Thank you very much. I was delighted to receive the invitation to appear before the committee here in Halifax. I'm at a bit of a disadvantage. I'd understood I was to speak for half an hour and then you might cross-examine me for awhile. As the old joke goes, I wrote a long talk because I didn't have time to write a short one, but let me offer this much.
Today I want to speak to the committee on one aspect of our current trademark law that stifles innovation and distorts the market, and that's the use of what are called official marks, which is a kind of hyped-up trademark regime that allows public authorities to reach into the market and exert nearly impenetrable control over words and phrases and things. It has been called a super trademark, and there's a reason for that.
To a limited extent, this is a good thing. There was good public policy behind the idea of official marks when they were originally brought in. It was in no small part to protect important national government symbols, coats of arms, flags, and that sort of thing from being used by commercial entities to bump up the perception of their product by falsely associating themselves with the state.
There are situations where we need the government to protect the dignity of our national symbols, but as we all know, especially after Hallowe'en, too much of a good thing can give you indigestion, and the Canadian public has long been getting indigestion from time to time arising from the over-broad use of official marks. Public authorities have sometimes used these marks not for public purposes exclusively, but to generate commercial revenue at the unnecessary expense of taxpayers and at the unnecessary expense of small business people.
This problem has been illustrated most starkly by two disputes over the last five years, one that took place in 2007 and one that took place earlier this fall. Both of these disputes involved the Canadian Mint and its official marks over various images of our currency.
In 2007 the City of Toronto, you may recall, embarked on a campaign called One Cent Now. The One Cent Now campaign was to have the federal government remit 1¢ of each GST dollar to municipalities. As part of the campaign, the city used the image of the penny and the phrase “One Cent Now”. They used it in their promotional material, bumper stickers, and posters. They also used it in their email address and in the address of a website that was used to promote the campaign.
They got a bill from the Mint for $47,000 for the use of the phrase “One Cent Now”: $10,000 for using it in paper materials, $10,000 for using it in Internet materials, and $27,000 for using the image of the penny in the promotional materials. The taxpayers in Toronto were unhappy. This got a lot of press, and the dispute was eventually dropped between the Mint and the City of Toronto.
Earlier this year, in fact, just about a month ago now, a Nova Scotian songwriter named Dave Gunning put out a CD called No More Pennies. On this CD, Mr. Gunning was reflecting on the impending death of the penny and giving the folksinger's take on that. The Mint sent Mr. Gunning a licence fee bill, in particular, for his image of the penny because he had an image of the penny like a setting sun on the back of his CD. It was something like a $1,200 bill levied on about 1,000 CDs. CDs are a very low yield product to begin with.
Mr. Gunning managed to convince the Mint to waive the royalty, perhaps coincidentally after there was significant media interest and clear public disgust at what was perceived to be exploitation of this small business person by his government.
Members of the committee, I'm adding my voice to a call that, in fact, is now decades old, if you read the literature, and which was raised in a white paper that the Government of Canada published in 1991. That call is to either abolish or to amend and significantly restrict the scope of item 9(1)(n)(iii) of the Trade-Marks Act, because this is where the authority for official marks comes from.
This is intellectual property law that breeds cynicism among the people of Canada. It's in no small part because it is so expensive to litigate and challenge any public authority that is using the official mark in an overbroad manner. As I said earlier, this is something that potentially distorts the market. The cost of litigation is particularly relevant in a time when we are faced with a crisis in access to justice and where an all-star legal committee, chaired by Justice Tom Cromwell of the Supreme Court of Canada, is trying to resolve the very real problems that result from access to justice. This is one of those, but it's part of a larger tapestry.
This is a law reform measure that I believe is significantly overdue, and I'd be happy to discuss it further with the committee in the question time.