January 29th, 2019

Copyrights

Copyright is the sole right to produce or reproduce; publish or perform original literary; dramatic, musical or artistic works.[1] Essentially, it is the right to copy.  Copyright applies to all original content, provided the conditions of the Copyright Act are satisfied, regardless of whether the original owner has registered their copyright.[2] Therefore, copyright rights exist the second an author concludes their book, a software engineer finishes a block of code, or a choreographer completes their routine. Certificates of registration of copyright only act as evidence that copyright exists and that the person registered is the owner of the copyright. This can be particularly helpful as an owner may transfer ownership or license their work out to other individuals.[3] One thing to note is that the Canadian Copyright office does not perform “gatekeeping” functions.[4] What this means is that anyone can claim to be the owner of a piece of work. In Andrews v McHale and 1625531 Alberta Ltd. et al, 2016 FC 624,[5] an ex-employee was able to register copyright ownership of some of his ex-employers’ software, turned around and sued the company for copyright infringement.[6] Additionally, the Copyright office does not “police” and therefore, the onus is on the owner of the copyright to ensure that no one is infringing on their right to reproduce.

A challenge for many growth companies with regards to copyright is who owns of the software when the author is an employee. As established above, the general rule is that the author is the owner. However, an exception can be found in section 13(3) of the Copyright Act.[7] It states:
       “Where the author of a work was in the employment of some other person under a  contract of service or apprenticeship and the work was made in the course of his employment by that person, the person by whom the author was employed shall, in the absence of any agreement to the contrary, be the first owner of the copyright”
What this establishes is that if you own a company and hire a software engineer to write code, the code they wrote in the course of their employment would belong to your company, unless there was an “agreement to the contrary”. It is important to remember that this agreement does not have to be in writing, and in certain circumstances, like in an academic context – where professors are generally owners of their work regardless of their employment, creators ownership can be presumed.[8] Another interesting concern relating to copyright is an author’s moral rights.  Moral rights are an author’s right to maintain the integrity of the work and the right to be cited as its author. Even if the work is created under employment or their rights to ownership were waived through contract, their moral rights in their work cannot be assigned and are not automatically waived.[9]
In conclusion, this post is to give you a little taste of how copyright works in Canada and how it can apply to growth companies.

Tyler Anthony is a member of the BLG Business Venture Clinic, and is a 2rd year student at the Faculty of Law, University of Calgary.

References:
[1] Canadian Intellectual Property Office, A guide to copyright(Ottawa: Canadian Intellectual Property Office, 2018) <ic.gc.ca/eic/site/cipointernet-internetopic.nsf/eng/wr03719.html?Open&wt_src=cipo-cpyrght-main/> accessed October 28, 2018
[2] Copyright Act,RSC 1985, C-42 [Copyright].
[3] Christopher Heer and Daryna Kutsyna, “Copyright FAQ” (13 August 2018), Heer Law (blog), online < https://www.heerlaw.com/copyright-faq/>.
[4] Richard Stobbe, “Ownership of Copyright in Software”, (21 September 2016), The Medium (blog), online < https://www.fieldlaw.com/portalresource/lookup/wosid/cp-base-4-7474/overrideFile.name=/Ownership_of_Copyright_in_Software.pdf/>. [Richard].
[5] Andrews v McHale and 1625531 Alberta Ltd, 2016 FC 624.
[6] Richard supra note 4.
[7] Copyright supra note 2 s.13(3)
[8] Jean-Sebastien Dupont and Guillaume Lavoie Ste-Marie, “Do you actually own the IP generated by your Canadian employees” (16 June 2016), Smart & Biggar Fetherstonhaugh (blog), online: <http://www.smart-biggar.ca/en/articles_detail.cfm?news_id=866/>.
[9] Ibid.