Lawyer Profile
Sylvain Pierrard
Québec, Québec
Overview
Do you have the right to copy source code written and developed by someone else? The answer to this question depends on the situation; however, even in the context of open innovation, intellectual property rights will be the starting point for any analysis required to obtain such an answer. In the software industry, open-source licences allow anyone to access the source code of corresponding software, free of charge and with few restrictions. The goal is generally to promote the improvement of this code by encouraging as many people as possible to use it. Linus Torval, the programmer of the Linux kernel (certainly one of the most well-known open-source projects) recently stated that without the open-source approach, his project would probably not have survived.1 However, this approach has legal consequences: Vizio was recently hit with a lawsuit alleging non-compliance with an open-sourceGPL licence used in the SmartCast OS software embedded in some of its televisions. It is being sued by Software Freedom Conservancy (“SFC”), an American non-profit promoting and defending open-source licences. As part of its lawsuit, SFC alleges, among other things, that Vizio was required to distribute the SmartCast OS source code under the above-mentioned open-source GPLlicence, which Vizio failed to do, thereby depriving consumers of their rights2. In Canadian law, section 3 of the Copyright Act3 gives the author the exclusive right to produce or reproduce all or any substantial part of an original work. This principle has been adopted by all signatories of the 1886 Berne Convention, i.e., almost every country in the world. A licence agreement, which may inter alia confer the right to reproduce the work of another person, can take different forms. It also establishes the extent of the rights conferred and the terms and conditions of any permitted use. However, not all open-source licences are equivalent. Many allow creators to attach various conditions to the right to use the code that has been made available. Under these licences, anyone may use the work or software, but subject to the following constraints, depending on the type of licence in effect: Obligation to display: An open-source licence may require disclosure of certain information in the software or in the source code itself, such as the following: The author’s name or pseudonym, or even maintaining the anonymity of the author, depending on their wishes, and/or a citation of the title of the work or software; The user licence of the redistributed open-source work or software; A modification note for each modified file; and A warranty disclaimer. Contribution obligations: Some licences require the sharing of any modifications made to the open-source code, with said modifications being under the same licence conditions. In some cases, this obligation extends to any software that incorporates the open-source code. In other words, code derived from open-source material can itself become open-source. This obligation to contribute can generally be categorized as follows: Any redistribution must be done under the original licence, making the result open-source as well; Any redistribution of the code, modified or not, must be done under the original licence, but other code may be associated or added without being subject to the open-source licence; or Any redistribution is done without any sharing constraints. Ban on commercialization: Some licences prohibit any use for commercial purposes. Apache v2 Level of obligation to contribute upon redistributionAny redistribution of the software, modified or not, or with added components, may be done under other terms. Mandatory elements to display Licence of the redistributed open-source software Identification of any changes made to the code Copyright notice Warranty disclaimer Commercial use permittedYes BSD Level of obligation to contribute upon redistributionAny redistribution of the software can be done without any obligation to share. Mandatory elements to display Copyright notice Warranty disclaimer Commercial use permittedYes CC BY-NC 4.0 Level of obligation to contribute upon redistributionAny redistribution of the software can be done without any obligation to share. Mandatory elements to display Licence of the redistributed open-source software Identification of any changes made to the code Copyright notice Warranty disclaimer Commercial use permittedNo CC0 1.0 Level of obligation to contribute upon redistributionAny redistribution of the software can be done without any obligation to share. Mandatory elements to display Licence of the redistributed open-source software Commercial use permittedYes GPLv3 Level of obligation to contribute upon redistributionAny redistribution of the software, modified or not, or with added components, must be done under the terms of the original licence Mandatory elements to display Licence of the redistributed open-source software Identification of any changes made to the code Copyright notice Warranty disclaimer Commercial use permittedYes, but sub-licensing is not allowed LGPLv3 Level of obligation to contribute upon redistributionAny redistribution of the software, modified or not, must be done under the terms of the original licence. New components can be added, but not integrated, under other non-open-source licences Mandatory elements to display Licence of the redistributed open-source software Identification of any changes made to the code Copyright notice Warranty disclaimer Commercial use permittedYes MIT Level of obligation to contribute upon redistributionAny redistribution of the software can be done without any obligation to share. Mandatory elements to display Licence of the redistributed open-source software Copyright notice Warranty disclaimer Commercial use permittedYes It is important to make programming teams aware of the issues that can arise when using modules governed by what are known as “viral licences” (such as the CC BY-NC 4.0 licence) in the design of commercial software. Such software could lose significant value if such modules are incorporated, making it difficult or even impossible to commercialize said software. In the context of open innovation where developers want to share their code, in particular to encourage collaboration, it is important to understand the scope of these different licences. The choice of the appropriate licence must be made based on the project’s objectives. Also, keep in mind that it is not always possible to change the licence used for the distribution of the code once said distribution has commenced. That means the choice of licence can have long-term consequences for any project. David Cassel, Linus Torvalds on Community, Rust and Linux's Longevity, The NewStack, Oct. 1, 2021, online: https://thenewstack.io. See the SFC press release: https://sfconservancy.org/copyleft-compliance/vizio.html. RSC 1985, c. C-42.
“The value of an idea lies in the using of it.” This was said by Thomas Edison, known as one of the most outstanding inventors of the last century. Though he fervently used intellectual property protections and filed more than 1,000 patents in his lifetime, Edison understood the importance of using his external contacts to foster innovation and pave the way for his inventions to yield their full potential. In particular, he worked with a network of experts to develop the first direct current electrical circuit, without which his light bulb invention would have been virtually useless. Open innovation refers to a mode of innovation that bucks the traditional research and development process, which normally takes place in secrecy within a company. A company that innovates openly will entrust part of the R&D processes for its products or services, or its research work, to external stakeholders, such as suppliers, customers, universities, competitors, etc. A more academic definition of open innovation, developed by Professor Henry Chesbrough at UC Berkeley, reads as follows: “Open innovation is the use of purposive inflows and outflows of knowledge to accelerate internal innovation, and expand the markets for external use of innovation, respectively.”1 Possible approaches: collaboration vs. competition A company wishing to use open innovation will have to decide which innovation "ecosystem" to join: should it favour membership in a collaborative community or a competitive market? Joining a collaborative community In this case, intellectual property protections are limited and the object is more focused on developing knowledge through sharing. Many IT companies or consortia of universities join together in collaborative groups to develop skills and knowledge with a view to pursuing a common research goal. Joining a competitive market In this case, intellectual property protections are robust and there is hardly any exchange of information. The ultimate goal is profit maximization. Unlike the collaborative approach, relationships translate into exclusivity agreements, technology sales and licensing. This competitive approach is particularly pervasive in the field of video games, for example. Ownership of intellectual property rights as a requisite condition to use open innovation The success of open innovation lies primarily in the notion that sharing knowledge can be profitable. Secondly, a company has to strike a balance between what it can reveal to those involved (suppliers, competitors, specialized third-party companies, the public, etc.) and what it can gain from its relationships with them. It also has to anticipate its partners’ actions in order to control its risks before engaging in information sharing. At first glance, resorting to open innovation may seem to be an imprudent use of intellectual property assets. Intellectual property rights generally involve a monopoly attributed to the owner, allowing it to prevent third parties from copying the protected technology. However, studies have shown that the imitation of a technology by a competitor can be beneficial.2 Other research has also shown that a market with strong intellectual property protections increases the momentum of technological advances.3 Ownership of intellectual property rights is therefore a prerequisite for any company that innovates or wants to innovate openly. Because open innovation methods bring companies to rethink their R&D strategies, they also have to manage their intellectual property portfolios differently. However, a company has to keep in mind that it must properly manage its relations with the various external stakeholders it plans to do business with in order to avoid unwanted distribution of confidential information relating to its intellectual property, and, in turn, profit from this innovation method without giving up its rights. Where does one get innovation? In an open innovation approach, intellectual property can be brought into a company from an external source, or the transfer can occur the other way around. In the first scenario, a company will reduce its control over its research and development process and go elsewhere for intellectual property or expertise that it does not have in-house. In such a case, the product innovation process can be considerably accelerated by the contributions made by external partners, and can result in: The integration of technologies from specialized third-party partners into the product under development; The forging of strategic partnerships; The granting of licences to use a technology belonging to a third-party competitor or supplier to the company; The search for external ideas (research partnerships, consortia, idea competitions, etc.). In the second scenario, a company will make its intellectual property available to stakeholders in its external environment, particularly through licensing agreements with strategic partners or secondary market players. In this case, a company can even go so far as to make one of its technologies public, for example by publishing the code of software under an open-source license, or even assign its intellectual property rights for a technology that it owns, but for which it has no use. Some examples Examples of open innovation success stories are many. For example, Google made its automated learning tool Tensorflow available to the public under an open-source license (Apache 2.0) in 2015. As a result, Google allowed third-party developers to use and modify its technology’s code under the terms of the license while controlling the risk: any interesting discovery made externally could quickly be turned into a product by Google. This strategy, common in the IT field, has made it possible for the market to benefit from interesting technology and Google to position itself as a major player in the field of artificial intelligence. The example of SoftSoap liquid soap illustrates the ingenuity of American entrepreneur Robert Taylor, who developed and marketed his product without strong intellectual property protection by relying on external suppliers. In 1978, Taylor was the first to think of bottling liquid soap. In order for his invention to be feasible, he had to purchase plastic pumps from external manufacturers because his company had no expertise in manufacturing this component. These pumps were indispensable, because they had to be screwed onto the bottles to pump the soap. At that time, the patent on liquid soap had already been filed and Mr. Taylor’s invention could not be patented. To prevent his competitors from copying his invention, Taylor placed a $12 million order with the two sole plastic pump manufacturers. This had the effect of saturating the market for nearly 18 months, giving Mr. Taylor an edge over his competitors who were then unable to compete because of the lack of availability of soap pumps from manufacturers. ARM processors are a good example of the use of open innovation in a context of maximizing intellectual property. ARM Ltd. benefited from reduced control over the development and manufacturing process of tech giants such as Samsung and Apple, which are increasingly integrating externally developed technologies into their products. The particularity of ARM processors lies in their marketing method: ARM Ltd. does not sell its processors as finished processors fused in silicon. Rather, it grants licenses to independent manufacturers for them to use the architecture it has developed. This makes ARM Ltd. different from other processor manufacturers and has allowed it to gain a foothold in the IT parts supplier market, offering a highly flexible technology that can be adapted to various needs depending on the type of product (phone, tablet, calculator, etc.) in which the processor will be integrated. Conclusion The use of open innovation can help a company significantly accelerate its research and development process while limiting costs, either by using the intellectual property of others or sharing its own intellectual property. Although there is no magic formula, it is certain that to succeed in an open innovation process, a company must have a clear understanding of the competitors and partners it plans to collaborate with and manage its relations with its partners accordingly, so as to not jeopardize its intellectual property. Henry Chesbrough, Win Vanhaverbeke and Joel West, Open Innovation: Researching a New Paradigm, Oxford University Press, 2006, p. 1 Silvana Krasteva, "Imperfect Patent Protection and Innovation," Department of Economics, Texas A&M University, December 23, 2012. Jennifer F. Reinganum, "A Dynamic Game of R and D: Patent Protection and Competitive Behavior,” Econometrica, The Econometric Society, Vol. 50, No. 3, May, 1982; Ryo Horii and Tatsuro Iwaisako, “Economic Growth with Imperfect Protection of Intellectual Property Rights,” Discussion Papers In Economics And Business, Graduate School of Economics and Osaka School of International Public Policy (OSIPP), Osaka University, Toyonaka, Osaka 560-0043, Japan.
Lavery is pleased to welcome the following professionals as partners in the firm. Sylvain Pierrard – Québec Sylvain Pierrard is a lawyer and trademark agent in the firm’s Business law and the Intellectual Property groups. He focuses his practice on trademarks, copyright, corporate and commercial law. Frédéric Laflamme – Trois-Rivières Frédéric Laflamme is a member of the firm’s Litigation and Dispute Resolution group. His practice is focused on matters involving civil and commercial litigation, such as civil liability, construction law and shareholder disputes. He is called upon to represent Canadian and foreign companies, insurers, manufacturers, contractors and shareholders before Quebec’s superior courts, and to advise them on settling their disputes. Vincent Towner – Sherbrooke Vincent Towner is a member of the Business law group. He frequently collaborates in matters involving corporate reorganizations and business transactions. Mr. Towner also drafts contracts such as commercial leases, service agreements, and supply agreements. This cohort of new partners plays a crucial role in the growth of the firm and our desire to be a growth partner for companies doing business in Quebec. They successfully embody Lavery’s culture and values: Excellence, Collaboration, Audacity and Entrepreneurship. Congratulations to our new partners!
On November 21, Chloé Fauchon, an associate of the Public and Administrative Law group, and Sylvain Pierrard, an associate of the Business Law group, delivered a seminar on copyright to professionals working in the film and television industry. Organized by the Table de concertation de l’industrie du cinéma et de la télévision de la Capitale-Nationale, the seminar was held at Le Camp in Québec City. Ms. Fauchon and Mr. Pierrard introduced participants to the different intellectual property rights, the exceptions to copyright protection of a work, copyright ownership, copyright assignment and the moral rights in the works.
On June 7, 2016, an event for the Chambre de commerce et d’industrie française au Canada – Section Québec (CCIFCQ), was held at Cafe Sirocco in Quebec City. Lavery was a proud sponsor of the evening and Sylvain Pierrard, one of its business law lawyers, was present as an administrator of the CCIFCQ and the event organizer. Since its creation in 1886, the CCIFCQ's mandate is to develop economic relations between France and Canada.
On May 2, 2016, the Fondation du Cégep Garneau and the École d’entrepreneuriat de Québec honoured fourteen young entrepreneurs during the first awards ceremony held at the École d’entrepreneuriat de Québec. Lavery is proud to contribute to the success of budding entrepreneur Jean Desmarais and his plan to open a clinic offering neurofeedback therapy and complementary psychological services by granting him a $5 000 scholarship. Lawyers Karine Pelletier, Sylvain Pierrard and Sarah Leclerc were on hand to present the award to him. During the event, the new entrepreneurs discussed their projects and the invaluable training and support they received from the École d’entrepreneuriat de Québec. The $5,000 scholarships were presented by established companies acting as sponsors to the young winners by offering them direct access to the business world through their position and network. The aspiring entrepreneurs in the school’s first two cohorts shared a total of $70 000 in scholarships awarded to encourage them to pursue their dreams.
Practice Areas
Bar Information
Called to the bar: 2015 (QC)