[IP] Canadian Gov't Files Brief in RIM Patent Disput e
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Subject: Canadian Gov't Files Brief in RIM Patent Dispute
Author: Michael Geist <mgeist@xxxxxxxxx>
Date: 24th January 2005 7:10:56 am
Dave,
Of possible interest to IP -- in what is believed to be a first, the
Canadian government has intervened in the ongoing U.S. patent dispute
involving Canadian-based Research in Motion. The Canadian government
argues that the U.S. courts are giving U.S. patent law
extra-territorial effect and ought to reconsider their decision. The
NY Times has coverage of the intervention at
http://www.nytimes.com/2005/01/24/technology/24rim.html
A copy of the brief is at
http://patentlaw.typepad.com/patent/files/CAGovBr.pdf
My weekly Toronto Star Law Bytes column, posted below, argues that
rather than criticizing the Canadian government for its involvement,
a more appropriate response would be to ask what took it so long,
since the U.S. has long adopted an aggressive extra-territorial
approach to intellectual property policy. While there remains doubt
that the government will stand up for Canadian interests on other IP
issues, the decision to intervene may foreshadow a greater
willingness to stand up for the national interest. Column at
http://geistrimintervention.notlong.com
MG
Why Ottawa should stand on guard in RIM case
Michael Geist
Toronto Star
The acronym IP means a variety of different things to different
people. To computer scientists, IP refers to Internet Protocol, the
technical standard that plays a key role in the network design of the
Internet. To politicians, IP may be used as shorthand for Industrial
Policy, while economists may think of Innovation Policy. Within the
legal profession, IP is the acronym for Intellectual Property, which
encompasses patent, copyright, and trademark law.
Earlier this month, all these "IP"s converged in a single development
as the Canadian government filed a brief with a U.S. court supporting
Research in Motion's appeal of a patent infringement decision
involving wireless email. The decision to file the brief, which asks
the U.S. court to reconsider its December 2004 ruling against RIM,
demonstrates a maturation of Canadian intellectual property policy
that recognizes the need to put the national interest first.
The RIM patent dispute has been brewing since 2001, when NTP, a U.S.
company that holds a large patent portfolio, sued the Waterloo
company for patent infringement in connection with its popular
Blackberry device. A U.S. jury ruled in favour of NTP, awarding it
$23 million (U.S.) in damages.
RIM appealed that decision, but in 2002 a U.S. federal court judge
upped the damage award to $53.7 million. RIM appealed yet again, but
last month a U.S. appellate court upheld most of the lower court's
findings.
Determined to pursue every legal option, RIM recently asked the
appellate court for an "en banc" review, which, if granted, would
lead to a rehearing of the case. Should its application be denied
(success in such a review is rare), an appeal to the U.S. Supreme
Court seems likely.
Ottawa's decision to get involved in the case sparked both surprise
and criticism. Since the federal government rarely intervenes in
private litigation, the surprise is understandable. Critics
suggested, however, that Ottawa should mind its own business and that
RIM should be prepared to play by the legal rules in the U.S. Such
criticism is patently absurd.
The U.S. appellate court, which was created in the 1980s specifically
to address patent matters, adopted an exceptionally expansive
approach to the scope of U.S. patent law in its decision. An
important component of NTP's patent infringement claims involve RIM
activities that occur solely within Canada. Under most of the world's
patent doctrine, that would effectively limit claims against those
alleged infringements to legal actions in Canada.
The U.S. court rejected an approach that stops U.S. patent law at
the border, however, instead interpreting the law in a manner that
gives it extra-territorial effect. As the Canadian government argues
in its brief, the ruling runs contrary to basic principles of comity
between nations (mutual recognition of others' laws), and negatively
impacts the "integrity of the operation of Canadian intellectual
property laws."
The government's concern is well-placed, since this decision could
effectively force Canadian businesses operating in Canada to comply
with two sets of patent rules - both the national Canadian rules as
well as those exported from the United States.
Not only does the extra-territorial application of U.S. law undermine
Canadian sovereignty, the particular approach the U.S. appellate
court has taken to patent issues has generated concern on both sides
of the border. Adam Jaffe and Josh Lerner, two leading U.S. experts
on innovation policy, recently argued in their book Innovation and
Its Discontents that the creation of this particular court has tilted
the law toward patent holders. In doing so, it has "wreaked havoc on
innovators, businesses, and economic prosperity."
In light of Jaffe and Lerner's concern that U.S. law stifles new
innovation, the Canadian government naturally expresses fear in its
brief that the detrimental consequences of the RIM decision would
extend to all Canadian businesses, particularly those in the
technology sector.
In fact, rather than criticizing the government for its involvement,
a more appropriate response would be to ask what took it so long,
since the U.S. has long adopted an aggressive extra-territorial
approach to intellectual property policy.
In the area of domain names and trademarks, it enacted the
Anti-cybersquatting Consumer Protection Act in the late 1990s. That
statute grants U.S. courts the right to assert jurisdiction over
domain name disputes even where the domain name registrant has no
presence in the country. The extra-territorial effect was tested
several years ago when a Canadian company hauled a Toronto teenager
into U.S. court over a domain name registration.
On the copyright front, the U.S. Trade Representative releases an
annual report in which it opines on the acceptability of foreign IP
laws. Known as the Section 301 report, it criticizes many countries
for failing to emulate the U.S. approach to intellectual property
protection. For example, Canada finds itself in the report this year
(alongside the European Union and dozens of countries in Asia and
South America), as the U.S. continues to exert pressure over the
federal government's "failure" to ratify the flawed World
Intellectual Property Organization Internet treaties and to provide
patent protection for higher life forms.
If Canada's decision to intervene in the RIM case foreshadows a
greater willingness of leaders such as Industry Minister David
Emerson to stand up for the national interest, the government should
be congratulated.
Unfortunately, there remains doubt that Ottawa will practice what it
preaches. In the face of intense lobbying by U.S. movie and music
associations in Canadian camouflage, Canadian Heritage Minister Liza
Frulla and her parliamentary secretary Toronto MP Sarmite Bulte have
given every indication that they intend to pursue policies that
prioritize U.S. interests.
For example, ratification of the WIPO treaties, a consistent theme of
U.S. lobby efforts, would not only stifle Canadian innovation but
would lead to transfer of millions of dollars in royalties to U.S.
interests while generating virtually no new compensation back to
their Canadian counterparts.
While many rightly criticize the U.S. for its aggressive approach to
intellectual property policy, its leaders make no bones about the
fact that the premise of their intellectual property policy is that
the national interest comes first. Canada too must prioritize its own
national interest by focusing on intellectual property policies that
benefit Canadian businesses, schools, and culture. The unusual
intervention in the RIM patent fight may signal the beginning of that
recognition, demonstrating the potential for a new era in which
Canadian IP will come to stand for Independent Policy.
--
**********************************************************************
Professor Michael A. Geist
Canada Research Chair in Internet and E-commerce Law
University of Ottawa Law School, Common Law Section
57 Louis Pasteur St., Ottawa, Ontario, K1N 6N5
Tel: 613-562-5800, x3319 Fax: 613-562-5124
mgeist@xxxxxxxxx http://www.michaelgeist.ca
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