BLAW 2911: Commercial Law 1

Module 5: Property
Activity 2: Reading—Intellectual Property
Chapter 18 “Questions for Review” Solutions

1 to 6, 9, 11, 15, and 16

1. What is intellectual property?

Intellectual property is the result of an intellectual or creative process; it is

the bundle of rights that people have in their ideas.

2. What are the major forms of intellectual property rights?

The major forms of intellectual rights are patents, industrial designs,

trademarks, copyright, and confidentiality.

3. What is a patent? Give an example.

A patent is a monopoly to make, use, or sell an invention. Recent examples

involved in litigation include a device that allows faxes to be sent via radio,
a cholesterol-lowering drug, and a washing-machine agitator.

4. Are life forms patentable in Canada? Explain.

Higher life forms are not patentable because they are neither manufactured
nor composed of matter that has been mixed together by a person.

5. Are computer programs patentable in Canada? Explain.

Computer programs are not patentable as they receive protection under

copyright law. They could, however, receive patent protection as part of a
broader patent.

6. What are the three requirements for patentability?

The invention must be new, useful, and obvious.

9. What is an industrial design? What are the requirements for industrial

design registration? How long does an industrial registration last?

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An industrial design is usually taken to mean a feature of shape,

configuration, pattern, or ornament or any combination of these that in a
finished article appeals to and is judged solely by the eye. An industrial
design does not protect the functional aspect of the product. It lasts for
10 years.

11. What is the purpose of a trademark?

A trademark indicates the source of the goods or services and gives the
owner exclusive rights to use the trademark. It also prevents others from
using a confusingly similar trademark.

15. Who owns the copyright in a book? How long does copyright last?

The author of the book owns the copyright, unless there is an agreement to
the contrary. If the book was created in the course of employment, the
employer owns the copyright unless there is an agreement to the contrary.
Copyright protection extends 50 years past the death of the author.

16. What are the moral rights of an author? Give an example.

The moral rights of a work are owned by the author, exist independently of
copyright, and provide authors with some control over how their works are
used and exploited. Moral rights include paternity, integrity, and
association. An example of moral rights is the right to integrity.

Chapter 18 “Questions for Critical Thinking” Solution

1. Three-dimensional printers have the capacity to reproduce solid objects.

Using computer modelling software, they can reproduce an object using
materials such as rubber, plastics, ceramics, and metals. The potential is
to reproduce everything from automobile parts to toys to household
items. How does this technology possibly impact intellectual property-
rights holders? How should companies deal with the risk posed by this
technology? [footnotes deleted]

3D printers have the capacity to create three-dimensional objects, layer by

layer, using a digital blueprint. There are no intellectual property provisions
exclusively dedicated to 3D printing. But given the diversity of products
that can be printable with 3D printers, intellectual property rights holders

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may be concerned about the ability of the 3D printer to reproduce the very
thing that they hold rights on. For example:

Copyright: If the object produced by the 3D printer is artistic in nature, it

has the potential to infringe copyright. Also, the drawings, designs, or plans
for making the object may also infringe copyright. The potential for
copyright infringement is compounded by the difficulty in detecting
infringement and exemptions for users where a copy is made for personal
use under appropriate circumstances.

Patent law: The making of an article that is subject to a patent may

constitute infringement. The problem for rights holders will be identifying
when that occurs. The Patent Act unlike other intellectual property statutes
does not provide for a personal use exemption.

Industrial design: The design features and visual appearance (shape,

configuration, and ornamentation) of products produced by 3D printers
may infringe an industrial design registration. The limitation of this
protection is that infringement is only triggered when a copy is produced
that is identical, thus through slight customization, consumers may be able
to avoid infringement.

Trademark: The features of an object (i.e., shape of the goods), if distinctive

of its source may be protected as trademarks. As the Trademarks Act
generally requires “use” of the mark in a commercial sense to constitute
infringement, it is conceivable that using a 3D printer to replicate
trademarked goods for personal use may not be actionable under the
statute.

The risk posed by this technology is widespread infringement of intellectual

property rights akin to the widespread copying of music that occurred
using MP3 files. Intellectual property rights owners could go after the
infringers, but it would be extremely difficult to go after people in their
homes. They could go after the makers of the printers or the websites that
host the software that is needed to run the 3D printer. This too may be
difficult—the music industry was unable to stop the copying of music.
Perhaps a better approach would be for rights holders to embrace the new
technology and the new markets that it presents. They could set themselves
up as authorized dealers of the software and materials and cater to the
consumer that wants a customized product to meet his personal needs.

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Sources: Laura Macfarlane, “The legal perils of 3D printing,” Field LLP (12
February 2014), online: Mondaq
<http://www.mondaq.com/canada/x/292362/Patent/The+Legal+Perils+of+3D
+Printing>; Phyllis Korkki, “Beyond the 3D magic,” The New York Times (24
November 2013) 5; Paul Banwatt & Ashlee Froese, “The practical and
artistic sides of 3-D distinctiveness,” The Lawyers Weekly (9 May 2014) 12;
Paul Banwatt & Ashlee Froese, “The future in 3D,” The Lawyers Weekly (3
May 2013) 10.

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BLAW 2911: Commercial Law 1

Module 5: Property
Activity 4: Reading—Real Property
Chapter 19 “Questions for Review” Solutions

1. What are the unique features of land as a form of property?

Land is permanent and immovable, and the quantity is limited.

2. What is a fee simple?

Fee simple is the highest level of land ownership.

3. What are the limits on an owner’s use of his land?

There are numerous restrictions on land use imposed by statute law and
common law. Examples are zoning regulations and the tort of nuisance.

4. How does a joint tenancy operate?

It is a form of co-ownership in which the survivor inherits the interest of the

deceased.

5. How can ownership of land be divided by time?

The most common method of dividing ownership by time is through a lease

in which the owner gives exclusive possession to a tenant for a defined
period.

6. What is the purpose of registering title to land?

There are two purposes of registering title: to enable landowners to give

notice of their ownership and to enable others to determine the state of
ownership.

7. What is a restrictive covenant relating to land?

A restrictive covenant is a restriction on the use of land that is specified in

the title document.

8. What are the benefits of an electronic registration system?

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Electronic registration creates a central database in each province, which

provides improved access, is instantaneously updated, and saves storage
costs.

9. What are the three stages in a transaction for the purchase and sale of
land?

The three stages are the agreement of purchase and sale, the investigation,
and the closing.

10. What should a buyer of land investigate?

A buyer needs to investigate many aspects of the property, such as the title
to the property and legal claims against the seller. The buyer should also
verify the boundaries of the land to make sure they are correct and conduct
a physical examination to look for environmental hazards.

11. What is clear title?

Clear title is demonstrated by a record of ownership that contains no

problems to hinder transfer.

12. What happens at the closing of a property transaction?

The purchaser makes final payment and the vendor formally transfers
ownership.

13. What are the key features of a mortgage?

A mortgage is a contract for credit and a means of providing the land as

security for the loan.

14. What are a lender’s remedies if the borrower fails to make mortgage
payments?

The lender has four possible remedies, depending on the jurisdiction: suing
the borrower, taking possession of the land, selling the land, and
foreclosing.

15. What are the essential terms in a lease?

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Essential terms are identification of the parties, the premises, the rent, and
the granting of exclusive possession to the tenant.

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