The Federal Court recently held in the Eurocopter v. Bell
Helicopter1 that punitive damages can be awarded in
relatively run-of-the-mill patent cases in Canada. The punitive
damages holding is all the more remarkable given that none of the
claims of the patent were held infringed by the defendant's
actual production design.
The defendant, Bell Helicopter, had developed a first design for
a "moustache" landing gear for a helicopter. Upon
receiving the Plaintiff Eurocopter's statement of claim, Bell
Helicopter redesigned the landing gear to a second design that was
used in production. Although 21 units of the first design had been
built by Bell Helicopter, those units were quarantined. None was
ever delivered to a customer. The only units delivered to customers
were units built according to the production design.
The earlier design was held to infringe. Although none of these
units were ever sold or delivered, nonetheless, the court awarded
Under existing governing Supreme Court of Canada precedent:
Punitive damages may be awarded in situations where the
defendant's misconduct is so malicious, oppressive and
high-handed that it offends the court's sense of decency.
Punitive damages bear no relation to what the plaintiff should
receive by way of compensation. Their aim is not to compensate the
plaintiff but rather to punish the defendant. It is the means by
which the jury or judge expresses its outrage at the egregious
conduct of the defendant.2
Punitive damages may be awarded where:
... there is a patent infringement and a willful breach of
injunction following that ...3
The defendant "may have intentionally hidden the fact that
they were infringing the patent.
In this case, the court determined that Bell Helicopter had been
wilfully blind as to the existence of the Eurocopter design and
patent rights Eurocopter might have in that design. The court
relied upon a "knew or should have known" standard in
respect of the original design, and drew negative inferences on the
basis of witnesses not called by the defendant, and privileged
opinions not produced by the defendant. From these negative
inferences the court held that "on the balance of probability,
the Court finds that there is clear evidence of bad faith and
egregious conduct on the part of Bell." This appears to be a
sharp divergence from previous case law.
The court also characterised some of the testimony given on
behalf of the defendant, as "far from
candid"4. It is not clear why this issue could not
have been appropriately addressed by an appropriate award of costs.
Punishment is not the job of the Patent Act. To award
punitive damages of capricious size and scope, potentially far
beyond the statutory penalties for perjury and contempt of court,
without the protections of the criminal law, as an arbitrary
penalty for suspected perjury, has not heretofore been the law in
While this is a decision of the Federal Court, it is hoped that
the fact situation is unique and that lower courts will not start
awarding punitive damages for patent infringement.
1 Eurocopter v. Bell Helicopter 2012 FC
2 Hill v. Church of Scientology of Toronto (1995),
2 SCR 1130, at para. .
3 Lubrizol Corp. v. Imperial Oil Ltd. (1996), 67
CPR (3d) 1 (FCA), at 20.
4 p. 137, para. 
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