Canada: Protecting And Navigating Intellectual Property For Artificial Intelligence Based Technologies

Last Updated: May 17 2018
Article by Isi E. Caulder and Paul Blizzard

Technological advances in Artificial Intelligence (AI) technology are accelerating due to the combination of machine learning breakthroughs, increases in computing power, and the emergence of big data analytics. Cloud based computing has also accelerated AI development, with more readily available and less expensive computing power for increasingly complex manipulations of information and the performance of difficult tasks by computers, such as facial recognition. The advent of big data analytics provides robust data training sets that bring AI technology to life.

A group of high profile technology companies including IBM, Google, Amazon, Microsoft, Samsung, and AT&T have been pioneering and patenting fundamental AI technology directed to machine learning, neural networks, natural language processing, speech processing, expert systems, robotic and machine vision. In turn, this fundamental AI technology is being adapted and utilized within a wide variety of industries including health care, manufacturing, and transportation to create AI-based products that are better, more useable and intuitive than before (e.g. smart surgical tools, warehouse robots, self-driving cars, etc.)

As with any burgeoning field of innovation, companies who develop and sell AI-based technology must assess the risks of doing business in the context of third-party IP rights, and develop strategies to capture and protect their own associated IP rights. At their root, both of these challenges require an assessment of the availability and scope of intellectual property protection. While many of the same considerations that apply to traditional technologies are relevant, there are a number of key aspects specific to developing patent, trade secret, and copyright protection of AI-based products.

Patent Protection

Patents protect the functionality of inventions which are new, non-obvious, useful and which consist of patent eligible subject matter. Patents provide national rights to prevent others from making, using or selling the protected invention in a specific jurisdiction. Patents can be strategically used to achieve or maintain position in the marketplace, increase share value and/or secure investment depending on business needs.

The U.S. Patent Office has been quietly issuing patents in ever-increasing numbers for fundamental AI technology. Over the past five years the number of patents issued under patent class 7061, a class dedicated to AI data processing systems, has seen an increase of 500%. While increasing numbers of AI technology patents are issuing, as with other kinds of computer-implemented inventions, AI-based inventions are generally vulnerable to being considered ineligible subject matter.

The current subject matter eligibility test in the U.S. requires the invention to be evaluated to determine whether it is directed to a law of nature, natural phenomenon or an abstract idea and if so whether the invention provides "significantly more"2.  Abstract ideas, laws of nature, and natural phenomenon are considered by U.S. courts to be "the basic tools of scientific and technological work" however the term "abstract" is not clearly defined.  As a result, patent applications (including applications for computer software) that approach this very blurry line have faced significant challenges during prosecution.  U.S courts have consistently expressed concern that monopolizing tools such as abstract ideas by granting patent rights impedes innovation rather than promotes it.

In recent cases, "significantly more" has been found where the inventive solution is necessarily rooted in computer technology in order to overcome a problem specifically arising in the realm of computers3 , where an inventive feature is an improvement to computer functionality4 and where an invention uses limited rules in a process specifically designed to achieve an improved technological result in conventional industry practice5.

Recent U.S. Patent Appeal Board decisions specifically involving AI-based inventions indicate that eligible inventions are those which have a feature or limitation which produces a "useful, concrete and tangible result without pre-empting an abstract idea like a mathematical algorithm6.  Further, patent eligible inventions which can be described in terms of structure ("what is is") rather than functionally ("what it does") will have a better chance of allowance. For example, the structural aspects relating to methods of creating, training and/or validating a neutral net may be fertile ground for patenting. Also, structural aspects of the final product that results from these methods may also yield patentable eligible subject matter.

Similarly in Canada, computer-related subject matter is generally considered patent eligible if a solution provided to a problem is technical and strictly requires the use of a computer.7 For example, an invention that represents a technical solution that results in a more efficient operation of the computer or is a solution to a technical problem related to the computer may be considered to be of patentable subject matter in Canada.

Fundamental AI technologies appear to be satisfying the currently stringent but evolving patentable eligibility subject matter test for software inventions (i.e. "sufficiently technical" to be patentable) as well as overcoming the usual novelty and obviousness hurdles presented by the prior art (i.e. patents and documents publicly available). In fact, a study recently conducted by Oracle concluded that 87.5% of patent applications directed to fundamental AI technology such as specific technical details of the machine learning or deep learning functionality have received the green light when examined by the U.S. Patent Office.

An example of a patented fundamental AI technology is Google's US Patent No. 9,406,017 entitled "System and Method for Addressing Overfitting in a Neural Network"8 which covers a system and method for training a neural network that uses a switch linked to feature detectors in at least some of the layers of the neural network. For each training case, the switch randomly selectively disables each of the feature detectors in accordance with a preconfigured probability. The weights from each training case are then normalized for applying the neural network to test data. This U.S. patent issued in 2016 based on a U.S. patent application filed in 2012.

As another example, artificial perception pioneer AEye has recently been awarded a number of foundational patents for solid state MEMs-based agile LiDAR and embedded AI technology that is core to its iDAR" perception system. Specifically, US Patent Nos. US9885778B29 and US9897689B210 cover aspects of their iDAR perception system ranging from a unique approach to dynamic scan and shot pattern for LiDAR transmissions to the ability to control and shape each laser pulse though pulse modulation. AEye states that these aspects improve scanning range by 400% and increase speed by 20 times.

For an AI related innovation to be considered patentable subject matter in the U.S., Canada and elsewhere, it needs to be sufficiently technological. A sufficiently technological AI innovation must therefore be necessarily rooted in computer technology and seen to provide a "technical solution" to a "technical problem" in the realm of computing. Showcasing and describing technical details of an AI invention and its practical application may increase the chances of meeting these subject matter requirements.

Trade Secret Protection

Patents can be an important IP tool to protect the functionality of a new and non-obvious technology. However, they are not well suited to secure other forms of software-related intellectual property such as source code, contents of AI training sets, etc. Further, in the context of the currently restrictive climate for patent eligible subject matter as discussed above, patent protection is not always available or feasible for AI-based technology.

Trade secrets can provide a viable avenue of alternative protection. Trade secrets include any valuable business information that derives its value from the secrecy. Unlike patents, no application or registration is required to obtain trade secret protection, however an innovator must take reasonable steps to establish and maintain secrecy. In turn, the covered information may be protected for an unlimited period of time as long as it is kept secret and has commercial value.

Trade secret law may be particularly applicable to various aspects of AI technology, including: formulae, compilations of information, programs, commercial methods, techniques, processes, designs, patterns, and codes which are not generally known or reasonably ascertainable by others.

Practically speaking, taking "reasonable steps" to maintain the secrecy of a trade secret typically involves logistical and digital mechanisms (e.g. firewalls, encryption and authentication methods, data security measures, password protections, download disabling) to restrict and monitor access to trade secret information. Other safeguards can include restricting employee access to a company's confidential and trade secret information, putting in place nondisclosure agreements with secrecy obligations when sharing trade secrets with business partners, and guarding against reverse engineering. In addition to these "reasonable steps", organizations should consider putting in place processes which identify the most valuable trade secrets and prioritizing protection measures for them.

However, there are also important limitations to the protection that trade secrets can offer AI-based technology. AI-based software typically undergoes continual development by a number of inventive entities through many revisions. This requires continual and proactive steps to identify and prioritize trade secrets (e.g. a valuable training dataset) in order to avoid loss of trade secret protection. It is necessary to commit the necessary resources to ensure that critical trade secrets are identified, protected, and that internal processes prioritize and maintain secrecy. More generally, enforcement of trade secret rights in AI-based software can be limited due to onerous requirements to evidence and establish misappropriation of trade secret rights. Also enforcement of trade secret protections can be ineffective against third parties who independently develop or indirectly obtain the secret subject matter.

Ultimately, the choice of whether to protect AI technology with patent or trade secret protection will depend, on one hand, on the likelihood of patentability, and the possibility of establishing and maintaining secrecy on the other.

Copyright Protection

Copyright may be available to protect those aspects of AI-based technology that are recognized as "literary works" within the meaning of the Canadian Copyright Act11 and corresponding legislation elsewhere. Copyright arises automatically when an original work is created and protects original expressions embodied in software including: computer source code, visual user interface elements, API structure, user documentation and product guides. Copyright however does not extend to the functional aspects of software.

While data itself is not copyrightable, copyright can cover original compilations of data in a database and especially when data has been specifically arranged into structured datasets. This protection is afforded under the concept of a compilation copyright that protects the collection and assembling of data or other materials. Although AI training data sets may be protected as compilations, the underlying data is not automatically granted protection. Some jurisdictions like the U.K. provide specialized IP protection for database rights12.

Finally, there are new and evolving challenges involving copyright ownership of AI-generated works. For example, the U.S. Copyright Office clarified in the now infamous "Monkey-Selfie" that "to qualify as a work of authorship a work must be created by a human being"13.  The decision was recently upheld by the US Ninth Circuit Court of Appeals14. This case illustrates that legislative changes will be required to extend copyright protection to works created by non-human beings and this will be an issue to watch closely.

Industrial Designs

Industrial designs, also known design patents, protect novel and non-functional, aesthetic aspects of products. Industrial designs can protect the appearance of AI-based technology products, such as the physical devices (e.g. household robotic devices) novel shape of graphical user interfaces or a graphical animation.

Design protections are evolving in the U.S., Canada and elsewhere. For example, the Canadian Intellectual Property Office (CIPO) announced in early 2017 that a sequence of graphics within computer-generated animated designs (i.e. animated GUIs) can create a unique and dynamic visual effect and that this is protectable subject matter under industrial design practice15. This acceptance of animated designs follows similar practice in the U.S. Patent and Trademark Office and elsewhere.

Finally, design protection can form a strategically complement to other IP protections for AI-based technology with product features that have a unique look and feel. For example, it can be useful from an enforcement point of view, to have the ability to prevent importation of competing AI-based products on the basis on how similar the products look to a registered design without the need to consider technical functionality as would be required under a patent infringement analysis.

Looking Ahead

There are many developing patent, trade secret, and copyright law aspects specific to AI technology, a very exciting new frontier. While these legal issues are complex and will continually evolve, it is important for companies who are building and selling AI-based products to put in place a proactive and complete strategy for IP protection and risk evaluation. Such a strategy should include not only measures to secure patent, trade secret, copyright and design protection where available but also measures to monitor third party IP rights and assess associated risks.


1  USPTO, "CLASS 706, DATA PROCESSING - ARTIFICIAL INTELLIGENCE" (May 10th, 2018), USPTO – Class Definition, online:

2 Bilski v. Kappos, 561 U.S. 593, 612-13 (2010), Mayo Collaborative Services v. Prometheus Labs, 132 S. Ct. 1289 (2012), and Alice v CLS Bank, 134 S. Ct. 2347 (2014).

3 DDR Holdings, LLC v., L.P., 773 F.3d 1245 (Fed. Cir. 2014).

4 Enfish, LLC v. Microsoft Corp., 2016 U.S. App. LEXIS 8699, 2016 WL 2756255 (Fed. Cir. May 12, 2016).

5 McRO, Inc. v. Bandai Namco Games America, Inc. et al. (Fed. Cir. Sept 13, 2016).

6 Ex Parte Kirshenbaum (Patent App. No. 2009/896,036, Appeal 2007-3223].

7 Inc. v. Canada (Commissioner of Patents), 2010 FC 1011.

8 Google Patents, "System and method for addressing overfitting in a neural network" (2016-08-02), Google Patents,

9 Google Patents, "Method and system for scanning ladar transmission with pulse modulation" (2018-02-06), Google Patents,

10 Google Patents, "Method and system for ladar transmission with interline skipping for dynamic scan patterns" (2018-02-20), Google Patents,

11 Copyright Act, RSC 1985, c C-42.

12 The Data Protection Act 1998 (c 29) United Kingdom Act of Parliament and follows the EU Data Protection Directive 1995 protection, processing and movement of data.

13 Naruto v. Slater, No. 15-cv-4324, 2016 WL 362231 (N.D. Cal. Jan. 28, 2016).

14 Naruto v. Slater, D.C. No. 3:15-cv-04324-WHO (9th Cir. 2018).

15 Matthew Graff, "Animated GUI Designs – Who's Registering in Canada?" (April 10, 2018), Bereskin & Parr LLP, online:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Isi E. Caulder
Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions