ARTICLE
7 January 2025

Connection To Canada: Reviewing The Reasoning In ProSlide Technology, Inc. And WhiteWater West Industries, Ltd.

ProSlide, which is based in Ottawa, and WhiteWater, which is headquartered in Richmond, B.C., are global leaders in the water slide industry. Both WhiteWater and ProSlide have been involved in a multi-jurisdictional and years-long court struggle centering around ProSlide's patents to its waterslide products.
Canada Intellectual Property

ProSlide, which is based in Ottawa, and WhiteWater, which is headquartered in Richmond, B.C., are global leaders in the water slide industry. Both WhiteWater and ProSlide have been involved in a multi-jurisdictional and years-long court struggle centering around ProSlide's patents to its waterslide products. In the Canadian infringement case, ProSlide alleged that WhiteWater's products infringed upon several patents owned by ProSlide, specifically Canadian Patent No. 2,778,601 (the "601 Patent"), Canadian Patent No. 2,951,552 (the "552 Patent"), Canadian Patent No. 3,063,073 (the "073 Patent"), and Canadian Patent No. 3,085,150 (the "150 Patent").

WhiteWater denied the infringement claims and argued that the patents were invalid, and even if they were valid, that WhiteWater did not make, use, construct, or sell the products in question within Canada.

Generally, patentees are granted exclusive rights to make, construct, use, and sell their inventions within Canada. To prove infringement, it generally must be shown that one or more of these activities occurred within Canada. ProSlide argued that WhiteWater's activities met the criteria for connection to Canada of the infringing activity, while WhiteWater asserted the alternative.

WhiteWater manufactured components of its products through subcontractors. The components were the parts that needed to be assembled on site to create a complete water slide. The subcontractor delivered the components to a customer for final assembly and use at the customer's location. The Court noted that none of the products were physically manufactured, assembled, or used in Canada; except for one type of slide which components were manufactured in Canada and then shipped for assembly and use abroad.

ProSlide argued that even though the components were not manufactured or assembled in Canada, WhiteWater's conduct was still infringing because WhiteWater is essentially doing, in Canada, everything to make the slides, apart from the final steps of the physical making. ProSlide alleged that WhiteWater (1) created pre-contract conceptual designs to promote its products, (2) generated detailed computer-aided designs and mechanical specification drawings in Canada for each product it sold, (3) provided these designs and drawings to subcontractors, who then manufactured the impugned articles' components outside of Canada, (4) inspected and audited the moulds and parts created by the subcontractors, (5) sent instructions for the assembly, and (6) supervised installation, among other things.

The court drew on established jurisprudence, including the recent ruling in Steelhead LNG (ASLNG) Ltd v Arc Resources Ltd., 2024 FCA 67, which reinforced that use of a patent concerning a physical object only occurs when the object itself, not just its conceptual or design materials, is made or used within Canada. In this way, where a patent claims a physical object, the patentee's exclusive rights under section 42 of the Patent Act to "use" the invention extends only to that object; it does not extend to the use of conceptual designs or drawings of that object. Accordingly, detailed design work or conceptual planning within Canada does not equate to the "making" of an invention under section 42 without physical creation and operational use of the patented item. This distinction reinforced that even partial manufacturing and design did not satisfy the "making" or "using" requirement.

Accordingly, while WhiteWater's preparatory work and intellectual contributions took place within Canada, including CAD design work, testing protocols, and supervisory oversight of subcontractors, these acts did not constitute making or using the products in Canada. Due to the fact that the components were shipped internationally, and all final assembly steps occurred outside of Canada, the acts did not meet the "making" or "using" threshold necessary for infringement under Canadian patent law.

This case underscores the strict territorial boundaries of patent rights under Canadian law. Activities like design, planning, and even partial manufacturing must culminate in a complete product or process within Canada for infringement to occur. Accordingly, patentees need to present clear evidence showing that the full scope of activities related to making or using a patented item occurred within Canadian jurisdiction. Simply demonstrating preparatory or supportive work in Canada is insufficient without the actual completion of the patented object or its operational use domestically.

When drafting claims for Canadian patents, in light of ProSlide v. WhiteWater, it is best to structure claims to ensure, where possible, that infringement will occur within the geographic limitations of Canadian patent law. For example, if the invention can be infringed by mere assembly or use, ensure that these aspects are explicitly covered in the claims. Further, draft claims covering both the overall system and its individual components or modules. Where any part of the product has critical components or steps that occur within Canada, where possible, draft claims to these aspects instead of necessarily only to the end product. Similarly, even if the final product is not made or assembled in Canada, claims directed at key method steps that may be carried out in Canada can provide broader protection. Further still, where possible, draft claims that protect subassemblies or kits of parts that are crucial to the final product. For instance, if an initial phase of production (e.g., mold-making) is performed in Canada, consider including dependent claims that cover just these activities.

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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