Canada: Patentable Subject Matter – Clarity Or Prolonged Confusion?

Last Updated: January 3 2012
Article by Mukundan Chakrapani, Steven Kennedy, Anne Kinsman and Chantal Saunders

Most Read Contributor in Canada, September 2016

It's back to the "check-out" counter for's (Amazon) "one-click" patent application.1 The Federal Court of Appeal (FCA) sent the application back to the Commissioner of Patents (Commissioner) for expedited re-examination with a direction to consider the issue of patentable subject matter after a purposive construction of the claims.2

In its initial decision, the Commissioner set out a novel test for determining patentable subject matter and stated that business method patents were traditionally considered non-patentable subject matter in Canada. In particular, the test included a determination of the "actual invention" or the inventive concept, and an assessment of whether the "invention" constituted patentable subject matter.

Upon appeal by Amazon, the Federal Court3 essentially found the claims to constitute patentable subject matter and directed the Commissioner to re-examine the patent application accordingly. In particular, the Federal Court held that there is no Canadian "tradition" of excluding business methods from patentability, nor is there a statutory exclusion for business methods in Canada as exists in other countries, such as the UK.

The Federal Court held that the Commissioner's return to a consideration of the "form and substance" of claims was an error of law. The Supreme Court, in 2000, gave clear directions to apply a "purposive" construction in all cases.4 In accordance with the principles of purposive construction, the Federal Court also confirmed that it was inappropriate to parse the claims into novel and non-novel elements in order to evaluate patentability. The claim must be viewed as a whole.

The Federal Court held that the term "art" in the Patent Act5 requires the following three criteria:6

i) it must not be a disembodied idea but have a method of practical application;

ii) it must be new and inventive method of applying skill and knowledge; and

iii) it must have a commercially useful result.

The Federal Court had directed the Commissioner to re-examine the "one-click" application with the direction that the claims, when purposively construed, constituted patentable subject matter.

The Commissioner appealed to the FCA.

The FCA rejected the "form and substance" analysis adopted by the Commissioner.

Furthermore, the FCA agreed with the Federal Court's decision that, "in determining subject matter solely on the basis of the inventive concept, the Commissioner adopted an analysis that is incorrect in law."7 The FCA ruled that the question to be answered when determining patentable subject matter was whether "the subject matter defined by the claim," not the "invention" or "what the inventor claims to have invented" fell within the definition of invention in Section 2 of the Patent Act.8

Following a similar line of reasoning as the U.S. Supreme Court in In Re Bilski,9 the FCA was reluctant to enunciate a test for patentable subject matter, and cautioned against "devising or relying on tests...even if they are intended only to summarize principles derived from jurisprudence."10 The FCA urged the Commissioner to rely on fundamental principles derived from the jurisprudence and not "apply a jurisprudential principle in way that forecloses the possibility that new knowledge has rendered conventional ideas obsolete."11 In particular, the FCA ruled that "a business method may be an essential element of a valid patent claim."12

The FCA then held that the Federal Court should not have construed the claims on the basis of the record available, and instead directed the Commissioner to purposively construe the claims "on the basis of a foundation of knowledge about the relevant art, and in particular about the state of the relevant art at the relevant time."13

It is too early to determine whether the Patent Office will consider favourably the claims in the "one-click" application. In the meantime, we recommend relying on established jurisprudence on purposive claim construction to rebut non-statutory subject matter rejections.

In addition, ensuring that the claimed subject matter includes meets the criteria for "art" set out by the Federal Court will likely assist in the purposive construction of the claims.


1 Canadian Patent Application No 2,246,933 (Hartman et al., inventors).

2 Canada (Attorney General) v, Inc, 2011 FCA 328 (FCA) [].

3, Inc v Canada (Attorney General), 2010 FC 1011, 86 CPR (4th) 321 (FC) [].

4 Free World Trust v Électro Santé Inc, 2000 SCC 66, [2000] 2 SCR 1024;

Whirlpool Corp v Camco Inc, 2000 SCC 67, [2000] 2 SCR 1067.

5 RSC 1985, c P-4.

6, supra at paras 51-52.

7 Ibid at para 47.

8, supra at para 39.

9 130 S. Ct. 3218 (2010).

10, supra at para 53.

11 Ibid at para 54.

12 Ibid at para 63.

13 Ibid at para 73.

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