Canada: Patents Comparative Guide

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1 Legal framework

1.1 What are the sources of patent law in your jurisdiction?

Patent law in Canada is governed by a federal statute, the Patent Act.

1.2 Who can register a patent?

A patent application can be filed by the inventor or the inventor's legal representatives. An inventor's legal representatives include such individuals and entities as the inventor's heirs, executors, assignees and all other persons claiming through an applicant for a patent.

2 Rights

2.1 What rights are obtained when a patent is registered?

A patent grants the patentee and the patentee's legal representatives, for the term of the patent, the exclusive right, privilege and liberty to make, construct and use the invention and sell it to others to be used, subject to adjudication in respect thereof before any court of competent jurisdiction.

2.2 How can a patent owner enforce its rights?

An action for infringement may be brought in Canada's Federal Court or in a court of record in a province in which the infringement is said to have occurred.

2.3 For how long are patents enforceable?

For a patent that is granted in respect of an application that was filed on or after 1 October 1989, the term begins on issuance and ends 20 years after the filing date. For a patent that is granted in respect of an application filed prior to 1 October 1989, the term is 17 years from the date on which the patent issued. In certain circumstances, a patentee may be able to obtain a certificate of supplementary protection for up to two years in respect of a patent that pertains to a medicinal ingredient or combination of medicinal ingredients contained in a drug for which marketing approval was delayed.

3 Obtaining a patent

3.1 Which governing body controls the registration procedure?

The patent registration procedure is under the control of the Canadian Intellectual Property Office (CIPO), which is an agency of Innovation, Science, and Economic Development Canada.

3.2 What is the cost of registration?

The government fee for filing a patent application is C$400. In order for a patent application to be granted, it must be examined by an examiner of CIPO, which requires the filing of a request for examination and payment of the prescribed examination fee of C$800. The request for examination must be filed within a prescribed timeframe. At present, the request for examination must be filed within five years of the filing date of the application; however, this period will be reduced to three years from the date of filing once the provisions of the new Patent Act come into force (this is expected to occur in early 2019). Once the examination is completed and allowance of the application is achieved, the prescribed final fee of C$300 must be paid in order for the patent to be granted.

The above-mentioned government fees may be reduced by 50% if the applicant qualifies as a small entity. A ‘small entity' is defined in the Patent Rules as an entity that employs 50 or fewer employees or that is a university, but does not include an entity that:

  • is controlled directly or indirectly by an entity, other than a university, which employs more than 50 employees; or
  • has transferred or licensed or has an obligation, other than a contingent obligation, to transfer or license any right in the invention to an entity, other than a university, which employs more than 50 employees.

3.3 What are the grounds to reject a patent application?

Under Section 30(2) of the Patent Rules, a patent application can be rejected if the CIPO examiner has reasonable grounds to believe that the application does not comply with the requirements of the Patent Act or Patent Rules.

3.4 What programmes or initiatives are available to accelerate or fast track examination of patent applications?

Examination of a Canadian patent application may be expedited in three ways. First, the applicant may request entry of the application into the Global Patent Prosecution Highway programme or one of the bilateral Patent Prosecution Highway programmes to which Canada is a party (collectively, ‘PPH'). Under this programme, the applicant must request entry into the PPH and amend the claims of the Canadian application to "sufficiently correspond" to one or more claims that were found allowable by a foreign patent office that is also a participant in the PPH. There is no fee for requesting entry into the PPH.

Second, the applicant or any other person may request expedited examination of an application under Paragraph 28(1)(a) of the Patent Rules if such person believes that failure to advance the application is likely to prejudice that person's rights. A request under this provision requires payment of a government fee of C$500.

Third, where an application is directed to technology that, if commercialised, would help to resolve or mitigate environmental impacts or to conserve the natural environment and resources, the applicant may request expedited examination under Paragraph 28(1)(a) of the Patent Rules. No government fee is required for filing such a request.

3.5 Are there any types of claims or claiming formats that are not permissible in your jurisdiction (eg, medical method claims)?

There are no limitations in the Patent Act or Patent Rules on the types or formats of claims that may be included in a patent application. Thus, it is permissible for a patent application to contain any number of independent and dependent claims and multiple dependent claims. However, as discussed further in question 3.7, claims directed to certain types of subject matter, such as methods of medical treatment, are not patentable in Canada.

3.6 Are any procedural or legal mechanisms available to extend patent term (eg, adjustments for patent office delays, pharmaceutical patent term extension or supplementary protection certificates)?

Under the Comprehensive Economic and Trade Agreement (CETA) between Canada and the European Union, patent term restoration became available as of 21 September 2017 for patents directed to drugs comprising new medicinal ingredients or new combinations of medicinal ingredients. Under CETA, the patentee of a qualifying patent may apply for a certificate of supplementary protection to extend the term of the patent up to a maximum of two years as compensation for delays in obtaining regulatory approval for the patented drug.

Under the recent United States, Mexico, Canada Agreement, a patent term extension will be made possible to extend the term of a granted patent by a period attributable to unreasonable prosecution delays by CIPO in granting a patent. An ‘unreasonable delay' is defined as a delay of more than five years from filing of the application or three years from filing of a request for examination, whichever is later. The details of this provision, including the possible length of the patent term extension, have not yet been established. Canada has four and a half years to implement this provision.

3.7 What subject matter is patent eligible?

A patent may be obtained for an ‘invention'. This term is defined in Section 2 of the Patent Act as any new and useful art, process, machine, manufacture or composition of matter, or any new and useful improvement in any art, process, machine, manufacture or composition of matter. The only statutory exclusion to patentability is provided in Section 27(8) of the Patent Act, which states that a patent may not be granted for a mere scientific principle or abstract theorem. In addition, the Canadian courts have held that the following do not constitute patentable subject matter under Section 2 of the Patent Act:

  • methods of medical treatment or surgery;
  • higher life forms (including fertilised eggs and totipotent stem cells);
  • forms of energy (including electromagnetic and acoustic signals);
  • features of solely intellectual significance (eg, literary works) or aesthetic significance;
  • schemes, plans, rules and mental processes;
  • fine arts;
  • printed matter; and
  • games.

3.8 If the patent office does not grant a patent, is an appeal available and to whom?

When an impasse is reached between an applicant and an examiner with respect to the allowance of a patent application, the examiner may issue a final action stating the reasons for refusing the application. The applicant is invited to respond to the final action; should such response not overcome the examiner's grounds for refusal, the application is referred to the Patent Appeal Board (PAB) for review. The PAB will review the prosecution history, invite comments and/or amendments from the applicant, and issue a final decision. The decision of the PAB may be appealed to the Federal Court.

4 Validity/post-grant review and/or opposition procedures

4.1 Where can the validity of an issued patent be challenged?

The Federal Court has jurisdiction, in a legal proceeding challenging the validity of a patent, to make an in rem declaration that a patent or any claim in the patent is invalid. The commissioner of patents can also declare a patent or any claim in a patent to be invalid in a re-examination proceeding.

4.2 How can the validity of an issued patent be challenged?

The attorney general of Canada or an ‘interested person' can commence an action in Federal Court seeking a declaration of invalidity of a patent or any claim in a patent. The threshold to qualify as an interested person is low. A defendant in an infringement action can also attack the validity of a patent by way of counterclaim in the infringement action. If the validity of a patent is at issue in a provincial court proceeding, any ruling made by the court on the issue of validity will be binding only as between the parties. Any person (including the patentee) can request that the commissioner of patents commence re-examination proceedings in respect of an issued patent where a substantial new issue of patentability is raised by prior art consisting of patents, patent applications and/or printed publications.

4.3 What are the grounds to invalidate an issued patent?

There are many grounds upon which an issued patent may be invalidated, such as lack of utility, obviousness, lack of novelty, ambiguity in the claims, double patenting and the claims being broader than the invention made or disclosed.

4.4 What is the evidentiary standard to invalidate an issued patent?

Although an issued patent is entitled to a presumption of validity under the Patent Act, once the validity of a patent is challenged in a legal proceeding, the standard upon which the patent may be invalidated is by the preponderance of evidence.

4.5 What post-grant review or opposition procedures are available for third parties to challenge the validity of a patent?

A third party can challenge the validity of a patent either in the courts (through commencement of an impeachment action or by way of counterclaim in an infringement action) or through a re-examination proceeding before the commissioner of patents.

4.6 Who can oppose a granted patent?

A person seeking to challenge a granted patent by way of an impeachment action must qualify as an ‘interested person'. As noted above, the threshold to qualify as an ‘interested person' is low. Any person can seek to challenge a patent by way of re-examination.

4.7 What are the timing requirements for filing an opposition or post-grant review petition?

There are no time limits for challenging an issued patent.

4.8 What are the grounds to file an opposition?

In the case of a pending application, any third party that wishes to object to the granting of a patent can file a protest with the commissioner of patents based on patents, published patent applications and printed publications that the requesting party believes bear on the patentability of one or more claims. In the case of a granted patent, any third party can request that the commissioner of patents commence re-examination proceedings in circumstances where a substantial new question of patentability is raised by prior art consisting of patents, patent applications and/or printed publications. In the case of a court challenge to the validity of a patent, a broad range of grounds can be alleged, including not only attacks based on prior art, but also other grounds such as lack of patentable subject matter, insufficiency of the patent specification, best mode and the like.

4.9 What are the possible outcomes when an opposition is filed?

In the case of a protest or a re-examination, the commissioner of patents will decide whether the prior art being relied upon by the requesting party affects the patentability of any claim in the patent application or patent, as the case may be. In a protest, the commissioner may reject one or more claims based on the submitted art. In a re-examination, the commissioner may declare one or more claims to be invalid based on the prior art. In a court challenge, the court may declare one or more claims of the patent to be invalid.

4.10 What legal standards will the tribunal apply to resolve the opposition or challenge, and which party bears the burden of proof?

In a protest, the commissioner will consider the submitted prior art and how it affects the patentability of any pending claim in the same manner as if the commissioner had located the prior art in a search or if the art had been submitted by the applicant. In the case of a re-examination, the commissioner establishes a re-examination board which first determines whether a substantial new question of patentability affecting any claim of the patent is raised by the request for re-examination. If the re-examination board concludes that a substantial new question of patentability has been raised, it shall then determine the patentability of the claims in the same manner as patentability would be considered during examination of a pending application. In a court challenge, although a patent is entitled to a statutory presumption of validity, if the party challenging the patent can establish on the preponderance of the evidence that the patent is invalid, the court will issue a declaration of invalidity.

4.11 Can a post-grant review decision be appealed and what are the grounds to appeal?

A decision by a re-examination board to cancel a claim of a patent may be appealed by the patentee to the Federal Court. On appeal, the patentee can argue that the re-examination board made errors of law, fact or mixed fact and law that require intervention by the Federal Court. A party which requests the commencement of a re-examination proceeding has no right to appeal the re-examination board's decision. In an invalidity action before the court, the losing party can appeal to the appellate court as of right and can allege that the court below made errors of law, fact or mixed fact and law that justify intervention by the appellate court.

5 Patent enforceability

5.1 What makes a patent unenforceable?

The primary grounds upon which a patent may be held to be unenforceable are laches and acquiescence on the part of the patentee.

5.2 What are the inequitable conduct standards?

Canada does not have a doctrine of inequitable conduct as it applies to patents.

5.3 What duty of candour is required of the patent office?

The Patent Act provides that an applicant must reply in good faith to any requisition issued by an examiner during examination of an application. Aside from that obligation, there is no general duty of candour imposed on an applicant during prosecution of a patent application.

6 Patent infringement

6.1 What Constitutes Patent Infringement?

The Supreme Court of Canada has held that infringement takes place when an activity deprives the patentee "in whole or in part, directly or indirectly, of full enjoyment of the monopoly conferred by law".

6.2 Does your jurisdiction apply the doctrine of equivalents?

No.

6.3 Can a party be liable if the patent infringement takes place outside the jurisdiction?

No, there must be an activity that occurs in Canada in order to ground an infringement claim.

6.4 What are the standards for wilful infringement?

Although Canada does not have a doctrine of wilful infringement, it is possible that an infringer's conduct in infringing a patent through bad faith or wilful blindness could justify an award of punitive damages.

6.5 Which parties can bring an infringement action?

Although an infringement action can be commenced by any person "claiming under the patentee" (eg, a licensee), the patentee must be made a party to the litigation unless the court orders otherwise.

6.6 How soon after learning of infringing activity must an infringement action be brought?

The Patent Act provides that a patentee cannot seek remedies in respect of acts of infringement that occurred more than six years before commencement of an infringement action.

6.7 What are the pleading standards to initiate a suit?

A statement of claim must plead:

  • facts from which it follows that the plaintiff has the exclusive right to do certain things; and
  • facts that constitute an encroachment by the defendant on that right.

In a patent infringement action, the statement of claim must, at a minimum, identify the parties, the patent(s) and claim(s) in suit and the defendant's acts which are alleged to constitute an infringement.

6.8 In which venues may a patent infringement action be brought?

A patent infringement action may be commenced in the Federal Court or in a provincial court in a province where infringement is alleged to have occurred. The Federal Court has country-wide jurisdiction, so an action can be commenced in any office of the court regardless of where in Canada the infringement is alleged to have occurred.

6.9 What are the jurisdictional requirements for each venue?

As noted above, a patentee can commence an action in the Federal Court in any location where the court sits in respect of acts of infringement that have occurred anywhere in Canada. Alternatively, a patentee can commence an action in a provincial superior court in any province where acts of infringement are alleged to have occurred.

6.10 Who is the fact finder in an infringement action?

The trial judge. The Federal Court prohibits juries and although it is possible to have a jury trial in provincial courts, it is very rare for a patent case to be tried before a jury in Canada.

6.11 Does the fact finder change based on venue?

No.

6.12 What are the steps leading up to a trial?

The steps in an action are:

  • exchange of pleadings;
  • exchange of documentary productions;
  • examinations for discovery of the parties and the inventor(s) named in the patent(s) in suit;
  • exchange of expert reports;
  • pre-trial conference;
  • trial management conference; and
  • trial.

6.13 What remedies are available for patent infringement?

In most cases the trial judge will award a successful patentee its election between damages and infringer's profits. The trial judge, however, has wide-ranging discretion when it comes to deciding whether to grant the patentee the right to elect to recover infringer's profits instead of damages; it is not automatic that the patentee will be granted such an election. In addition to remedies for any post-grant acts of infringement, a successful patentee is entitled to ‘reasonable compensation' for acts that occurred between publication of its patent application and issuance of its patent that would have constituted infringement of the patent had the patent been issued at the time of such acts. In addition to the foregoing financial remedies, a court will in most cases grant an injunction prohibiting further acts of infringement until expiry of the patent. The court can also grant other remedies such as destruction or delivery up of infringing products.

6.14 Is an appeal available and what are the grounds to appeal?

Yes, the losing party can file an appeal as of right. On appeal, it can argue that some or all of the trial judge's judgment should be overturned on the basis that the judge committed errors of law, fact or mixed fact and law that justify the intervention of the appellate court.

7 Discovery

7.1 Is discovery available during litigation?

Yes.

7.2 What kinds of discovery are available?

Each party to litigation must produce documents that are in its possession, power or control and are potentially relevant to an issue in the litigation. Each party is entitled to examine for discovery a single representative of each party that is adverse in interest. Additionally, a party that is accused of infringement is entitled to examine any inventor(s) named in the asserted patent. Lastly, in certain circumstances, the court will grant leave for the examination of a non-party.

7.3 Are there any limitations to the amount of discovery allowed?

Yes. Canadian courts apply the principle of proportionality to discovery such that the potential relevance of a document or line of inquiry on an examination is weighed against the effort involved in responding to the request.

8 Claim construction

8.1 When during a patent infringement action are claim terms defined by the tribunal?

Although claim construction is usually the subject of expert reports delivered by the parties prior to trial and is also addressed in the testimony of experts given at trial, in most cases the issue of claim construction is not determined until the trial judge releases his or her reasons for judgment after trial.

8.2 What is the legal standard used to define claim terms?

The trial judge determines the meaning of claim terms based on the preponderance of evidence. Construction is to be determined as of the publication date of the patent (ie, the date when the patent application was laid open for public inspection). Claim language must be read in an informed and purposive way. Construction is objective, in that the words chosen by the inventor will be read in the sense that the inventor is presumed to have intended, and in a way that is sympathetic to accomplishment of the inventor's purpose expressed or implicit in the text of the claims. The public is entitled to rely on the words used, provided that those words are interpreted fairly and knowledgeably.

8.3 What evidence does the tribunal consider in defining claim terms?

In most cases each party will submit evidence at trial from one or more experts as to the meaning that should be ascribed to terms in a claim. Although claims are to be construed in light of the entire specification, recourse to the specification is unnecessary where words in a claim are plain and unambiguous. It is not permissible to use the prosecution history in order to construe a claim.

9 Remedies

9.1 Are injunctions available?

Yes.

9.2 What is the standard to obtain an injunction?

In most cases, if the trial judge finds a patent to be valid and infringed, the judge will also grant a permanent injunction restraining the defendant from infringing the patent until its expiry. A patentee which seeks an interlocutory injunction prohibiting allegedly infringing acts pending trial must satisfy the following three-part test:

  • the existence of a serious issued to be tried;
  • that the patentee will suffer irreparable harm if the injunction is not granted; and
  • that the balance of convenience favours the granting of the injunction.

However, it is rare for a plaintiff to seek an interlocutory injunction in a patent infringement action, since it is very difficult to establish the irreparable harm criterion.

9.3 Are damages available?

Yes.

9.4 What types of damages are available?

A successful patentee will typically be awarded:

  • reasonable compensation for infringing acts between publication of its patent application and issuance of its patent; and
  • its election of damages for post-issuance activities or infringer's profits.

9.5 What is the standard to obtain certain types of injunctions?

It is virtually automatic for a trial judge to award a permanent injunction where a patent is held to be valid and infringed at trial. The test for an interlocutory injunction pending trial is a three-part test that is difficult to meet.

9.6 Is it possible to increase or multiply damages due to a party's actions?

If the trial judge is of the view that the infringer's conduct warrants a remedy beyond the standard award of the patentee's damages or the infringer's profits, the judge may also make an award of punitive damages.

9.7 Are sanctions available?

Yes.

9.8 What kinds of sanctions are available?

The most common type of sanction is a finding of contempt of court if the infringer disobeys an interlocutory or permanent injunction by continuing its infringing activities.

9.9 Can a party obtain attorneys' fees?

It is typical for the court to award a successful party the recovery of at least a portion of its legal fees and disbursements.

9.10 What is the standard to obtain attorneys' fees?

As noted above, it is typical for the court to award a successful party at least a portion of its legal fees and disbursements. The amount of the recovery can vary depending on factors such as:

  • the complexity of the case;
  • any settlement offers that were exchanged;
  • the reasonableness of the fees and disbursements; and
  • any conduct of the parties during the litigation process.

10 Licensing

10.1 What patent rights can a party obtain through a licence?

A patentee can license any of its rights under a patent to a third party.

10.2 What limits can a patent owner impose on a licence?

As a general rule, a patentee is free to license or not license its patent as it so chooses. In some circumstances, however, a patentee's licensing activities may have consequences under competition law. For example, if a patentee's refusal to grant a licence is coupled with activity that goes beyond the scope of its patent rights, then there may be a violation of competition laws.

11 Antitrust

11.1 Are there any limits on patent protection due to antitrust laws?

Yes. For example, antitrust laws may be invoked in the case of some patent infringement settlements. As a general rule, where a patent infringement claim is legitimate and well founded, antitrust laws will respect the process for resolving the claim, including the settlement of such claim. If, however, an infringement claim is a sham that is designed to stop another entity from engaging in competition, or if the settlement terms go beyond the scope of the patent in duration or scope, then the patentee may be held to have engaged in anti-competitive behaviour contrary to the Competition Act.

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.

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28 May 2019, Other, Toronto, Canada

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Please join our Cybersecurity, Privacy and Technology lawyers for an in-depth discussion about data as one of the most valuable assets of an organization.

28 May 2019, Other, Toronto, Canada

Please join our Cybersecurity, Privacy and Technology lawyers for an in-depth discussion about data as one of the most valuable assets of an organization.

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