Legal news and trends for Canadian in-house counsel and c-suite executives
Issue link: https://digital.canadianlawyermag.com/i/50888
By Isis E. Caulder & Jennifer McKenzie Beware of new breed marking trolls in the United States allows false mark- ing claims against defendant patentees who have falsely marked products. The offence of statutory false marking, P under s. 35 U.S.C. 292 of the U.S. Patent Act, is the act of marking an article or product to suggest patent protection with an intent to deceive the public when, in fact, no such patent protection exists. Until recently, it was unclear whether a false marking offence occurred on a per article or per decision basis. This ambigu- ity has been resolved by the U.S. Court of Appeals for the Federal Circuit, which ruled per offence means per article. In The Forest Group Inc. v. Bon Tool Co., the court held that the stat- ute clearly suggested an intention to impose the statutory fine, of up to $500, on a per article basis. The court noted the harms created by false mark- ing can occur each time an article is marked, and that larger numbers of falsely marked articles made available to the public may exacerbate the prob- lems. In view of the modern reality of mass-produced articles, a single fine of $500 per decision was not consid- ered a sufficient penalty to satisfy the intended purpose of the statute. Since the fine is split between the complainant and the federal govern- ment, some suggest imposing a per article fine will lead to huge statutory fines and could promote a new breed of litigants, dubbed marking trolls, to launch a wave of new false mark- atent holders should be aware of a new breed of trolls, marking trolls, and how a recent case around the false marking statute ing lawsuits. Interestingly, the court stated that encouraging individuals to bring false marking claims is actu- ally an intended purpose of the current statute. However, it also held that a statutory penalty of up to $500 does not mean a court must impose a penalty of $500 per article. Instead, the court has the discretion to award a much smaller fine per article — for example, a frac- tion of a penny — so that the total fine is proportional to the marking offence. Giving courts the discretion to award a reasonable fine in false marking cases may prove to be an effective way to curtail the impact of aggressive mark- ing trolls, but only time will tell. What you need to know about the new organic products regulations In the world of advertising law, new organic product regulations came into force June 30, 2009. For the first 24 months following the implementation date, the Canadian Food Inspection Agency will implement temporary com- pliance and enforcement measures. Are you compliant? Agricultural products represented as "organic" in international or interprovincial trade or dis- playing the new CANADA ORGANIC/BIOLOGIQUE CANADA logo must now be certified to the National Organic Standard by a federally accredited certification body. Key elements of the regulations include the logo and the word "organic" or equiv- alents such as "organically grown" can be used only on single ingredient agricul- tural products that have been certified as organic to the National Organic Standard by a federally accredited certification body, or on multi-ingredient products with at least 95-per-cent certified organic content. The label must contain the name of the certification body. Products with 70- to 95-per-cent organic ingredients can carry a claim of "X-per-cent organic ingredients." The percentage of organic contents must be indicated in the same size and promi- nence as the words "organic ingredients," and the ingredient list must also identify ingredients that are organic. These prod- ucts must also be certified to the National Organic Standard and contain the name of the certification body on the label. Products with less than 70-per-cent organic ingredients cannot use the logo or claim to be "organic" but they can identify the ingredients on the ingredient list that are organic. Certification remains in effect for 12 months and must be renewed annually. Qualifying imported products with the logo on the label must have the words "product of" immediately preceding the name of the country of origin or the statement "imported" in close proximity to the logo. For the first 24 months following the implementation, the CFIA will imple- ment temporary compliance and enforce- ment measures. Following this period, more stringent enforcement will apply. There is a grandfathering clause stating that any certifications issued before June 30 by a certification body recognized by the regulations are deemed to have been issued under the regulations. IH Isis E. Caulder is a partner in the software & high technology prac- tice group of Bereskin & Parr LLP in Toronto. Jennifer McKenzie is the leader of the regulatory, advertising & market- ing practice group of Bereskin & Parr in Toronto. INHOUSE APRIL 2010 • 9