Author Archives: Katie LeClair

Feb 24, 2021

3 mins | 620 words
Author: Avah Taylor

Avah Taylor headshotThe #BuyBlack movement has garnered mainstream attention and raised international awareness and interest in Black-owned products and services.

#BuyBlack places an increased focus on both Black and non-Black consumers being more conscious of where they spend their money. It underscores the importance of creating generational wealth through the economic empowerment of Black entrepreneurs.

The call to action has led to a rapidly growing number of Black Canadians and allies using their purchasing power to support more Black-owned businesses, especially in the food and beverage industry – the second largest manufacturing industry in Canada.

This Black History Month, Invest Ottawa is highlighting three local Black entrepreneurs who recently participated in the Starter Company Plus program and are tasting success in the food and beverage industry.

Marie Pierre Faye – Faye Beverage


Faye Beverage is an Ottawa startup that provides delicious and healthy vegan drinks to help support people’s wellness. After being unable to find any of the traditional African drinks she loved growing up, founder and CEO Marie Pierre Faye decided to introduce Jogo Juice to the Canadian market.

Jogo Juice is made from hibiscus flowers and fresh fruits. It’s also filled with antioxidants and other nutrients to boost your immune system. The drink is better known in Africa as bissap and in the Caribbean as sorrel. 

Marie said it is important to her that her traditional Senegalese culture is incorporated into the company’s day-to-day operations. She came up with “Jogo” by combining the names of both her parents, who were early investors in her business venture.

Originally from Senegal, Marie immigrated to Toronto in pursuit of higher education before eventually relocating to Ottawa. She graduated from the University of Ottawa last December with a bachelor’s degree in mathematics and finance.

She started out by selling the drinks at a store on the university campus and giving away free samples at farmers’ markets. Fast forward almost two years later, Jogo Juice is now available online at www.faybeverage.com, as well as eight locations in Ottawa and Montreal.

Gilles Tchappi – Taltis Foods

Headshot of Gilles Tchappi, Founder of Taltis FoodsGilles Tchappi runs Taltis Foods Inc., a Toronto-based manufacturing and distribution company bringing African food products and beverages to North America.

Their Taltis Africa brand currently offers two lines of drinks that come in eight different flavours in addition to Jollof sauce, which is extremely popular in West Africa.

Gilles created the company because he missed the tastes of Cameroon. 

“Since I came to Canada more than 10 years ago, I could not find or share those products that remind me of my childhood and my home country,” he explains. “There was nothing available in mainstream retail grocery stores.”

Before launching the business in 2017, Gilles was a teacher at a French-language public school for seven years. He holds a master’s degree in food processing from the University of Milan in Italy and is a member of the Canadian Black Chamber of Commerce.

“I am passionate about changes and innovative ideas that can bring improvement to the life of others and to the community. I deeply believe diversity is a treasure that increases in value just as much as the strength we embrace it with.”

Deborah Ntawigiriria – Izere Coffee



Deborah Ntawigirira, Founder of Izere CoffeeEver since she moved to Canada from Burundi 14 years ago, Deborah Ntawigiriria always wanted to start a business that would link the two countries.

Inspired by Canada’s strong coffee culture and a four-month visit to her native country, she co-founded Izere Coffee with her mother in 2014. They sell high-quality Burundian coffee that is presently carried at 3 locations in Ottawa and Quebec.

For Deborah, Izere Coffee is more than just a business, it’s also a way of empowering the local coffee farmers who harvest the beans. The company embraces sustainability and works directly with coffee cooperatives that reinvest money into improving the quality of life of their farmers and their communities.

Deborah says when you buy Izere Coffee, you’re essentially investing in other people’s lives. 

“In every cup of coffee there is a story… we are proud that ours is a story infused with community, providing opportunity and being a part of something greater.”

This article is the second in a special Black History Month series.
Feb 10, 2021

For many, the workplace in 2020 looked quite different. And, for a lot of companies, these changes are continuing into 2021. With all of these shifts happening, there is a unique opportunity right now for companies to look for ways to evolve, innovate, and focus on specific streams that will grow their businesses in the long run. This may require some help from government relief programs, and also some restructuring or downsizing to adapt.

Invest Ottawa recently sat down with tax, legal, and HR experts to offer some guidance to companies during this unique shift. Some topics covered included how to deal appropriately with constructive dismissal cases, how government relief programs can help both employers and employees during this time, and how these programs might affect any 2020 tax filings.

Host

Kara Eusebio – Senior Manager, Strategic Partnerships, Invest Ottawa

Panellists

Gavin Miranda, – Partner, Taxation Services, MNP

Jim Cruikshank – Human Capital Consulting, MNP

Simon Sigler – Lawyer, MDK Business Law

Here is the recording of this informative session which we will be breaking down into three quick, easy-to-digest articles.

Article 2 of the Recovery Essentials: Labour Relations, Tax and People in the 2nd Wave

Constructive Dismissal

Constructive dismissal may occur where there has been such a change in the nature of the employment that in the employee’s mind they have been essentially dismissed. This can result from a reduction in compensation, hours, or a change to other fundamental terms of the employment contract. To prevent claims of constructive dismissal an employer should hold a conversation with their employee and obtain mutual consent for any new conditions of the employment in writing.

If the employer is looking to retain an employee but can’t maintain their full pay, a reduction of 10-15% is standard, and in more extreme circumstances [such as COVID] a temporary reduction of up to 20% may be acceptable. Some employers may be considering these options for employees that have moved to an area with a lower cost of living during the pandemic. Employers should be careful, as minor reductions in pay combined with changes to other fundamental terms of the contract may rise to the level of constructive dismissal.

Currently, there is emergency legislation in place till July 3, 2021 that allows employers to temporarily decrease compensation above 10-15% which may be appropriate for extenuating circumstances. Again, if any type of reduction is being considered, it is recommended that a conversation happens with the employee(s) affected, where agreement to the new terms is mutually established.

When it comes to potentially terminating an employee, the employer may consider factors such as the cost of training a new hire down the road, and the potential damage it may cause to the relationship with the affected employee(s) should they wish to rehire them post-recovery. Ideally, employers want to take a balanced approach to any termination case. Considering the costs and benefits beforehand.

Advice to employers when it comes to any potential form of constructive dismissal – keep things personalized and compassionate, have the meeting over video chat (include one other team manager on the call whenever possible), and follow up with both an email and a physical letter (sent to the employee’s home). Further, employers should have the employee return a signed consent after a few days, and with the chance to obtain legal advice. It is vitally important that the employee have time to process the conversation and not consent immediately, otherwise, it is highly probable that no court would uphold the consent.

When it comes to weighing options, it’s important to practice balance in any potential change in fundamental employment terms that may create a situation of constructive dismissal. With every reduction in pay, or change to contract terms there may be potential for the employee to file a claim, which the employer may be required to defend in court or settle.

Government Programs

The Government of Canada unveiled a number of relief programs to support both businesses and employees during the pandemic including CEBA, CEWS, and CERB. It’s important for anyone who utilized these programs, to understand how this might impact tax filing for 2020.

The Canadian Emergency Business Account (CEBA) includes an initial $40k business loan, then another $20k loan which is available for further assistance. Each is a separate loan which includes forgivable portions of 25% and 50% respectively if the loan(s) are paid back in full by December 2022.

The Canada Emergency Wage Subsidy (CEWS) was intended to cover employees once they returned to work. But, if the funds were used to draw down on their vacation days, or as pay for leave – and the employee has overlap with another subsidy program – then there are tax considerations. For furloughed employees, the employer is eligible to provide payroll at a reduced rate.

Then, there is the Canadian Emergency Response Benefit (CERB). If an employee was furloughed or put on leave, and also collected the CERB, they can still return to work and be paid retroactively. However, employees need to be mindful that they will have a tax bill for any overlapping payments, and they should budget for this come tax season.

Tips for Employers

  • Take stock of the business – process re-design, re-engineer the business. This could justify downsizing or restructuring to increase efficiency. Or focus on specific streams. Focus on core competencies.
  • Take a balanced approach when considering any form of constructive dismissal.
  • Treat all constructive dismissal cases with compassion, taking a personalized approach.
  • CERB or CEWS (as well as other government subsidy programs) will require more reporting for employers and employees, so be prepared for that. And prepare your employees for anything that might affect them as well.
  • If you are unsure, it is important to consult with experts including tax, legal, and HR before taking action in any case.

It can be challenging to know what resources and safeguards are in place to ensure a smooth transition to your next step. To learn more about the services and support provided by MNP and MDK Business Law, please contact:

Gavin Miranda, Regional Tax Leader, MNP, Eastern Ontario

[email protected]

Phone number: 613-691-4224

Jim Cruickshank, Senior Manager, MNP, Human Resources Consulting

[email protected]

Phone number: 905-333-9888

R.Drew Kelsall, Business Lawyer, MDK Business Law

[email protected]

Phone number: 613-695-7800 ext.102

The article above is provided for general information only and does not constitute legal or tax advice. MDK Business Law Professional Corporation (“MDK”) and MNP LLP does not warrant or guarantee the quality, accuracy or completeness of any information. The article published is current as of the date of publication or date noted above, but should not be relied upon as accurate, timely or fit for any particular purpose.

Accessing our content, and receipt or transmissions of any communications to you or by MDK and MNP relating to the content does not create a lawyer-client relationship.


For more content like this, see our Expert Series.

Posted in Blog
Feb 10, 2021

4 mins | 920 words

TSMCthe world’s largest dedicated IC foundry, has been in Ottawa for more than a decade and it’s eager to expand its operations. Specifically, the company is looking to hire talented engineers to work in designs for its advanced process technologies. 

“We are looking to continue to grow the current talents we have, which are in memory design and custom layout,” says Cormac O’Connell, director of TSMC’s Ottawa Design Center. In August 2007, when the design center opened in Ottawa, TSMC had 20 employees here. Now it’s up to 60 and it’s not stopping there.  

The company enables the semiconductor industry’s innovators by working with them to make their designs into real, functioning products, manufactured in high volume. In fact, there’s a good chance the electronics you are carrying right now contain chips made by TSMC, a multinational headquartered in Taiwan, with a design center in Canada’s capital.  

TSMC was established in 1987 when large companies such as Intel, Philips and Motorola were the only ones producing computer chips, but many smaller startups were coming along with good ideas and they needed a chip manufacturer to carry them out. With the advent of the personal computer, that demand became even stronger and TSMC’s Founder Dr. Morris Chang decided there was a business for him in manufacturing chips. Soon TSMC was the leader in the logic-chip manufacturing business.  

In the intervening years, TSMC has captured a good portion of the foundry segment of the global semiconductor industry, providing independent design and processing capability to semi-conductor companies. And while it was growing, it discovered Ottawa was a burgeoning hub for chip design. A company called Emerging Memory Technology (EMT) that was being run by TSMC was designing embedded memories, which were being used on chips. TSMC decided it would be useful to bring that little group to its larger table. In 2007, the folks from EMT joined TSMC and the rest is a success story of a company setting up in the right environment and flourishing.  

Why Ottawa?  

First, there was ready talent — high-quality, well-trained people with experience in an area of value to TSMC.  

Ontario has very high concentration of high-tech firms and Ottawa boasts a strong reputation in research and development excellence,” O’Connell says. “Also, Canadians, because their country sits beside the U.S., have to have a culture of adaptability and a certain willingness to get along. 

In addition, the quality of life in the capital also helps to attract key talent. Kevin Huynh, senior memory designer at TSMC, moved from Belgium to Ottawa for the job.  

“I came to Ottawa because of the company, but also the city,” he says. “I did some research before. My whole family needed to relocate. The language made it easier for my family to be integrated in the community.”  

Plus, says O’Connell, there’s a vibrant high-tech ecosystem in Ottawa and the city seems to have plenty of people who work well with different cultures easily.  

“Workforce diversity was another key factor for us to consider. TSMC’s Ottawa site has nearly 20 different nationalities among its 60-person staff,” he says. 

Why TSMC?  

TSMC has a long-term view and instead of the hire and fire cycles for which many U.S. companies are famous, it holds on to its workers. In addition, TSMC’s Ottawa employees are fulfilled engineers who get to work on leading-edge technology.  

TSMC was the first to provide 7nm process technology to its customers and also the first to bring extreme ultraviolet (EUV) lithography to commercial production. In 2020, the company was the first to offer 5nm process technology. “We’re leading the pack in terms of semiconductors,” says one such engineer, Adrian Earle, memory-design manager at TSMC’s Ottawa Design Center. “We’re solving problems and contributing to products that are going to be in people’s hands in a couple of years. It’s really gratifying to see someone pull out a device and use it. One of the things that’s really cool is we’re on the leading edge. If you want to make a difference, you want to be here.”  

O’Connell says “it’s a real buzz to work on the most advanced research,” but he also lauds TSMC as a good company with strong values, including honour, trust, ethics and loyalty.  

“Lots of companies say they have those values, but few companies actually live them. Rather than being trite about it, TSMC sees that there’s a real business reason for it,” he says. “We have to earn customers’ trust because they work with us to develop their products. TSMC does its best to earn the trust of partners whether it’s customers, employees or vendors.”  In a show of optimism, TSMC’s Ottawa design center is expanding its workforce of designers to serve customers in North America and other regions around the world.  

“We not only seek to support a diverse and flourishing semiconductor ecosystem in Canada and North America, we hope to tap those resources to benefit our customers around the world,” O’Connell says. 

TSMC at a glance 

A group of people smiling and high-fiving.Employees: 51,000 worldwide – 60 in Ottawa 

Years in business: 34 years 

Number of foreign markets: In 2019, TSMC maintained a leading position in the foundry segment of the global semiconductor industry with an estimated market share of 52 percent. It had 499 different customers that year.  

Main product/service: TSMC-manufactured semiconductors serve a wide range of applications in the computer, communications, consumer, and industrial/standard segments. These products are used in a variety of end markets including mobile devices, high-performance computing, automotive electronics and the Internet of Things (IoT). 

Visit www.tsmc.com to learn more and apply.

 

Feb 4, 2021

Black History Month is always a time to reflect not only on the historical achievements of Black Canadians but also on those who are blazing a trail for themselves and the community today. 

With the unfortunate events and racial tensions of 2020, conversations have increased in the Black community about the need for more business ownership and economic development en route to true inclusion.

Every day at Invest Ottawa we get a chance to meet bold entrepreneurs who are doing just that, whether it’s through our Digital Main Street or Starter Company Plus programs.

In celebration of Black History Month, Invest Ottawa is highlighting some of the Black entrepreneurs through a series of profiles we’ll be publishing throughout February and into March. We’re excited to introduce you to our first group of entrepreneurs. 

Five men and women who are blazing a trail in the arts, culture and lifestyle space here in the capital.

Stacey Martin Bafi-Yeboa

Photo of fashion designer and entrepreneur Stacey Martin Bafi-Yeboa

Stacey Martin Bafi-Yeboa, Founder of Stacey Martin Lifestyle, and Owner and Designer of Kania

If you’ve followed the local fashion industry, you are definitely familiar with the name Stacey Martin Bafi-Yeboa. The former Broadway dancer turned fashion designer is the founder of Stacey Martin Lifestyle. Founded in 2003 as Kania Couture, Stacey Martin Lifestyle specializes in comfortable and sustainable fashion apparel, filling a gap between fitness and fashion clothing. As a mom and former professional performing artist, she knows how important it is to have clothing that moves with your body while balancing comfort and confidence. It’s this balance of comfort, confidence and elevated design that makes her pieces absolutely essential for today’s work-at-home woman who wants to be comfortable while looking and feeling good.

Aside from today’s modern woman, there’s also any beneficiary of Stacey Martin products–the planet. Not only is every piece of Stacey Martin clothing designed by a woman for a woman’s body, but they are eco-friendly and sustainable with a low carbon footprint.

With only 14% of major fashion brands being run by a female executive and less than 0.5% of Black female entrepreneurs receiving venture capital funding, Stacey Martin Bafi-Yeboa offers a fresh new perspective on her industry, both as a designer and businesswoman.

Tevin Haye

Tevin Haye, Founder of Unavailshop, sitting on a cement blog with displayed sneakers laid out on either side of him. Photo by Yoni Sambo.

Tevin Haye, Founder, Unavailshop. Photo by Yoni Sambo.

When you think about sneakers and streetwear you may not think about Ottawa, but if Tevin Haye has anything to say about it that may change. 

Sneakers is big business in Canada with the Canadian footwear industry having reached $7.7 billion in value in 2019. Add to that the current COVID-19 pandemic, which is accelerating the transition to online shopping among Canadians and you have the perfect conditions for Haye’s current venture, Unavailshop, Canada’s first and largest online consignment marketplace. 

The platform was founded in 2017, inspired by Haye’s experience of spending hours trying to find the items he saw artists wearing in magazines and music videos. Through Unavailshop, Haye now makes it easier for fashion-forward consumers like him to buy, sell and trade the most stylish streetwear and luxury brands, including Nike, Adidas, Levi’s, Supreme, Off-White, Yeezy, Gucci, Chanel, Dior, Prada, and more.

“I saw an opportunity to offer a unique shopping experience for the natives of Ottawa and globally…We aim to provide an easy shopping experience where you can leave with something new and rid yourself of something you were looking to part with”, Haye explains.

But for Haye, it’s not just about offering a consignment marketplace where Canadian buyers can purchase items with convenience and peace of mind without the fear of exchange rates and import fees, but it’s about the planet.

“By buying and recycling old but beautiful clothes, you are contributing to a more sustainable type of fashion.”

Paula Whitelocke

Photo of Curly Hair Designs Founder, Paula Whitelocke.

Curly Hair Designs, Professional Hairstylist and Owner of Curly Hair Designs

Paula Whitelocke is a long-time professional hairstylist and owner of Curly Hair Designs. After getting her start at 13 years old doing hair in her parents’ basement, two years later she began working out of professional salons. Then in 2010, she decided to open her own salon and Hair Designs by Paula was born. 

“I started my business out of the want to fill a need in the community by providing a space for hair services, as well as a place for conversations that go beyond surface level and inspire self-exploration…I trusted and believed that I could create a lasting experience for my clients.”

Now 15 years deep in the industry, Whitelocke has become one of the capital’s foremost experts on curly hair. She has now paired her passion for hairstyling with her other passion, teaching, launching another venture–Curls Understood The Academy, a self-directed hair care program for anyone who wants to start a natural hair regimen from the privacy of their own home. 

Aside from being a business entrepreneur and mentor with Invest Ottawa, she is also a community organizer with Equal Chance and a talented singer-songwriter.

Karissa Fernandes

A displayed framed printed image of dried flowers.

Design by Asayah Designs

While many businesses suffered during the COVID-19 pandemic, many companies were also born. One of those companies was Asayah Designs. The all-in-one art, home decor, apparel and self-care products company and lifestyle brand specializes in products that are sustainable, sustainable, timeless and minimal. “We’re a one-stop-shop for essentials related to home, wellness and apparel.”

The now six-month-old company was created by a husband and wife duo, dedicated to their young daughter, Marley Asayah. 

“Becoming a mother in the midst of a global pandemic motivated me to pursue my passions and create an additional source of income and financial security for my family”, Asayah Designs co-founder, Karissa Fernandes explains.

“It’s a place where luxury meets affordability, where you can find basics and essentials related to the home, your self-care regimen, and wardrobe.”

Suzan Richards

Suzan Richards is the founder of the Cultural Arts Studio

Suzan Richards, Founder of the Cultural Arts Studio

Suzan Richards is the founder of the Cultural Arts Studio. Richards started her business 26 years ago after noticing there was a lack of cultural spaces and opportunities for the Afro-Caribbean community in the capital.

“I am the only studio in the region that specializes in Afro-Caribbean culture through the arts”, Richards explains.

Known throughout her community as “Teacher Suzan”, the award-winning entrepreneur and community builder, is dedicated to preserving and sharing Afro Caribbean culture. Although she has been at it for decades, her relationship with dance started at a young age. She started performing at four years old, going on to learn classical ballet and then receiving formal training at the Montreal Jazz Dance Academy. She then toured with South African singer Lorraine Klassen, one of Canada’s top world beat performers and Tandie Klassen, a South African singer and anti-apartheid activist. 

Her biggest claim to fame may be her tenure as a member and choreographer for Voices of Praise Gospel Choir who has performed with the likes of Paul Anka, Celine Dion, Maya Angelou and Coretta Scott King.

This article is the first in a special Black History Month series by Invest Ottawa.

About the Author

Kevin Bourne headshot. An image of him standing in front of a brick wall.Kevin Bourne, also known as “KB The Boss” or simply “KB”, is an Ottawa-based media/entertainment entrepreneur, freelance journalist, and media personality.

The former political staffer is quickly becoming a staple in Ottawa and Canada’s cultural landscape as both a commentator and freelancer, appearing nationally on CBC News Network and locally on CTV, CBC Radio, CityNews, and 580 CFRA and having been published in ByBlacks, the Ottawa Citizen and Ottawa Business Journal. Doubling as CEO of the PR and content marketing firm SHIFTER Agency Inc. and editor-in-chief at SHIFTER magazine, Kevin has covered some of Canada’s top red carpet events, from the Juno Awards to the Canadian Screen Awards and has interviewed everyone from Kevin Hart to”Fast and the Furious” star Tyrese Gibson. He is currently co-host of The Morning Shift, Ottawa’s daily hip-hop morning radio show on CHUO 89.1FM.

He is also a board member at the Ottawa Music Industry Coalition and the Ottawa Film Office and was recently named to the TEDx Kanata Leadership Committee and Ottawa Life Magazine’s Best of Ottawa: Activists & Changemakers list for 2020.

Posted in Blog, Expert Series
Feb 2, 2021

8 mins | 1863 words
Author: Jeffery Slater

Innovations that arise in competitive markets with a well-developed and rapidly evolving intellectual property space, often integrate several pre-existing technologies from various scientific and engineering disciplines. If your company operates in such an environment, conducting patent due diligence and a ‘Freedom to Operate’ analysis – can be integral to growth and can provide a true competitive advantage when properly managed.

Patent due diligence can be broadly defined as an investigation into a company’s innovations and patent assets with respect to the state of the target industry, with the goal of identifying risks and opportunities. Well-planned and executed, patent due diligence can be beneficial to both entrepreneurs and investors as it can uncover market gaps and potential for further innovation or product development and help anticipate legal issues, such as risks of infringement before they arise.

In addition to understanding the competitive patent landscape for your company’s technology and the strength of patent protection within your target industry, comprehensive patent due diligence includes identifying and understanding the nature and scope of your company’s technology and related intellectual property rights, duties, and any limitations. This type of investigation of the patent landscape can uncover potential infringement risks and reveal new patenting opportunities you may want to consider.

What is a ‘Freedom to Operate’ analysis?

When developing a new product or service, every effort should be made to ensure that the commercialization of that product or service does not infringe any existing patents owned by third parties. Companies failing to do so could suffer dire consequences.

To avoid any legal issues, it is prudent and reasonable for many companies to perform a Freedom to Operate (FTO) or “market clearance” analysis before you commercialize or launch the product or service. The main purpose of an FTO analysis is threefold:

  1. to understand what patent infringement risks exist with the potential commercialization of a product or service;
  2. to understand where those risks lie (g.in whose hands, in what market(s) and in what technology area); and
  3. to determine how to manage those risks prior to commercialization.

At its most basic level, an FTO analysis involves two major steps. The first is to perform a patent search to identify others’ patents in the same technology area as the product or service being commercialized. The second is to analyze those patents to determine whether the product or service falls within the scope of the patent claims. These steps should be conducted in each target market you are considering for commercialization.

Why a ‘Freedom to Operate’ patent search is important

The term Freedom to Operate can be misleading. It sounds very finite and can sometimes give the impression that there is absolutely no risk of infringing any third party patents once the analysis has been performed. Unfortunately, this is seldom the case. However, an FTO analysis should seek to provide sufficient information to allow the risks associated with launching a product or service into the marketplace to be reasonably understood and managed.

Accordingly, the scope of the patent search strategies that will be used to generate the results upon which the FTO analysis will be based must be carefully defined to include the relevant industries, technologies and markets to be proactively identified and evaluated.  In practice, this typically involves designing multiple search strategies and searching multiple databases to consider foreign and domestic patents and patent applications.

Types of Freedom to Operate Analyses

There are many different types of FTO analyses, and the type performed can vary depending on a company’s tolerance for unknown risk, key business goals and priorities and budget.

Competitor-specific FTO Analysis

A first common type of FTO analysis focuses only on assessing the patents belonging to a key competitor. In such a case, the search would only reveal those patents belonging to that competitor, and the analysis would simply provide an indication as to whether the commercialization of the product or service could be problematic in view of the patent rights of that competitor. While this type of FTO provides some indication of the risk of entering the marketplace, there is still the possibility that patent rights held by someone other than that competitor could present a problem from an infringement perspective.

Feature-specific FTO Analysis

A second common type of FTO analysis focuses only on assessing third party patent rights relating to a single feature or aspect of a new product or service. For example, in the case of a new car engine that has self-diagnostic capabilities, the FTO analysis could focus solely on assessing third party patents in the field of self-diagnostic engines. All the other aspects of the engine (for example, the design and operating characteristics of the engine) would be ignored. This type of FTO would provide an indication of any potentially problematic patents relating to that single technological aspect of the new product. While cost-effective, this type of FTO is limited and there could still be patents covering other aspects of the engine that would not be identified that could be problematic.

Comprehensive FTO Analysis

The most thorough and extensive type of FTO analysis involves considering ALL third party patents relating to every aspect of a product or service to be commercialized.  This comprehensive type of FTO analysis would provide the most information, and thus the most assurance that there will be no infringement issues when commercializing the product or service. However, a comprehensive FTO analysis can often be prohibitively expensive both in terms of time and financial resources required for investment.

Assessment of potential risks

Regardless of the type of FTO analysis that is performed, some effort should be made by the company to understand and mitigate the risks associated with entering the marketplace with a product or service prior to commercialization.

If potentially problematic patents or pending patent applications are identified through the FTO analysis, depending on the goals of the due diligence, further investigative activities may involve obtaining infringement and validity opinions. Infringement and validity opinions often require rigorous legal analysis, including the construction of the claims of the patent within the legal framework, to determine whether the company’s product or service falls within the scope of the construed claims or whether the problematic claims may be invalidated in view of the prior art or previously granted patents. Such a legal analysis may be significantly complicated in cases where the problematic claims support both broad and narrow construction regarding their scope. Broad claims that are considered valid can pose a risk because they may not be easily designed around, requiring competitors to obtain a license from the patent owner, or risk a patent infringement lawsuit.

As such, FTO analyses can prove invaluable in identifying material issues that could impact value for IP-rich and sophisticated companies in commercialization deals, for investors (VCs and Private Equity) in financing deals, and for foreign acquirers in M&A / IPO deals.

Integrating FTO analysis into the product development cycle

A properly conducted FTO analysis for patent due diligence and any opinion arising from it should flag issues that merit additional consideration to enable informed business decisions to be made as to which risks are acceptable and which are not, and whether to pursue potential opportunities.

In the specific business context of product development, FTO analyses can and should be used to proactively identify and assess potential IP infringement risks, develop and recommend potential design-around options and solutions where necessary, as well as identify opportunities for building a solid patent portfolio that may be leveraged in both commercial and litigation settings.

Accordingly, an FTO analysis should be considered as a preliminary stage of the overall design cycle. This stage should occur as early as possible in the design cycle once certain specific or desired features/aspects of a design have been defined with some specificity so that they can be effectively searched, but before the design is finalized so there is still room for flexibility in the design. In practice, this means that the FTO analysis stage of the design process typically occurs between the ideation and prototyping stages so that design changes, if needed, can be made before significant investment in a given design. Furthermore, if there is a particular third party or competitor that is of concern, then a targeted search for patents owned by such third parties or competitors should be considered at an earlier stage. Periodic patent watch searches, independent of the design cycle, also constitute prudent patent risk management and mitigation practices.

Another key component to mitigating risk during product development is ensuring that all critical areas of the new design and the company’s overall technology/product roadmap are proactively identified and that the company owns all of the intellectual property rights in those areas so that the company has the continued freedom to innovate. For example, if your company is a manufacturer that integrates parts from suppliers into new products, the objective would be to own as much of the intellectual property possible to allow the manufacturer to execute its technology/product roadmap without being materially constrained or controlled by its suppliers. Otherwise, if left unmanaged IP ownership issues can present substantial risks for manufacturers.  On the other hand, if your company is a supplier to such a manufacturer, the objective would be to exploit IP ownership opportunities by obtaining patent rights that cover not only components that will be supplied to the manufacturer, but also on the integration of such components into the manufacturer’s products at the next stage of the value chain.

Conclusion

Patents are one of the most valuable assets for innovation-driven companies. A well-planned and on-going patent due diligence strategy, involving regular patent watch searches and FTO analyses can maximize the value of your patents and enhance returns while minimizing risks and enable innovators to monitor and evaluate their position in an ever-evolving competitive landscape.

For further information please contact a member of our Patents team.

The preceding is intended as a timely update on Canadian intellectual property and technology law. The content is informational only and does not constitute legal or professional advice. To obtain such advice, please communicate with our offices directly.


About the Author 

Jeffery Slater is a senior patent agent in Smart & Biggar’s Ottawa office. Jeffery combines his patent expertise and engineering background to help innovative companies obtain patent protection for their electrical, computer, mechanical and software-related inventions.


Smart & Biggar logo

Smart & Biggar is widely recognized as Canada’s leading firm for intellectual property, and with over 100 lawyers, patent agents and trademark agents in five offices, we are also the largest firm focused purely on IP and related specialty areas.

We have a storied history and tradition of providing the highest quality of IP advisory services and have filed more patent and trademark applications than any firm in Canada.  Our decades of experience in intellectual property, combined with our deep knowledge and expertise across a wide range of technologies and industries, allows us to provide clients with clarity on opportunities and solutions to leverage and maximize IP.

No other firm can claim a stronger track record of victories in intellectual property litigation for its clients than Smart & Biggar. We pride ourselves on providing clients with the rare combination of successful trial experience, deep subject matter expertise and sophisticated and practical skills and analysis.

Posted in Blog, Expert Series
Jan 27, 2021

The workplace in 2020 looked quite different for many. And, for a number of companies out there these changes are continuing into 2021. With these changes, there are a lot of questions on how to maintain and support employee health, safety, and well-being in this new working environment.

Invest Ottawa recently sat down with tax, legal and HR experts to get their thoughts on how to support and maintain the health and safety of staff while working in a remote setting.

Host

  • Kara Eusebio – Senior Manager, Strategic Partnerships, Invest Ottawa

Panellists

Here is the recording of this informative session which we will be breaking down into three quick, easy-to-digest articles.

Article 1 of the Recovery Essentials: Labour Relations, Tax and People in the 2nd Wave series

Health, Safety, and Accommodation

With the shift to remote work, it is important to remember that the employer is still responsible for the health and safety of their employees. While policies put in place prior to the pandemic, should continue to be enforced, they should also be reviewed and adjusted as conditions of the workplace evolve.

Accommodation requests are common in a work from home environment. The employer is responsible for addressing these requests. Each request should be handled on a case-by-case basis. Depending on the request, the employer may need to consider what is required to fulfill it. Will it cause undue hardship to the company? What is the cost to accommodate vs. the cost to terminate?

If the request relates to the location in which the work is being done, keep in mind that there may be tax implications associated with fulfilling that request. For example, if an employee wants to work in a different province, they may be creating a taxable presence which obligates the employer to allocate revenue or profits to that province.

Finding solutions to these requests will require a balanced approach that keeps the health and safety of the employee in mind while keeping the business running at optimal capacity.

Mental Health, Well Being and Sick Leave

Now is a great time for employers to assess and audit the benefits that they offer employees. Having discussions with employees about the challenges they are facing when working from home – safety, security, home-schooling, and other issues – could provide opportunities to increase or customize existing benefits and provide support. Flexibility and communication are necessary to adapt policies and ensure they work for everyone.

And, when it comes to COVID diagnoses unless the employee has been in contact with other team members, and there is a risk to them, then a reasonable right to privacy should be exercised.

Tips for Employers

  • Remain flexible and stay in communication with your employees.
  • Consider contract updates that include accommodation considerations for the new working environment.

It can be challenging to know what resources and safeguards are in place to ensure a smooth transition to your next step. To learn more about the services and support provided by MNP and MDK Business Law, please contact:

Gavin Miranda, Regional Tax Leader, MNP, Eastern Ontario

[email protected]

Phone number: 613-691-4224

 

Jim Cruickshank, Senior Manager, MNP, Human Resources Consulting

[email protected]

Phone number: 905-333-9888

 

R. Drew Kelsall, Business Lawyer, MDK Business Law

[email protected]

Phone number: 613-695-7800 ext. 102

 


The article above is provided for general information only and does not constitute legal or tax advice. MDK Business Law Professional Corporation (“MDK”) and MNP LLP does not warrant or guarantee the quality, accuracy or completeness of any information. The article published is current as of the date of publication or date noted above, but should not be relied upon as accurate, timely or fit for any particular purpose.

Accessing our content, and receipt or transmissions of any communications to you or by MDK and MNP relating to the content does not create a lawyer-client relationship.

X