Intellectual Property and Tech Strat-Ups: Protecting Software in Canada

Intellectual Property and Tech Strat-Ups: Protecting Software in Canada
By Saranjit Dhindsa
 
Introduction
 
For tech start-ups, protecting your software is an important step in ensuring that your company can retain the source of its value. There are many forms of IP protection available to protect software, but it is difficult for start-ups to determine which form will strategically protect their valuables, while also being the most cost-effective.
 
Below is an overview of the different forms of IP offered by the Canadian Intellectual Property Office (CIPO), and how they can protect your software.
 
Copyrights (per the Copyright Act)
 
Canadian copyright law gives the author (creator) the sole right to produce and reproduce your work in any form. It provides protection to literary, artistic, musical, or dramatic works – in this case, software falls into the “literary” category. Per copyright laws, copyright subsists in both the source code and assembly code of computer software.
 
But it is important to note that copyright only protects expressions of ideas, not the idea itself.[1] This is important to note, as copyright will only prevent others from copying your specific code but will not help if a competitor independently develops the same software or copies the functionality of the code.[2]
 
It's also important to note that, unlike other forms of IP, copyright does not need to be registered with CIPO. Per section once a copyrightable work is created and fixed in a material form, it is protected by law.[3] But when you register, you are provided with a certificate of registration that can be used in court as evidence of ownership – this can be very beneficial in case of litigation.
 
Copyright generally lasts for the life of the author of the work, plus 50 years.[4]
 
Patents (per the Patent Act)
 
Patents are the most common form of IP, but it is difficult to obtain a patent for software. While you cannot use a patent to protect the lines of code, the functional aspects of software can be patentable. This is what makes a valuable, as it would prevent competitors from reproducing the functional aspects of your software.[5] As such, software patents provide broader protection.
 
To patent software, your software must be:

1. new;
2. useful; and
3. Non-obvious.

This blog post explains the requirements in more depth.
 
Essentially, if your software simply automatizes a human task or provides simple/generic components it may not be patentable, as they do not provide any novel function. Furthermore, if the software is considered to be directed to an “abstract idea” it may not be patent-eligible. CIPO guidelines make software eligible if the claims are drafted in a way that essentializes tangible elements (i.e., a computer, phone, circuit board) to the software.[6]
 
In Canada, a patent lasts for 20 years from the date it is filed with CIPO.[7]
 
Trade Secrets/Confidential Information
 
Canada has no legislation governing trade secrets, but rather is enforced through torts such as breach of confidence or breach of fiduciary duties. Additionally, trade secrets can be enforced on a breach of contract claim (i.e., when someone breaks an NDA). The protection of a trade secret requires the following, at a minimum:

1. that the information has commercial value;
2. that the information is secret; and
3. that the information has been subject to reasonable measures by the business to ensure that it remains secret.[8]

 
When a trade secret has been revealed, you can seek damages (money) in courts.

Additionally, trade secrets can potentially last forever – as long as the information remains secret, trade secret protection applies.
 
Integrated Circuit Topography (per the Integrated Circuit Topography Act)
 
Software that has been or can be embedded on a semi-conductor chip can be eligible for protection under Canada’s Integrated Circuit Topography Act. This specific Act provides protection for certain original integrated circuit topographies, whether the design has been embodied in an integrated circuit product or not.[9]
 
The Act protects only the registered topography – this means the idea, concept, process, system or any information embodied is not protected.[10]
 
Like patents, protection for integrated circuit topographies is not automatic – a registration of the topography in Canada must be obtained.
 
The Act protects registered topographies for a period of up to 10 years, beginning from the filing date of the application.[11]
 
Conclusion
 
There are many ways to protect your software using Canadian IP laws – these are just some of the most common. It’s also good to note that you can use a mixture of IP protection to ensure that your software is as protected as possible.
 
Contact the Business Venture Clinic to provide you with legal information on each form outlined above, and some next steps to take in your mission to protect your start-up from IP infringement.

Footnotes:
[1] https://patentable.com/software-copyright-in-canada/
[2] https://www.mondaq.com/canada/patent/1135896/you-can39t-patent-software-right-or-can-you
[3] https://www.ic.gc.ca/eic/site/cipointernet-internetopic.nsf/eng/wr03915.html
[4] https://canlii.ca/t/7vdz#sec6
[5] https://www.mondaq.com/canada/patent/1135896/you-can39t-patent-software-right-or-can-you
[6] https://www.dentons.com/en/insights/alerts/2020/june/22/software-patentability-in-canada-and-beyond
[7] https://canlii.ca/t/7vkn#sec44
[8] https://www.ic.gc.ca/eic/site/cipointernet-internetopic.nsf/eng/wr03987.html
[9] https://www.ic.gc.ca/eic/site/cipointernet-internetopic.nsf/eng/h_wr02282.html#part1.6
[10] https://www.ic.gc.ca/eic/site/cipointernet-internetopic.nsf/eng/h_wr02282.html#part1.6
[11] https://www.ic.gc.ca/eic/site/cipointernet-internetopic.nsf/eng/h_wr02282.html#part1.10