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CCCA61_020-024,026,052.qxd:CCCA_V1No2_Recruiting-V1.qxd 02/07/2008 05:56 PM Page 20 Cover Story In addition to the many duties corporate counsel oversee, they have to keep on top of their company’s intellectual property, both in Canada and around the world. Patents, trademarks and copyrighted materials are the most important intangible assets a company owns, and in the Internet age, they are being accessed and abused at a rate never seen before. By Ann Macaulay Protecting Intellectual Property overseas Companies’ legal departments are on the front lines of the struggle to fight illegal trade and protect IP rights. rancis Chang saw a great deal of movie and television program piracy, including illegal copies of DVDs and unauthorized broadcasts of programs or channels, when he worked in Hong Kong for Walt Disney Television and Star TV for several years. Some of the most flagrant crimes he witnessed occurred when, across the Chinese border in Shenzhen, DVD copies of first-release movies would Fbe available for sale the same day or even prior to their release in theatres. The rewards that accompany this piracy are immense:“There is a lot of money being made illegally by certain persons who do not have any rights whatsoever [to the material],” says Chang, a partner at Blake, Cassels & Graydon LLP inVancouver. Theft of intellectual property is a massive underground industry. According to the U.S.-based International AntiCounterfeiting Coalition (IACC), counterfeiting is a global US$600 billion a year problem that’s grown by more than 10,000 per cent in the past two decades. Chang says there are markets in several Asian cities that are notorious for selling fake Chanel or Hermès handbags.“Sometimes, the copies are so good that it’s quite hard to tell the difference when you take an initial look,” he adds. Approximately 5 to 7 per cent of world trade is in counterfeit goods, including many potentially dangerous fakes such as medicines and machinery, according to the IACC: “In 2003, the Motor and Equipment Manufacturers Association cited safety violations due to counterfeit auto parts: brake linings made of compressed grass, sawdust or cardboard; transmission fluid made of cheap oil that is dyed; and oil filters that use rags for the filter element.” In some developing countries, it’s difficult to convince individuals, or even the authorities, that piracy of intel- lectual property is a serious issue. Some will argue that the owners of intellectual property are big multinational companies that are rich already,and that using such IP is a redistribution of wealth,says Chang.“But certainly,from ROBER KARPA a bigger point of view,the issue is that the ones who engage in this type of activity are also making a lot of money; 20 CCCA Canadian Corporate Counsel Association SPRING 2008