A patent landscape provides a bird’s-eye view of the patenting activity related to a specific technology. It can be an invaluable tool for your organization as the analysis of patent data reveals business, scientific and technological trends. Indeed, many industries increasingly rely on patent landscapes to provides a basis for understanding innovation activity in their field. A landscape can tell you which organizations are working in your field, where they file their patents, who are their key inventors, and much more. The information derived from a patent landscape analysis can help you identify whether competitors are encroaching on your core market, design around others’ technology, identify licensing and M&A targets, headhunt new talent, and reduce legal risks, among others. A patent landscape analysis is a powerful tool as the insights it uncovers allow for forward-thinking, data-backed decision-making in business strategy, R&D investments, and IP strategy. To illustrate the usefulness of patent landscapes, we provide you below with some very high-level data on the patenting of cannabis-related technologies. Keep in mind that, when performing a patent landscape analysis with the help of your patent agent, much more information is provided and each set of data can be further drilled down to get ever more detailed information. Below, you will see how we could easily identify and measure the impact of the recent changes in the legal status of cannabis. This is a convincing demonstration of the power of patent landscape analysis to identify trends in a given industry. Please contact us to explore how a patent landscape analysis can provide your business with similarly powerful data in your field of expertise. Cannabis Patent Landscape analysis Let’s start with the number of patent applications filed each year. Variations in the number of patent applications filed tell you whether your industry is growing, declining, or mature (stable). Also, the appearance of patent applications tends to correlate with new innovative products entering the market. An increased number of recent applications foreshadows the apparition in your market of more numerous innovative products, thus increased competition. A low or decreasing number of recent applications indicates a less active area to technology where any new innovative product you launch may more easily distinguish itself from those of your (decreasingly innovative) competitors. For cannabis technologies, figure 1 shows that, after remaining more or less stable from 2000-2013, the number of patent applications filed doubled in 2014 and then continued to increase rapidly in the following years. This trend is expected to continue, albeit slower, with a predicted number of patent filings reaching 3000 in 2025. The 2013 inflection point clearly shows the impact of the changes in the worldwide legal landscape regarding cannabis throughout the years. Indeed, on November 6 and 10, 2012, the recreational use of cannabis was legalized for the first time in the American states of Washington and Colorado. These events signaled the opening of a very large market and triggered a so-called “Green Rush”, which saw the birth of multiple companies and the creation of hundreds of thousands of jobs in this new industry. Figure 1. Nb of patent applications filed per year Let’s turn now to the countries from which these patent applications originate. The country of origin of the patent applications in your field indicate where your innovative competitors are located. A large number of patent application originating from a given country may be reflective of the quality of the local environment supporting innovation in the field in term of, for example, increased access to capital, a larger pool of skilled talent, advantageous legislation, etc. Hence, such a country could be a worthwhile option to consider when opening a new branch, seeking a new partnership, or looking to acquire smaller innovative competitors. Also, an increasing number of countries from which technologies originate is indicative of growing global interest in your field. Conversely, a decreasing number of countries indicates that innovation in your field is being consolidated in specific geographical areas and could prompt you to research the reasons behind this shift e.g., market interest, legislative environment, extensive M&A, etc.   Fig. 2 below shows the countries from which the cannabis-related patent applications originate. The number of countries producing these patent applications nearly doubled, going from 34 for the period between 2000 and 2013 to 59 since, showing increased global interest. Nevertheless, innovation on cannabis is now more concentrated as a larger share of the applications come from the top 4 jurisdictions showing that this global interest did not raise equally everywhere. Indeed, together the United States, China, Great Britain, and Europe account for 89% of the patent applications filed since 2014, whereas they accounted for only 79.5% of those filed before 2013. Also, a larger proportion of the applications now originates from the United-States (from 39% to 58%) showing that the activity has greatly increased in this country thanks to the abovementioned legislative changes. This happened at the expense of almost all other jurisdictions, which have seen their share of the patent applications decline, with the exception of China, which kept about the same share (i.e., 20%-21%). This data shows that, if one were to look for a partner in the industry, the USA and China would be good places to start with. Figure 2. Jurisdictions from which the patent applications originated We can turn now to the jurisdictions in which the patent applications were filed. By looking at the countries in which your competitors field their patent applications, we can deduce where they believe their main markets are and where they believe their technologies is most promising. Again, the reasons underneath these numbers could be investigated: is a country selected because of the size of its market, its accommodating legislations, its business incentives, or other reasons? This can tell you where to file your own patent applications. It may also help you identify underserved markets that you may want to develop in with lesser interference from your competitors’ patents. Fig. 3 below shows the jurisdictions where patent applications related to cannabis were filed before 2013 and have been filed since 2014. Patent applicants now seek to protect their innovation in a greater variety of jurisdictions (57 compared to 66) indicating that cannabis innovators believe their market is now more global. On the other hand, patent filings have become more concentrated with the top 5 jurisdictions (China, the United States, WIPO, EPO, and Canada), which have increased their total share from 60% to 78.5% of all patent applications. This indicates that, despite the above, cannabis innovators are concentrating their marketing efforts in the USA, in Europe, and in China. Figure 3 also clearly reveals the impact of the 2018 legalization of cannabis in Canada. Indeed, it has had a clear effect with the country share of patent applications increasing from 6% to 9%. In other words, cannabis innovators are now filing twice as many patent applications in our country, showing it is now a more interesting market to them, probably due to the legalization of cannabis. Figure 3. Jurisdictions in which the patent applications were filed Let’s continue by looking at the technological sub-fields to which the patent applications belong. This provide a high-level snapshot of which technologies are being developed. More interestingly, this can be drilled down to narrower technological sub-fields, or by various countries, or by specific competitor to have yet more information on “who is doing what and where”. Figure 4 shows the technological sub-fields to which the cannabis-related patent applications filed since 2014 belonged. We can clearly see, somewhat unexpectedly, that the recreational use of cannabis, while responsible for generating initial business interest in the field, does not seem to be the driving force behind patenting activities. Indeed, one might have expected activities ancillary to such use including technologies to grow, cultivate, track, and store cannabis, would be prominent. It rather seems that the health industry dominates since most of the patent applications relate to medicinal preparations and drugs for specific disorders. A smaller number of patent applications relate to foods with modified nutritive qualities and methods of isolation (extraction). Interestingly, after some drilling down, we noted that China has the largest number of patent application filed in the following classifications: A61K36 – traditional medicines, and A61P1 – drugs for the digestion system, perhaps indicating a larger potential market for this type of innovation in this country. Meanwhile, the United States dominates in the following classifications: A61K31 – medicines containing organic ingredient and A61K9 – medicines having a special physical form. Figure 4. Patent classification distribution (the size of the boxes indicate their relative prominence) A patent landscape can help you identify who exactly is patenting technologies in your field. This allows you to identify your competitors as well as potential partners, licensees, or licensors. It also tells you whether innovation is driven by academic institutions (potential licensors) or by companies. You can also look at the size of your competitors to assess whether you are evolving among many small startups, competing against giants, etc. You can even look at the past litigation/enforcement behavior of the top patent filers as part of a risk assessment analysis. Again, this data can be drilled down to see what each top competitor is patenting, where, and when and where they themselves are located. Therefore, to conclude this “Patent Landscape Teaser”, figures 5 and 6 show the top 15 owners of the cannabis patent applications filed between 2000-2013 and since 2014, respectively. GW, a British pharmaceutics company focused on cannabis products, has consistently been the top filer in this field. In contrast, all the other top filers have changed denoting a fundamental change in the cannabis industry landscape. Before, 2014, the top filers were mostly pharmaceutical companies and large corporations with varied business interests indicating that, for most patent filers, cannabis was more or less a side project. After 2014, many cannabis-focused companies appear and take top spots: Canopy Growth, Hexo Operations, Zelira, Bazelet, Syqe, Receptor, Nextleaf, Hanyi, and Radient. This trend clearly reflects the fundamental change brought upon the industry by the Green Rush, which led to the creation of numerous new players in the field. A company before 2014 clearly did not face the same challenges and opportunities as one evolving now. Figure 5. Top 15 owners of the patent applications filed between 2000-2013 Figure 6. Top 15 owners of the patent applications filed since 2014 In summary, the data shown above clearly illustrates the rapid and profound impact that the legalization of cannabis has had on cannabis innovation. The patent landscape analysis allowed identifying many trends and facts indicative of a nascent technological field or one having received a recent boost. In other circumstances, other trends would have been observed. For example, we can expect to see a reversal of most of the above trends as the technology matures yielding fewer patent applications, as less proficient companies fail yielding fewer patent applicants, and as the market stabilizes resulting in patent applications being filed in possibly fewer and more well-defined markets.

In the third and final entry of this three-part article series, we share with you the last set of intellectual property (IP)–related mistakes (mistakes #10 to #13) that we regularly see with startups. We hope you will find it useful for your business. Please be sure to read our first and second entries in this series, where we go over mistakes #1 to #5 and #6 to #9, respectively. Happy reading! Part 3 of 3 Mistake #10:       Assuming that your invention is unpatentable One common mistake we see business owners make is that they assume their technology is not patentable. This frequently applies to computer-related inventions, such as software. Even though there is no outright ban on patenting software in Canada, many inventors are under the impression that software is unpatentable. This is most likely due to the fact that many patent applications for computer-implemented inventions are initially refused because the Patent Office determines that the invention in question is merely a disembodied series of mental steps and/or a mathematical formula (both of which are not considered patentable subject matter). However, it is important to remember that, while certain types of subject matter are not patentable in Canada (e.g., disembodied mental steps and mathematical formulae, as mentioned above), that does not mean that technology involving such unpatentable subject matter (e.g., computer software) is completely void of patentability. Often, it simply means that another aspect of the technology should be the focus of the patent application. For example, with regard to computer-implemented inventions, one strategy to increase the likelihood of patentability is to draft the patent application in such a way so as to emphasize that the computer hardware is essential, or to draft the application in such a way that it is clear that the invention creates an output comprising discernible effects or changes (e.g.: this can be as simple as generating distinct groups in a classification method). It is also worth noting that many inventors are under the mistaken impression that a new piece of technology has to be all but revolutionary in order to be patentable. However, improvements over existing technology are also patentable as long as they are sufficiently new and inventive. Accordingly, it is important to speak to a patent agent to properly determine if and how your invention may be patented. Mistake #11:       Believing that your patent automatically gives you the right to use and/or commercialize your invention One common misconception regarding patents is that they give the owner thereof the right to use and/or commercialize the patented technology without fear of infringing third-party patents. However, what a patent actually does is allow its owner to exclude others from using and/or commercializing their patented technology. It is not a shield against potential infringement of third-party IP rights. For example, if you obtain a patent for a piece of technology you developed, that does not necessarily mean you have the right to use or commercialize that technology. Specifically, if your technology incorporates patented technology owned by another company, then that company can actually prevent you from using or commercializing your own invention. This is an important aspect of “patent protection” that all entrepreneurs should be aware of. Mistake #12:       Not informing yourself about the criteria for recognition as an inventor or owner of an invention, and not training your employees on these criteria Many types of intellectual property disputes can arise within a business. Most of the time, they are the result of misconceptions, such as: An employee believes they are the inventor of an invention, when they are not; An employee believes that as the inventor of an invention, they are necessarily entitled to consideration (monetary or otherwise); the invention belongs to them rather than to the company; they are free to use the invention, for example upon leaving the company to become a competitor; or An employer believes that their company can use the specific results of a researcher’s work obtained from a previous job. It’s easy to imagine how messy such issues can get! An ounce of prevention is certainly worth a pound of cure. Get informed! Also, clarify these issues with new employees as soon as you hire them, and set down in writing who will own the rights to intellectual property developed during the course of employment. A quick training session before such problems arise can set the record straight and avoid conflicts based on unrealistic expectations. Mistake #13:       Not having an intellectual property protection strategy After reading this three-part article, we hope you now have a better understanding of the importance of developing an intellectual property strategy for your company. While such strategies can be very complicated, we have provided three broad questions that you should consider at all times (not just when starting out).  What intellectual property is my company using? This first question tasks you with identifying intellectual property that your company uses. This would include any technology that you are using or selling; any brand names/logos; and any works you are currently using (e.g., logos, slogans, website layouts, website texts, pictures, brochures or computer programs). Is there a risk that I am infringing a third party’s IP? Once you have identified the above intellectual property, you should ask yourself if your activities might infringe a third party’s IP rights. Obtaining a response may involve the following: Hiring a patent agent to perform a freedom to operate search for any technology you plan on using. Hiring a lawyer specialized in IP to perform a trademark search and opinion for any brand names/logos you use, as well as to negotiate and prepare an assignment of IP rights. How can I expand my own IP portfolio? This question involves determining, for each piece of IP you have identified, if and how it can be protected. This can include asking yourself the following additional questions: Is any of the technology I use or commercialize worth protecting? If so, should I file a patent application or keep the technology a trade secret? In which countries do I want IP protection? Are any of my company’s brand names or logos worth protecting by filing a trademark application? What’s important is not necessarily that you protect each and every piece of intellectual property your company owns, but that you have properly evaluated your company’s IP and have come up with an effective strategy that suits your business. In order to properly optimize your company’s IP portfolio, we naturally recommend speaking with your IP professional, whether it be a patent agent, a trademark agent, or a lawyer. Conclusion Lavery’s intellectual property team would be happy to help you with any questions you may have regarding the above or any other IP issues. Why don’t you take a look at our Go Inc. start-up program? It aims to provide you with the legal tools you need as an entrepreneur so you can start your company on the right foot. Click on the following links to read the two previous parts. Part 1 | Part 2

In the second entry of this three-part article series, we share with you the next set of intellectual property (IP)–related mistakes (mistakes #6 to #9) that we regularly see with startups. We hope you will find it useful for your business. Please be sure to read our first entry in this series, where we go over mistakes #1 to #5. Happy reading! Part 2 of 3: Mistakes concerning trademarks, industrial designs, copyrights, and trade secrets Mistake #6: Launching your product on the market without having verified the availability of your trademark Choosing a trademark can be a long and expensive process. People sometimes focus on the attractive qualities of a trademark, forgetting that its primary function is to distinguish a company’s products or services from those of others. To properly fulfil this function, the trademark must not be confusing with other trademarks, trade names, and domain names. In order to avoid conflicts with existing rights, an availability search should be conducted prior to a trademark’s adoption and the launch of a new product, service, or business. Furthermore, it may not be possible to register a trademark if it doesn’t have certain necessary intrinsic qualities, and a trademark may not be usable if it conflicts with the rights of third parties. A search will make it possible to determine where your desired trademark stands in terms of these two aspects; if necessary, a different mark may need to be adopted. Conducting a pre-adoption trademark search may prevent you from having to change trademarks after sales have begun or after the marketing development of your products or services is underway. Redesigning your advertising campaign; modifying your documentation, website, and packaging; and developing a new marketing strategy to transfer and retain the goodwill surrounding your initial trademark will be an expensive task, taking up time that could have been invested elsewhere. Such a process also carries the risk of tarnishing your reputation or losing your goodwill. Mistake #7: Not having your software or graphic designer sign a copyright assignment Many people think that a copyright is intended to protect a work with exceptional artistic qualities. However, such thinking is erroneous. As long as a text, drawing, graphic design or computer program is a creation that required a certain amount of effort and is not a copy of an existing work, it constitutes a “work” and is automatically protected by copyright. As a general rule, in Canada, the author is the first copyright owner; thus, just because the work was created in exchange for remuneration doesn’t mean that its copyright was transferred. For a startup business owner to ensure that they own a copyright, they should ask the artist or author to sign a written transfer of copyrights, thereby ensuring that the business can publish and use the work as it sees fit. It is also important to have the author of a work sign a waiver of moral rights or to outline the terms and conditions that will apply to the work’s authorship and integrity. If these steps are omitted, you’ll be limited in the use of such works. They won’t be part of your assets and will therefore not increase the value of your portfolio. In addition, you’ll be dependent on the consent of the actual holders of the rights to commence actions for infringement, should that ever be necessary. Mistake #8: Not having your employees, officers, and contractors sign confidentiality agreements (before entering into a business relationship) The sooner the better! Your company should see to having an agreement intended to preserve the confidentiality of its information signed by all those whom it mandates to perform work that is significant for its development, including its employees. The type of information that can be protected is virtually unlimited; at a minimum, it includes information related to R&D, market studies, prototypes, ongoing negotiations, marketing research of any kind, and lists of target customers. Ideally, in an employer-employee relationship, when an employee or officer leaves, a company should make sure to remind them of the confidentiality obligations that will continue to apply despite the end of the relationship. Applying these principles reduces the risk that an employee or partner will publicly share or independently use your strategic information at your company’s expense. Mistake #9: Not protecting your original products’ shapes and ornamentation within the prescribed time limit Many are unaware of the benefits of protecting an object’s shape, form, and ornamentation through the Industrial Design Act, or they learn of such benefits too late. In Canada, such protection has two key requirements: The industrial design must not have been published more than one year before the date on which an application for registration is filed; and The protection must be acquired by registration to exist. This type of protection is more effective than one might think and should not be overlooked. For example, a search of the industrial design register will reveal how many industrial designs tech giants have obtained. Some industrial designs have even been the subject of high-profile disputes, including one between Apple and Samsung over the shape of tablets. Apple Inc. uses such protection to prevent the presence of competing products that copy its designs on the market. As an example, in Canada, the shape of the headphones shown below was protected in 2021 and the shape of the phone shown below was protected in late 2020. For more detail on the protection of each of these articles, see Registration 190073 and Registration 188401. Conclusion Lavery’s intellectual property team would be happy to help you with any questions you may have regarding the above or any other IP issues. Why don’t you take a look at our Go Inc. start-up program? It aims to provide you with the legal tools you need as an entrepreneur so you can start your company on the right foot! Click on the following links to read the two previous parts. Part 1 | Part 3

In this three-part article series, we will share with you the intellectual property (IP)–related mistakes that we regularly see with startups. We hope you will find it useful for your business. Happy reading! Part 1 of 3: Mistakes concerning IP in general Mistake #1:                 Believing that IP issues don’t affect you Some companies don’t put too much thought into intellectual property considerations, either because they feel they don’t have any intellectual property worth protecting, or because they simply don’t want to go through the trouble of obtaining such protection. While refraining from obtaining IP protection might, in rare instances, be a viable business decision, that does not mean that your company should ignore IP considerations altogether. This is because of the existence of third-party intellectual property rights. As an example, if your business sells or uses technology that has already been patented by a competitor, or your business uses a trademark that is confusingly similar to that of a competitor, then said competitor may be able to sue you for infringement, regardless of whether or not said infringement was deliberate. This is why it is always important to consider third-party IP rights, regardless of the nature of your business activities, and regardless of whether you intend on obtaining IP protection. Mistake #2:                 Believing that IP will cost you too much Many business owners think that intellectual property is too expensive to warrant spending money on when their company is just starting out.  However, while obtaining intellectual property rights can sometimes be an expensive process, it is important to remember that investing in your company’s IP rights is just that: an investment, one that can result in the creation of a valuable asset for your company. This can include a trademark registration for a brand that, over the years, will become incredibly popular, or a patent for a highly sought-after piece of technology. In fact, if properly protected, a company’s intellectual property assets can easily become more valuable than any physical asset. And just like any other valuable asset, it will increase your company’s worth and make your business all the more appealing for potential investors.   Mistake #3:                 Hoping for the intervention of the “IP police” Some entrepreneurs believe that once they have obtained an IP right, the government will be the one to enforce it with their competitors. This is unfortunately not the case. It is up to you, as an IP owner, to monitor the market and ensure that your competitors don’t infringe your rights. Should you fail to do so, you’ll be leaving the door wide open to those who would wish to imitate your products and services. In addition, you even risk losing some of your previously acquired rights. For example, your trademark could become non-distinctive—meaning you would no longer be able to protect it—if you were to fail to react and let a third party copy it. Reacting to every single situation isn’t necessarily called for, but each case should be examined in order to determine what consequences third-party use might have on your rights as a holder. Should you discover, in your market monitoring, that a third party is imitating your intellectual property, talk to your IP advisor or lawyer. They can help you decide on an effective first approach to take, either on your own or through them. Said approach might involve asking the third party to cease its activities, claiming compensation for prejudice caused, requiring that certain modifications be made to the use, and/or negotiating a coexistence agreement or a license with or without royalties. Mistake #4:                 Believing that you won’t be able to “defend your IP” We sometimes hear entrepreneurs say that securing IP rights isn’t worth their while, as they won’t be able to “defend their IP.” They essentially believe that the only purpose of holding IP rights is to sue competitors who imitate their products and services, which they necessarily believe is very expensive. The result is that they fail to protect their innovations and let their competitors appropriate their products and services. Without IP rights, it is true that they have little recourse. In reality, a lawsuit is usually the last option to use against competitors. Many other steps can be taken before resorting to a lawsuit. As is the case for other IP owners, holding IP rights may allow you to: -          Significantly discourage competitors from imitating your products and services by clearly indicating that you hold IP rights; and -          Negotiate agreements with your competitors who would like to imitate or who are already imitating your products and services. Remember that only a small minority of IP disputes are resolved in court; all other disputes are resolved out of court quickly and at relatively little cost. Mistake #5:                 Launching your product or service on the market and waiting to see if it will be a success before obtaining IP protection Some entrepreneurs, preoccupied with saving money, launch their new products or services on the market and wait to see if they are successful before protecting them with IP rights. This constitutes a serious mistake, because some IP rights may no longer be available. More specifically, once a product or service is launched, the possibility of protecting it by patent or industrial design is no more. Note that some exceptions apply, particularly in some jurisdictions that allow grace periods. If you are considering protecting one of your products or services by patent or industrial design, you should start the protection process before you launch your innovation on the market. However, said protection process doesn’t need to be completed in order to begin marketing your product or service. Conclusion Lavery’s intellectual property team would be happy to help you with any questions you may have regarding the above or any other IP issues. Why don’t you take a look at our Go Inc. start-up program? It aims to provide you with the legal tools you need as an entrepreneur so you can start your company on the right foot! Click on the following links to read the two previous parts. Part 2 | Part 3