Evidence of meeting #31 for Industry, Science and Technology in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was innovation.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Mark Eisen  President, Intellectual Property Institute of Canada
Graham Henderson  Co-chair, Canadian Intellectual Property Council
Michel Gérin  Executive Director, Intellectual Property Institute of Canada
Ruth Corbin  Managing Partner and Chief Executive Officer, CorbinPartners Inc., As an Individual
Jeremy de Beer  Associate Professor, Faculty of Law, University of Ottawa, As an Individual

9:15 a.m.

Conservative

Cheryl Gallant Conservative Renfrew—Nipissing—Pembroke, ON

All right.

Mr. Eisen.

9:15 a.m.

President, Intellectual Property Institute of Canada

Mark Eisen

I agree completely in all cases here.

I think one of the problems with harmonization of laws for obtaining patents, trademark registrations, and so on is that the courts do react so differently, but it is up to the private individual to decide where to commence the lawsuit, and that's just one of the strategies involved in enforcement.

9:15 a.m.

Managing Partner and Chief Executive Officer, CorbinPartners Inc., As an Individual

Dr. Ruth Corbin

I wanted to echo Professor de Beer's comments that although you've asked about the courts and enforcement, one of the reasons the courts are so complicated and busy is because of insufficient education.

Many of the people I deal with just don't know what their rights are. The kids are downloading stuff from the Internet, and they just don't know--and their parents aren't so sure either. So we don't grow up with an appreciation for where the borderlines are for intellectual property.

Again, although I understand that your question is directed toward our justice system, our justice system would be less pressured if we had an understanding of the borderlines of intellectual property that is owned by individuals.

9:15 a.m.

Co-chair, Canadian Intellectual Property Council

Graham Henderson

There were several recommendations in the 2007 report that dealt specifically with your question.

9:15 a.m.

Conservative

Cheryl Gallant Conservative Renfrew—Nipissing—Pembroke, ON

Okay.

Mr. Eisen mentioned that the United States protects the rights of business owners whose IP has inadvertently been lost. Would that sort of protection apply to a company where the law firm had been instructed to renew patents on behalf of a client, and there's evidence to show that, but it neglected to do so? In the case that you described with the United States or the law for the United States, would that be the case where the person could have it recouped?

9:20 a.m.

President, Intellectual Property Institute of Canada

Mark Eisen

I believe it would.

There are two levels of rectification: there is rectification for unintentional abandonment, and rectification for unavoidable abandonment. And to my understanding--I'm not a U.S. attorney--as long as there is a bona fide intent and attempt to renew patents or proceed with examination, that can be rectified within a reasonable amount of time.

9:20 a.m.

Conservative

Cheryl Gallant Conservative Renfrew—Nipissing—Pembroke, ON

You can provide that aspect to this committee?

9:20 a.m.

President, Intellectual Property Institute of Canada

Mark Eisen

We will provide information on that to the committee.

9:20 a.m.

Conservative

Cheryl Gallant Conservative Renfrew—Nipissing—Pembroke, ON

The other aspect or hurdle to innovation that was mentioned was cost. Do you have any innovative way of reducing the patent cost without burdening taxpayers?

9:20 a.m.

President, Intellectual Property Institute of Canada

Mark Eisen

Well, it's an extremely difficult thing to do, because it's a very involved area. With patents, certain things have to be done in order to ensure, as has been said here before, that the rights holder gets the rights commensurate with what they've actually created, so it's a difficult thing to actually reduce costs.

I think there has to be a taxpayer burden to some degree for this, but costs are not all that high, either. For $20,000 to $25,000, a truly inventive invention can be patented in Canada and the United States.

9:20 a.m.

Conservative

Cheryl Gallant Conservative Renfrew—Nipissing—Pembroke, ON

Dr. de Beer, you described that IP could be used as collaboration, as opposed to safeguarding an idea. Is there an example you could share with the committee on how that would play out?

9:20 a.m.

Associate Professor, Faculty of Law, University of Ottawa, As an Individual

Prof. Jeremy de Beer

Yes, certainly.

It's been well known that proximity and interaction in physical spaces facilitates innovation. Innovation does not happen when people are isolated from each other. The same principle applies in intellectual spaces or intangible spaces. If we focus too narrowly on simply acquiring intellectual property outputs and not monitoring what happens with those kinds of outputs, we're losing the opportunity to create knowledge networks.

This is the term that the OECD now uses. They don't talk about intellectual property or intellectual property outputs in the abstract. They talk about creating knowledge networks, because knowledge networks facilitate innovation.

9:20 a.m.

Conservative

The Chair Conservative David Sweet

I'm sorry to interrupt you, and hopefully you'll be able to expand on that in the next round, but we're over time now.

We'll go to Madame LeBlanc, for seven minutes.

9:20 a.m.

NDP

Hélène LeBlanc NDP LaSalle—Émard, QC

Thank you, Mr. Chair.

Mr. de Beer, thank you for educating us on a fascinating subject.

It is extremely difficulty to acquire intellectual property and to keep it. For that reason, I would like you to tell us more about this model. Since 2007, we have seen incredible advancements in technology. At the end of your statement, you mentioned a concept when you were answering Ms. Gallant's question. Could you elaborate on that? Could that concept also apply to other industries in Canada, such as the more traditional sectors of manufacturing and natural resources?

9:20 a.m.

Associate Professor, Faculty of Law, University of Ottawa, As an Individual

Prof. Jeremy de Beer

I'll give you two concrete examples. The idea of open innovation has been popular across a wide variety of sectors. It's being used by Nike, General Electric, and Nestlé. But there are two particular examples in science and technology. One is open-source software, which is a very popular business model for companies to move away from a proprietary framework toward an open-source framework.

On the basic idea, there is intellectual property protection, such as copyrights and often patents, that protect software or code. But rather than using those intellectual property rights to prevent other people from using the same kind of invention, you issue a licence that says other people may use that software if they agree to reciprocal obligations to further share and grow the community.

This has been applied experimentally in the context of biotechnology. There's an organization in Australia called Cambia. They're running BiOS, the biological open-source project. The first step is to make patent information about agricultural biotechnologies more transparent and easier to access, so people know what is patented and what is not. It reduces transaction costs. Then they create a repository of agricultural biotechnological inventions that any entrepreneur can easily access and use if they agree to certain conditions. Some of the conditions may be financial, like revenue sharing, and others are not. We also see universities doing this. The University of Glasgow is an excellent example, as well as North Carolina and a number of others.

9:25 a.m.

NDP

Hélène LeBlanc NDP LaSalle—Émard, QC

In that case, do the partners determine the rules of the game? Is there some sort of legal framework?

9:25 a.m.

Associate Professor, Faculty of Law, University of Ottawa, As an Individual

Prof. Jeremy de Beer

No. The legal rules are mostly negotiated through contracts...but also social, cultural, and commercial economic norms.

The key lesson for policy-makers is to not presume that everybody wants to manage their IP in the same way. There are some very clever and sophisticated things the private sector is doing to work around the inefficiencies in the system. The key thing the government can do is provide awareness, training, and research to support the private sector to better manage their intellectual property rights.

9:25 a.m.

NDP

Hélène LeBlanc NDP LaSalle—Émard, QC

Thank you very much.

Mr. Henderson, I would like to know your take on what we just heard about a more cooperation-based intellectual property model, versus an output-based model.

I would like to hear what the other witnesses think as well.

9:25 a.m.

Co-chair, Canadian Intellectual Property Council

Graham Henderson

Thank you.

I was on the steering committee that produced the OECD's recent study on knowledge networks, among other things. I should point out that while knowledge networks are part of an IP system, they're just part of it. That was very much the view of the steering committee and the OECD.

I don't think I disagree with anything the professor is saying about the importance of new routes and methods for exploiting intellectual property rights. But I differ in that I don't think if one person wants to choose a particular route—whether it's an open-source route or otherwise, where you're making information available freely, or for whatever purpose—it should detract from protecting, advancing, and enforcing the more traditional systems that still work and are still very necessary for the advancement of innovation.

The issue of collaboration is an important one, because it has been brought up as an example of something that can only really work in a sort of more open environment. In fact, the studies seem to have found—at least the ones that were made available to our committee at the OECD—that patents and a clear knowledge of who owns what actually encourages just as much collaboration as anything else.

I would urge the committee that while what the professor is suggesting is important and an interesting way of exploiting intellectual property rights and innovation, it's just one way. It doesn't mean we shouldn't take advantage of the many recommendations that have been made to this point by the past committee and many others.

There is a gap from 2007 to 2012, but I think that report is still fresh and has been built on by others since then.

9:25 a.m.

Managing Partner and Chief Executive Officer, CorbinPartners Inc., As an Individual

Dr. Ruth Corbin

I think the debate has raised something that clarifies where the policy options are. Professor de Beer is right when he says a lot of junk gets registered. Until it's registered and defined as intellectual property—trademarks, patents, copyright, trade secrets...well, trade secrets can't be registered—it can't become monetizable. If you want to get the economic value out of intellectual property, it has to be monetized by business. Government has the option to invest in the process, which we do through our universities—we admire what they produce—or to help encourage the monetization, which will give us the economic prosperity that we seek through intellectual property.

In summary, what you have just heard is where the options are for government: the front end or the back end. Business, in my experience, needs the encouragement—a little more encouragement of the downstream monetization to help deliver the benefits to the country.

9:25 a.m.

Conservative

The Chair Conservative David Sweet

Thank you very much, Madame Corbin and Madame LeBlanc.

Now we're on to Mr. Lake for seven minutes.

9:25 a.m.

Conservative

Mike Lake Conservative Edmonton—Mill Woods—Beaumont, AB

Thank you, Mr. Chair.

This is a fascinating discussion. I have way more questions than I'm ever going to get to.

I want to focus first on what I see as a disconnect between the type of conversation we're having today—conversations at a legal level—and the level of understanding of intellectual property among entrepreneurs, potential entrepreneurs, researchers, and inventors. What scares me the most is developing some form of regime where we take Canada's best and brightest and have them all working as lawyers—no offence to the lawyers in the room—instead of as inventors and innovators who are creating things. How do we find that balance to ensure we have a regime that makes sense and encourages innovation, but a regime that is not so complex that we need every second Canadian working as a lawyer to understand it?

9:30 a.m.

Co-chair, Canadian Intellectual Property Council

Graham Henderson

I suggest it hasn't impeded other countries that have more sophisticated intellectual property regimes than ours. For example, it hasn't really impeded Japan. If you look at Japan as an interesting model, they have a top-down IP system. It's pushed right down from the presidency. In many ways it's like an IP culture in the way that RIM is an IP culture, by the way. It's an IP culture, and it has to start at the top. It pushes all the way down, and it becomes a priority throughout government. You're not necessarily creating rules and laws that are going to gum up the works. The education is designed—we found this as well at the CIPC. There is a real problem at the lower levels about awareness: what do I have to do, how do I do this, and where do I go? Obviously they found it at IPIC. We found it at the CIPC. I know CIPO is aware of it.

You heard from Sylvain Laporte last week. I think he's terrific. I think he has been a great appointment. I think he's going to take CIPO to another level, but it is going to involve some resources.

Back to Ms. Gallant's question, are these resources going to involve a burden on the taxpayer? There might be a slight burden, but the return on the investment could be incalculable.

9:30 a.m.

Conservative

Mike Lake Conservative Edmonton—Mill Woods—Beaumont, AB

Does anyone else want to weigh in on that?

Mr. de Beer.

9:30 a.m.

Associate Professor, Faculty of Law, University of Ottawa, As an Individual

Prof. Jeremy de Beer

Yes.

I think training and awareness are the key. The Canadian International Council, in its report Rights and Rents, called for the establishment of an IP czar, who would have a much broader mandate than the current head of the Canadian Intellectual Property Office to expand training and engagement programs in the private sector, both practically oriented as well as high-level policy engagement. I would endorse that recommendation. I think it's a very good one.

That's the answer: create more awareness. One of the things we need to create awareness of is that intellectual property can be a very important asset, and a sword for all companies, including SMEs. It can also be a land mine, which companies can inadvertently step on. Research In Motion is an excellent example. It paid $612.5 million U.S. to settle a dubious lawsuit brought against it by a U.S. company. It threatened to shut down the BlackBerry distribution in the U.S.—$612.5 million U.S. to a company that didn't even have a website. It didn't make anything. All it did was troll for patents. We have to understand the dangers as well.