect on damage award

On November 26, 2013, the Federal Court issued its decision in Trans-High Corporation v. Hightimes Smokeshop and Gifts Inc. The proceeding, which claimed trademark infringement, passing-off and depreciation of goodwill, was brought by the applicant, Trans-High Corporation (Trans-High) by way of a summary application to the Federal Court.  This option (which sees evidence confined to affidavit evidence, and no rights of discovery) was confirmed to be available by the Federal Court of Appeal in its 2011 decision in BBM Canada v. Research in Motion Limited. The respondent, Hightimes Smokeshop and Gifts Inc. (Hightimes Smokeshop), did not file any submissions in the proceeding or appear at the hearing.

In upholding the claims for trademark infringement and passing-off, the Court found that Hightimes Smokeshop had infringed Trans-High’s trademark “HIGH TIMES”, which has been registered in Canada since 1980 for use in association with magazines.  The Court found that Trans-High had tendered sufficient evidence to show a likelihood of confusion between its use of the mark in association with High Times magazine and website (with a focus on medical and recreational uses of marijuana) and Hightimes Smokeshop’s retail sale of marijuana-related paraphernalia and merchandise.  However, the Court declined to find depreciation of goodwill, citing insufficient evidence.   In particular, the Court noted that the evidence of volume of sales and depth of market penetration of magazines and related wares sold by Trans-High in Canada was limited, as was evidence in respect of the extent of advertising and publicity accorded to Trans-High’s HIGH TIMES trade-mark.  Further, there was little evidence of the degree of inherent or acquired distinctiveness of the HIGH TIMES trade-mark, and the products associated with the mark were confined to a specialized channel of trade.

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Canada finalizes anti-spam regulations; new anti-spam rules in effect July 2014

David Elder -

The Canadian government has finalized long-awaited regulations made under Canada’s Anti-Spam Law (CASL), announcing at the same time that the core of the new anti-spam regime will come into force on Canada Day, July 1, 2014, while other provisions will come into force the following year, and some will not be effective until 2017.

While the final regulations do include a number of last-minute revisions that respond to concerns raised by Canadian businesses, the new regime promises to have a significant negative impact on many businesses that have come to rely on electronic marketing. 

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New cyberbullying bill resurrects many police powers from scrapped "lawful access" bill

David Elder -

A new proposed federal law would make it a crime to distribute “intimate images” without the consent of the subject of those images; however, the new law would also create new police powers and procedures that go well beyond the context of cyberbullying to cover a broad range of online activity associated with other crimes.  The breadth of the cyberbullying offence may also raise concerns for news media about possible criminal liability for reporting certain stories.

In fact the bill, introduced as Bill C-13 and entitled the Protecting Canadians from Online Crime Act, appears to resurrect many of the provisions from the last incarnation of the failed lawful access bill, Bill C-30.  Bill C-13 seems to reintroduce much of what had been Part 2 of the earlier bill, including many of the proposed new and amended powers respecting the preservation and production of various types of electronic data, including the provision by telecommunications service providers of transmission or metadata associated with electronic communications, as well as setting out the procedures through which these orders would be obtained.

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No dice: Supreme Court declares Alberta privacy law unconstitutional in Palace Casino case

David Elder -

In a landmark ruling, the Supreme Court of Canada has declared Alberta’s Personal Information Protection Act (PIPA) to be invalid in its entirety, finding that it infringes the freedom of expression guaranteed by the Canadian Charter of Rights and Freedoms by limiting the ability of labour unions to videotape and photograph individuals crossing a picket line.

The declaration of invalidity is suspended for a period of 12 months to give the legislature time to decide how best to make the law constitutional. In light of the “comprehensive and integrated structure” of the law, the Court decided to strike PIPA down in its entirety, rather than declare as invalid particular provisions.

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Manitobans get new privacy law, but no one to complain to

David Elder and Bessie Qu -

Nearly a decade after British Columbia and Alberta enacted their own private sector privacy laws, Manitoba’s Legislative Assembly recently passed the Personal Information Protection and Identity Theft Prevention Act (PIPITPA or the Act), a privacy statute governing the private sector in that province.

The Act, which has yet to be proclaimed in force, will apply to the collection, use and disclosure of personal information by organizations carrying on commercial activities in Manitoba, and will govern the handling of both consumer and employee information. While much of the Act is modeled after Alberta’s Personal Information Protection Act (PIPA), several differences are worth noting:

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The long reach of Quebec's consumer protection legislation

Catherine A. Jenner -

On October 31, 2013, the Supreme Court of Canada rendered three related decisions (Pro-Sys v. Microsoft, Sun-Rype v. Archer Daniels Midlandand Infineon Technologies AG c. Option Consommateurs). The cases dealt with the rights of indirect purchasers to join direct purchasers in a class action to recover damages resulting from an alleged conspiracy by the defendant companies to inflate the prices to dynamic random-access memory (DRAM) chips. These decisions are very significant even though the cases are at a preliminary stage and deal only with the procedural aspects of the class action rather than the actual liability of the defendants. For a discussion of the Competition Act  aspects of the decisions, see our colleagues’ post on The Competitor.

Our focus here is on the Quebec Consumer Protection Act (QCPA) aspects of the Supreme Court decision on the Infineon case and the serious implications it has for all retailers doing business with Quebec consumers over the internet, through mail order, or in any other remote manner. Quebec bricks and mortar businesses will be quite familiar with the QCPA, which strictly regulates consumer contracts. 

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Ahoy Mateys! Judge scuppers suit against Pirate Joe's

On Oct 2, 2013, a Washington District Court judge dismissed a trademark infringement lawsuit against Vancouver businessman, Michael Hallatt. Powerful U.S. discount grocer Trader Joe’s had filed the suit, irked by Hallatt’s business of reselling its products in his cheekily-named Vancouver shop, Pirate Joe’s. Trader Joe’s has no Canadian locations, so Hallatt made frequent buying trips to its U.S. outlets. There he paid retail prices, then declared the goods at the border, marked them up and sold them in his store.

In its complaint, Trader Joe’s made numerous allegations under the Lanham Act (the U.S. federal trademark legislation), including trademark infringement, false endorsement, unfair competition, trademark dilution and false advertising. It also alleged deceptive business practices and trademark dilution under state law. Trader Joe’s contended that Pirate Joe’s intentionally copied the appearance of its stores and used its product images in order to confuse customers and pass as an authorized Trader Joe’s retailer. This, it argued, would damage the Trader Joe’s brand and dilute the source-designating ability of its trademarks, as well as deter Canadian customers from traveling to the United States to purchase its products.

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Intellectual property issues in the online world

Justine Whitehead -

The online world is a much different place today than it was just a few years ago. While the emergence of social media websites such as Facebook and YouTube has made it easier for people to network and share content, it has also opened the door to a number of unique IP issues that must be considered in the regular course of business.

Recently, my colleagues Ryan Sheahan, Alexandra Stockwell, and Nick McHaffie and I hosted a seminar that considered some of these issues, including the availability of business method patents in Canada, fair use under Canadian copyright law and IP issues raised by social media assets and user generated content. Below is a video of the seminar, and the associated materials are also available for download.

Open source software in the M&A context

While open source software (OSS) has been around for decades, companies are just starting to appreciate the importance of focused OSS due diligence in the M&A context. In this context, purchasers are most concerned with unknowingly inheriting the target’s OSS issues, such as reciprocal licences or deficient code, or overvaluing the target based on misinformed assumptions of the proprietary nature of its software. This is particularly worrisome considering that less than 50% of companies have OSS governance or monitoring policies and it is estimated that more than 50% of source code is licensed pursuant to unknown or reciprocal licences. Exacerbating these concerns is the fact that most companies do not know what is in their source code, despite being under the assumption they do.

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