Litigation – Intellectual Property

The Alberta Court of Queen’s Bench April 2016 decision in Geophysical Service Incorporated (GSI) v. Encana Corporation is the first case in the world that has ever found that copyright exists in seismic data. But the decision also held that the existing regulatory regime governing federal lands in the north and the east coast creates an exception to copyright protection, so that once the privilege period expires over seismic data governed by the regime, the owner no longer has exclusive right to control the public dissemination of its data.

Under the regulatory regime, companies like GSI must submit seismic data to various federal and provincial regulators and other governmental entities in return for permission to operate on government land. The data remains confidential for five years, after which the regulatory regime provides that the public can access the information. In practice, governments have kept non-exclusive data confidential for 10 years.

GSI claimed its consent was required to the use of the seismic data even following the expiration of the confidentiality period. The company sought more than $2 billion in damages.

Some 25 defendants, including a wide array of industry players and government entities, responded that copyright did not exist in the data and that, in any event, the regulatory regime was a complete answer to the copyright infringement claims.

Justice Kristine Eidsvik concluded that raw and processed seismic data were original literary compilations. Processed data was also an artistic compilation in scientific form. “This finding is significant to industry participants as it applies to the treatment of seismic data obtained from non-exclusive seismic companies,” Killoran said. “The judgment serves to confirm as valid a contractual term often found in seismic license agreements that expressly acknowledges that copyright over seismic data is held by the licensor.”

Eidsvik went on to conclude that the Regulatory Regime’s specific provisions, which permit disclosure after the defined period of time, override the more general provisions of the Copyright Act. The decision affirms the existing understanding in the oil and gas industry, namely, that once the privilege period expires over seismic data governed by the Regulatory Regime, the owner no longer has exclusive rights to control the public dissemination of its data.

Not everyone agrees with this aspect of Eidsvik’s ruling.

Writing in the University of Calgary Faculty of Law’s blog, Professor Nigel Bankes argues that it is unnecessary to erase all property rights in order to give effect to the regulatory regime. Allowing access to the data after the confidentiality period has expired is not tantamount to allowing someone to copy the materials or to facilitate illegal copying.

Indeed, Eidsvik’s conclusion that the regulatory scheme creates something akin to a compulsory licensing regime is simply an “unsupported assertion,” according to Bankes. “The [regulatory scheme] does not expressly address data copying and it certainly does not create an express compulsory licensing scheme that makes law what would otherwise be unlawful (the definition of a license),” he writes.

Federal Court Considers Section 22 of the Trademarks Act

A Federal Court decision involving the iconic Harley-Davidson motorcycle brand provides the first detailed consideration of section 22 of the Trademarks Act since the Supreme Court of Canada’s analysis of the provision in 2006. The section prohibits use of a trademark registered by another person in a way that depreciates the value of the goodwill attached to the mark. Unlike the more commonly cited section 20, section 22 contemplates depreciation of goodwill in the absence of any proof of confusion among prospective consumers. H-D U.S.A., LLC and Harley-Davidson Motor Company v. Jamarl Berrada, 3222381 Canada Inc. and El Baraka Inc., however, had a different twist to it in that it was the lesser known brand, Berrada, that made the allegations of depreciation.

The case originated with Harley’s claim for several declarations regarding their right in the “SCREAMING EAGLE” trademark. Berrada, a clothing retailer, counterclaimed, alleging that Harley had been selling clothing with SCREAMING EAGLE trademarks in an attempt to diminish the goodwill of the SCREAMING EAGLE and SCREAMIN’ EAGLE trademarks that Berrada had been using for over two decades. Harley owned the Canadian SCREAMIN’ EAGLE trademark in relation to motorcycles, and also owned that trademark in relation to clothing in the US, but not in Canada. The evidence established, however, that Canadians had purchased Harley’s SCREAMIN’ EAGLE clothing. Berrada registered SCREAMING EAGLE and SCREAMIN’ EAGLE trademarks for its stores. Although it had registered both marks in relation to clothing, it had allowed the marks to lapse, but continued to use them in association with clothing sales.

The Federal Court found that Berrada had not met the four elements of the SCC’s test for success under section 22: Harley had been using its own trademark and not Berrada’s trademark; while Berrada’s trademarks had some goodwill attached to them, Harley’s marks were much better known; a reasonable buyer of Harley motorcycle clothing would not think of the defendant’s mark; and Berrada had not proved lost sales or other damage to its goodwill. The Court also noted that Berrada, which had made several attempts to associate itself with Harley, couldn’t have it both ways.