INTELLECTUAL PROPERTY LAW SHOULD MATTER TO YOU

AN INTRO TO IP LAW FOR THE CONSTRUCTION INDUSTRY

The construction industry is rapidly evolving and competition is fierce . Companies are striving to create innovative buildings and structures, while reducing costs and build time . To achieve these goals, companies are constantly creating new products, designs, plans, drawings, and methods .

Intellectual property lies at the heart of all of this . Familiarizing yourself with intellectual property law will allow you to protect these critical assets and avoid infringing on the intellectual property rights of others .

What is intellectual property?

Intellectual property refers to creations of the mind . It is any kind of idea that you can ‘own’ . It is not a physical object, even if it can be manipulated into one . The purpose of intellectual property law is to encourage people to create intellectual goods . To achieve this, the law gives people and businesses the right to ‘own’ their intellectual goods, usually for a limited time, which allows them to profit from their ideas .

Intellectual property rights are ‘negative’ in that they only prevent others from using or distributing your protected works . It is also possible that the protected works of others may encumber your works .

Generally, intellectual property may be subdivided into four categories: copyrights, patents, trademarks, and trade secrets .

Copyrights

A copyright is the right to use or reproduce a creative or intellectual work and derive a commercial benefit from it . It includes literary works, artistic works, and software code . To be granted a copyright the work must be original and must involve more than a trivial amount of skill and judgment .

In the construction industry, copyright most often relates to artistic work, which encompasses architectural drawings, sketches, site plans, and construction documents .

The owner of the work is presumed to be its author . However, if the author of the work created it within the scope of employment duties, the owner will usually be his/her employer .

A copyright automatically comes into existence when the work is created . It is not necessary to mark the work with the word ‘copyright’ or the ‘©’ symbol .

A copyright is infringed when a substantial portion of a work is reproduced without the owner’s consent . Therefore, even if you make minor changes to someone’s work, you may still be liable . In the 2017 Lainco case, the Federal Court extended copyright protection to a building structure and awarded $750,000 in damages, signalling that courts are prepared to award significant damages when there is an infringement .

The issue of copyright is often forgotten during the negotiation of construction agreements . A contract may state that all documents created by the contractor, architect, or engineer –in preparation of the project, – will belong to the owner . Such a situation would result in the contractor, architect, or engineer losing his/her ability to use or reproduce the documents outside the project . Accordingly, parties to a construction agreement should ensure that they have been properly compensated for the extra copyright value, prior to agreeing to such conditions .

Patents

A patent is a temporary protection granted to an individual who invents or discovers a new product or process . For example, you can patent a tool, and also the method to build it . The patent gives the individual the right to stop others from making, using or selling the invention .

When most people think of a patent, they imagine a utility patent . This patent covers the creation of a new or improved, and useful product, process, or machine . In other words, it’s what we colloquially refer to as an invention . Utility patents have been granted for such inventions as a roof shingle system and a new house-building method .

The second type of patent is a design patent . This patent is granted to the ornamental design of something with practical utility . For example, a new type of tile flooring or house façade may be eligible for such patent protection .

Patents are typically granted for a period of 20 years . It is the responsibility of the patent owner to enforce his/her patent should an infringement occur .

Trademarks

Trademarks are symbols, designs, or words that identify products or services as being connected to a particular source . Unlike a patent, a trademark cannot have a functional purpose . One of the most well known trademarks is the Coca-Cola logo, which you immediately reference back to the company . Trademark law exists so that consumers can make informed purchasing decisions and are not misled as to the product’s or service’s origin . As long as the entity continues to use the trademark, and as long as it is attributable to the entity, the trademark will continue to exist and be enforceable .

No registration is necessary to have rights over a trademark . For example, a company may affix the ™ symbol to its logo without registering it . However, it is also possible to apply for a registered trademark, which is identified using the ® symbol and means that your trademark has been reviewed and accepted by the government .

Since trademarks do not have to be registered, it may be difficult to ensure that

your new mark does not infringe on an existing one . Accordingly, a company should speak to a lawyer who can perform comprehensive searches prior to adopting a new logo or other trademark .

In the construction industry, certain distinctive design features and layouts may also be trademarked . For example, it is possible that a retail merchant’s use of vaulted ceilings in his/her store is a trademark and cannot be imitated .

Trademark law also extends to the way in which owners or vendors advertise their products or services . For example, displaying another business’ slogan in your marketing material may confuse a consumer into believing that your development is connected to that other business .

When determining whether the use of a symbol, design or layout infringes on an existing trademark, a company should ask whether consumers might be misled or confused by the mark .

Trade secrets

A trade secret applies to confidential information that gives a business a competitive edge . In other words, the business derives its value from the secrecy . This information might be a formula, process, or design . A trade secret must contain information that is not generally known or reasonably ascertainable by others . The holder of the secret must also have taken all reasonable measures to keep it secret .

Within the construction industry, secrets may attach to customer lists, production or construction methods, product formulas, and marketing strategies .

Unlike the other types of intellectual property, which are protected by the government, a trade secret is protected by private means, and does not have a formal registry . Once a trade secret is made public, it stops being a trade secret and can be freely used by anyone . Accordingly, the law surrounding trade secrets focuses on the broken duties and wrongful actions of people who steal and receive them .

Intellectual property basics to keep in mind when dealing with a potential intellectual property issue, you should:

• Ensure your work is protected wherever possible, and that you are not infringing on someone else’s intellectual property rights . • Remember that you can’t escape liability just because you weren’t directly involved in the infringement . • Carefully review contracts to see if you are unknowingly transferring any of your intellectual property rights . • Remember that you may license your intellectual property rights through an agreement, without having to transfer ownership . • See if there’s any insurance coverage for potential intellectual property infringement . • Speak to a lawyer, when in doubt . These comments are of a general nature and not intended to provide legal advice as individual situations will differ and should be discussed with a lawyer.

About the authors

Paul Hancock is a lawyer practising with the construction practice group at Goldman Sloan Nash & Haber (GSNH) LLP . He has acted for owners, general contractors, subcontractors, architects, and material suppliers in complex construction lien matters, contractual claims, and breach of trust actions . Paul offers timely and pragmatic advice to his clients to reach cost-efficient and successful resolutions of legal disputes .

Joshua Halpern is a Student-at-Law with Goldman Sloan Nash & Haber (GSNH) LLP . He holds a Juris Doctor degree from Osgoode Hall Law School, and a Master of Business Administration degree from the Schulich School of Business .