Amin Hosseini is an IPilogue Writer and an LLM Candidate at Osgoode Hall Law School.

On Friday, November 11, 2022, FTX. Shortly after that, filed for bankruptcy, and a Japanese exchange called Bitfront shut down. FTX is a global, centralized cryptocurrency exchange based in the Bahamas. It enables customers to exchange their digital currencies for other digital currencies or regular money. Sam Bankman-Fried ("SBF”) was the CEO of FTX.

The collapse came when FTX. is the cryptocurrency exchange with the highest daily trading volume of cryptocurrencies globally. On November 9, Binance it would no longer purchase FTX, mentioning reports of mishandled funds and regulatory investigations. Since then, the price of has plunged by more than 90%. The FTX's native token is called . It is generally used as collateral for future positions and to lower trading fees.

��According to a report by , on November 2, Alameda Research ("Alameda”), the cryptocurrency trading firm led by SBF, was found to have an unusually high stockpile of FTT. FTX and Alameda's connections may have been more complex than had been previously disclosed, raising the question of whether FTX moved customers’ assets to Alameda. Since Alameda and FTX owned most of the FTTs, the other business would suffer severe financial consequences if one of them is compelled to sell or transfer its FTT holdings.

On November 6, that it would sell its FTT tokens. The value of FTT fell, triggering investors to race to sell their holdings in FTX out of concern that it would collapse like other cryptocurrency corporations. FTX rushed to execute withdrawal requests, but could not pay. As a consequence, FTX filed for bankruptcy.

John J. Ray, the new CEO of FTX, believes such a disaster is due to a lack of supervision and poor record-keeping. He numerous mismanagements leading to the disaster, including concealing misuse of customers' funds through software, using unprotected group emails, and communicating using applications with auto-delete features that restrict access to FTX records.

Platform customers, unsecured creditors, must wait in line to receive whatever assets the court may take from FTX based on priorities established by equitable principles. The bankruptcy has highlighted an $8 billion shortfall. After the fall of FTX, it will be more difficult for crypto exchanges to gain trust.

Industry experts are now predicting a "". The cryptocurrency market has long battled to win over investors and authorities. Investor trust in digital assets has weakened in the fallout of FTX, which will likely lengthen the impending crypto winter.

The FTX collapse underscores the lack of investor fund regulation in cryptocurrency markets. The cryptocurrency industry requires more stringent regulation to be rid the market of manipulation, fraud, mismanagement, cyber security risks, and money laundering. What steps will be taken to address these concerns will remain to be seen.

Further Reading:

The post The future of the crypto industry after the FTX collapse appeared first on IPOsgoode.

Photo by Engin Akyurt ()

Prof. Pina D’Agostino is the Founder and Director of IP Osgoode, the IP Intensive Program, and the IP Innovation Clinic, the Founder and Editor-in-Chief of the IPilogue, the Deputy Editor of the Intellectual Property Journal, and an Associate Professor at Osgoode Hall Law School. This article features contributions from Ryan Wong (IP Osgoode & IP Innovation Clinic Alumnus), Sabrina Macklai (IPilogue Senior Editor), Tianchu Gao (IPilogue Writer), and Ashley Moniz (IPilogue Managing Editor).

2021 was an exciting year for the IPilogue. Our hard-working students and community members published more than twice as many articles than in 2020 and the most articles in a calendar year since 2011. This sharp increase helped us stay up to date with some of the biggest topics shaking up intellectual property: from , to ; and from growing investments in and , to IP registrars around the world grappling with whether to acknowledge ��as an inventor or artist. This article summarizes the top developments reported on our blog and in patents, trademarks, and copyright law in 2021. For a review of Privacy legislation in Canada, check out .

Top 10 Most Read IPilogue Articles Published in 2021

1. by Sabrina Macklai & Emily Chow
2. by Prof. David Vaver
3. by Claire Wortsman
4. By Claire Wortsman
5. by Natalie Bravo
6. by Prof. Giuseppina D’Agostino
7. by Bonnie Hassanzadeh
8. By Meena Alnajar
9. by Prof. David Vaver
10. by Bonnie Hassanzadeh

Introducing the College of Patent Agents & Trademark Agents

On , the came into force. The Act established the (‘’), an independent public interest regulator of patent and trademark agents in Canada. The purpose of the College is “to enhance the public’s ability to secure the rights provided under the and the .” The College’s responsibilities include maintaining professional competencies and ethics, issuing licences, collecting fees, and administering certification exams. This development marks a key milestone for the profession and for Canada’s . Though still in its infancy, the College has been criticized for and its , which may impose an additional fee on lawyer agents. It remains to be seen how influential the College is on the profession as it is expected to be fully operational within the next two years.

Patents

Overbreadth as an Independent Ground of Invalidity

On July 28, 2021, the Federal Court of Appeal confirmed overbreadth as a standalone attack on patent validity: . In this case, the appellants argued that there is no statutory basis for overbreadth as a ground for invalidity. The Federal Court of Appeal disagreed and found that overbreadth can be supported by a combination of sections 27(3) and 27(4) of the Patent Act. Case law has often overlapped overbreadth with other grounds of invalidity such as obviousness, anticipation, and inutility.��

First Time Interpreting Patent Agent Privilege

Similar to solicitor-client privilege, patent agent privilege was introduced by section 16.1 of the Patent Act on June 24, 2016. The first case on patent agent privilege was decided this year: In this decision, the Federal Court provided some helpful commentary and analysis on the application and limitations of patent agent privilege.��

Patent Prosecution History Now Admissible as Evidence

In 2018, section 53.1 of the Patent Act was added to make patent prosecution history admissible as evidence in patent proceedings. This was a significant development as the Supreme Court of Canada had expressly rejected the idea and stated that admitting patent prosecution history “would undermine the public notice function of the claims, and increase uncertainty as well as fuelling the already overheated engines of patent litigation” (Free World Trust v Électro Santé Inc., 2000 SCC 66 at para. 66). Three subsequent Federal Court of Appeal decisions developed this provision further: ; ; and .��

Continued Debates over AI as an Inventor

Around the world, patent registrars grappled with patent applications that credit artificial intelligence software as the inventor. Dr. Stephen Thaler’s “DABUS” (Device for Autonomous Bootstrapping of Unified Sentience) applied for patents around the world for its interlocking food containers. DABUS was granted patents in Australia and South Africa, with . In line with the and the , the disagreed, stating that absent express intention from Congress, the term “individual” in their statutory definition of “inventor” . The Supreme Court of Canada last considered the definition of "inventor" in 2002, but has yet to consider whether it would include non-human entities.

Trademark Law

Parody in Trademarks is No Joke

In , the Federal Court reaffirmed that parody is not a defence against trademark violation. Unlike the 2020 decision ), where the Federal Court failed to find the marks confusing, Justice McHaffie held there was a likelihood of confusion and passing off. This was based partly on the similarity of the trademarks and the overlap of the goods (both offering baked goods). However, even if the nature of the parties’ trades differ, trademark owners may still find recourse against spoofed versions of their marks through claiming depreciation of goodwill under section 22 of the . Here, the Court found goodwill in Subway’s trademarks, which was damaged by the nature of Budway’s products, as contrary to Subway’s “healthy and active” lifestyle promotion. With damages amounting to $40,000, it is clear the courts are unamused by parody in trademarks.

The Road Less Travelled Cannot be Trademarked

Like most countries, Canada bars the registration of “clearly descriptive” trademarks to prevent applicants from monopolizing words that merely describe the goods or services at hand. For this reason, marks consisting of are typically unregistrable. In , the Federal Court clarified when such marks might be protected. Hidden Bench and Locust Lane are two wineries operating on the same little road, “Locust Lane”. Although the Federal Court agreed that Hidden Bench met the threshold for a valid common law trademark over “Locust Lane”, they ultimately held that the mark, as clearly describing the goods and services’ place of origin, lacked both inherent and acquired distinctiveness. Therefore, Hidden Bench could not establish the necessary goodwill for a passing off claim. Only descriptive marks that have acquired a “secondary meaning” through use may warrant protection.

CIPO Addresses the Application Backlog

While filing trademarks is important for brand protection, the examination stage can take . In May, the Canadian Intellectual Property Office (CIPO) new measures to address the application backlog. Trademark owners may now file requests to expedite their examination where the registration of their mark is necessary for special circumstances such as if a Canadian court action involving the mark is expected or underway or if the goods or services are aimed at preventing, diagnosing, treating, or curing COVID-19. If accepted, the examination will take place within two weeks. The examination is also automatically expedited by approximately 6-10 months when the goods and services in the application are listed in CIPO’s . Though it is too early to assess the effect of these changes on mitigating the “”, the backlog of CIPO’s unexamined trademark applications appears to have as of December 13, 2021.

Push to Register Non-French Trademarks for Use in Quebec

Among the controversies associated with Quebec’s proposed Bill 96, , the bill stipulates new requirements for trademark owners operating in Quebec. Currently, under Quebec’s French-language laws, both registered and unregistered (i.e., common law) trademarks recognized under the may appear on public signs, posters, and commercial advertising in Quebec, in languages exclusively other than French. If enacted, Bill 96 would permit only registered non-French trademarks to appear on public signage, provided there is no corresponding registered French version of the mark. The Coalition Avenir Quebec government tabled Bill 96 on May 13, 2021, and Quebec’s National Assembly last examined it on December 10. Some iteration of the bill will likely become law by the end of this year. But even if it fails to pass, businesses relying on common law trademarks would be wise to try to register them, given the many that registration provides.��

Copyright Law

In 2021, the Federal Court and Federal Court of Appeal heard 57 copyright infringement proceedings, approximately of all IP-related litigations at these levels.

Developments in Fair Dealing

The Copyright Act’s section 29 fair dealing provision, which allows for certain uses of copyright-protected materials, remained a central issue. affirmed that fair dealing for the purpose of news reporting (section 29.2 of the Act) must provide attribution, mentioning both the source and the name of the author. An indirect reference to the author accessible through “minimum research” is insufficient. As such, the Federal Court of Appeal rejected Trend Hunter’s argument that hyperlinking to the source article where Stross was credited was sufficient to meet the second requirement. The Court also declined to find fair dealing under s. 29 more broadly, considering that Trend Hunter’s dealing was commercial in nature, reproduced Stross’ work in its entirety, and that alternatives were available.

Fair dealing was once again at issue in , where the Federal Court held that the Conservative Party’s use of the CBC’s news footage of Liberal Party Leader and Prime Minister Justin Trudeau during their 2019 election campaign did not infringe CBC’s copyright. The court undertook a large and liberal interpretation of fair dealing, finding that the Conservative Party’s use of CBC footage was for the purpose of criticism under s. 29.1.

91��ɫ achieved a in the copyright tariff dispute with the Canadian Copyright Licensing Agency (“Access Copyright”) in In a unanimous decision, the Supreme Court ruled that the interim tariff approved by the Copyright Board is not mandatory. Users can choose whether to accept licences or pursue alternative methods to lawfully copy works. Notably, this marked Justice Rosalie Abella’s final decision before her retirement from the Supreme Court of Canada. Throughout her tenure, and her judgement here provided helpful obiter regarding fair dealing as integral to users’ rights.

Even Fake Facts are Not Copyrightable

involves the alleged copyright infringement of the famous true-crime story The Black Donnellys. The book had always been presented and accepted as “.” The Federal Court ruled that “an author who publishes what is said to be a nonfiction historical account cannot later claim the account is actually fictional to avoid the principle that there is no copyright in facts.” Given today’s popularity of the phrase “based on a true story”, this ruling is a that there is no copyright in facts, even if they are later found to be untrue.

Copyright in Evolving Content Transmission

In , the Federal Court found the defendant liable for copyright infringement in its provision of pre-loaded set-top boxes and internet protocol television (IPTV) services and awarded the plaintiff nearly $30 million in damages. These services made copyrighted works owned by the plaintiff available to the public without the plaintiff’s permission. This decision marks the first time The court dealt with a similar issue in ). As IPTV is growing increasingly popular across the globe, its poses a challenge in Canada.

Availability of Reverse Class Actions for Copyright Infringement Claims

The first of its kind in Canada, the Federal Court of Appeal in affirmed that reverse class actions may be pursued in connection with copyright infringement claims. Though the matter was sent back to the Federal Court for further consideration, this judgement may encourage and enable mass copyright enforcement in the future, especially in our digital age where copyright infringement is more commonplace.

Public Consultations Ahead of 2022’s Copyright Reform

As part of the (CUSMA), which came into force on July 1, 2020, Canada has until the end of 2022 to implement numerous changes to their domestic copyright laws; most notably, extending the general term of copyright protection from . In light of the upcoming legislative amendments, the Government of Canada hosted three public copyright consultations in 2021:

• ;
• ; and

With the consultations now closed, it will be interesting to see how Canadian copyright laws will change in 2022 to accord not only with international obligations but our ever evolving digital world and public attitudes surrounding copyright laws.

The post 2021 IP Year in Review appeared first on IPOsgoode.

Source: Screenshot of the Zoom Panel

Natalie Bravo is an IPilogue Writer and a 2L JD Candidate at Osgoode Hall Law School.

��

On November 24, 2021, the Osgoode Emerging Technology Association (OETA) hosted an interactive panel discussion with Professors and , led by OETA president and co-founder Murad Wancho.

from the Osgoode Fintech & Blockchain Association, OETA was founded in Spring 2020 and has quickly grown in popularity. As an OETA executive, I am honoured to share details of this informative event delivered by my dedicated colleagues.

Despite the fast-approaching exam season, the virtual event had an excellent turn-out of students and legal community members. The panel garnered traction preceding the event, with participants eagerly sending in questions on topics ranging from concerns to the future of (“NFTs”). Wancho began by thanking participants and snapping a lovely photo of everyone in the call (as seen above). Everyone rushed to turn on their cameras in time. I regrettably was too slow (or maybe Wancho was too fast!) This spontaneous moment of collaboration and engagement served as a fun icebreaker before introducing the esteemed guests.

Professor is an internationally renowned legal theorist and an Osgoode faculty member since 1982. His research interests include politics, constitutional law, and torts, and he teaches a wide range of courses. Hutchinson also authored an on the intersection between cryptocurrencies and the law, .

Professor has been at Osgoode since 2020. He is a research affiliate at for Internet and Society and a Research Fellow at the based at the University of Toronto. His research lies at the intersection of law, technology, and human rights. Penney recently designed and is currently instructing “” at Osgoode.

Cryptocurrency was the main topic of interest, along with the ever-prevailing questions surrounding its future. This form of decentralized digital currency has been around for but is growing in mainstream popularity. With a show of hands, over half of the participants expressed owning or wanting to own some cryptocurrency.

Hutchinson shared details on his upcoming book and his thoughts on regulation. While no one can accurately predict the future of cryptocurrency, Hutchinson discussed the merit in theorizing unique regulatory approaches to the decentralized system(s). and self-regulation were of notable interest. Many participants asked whether further external regulations would detrimentally affect the appeal and use of cryptocurrencies. The implications of overarching regulatory actions, such as securities or tax, are looming realities of NFTs and cryptocurrency, as we are now witnessing in multiple regions, Penney shared the sentiment of cryptocurrency as a speculative asset that likely cannot succeed without further mainstream support and usage. He also explored the environmental impacts of cryptocurrency , as crypto- utilizes large amounts of energy. Remarking on China’s recent , Penney expressed that some major cryptocurrency players have simply migrated their mining practices elsewhere.

The conversation shifted to career guidance within the legal technology field. This discussion was particularly interesting for 1L students developing their legal paths. Both professors offered pertinent advice on professional development, emphasizing networking. Penney highlighted the importance of reaching out to tech companies for any legal work available. Companies are increasingly incorporating emerging technologies within their operations, such as and algorithms, which may require legal expertise to ensure legal compliance. As innovative technologies emerge, so will the demand for technology lawyers.

Following the event, Professor Penney added, “In the coming years, emerging technologies like cryptocurrency and NFTs will pose a range of complex challenges for law, policy, and broader society. This was an excellent panel discussion, and OETA is showing great leadership in bringing students and faculty together to discuss and debate.”

While no one can ever fully predict the future of cryptocurrency and NFTs, both Penney and Hutchinson provided insightful perspectives. They both have extensive work related to technology that can help us theorize when looking forward. The panel elicited strong engagement and interactive feedback from participants. It was refreshing to learn more about technology law outside of the classroom setting and see different perspectives and interests within the field. I encourage everyone to explore the work of both professors and follow the OETA’s socials below for more information about our next event!

OETA Socials:

LinkedIn:

Twitter:
Facebook:
Instagram:

The post Osgoode Emerging Technology Association Panel with Professors Allan Hutchinson and Jon Penney appeared first on IPOsgoode.

Natalie Bravo is an IPilogue Writer and a 2L JD Candidate at Osgoode Hall Law School.

��

For years now, have identified potential benefits for implementing blockchain technology in the music industry. Blockchain could allow for more equitable pay for artists. Artists currently to achieve pay equity, especially in . in unallocated royalties end up redistributed when rights are unidentified. If implemented correctly, blockchain technology can serve as a database hub for copyright information and metadata.

Technological advancements and increased accessibility to musical tools allow anyone to become a published musician. Aspiring artists no longer need fancy studio gear or support from well-known names to create popular hits. More creatives in the scene drive competition. Thus, . For example, a single hit song, like , could have a dozen writers, each with their own stake in the final product. In the digital streaming era, when music is often written by multiple people, allocating royalties has become much more complicated. Paying artists what they are owed is difficult when ownership data may be complex and/or lacking.

In brief terms, blockchain technology is known as the foundation for cryptocurrency. The technology first appeared in the infamous 2008 Bitcoin authored by Satoshi Nakamoto. Bitcoin works on peer-to-peer network “P2P” as an electronic cash system. It is publicly accessible and transparent through traceable transactions.

Today, blockchain technology’s utility has expanded to much more than just transferring digital currency. For years now, musicians have attempted to make use of the network. Notably, in 2015 . Heap has since been developing , a blockchain-based, music-sharing space. She recently released an in April 2021. Blockchain has established a following amongst listeners and musicians alike. It could drastically change the status quo, if done widely, correctly, and in .

As a trusted network system with no reliance on third parties, blockchain is a fairly transparent and secure platform. are key in dealing with music licensing in particular. To date, no database anywhere accurately demonstrates song and record ownership. Instead, various publishers own distinct datasets. These datasets are not always in agreement, and hence can result in conflicts. No uniform database on music copyright information exists. A notable failed attempt at a singular database is the . There are or , but none are used uniformly and across the board. For a longstanding industry such as music, this is a tremendous concern. Enthusiasts envision a music copyright database implementing blockchain technology that could remedy current industry complications. Ownership information could be accessible and easily verified by all. A network where everything is accounted for could potentially offer quick and seamless royalty payments.

Even if the industry doesn’t warm up to the idea of a centralized database utilizing blockchain technology, writers and musicians will likely keep exploring ways to get their fair share. With tech and music evolving at a rapid pace, it is anyone’s guess where the correct solutions lie.

��

The post Blockchain to the Rescue? Missing Music Data & Royalties appeared first on IPOsgoode.

Claire Wortsman is an IPilogue Writer and a 2L JD Candidate at Osgoode Hall Law School.

��

Held on May 27, 2021 as part of Gowling WLG’s 2021 Blockchain Webinar Series, explored all things non-fungible tokens (NFTs). Speakers included well-known entertainment lawyer Susan Abramovitch, entrepreneurship and technology commercialization expert Thomas Hunter, leader of the Toronto Gowling WLG advertising and regulatory group Daniel Cole, and founder and CEO of Vinay Gupta. Gowling WLG partner Michael Garellek moderated the panel.�� ����

Physical Assets as NFTs

Gupta gave participants a glimpse of , the world’s first and largest NFT marketplace. The front page was populated with ‘traditional’ NFTs: digital art objects, from paintings to sculptures to cartoons. But Mattereum specializes in another kind of NFT: physical assets. Gupta showed participants listings like a and a .

Listings of this nature are an exciting advancement in the NFT space, and not only for die-hard Star Trek fans and gold collectors. With companies like Mattereum using NFTs to eliminate risks associated with purchasing physical assets online, such as false condition reporting, the possibilities are endless. While NFTs were not designed for the sale of physical assets, vault reports, warranties, and the work of lawyers can build up additional layers of protection and open up the NFT market to a variety of assets by providing a guarantee that the information listed is accurate and building contracts that protect buyers’ and sellers’ rights. For example, since the buyer, seller, website host, and physical asset may be in different locations, an arbitration clause in the contract of sale prevents uncertainty about which laws apply to the sale/use of the NFT and in which venue any dispute would be resolved. In the future, NFTs may even be used to buy and sell real estate.

Digital Assets as NFTs

Abramovitch explained the importance for artists, and agents or marketplaces that sell work on artists’ behalf, to be aware of the IP rights involved in the sale of a digital asset. These rights vary more than those attached to the sale of physical assets. For example, musicians typically wish to retain copyright in their master recordings and musical compositions. But by entering into an agreement with an agency or marketplace to sell their music as an NFT, they grant the right to sell a copy of their master recording or musical composition minted (NFT lingo for created) as an NFT. While the agency or marketplace selling the NFT may allow an artist to retain their copyright, they will likely try to limit the rights an artist retains in order to guarantee the scarcity, and therefore the value, of the NFT.

NFTs and the Law

Hunter provided advice for individuals inspired to start an entrepreneurial venture using NFTs. First, it is essential from a legal and regulatory perspective to define the commercial purpose of the NFTs for sale. Second, individuals must determine who holds the rights over the product in order to mint and sell it as an NFT. Abramovitch touched on this as well, explaining the importance for artists, agents, and marketplaces to understand who is legally authorized to mint and sell something as an NFT, or to transfer this right.

Abramovitch went on to explain that although an artist may own the copyright in a work, they may have granted exclusive licenses. If a recording artist performs a cover song, they cannot give an agent or marketplace the right to mint and sell that recording without the consent of the musical composition’s owner. Similarly, a photographer may own the copyright in their work, but they may infringe the subject’s personality rights by selling the photograph as an NFT without the subject’s permission.

If an existing brand wants to use NFTs in contests or promotions, Cole explained that in addition to copyright, patent, and trademark laws, brands must be aware of advertising, marketing, and contest laws that still apply. He notes that this is an area where the law needs further development to keep pace with technology. For example, section 206(1)(f) of the prohibits contests with purchase requirements where the prize is any goods, wares, or merchandise. Is an NFT a good, ware, or merchandise? This is one of the many legal questions about NFTs that remain unresolved.����

For more information on any of the above topics, and many more ranging from the environmental footprint of NFTs/cryptocurrencies to whether an NFT could be used as collateral for a loan, I highly recommend checking out the .

��

The post Where to Buy a Signed Captain Kirk Action Figure & Why You Should Care: Takeaways from Gowling WLG’s NFT Webinar appeared first on IPOsgoode.

What is NFT?

are non-fungible tokens based on Ethereum, powered by smart contracts. means it is unique and one of a kind. It can also be understood as a proof of ownership and authenticity. is an open source and decentralized software platform, and it is also the technology behind the cryptocurrency ether (ETH).

There are various platforms for NFT marketplace, such as , , and (for sports digital collectibles).

What does NFT mean for artist, collectors and the market?

Traditionally, artists would sell the physical copy of their painting, but this business model is not as suitable for digital artworks as physical artworks. Some artists were posting their artwork , or unable to sell their digital work, because there was significant difficulties in the digital work or authenticating the owner of the original copy when there is no physical copy. With NFTs and increasing amount of marketplaces for digital works, artists might be able to finally make money with their works.

This article written by Andrew R. Chow also mentioned that NFTs seemed to encourage and applaud more creative and innovative forms of artworks - “[m]any other artists working in groundbreaking and sometimes controversial styles are also receiving unprecedented interest from NFT collectors. Art with whirling 3-D renderings, street-style oversaturated color schemes, and hyper-referential (and often crass) cartoons are thriving.”

For collectors and the digital art market, NFT is a proof that the person is the owner of the original copy. Collectors might be paying more for “” or appreciation of digital arts than just for the money in this .

Concerns about NFTs?

Ioanna Lapatoura has discussed copyright ownership with respect to NFTs in her recent article on . NFT ownership is different from copyright ownership or a proprietary right over an actual asset. NFT is the “proof of owning an unique digital version of an asset, rather than the asset itself”. There is also new type of alleged infringement – copied artwork . Since NFTs are still new and developing, there is likely to be difficulties in enforcing intellectual property rights.

What’s in the Future of NFTs?

Some people view NFTs as cards and were bidding on the virtual future. Some people were skeptical and worrying that the NFT bubble might burst. Nonetheless, NFTs are providing creators of digital works a way to monetize their work product and receive real returns for their virtual work. Since NFTs are based on the Ethereum blockchain, maybe the other question that we ought to ask is – what is Ethereum and ETH’s long term growth potential?

Written by Ya-En Cheng, JD Candidate 2022, enrolled in Professor D'Agostino's Directed Reading: IP Innovation Clinic course at Osgoode Hall Law School. As part of the course requirements, students were asked to write a blog on a topic of their choice.��

The post NFT, A New Crypto Trend For Digital Arts appeared first on IPOsgoode.

The speakers briefly introduced cryptocurrency as a digital currency that relies on encryption techniques to generate and verify the transfer of funds. Blockchain is the underlying technology that records and keeps a ledger of cryptocurrency transactions. Several relevant legal issues surrounding cryptocurrency were raised, and it quickly became clear that the law lags behind technology in this space. As Phull mentioned, this is still a very niche area of the law but there is a growing need for related legal services and a greater understanding of common issues. Specifically, issues with cryptocurrency contracts and litigation and the recent anti-money laundering legislation draft were discussed.

Cryptocurrency Denominated Contracts

While now regularly pay for goods and services in cryptocurrency, contracts involving cryptocurrency as “money” present a unique challenge. Under�� of the Currency Act, “every contract […] for money and every transaction, dealing […] with money [….] shall be made […] in the Currency of Canada” unless executed in the currency of another country or a “unit of account that is defined in terms of the currencies of two or more countries”. To date, cryptocurrency – including bitcoin – is not officially considered currency in any country.

We learned from the Conference that it is best to treat cryptocurrency as a commodity to ensure that contracts are enforceable. Still, there are challenges related to the treatment of cryptocurrency as a commodity. Recently, the regarding Token Funder Inc. required that the initial token offering price be fixed to Canadian fiat currency instead of Ethereum to avoid the question of whether Ethereum should be considered “money”. Furthermore, suppliers of cryptocurrency are required to charge GST and HST on their payments, adding another hurdle to using cryptocurrency as payment in contracts.

With respect to enforcing cryptocurrency contracts, treating cryptocurrency as a commodity is similar to the treatment of foreign currency “as a commodity in the sense of an object of a commercial transaction” (). Therefore, should a dispute arise between two parties in a cryptocurrency-based contractual agreement, the aggrieved should not seek damages. As Phull describes in his , seeking specific performance or mandatory injunction is more appropriate.

Significant progress and clarity with respect to the Currency Act will be required over the coming years, as more individuals choose to use cryptocurrency as a means of monetary exchange.

Anti-Money Laundering Draft Legislation

Hartzman discussed how companies that engage in cryptocurrency exchanges act in a quasi bank-like role, yet businesses dealing in cryptocurrency are not currently required to have a licence to practice. CoinSmart, although unlicensed, is unique since it is the only Canadian company dealing in cryptocurrency that is backed by two Canadian banks (DC Bank in Vancouver and Luminis Financial in Toronto).

An absence of legal rules governing these businesses could allow for criminal activity and money laundering. Phull referenced the , which is set to be amended to impose more regulations on “money services businesses”. In a in the Canada Gazette, there is a summary of the proposed amendments for the legislation. Its objective is to create more regulations for decentralized virtual currencies, which are “convertible” – that is, exchangeable for funds. Convertible virtual currencies are vulnerable to manipulation by criminal organizations who . These tokens are attractive based on their anonymity, global accessibility, and simplicity of transactions that do not require an intermediary.

The legislation proposes that businesses “dealing in virtual currency” would be “financial services”. As a “money services business”, businesses would be required to fully comply and register with FINTRAC. For example, when entities receive more than $10,000 in virtual currency, there are reporting steps that the business must take. By monitoring suspicious transactions, this new provision will allow for some level of legal oversight, but it may not be enough.

Businesses dealing in cryptocurrency need to be fully recognized as a unique business. There is tension between whether Ontario’s or the should govern these businesses. Instead of tweaking one piece of legislation to include cryptocurrency regulations for two very specific crimes, it may be necessary to draft novel legislation that explores the many ways that individual users and businesses engage with cryptocurrencies.

If cryptocurrencies continue to become more accessible to the general public and are increasingly used as “money”, it will be necessary for the law to adapt to the technology. As the law currently stands, it is important for businesses to be aware of the potential complications that cryptocurrencies pose. We will continue to watch for innovation and new legal precedents in this area of law.

��

Written by Lauren Chan and��Summer Lewis.�� Lauren Chan is an IPilogue Editor and a business student at the University of Guelph.��Summer Lewis is an IPilogue Editor and a JD candidate at Osgoode Hall Law School.

The post Enforcing Your Crypto Contracts and Avoiding Criminal Transactions appeared first on IPOsgoode.

The entered the blockchain world to solve four problems facing the creative industry: (1) unclear ownership of intellectual property (IP), (2) inadequate data authenticity (which often leads to unfair distribution of proceeds), (3) the centralized governance of publishing, distribution and platform management (which can prevent quality content from reaching consumers), and (4) difficulty in converting work products to liquid assets such as cash.

So how can this technology help creative minds address the aforementioned problems? Last Fall, I attended the launch event of to talk to its developers and find out. is a decentralized solution that harnesses the combined power of Consortium Blockchain, Public Blockchain and Cross-chain Interoperability to address challenges with respect to ownership and rights to the resulting content.

Decentralization means that the control of any process or service, such as domain or content registration, does not to belong to a single person, organization or government. Rather, the process is distributed among all users to record and track ownership of content that cannot be erased or modified by third parties.

Consortium blockchain is a type of a hybrid between and .

Cross-chain technology allows two people holding tokens (or any other asset) on two different blockchains to trade directly and instantly without the risk of one party pulling out of the trade before its completion.

So how does Ink use this technology?

Firstly, as , an attorney at Gerard Fox Law, : “When IP rights holders register their works to a blockchain, the rights holders can ultimately end up with concrete evidence of ownership, which is free from tampering, because once a work has been registered to a blockchain, that information cannot ever be lost or changed. So, third parties can use the blockchain to see the complete chain of ownership of a work, including any licenses and assignments.” Overall, the system addresses a fundamental challenge in content creation by allowing the owner and consumer to trail content ownership.

Secondly, the aforementioned blockchain designs each serve a distinct technical purpose. Ink strategically chose to use consortium blockchain to limit operations to country-specific regions. They refer to this concept as the “”. Given that content creators are bound by their country’s unique legal frameworks, regulatory policies and even cultural norms, the design had to account for complications that might arise from operating in multiple jurisdictions by implementing this very concept.

But, if the technology is only operable within a given country, how can Ink fulfill its mission to “distribute creative work without ���dzܲԻ岹�������”? This is where cross-chain technology comes in and acts like a bridge that allows information and content to flow freely between public blockchain (Qtum) and Sovereign Consortium Blockchain. For example, once you produce content that adheres to domestic regulations including copyright law, you can secure it on the local sovereign consortium blockchain. The content then passes into the proprietary Cross-chain Protocol to reach various public blockchains and can be traded through the blockchain globally.

By creating a decentralized registration system that allows one to claim ownership within seconds and reach its users around the globe through the cross-chain protocol, Ink is set to tackle the concerns of content providers and facilitate the flow of innovative ideas. It seems clear to me that, as part of the emerging decentralized web, blockchain has the potential to revolutionize our understanding of content creation, registry, and dissemination by using a decentralized database for IP.

Ekin Ober is an IPilogue Editor and a JD/MBA student at Osgoode Hall Law School and the Schulich School of Business.

The post Blockchain: Revolutionizing Content Creation, Registry and Dissemination in the Creative Industry appeared first on IPOsgoode.