On November 24, 2011, the Federal Court of Appeal issued its
decision in Canada (Attorney General) v. Amazon.com, Inc.
(2011 FCA 338) (Amazon). The Court agreed with Justice
Phelan of the Federal Court that the Commissioner of Patents'
"analytical framework" for determining whether to issue a
patent was flawed. However, the Court also held that the Federal
Court was not in a position to properly construe the patent
application claims, and thus could not direct the Commissioner to
follow its construction. Accordingly, the application was referred
back to the Commissioner for re-examination in accordance with the
Federal Court of Appeal's reasons.
While Amazon is concerned with patentable subject
matter in the context of prosecution, patent litigators will be
interested in noteworthy aspects of the judgment including findings
on the correct approach to patent construction. Any guidance is
particularly welcome since there has yet to be a software patent or
business method patent infringement trial decision in Canada.
No Prima Facie Prohibition on Business Method Patents
The Court of Appeal agreed with Justice Phelan that there is no
Canadian jurisprudence rejecting business method patents. However,
the Court added that a business method invention that is merely an
abstract idea does not become patentable subject matter
"merely because it has a practical embodiment or a practical
application." The Court offered that, "a novel business
method may be an essential element of a valid patent claim."
Accordingly, determining the proper approach to claims construction
to identify the essential elements of a claim is critical when
considering patentable subject matter.
"Form vs. Substance" is Rejected: Patent Claims to be
The Commissioner argued that the proper approach to determining
patentability was to first consider the "substance" of
the invention and the "form" of the claims. In other
words, the Commissioner sought to determine, "independently of
the construction of the patent claims, what the inventor has
claimed to have invented — the 'actual invention'
—and to determine whether the actual invention falls
within one of the categories enumerated in the statutory definition
The Court rejected the Commissioner's approach as an
improper "analytical framework," and found that purposive
construction continues to be the accepted approach to Canadian
patent law. The Court held that identification of the invention
must be grounded in a purposive construction of the patent claims;
it cannot be determined solely on the basis of a literal reading of
the patent claims or by parsing the substance of the invention. In
so finding, the Court reaffirmed Canadian law holding that the
invention is defined by the claims.
Deference to the Commissioner on Issues of Construction
Also of interest to litigators, the Court of Appeal's
decision appears to signal greater deference to the Commissioner on
questions of patent construction. Clearly, the Court reiterated
that patent construction is a question of law, reviewable on the
standard of correctness. The Court also found that factual
determinations made by the Commissioner in connection with the
construction of the patent should be reviewed on the standard of
However, the Court went on in its reasons to reject the lower
Court's construction as lacking a foundation of knowledge of
the relevant art. The Court of Appeal held that, during
prosecution, the Commissioner obtains that knowledge from the
applicant and "from staff at the patent office with
appropriate experience." However, during litigation, the Court
is more restricted, and generally requires expert evidence of
persons skilled in the art. Because the lower court lacked such
evidence, the Court of Appeal held that it was necessarily limited
to a literal interpretation of the claims and thus could not
perform a proper construction.
Foreign Patent Experience
Patent litigators, from time to time, point to the record of
patentability of certain inventions in other jurisdictions.
However, noting that every jurisdiction has patent laws and
administrative practices which may be inconsistent in important
respects, the Court held that the fact that a patent has been
granted in other jurisdictions "cannot determine whether it
constitutes patentable subject matter in Canada."
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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