Canadian Patent Law 2023: A Year In Review

• Published date: 25 January 2024
• Subject Matter: Intellectual Property, Food, Drugs, Healthcare, Life Sciences, Patent, Biotechnology & Nanotechnology
• Law Firm: Smart & Biggar
• Author: Mr David Schwartz, Michael Sgro and Iris Ngo (Articling Student)

In our annual review of developments in Canadian patent law, we considered over 60 patent decisions reported last year. This article highlights statutory changes and a selection of interesting points addressed in the reported decisions. For a comprehensive review of Canadian pharmaceutical decisions and developments, please see the 2023 Highlights in Life Sciences IP and Regulatory Law in our Rx IP Update.

Increased Patent Office fees but a broadened small entity definition

As discussed in our June 21, 2023 article, the first comprehensive revision of the Patent Office fee schedule in 20 years saw amendments to the Patent Rules that came into force on January 1, 2024 and increased most Patent Office fees by 25%. In combination with other legislation that adjusts fees automatically to account for inflation, the increases were effectively as high as 36% in some instances. The increased fees were tempered by a change to the small entity definition, such that entities having fewer than 100 employees may now qualify as small entities. Previously, a small entity could have no more than 50 employees.

Canada's upcoming patent term adjustment system

The Canada-United States-Mexico Agreement (CUSMA) requires Canada to provide patent term adjustment (PTA) to compensate the patentee for unreasonable Patent Office delay. The PTA provisions of CUSMA must come into force no later than January 1, 2025, and will apply to all Canadian patent applications filed on or after December 1, 2020. The required amendments to the Patent Act were enacted on June 22, 2023. However, PTA regimes may be more or less generous, largely depending on how "periods of time that are attributable to the patent applicant"'and which are deducted from accrued Patent Office delay'are calculated. This remains to be determined by regulation, and it is too soon to know whether PTA will have a meaningful impact.

Please see our article of May 1, 2023 for more details of the proposed PTA system.

Correcting missed maintenance fees under the "due care" regime

The requirement to satisfy the Patent Office that a maintenance fee payment was missed "in spite of the due care required by the circumstances having been taken" has been in place for four years. It took time to know how the Patent Office would apply the due care standard'very stringently as it turns out. We recently surveyed more than 230 Patent Office decisions that have now been issued under the due care standard and reported our findings together with recommendations for a successful due care submission in an article published December 7, 2023.

Patent-eligibility of computer-implemented inventions: déjà vu all over again

In the article Canadian Patent Law 2022: A Year in Review, we reported that the Federal Court had established a new three-part test to be used by the Patent Office in assessing the patent eligibility of computer-implemented inventions. However, on appeal in Benjamin Moore & Co v Canada (Attorney General), 2023 FCA 168, the Federal Court of Appeal held that the issue of a holistic framework for assessing patentability of computer-implemented inventions was not a matter that had properly been before the Federal Court. Rather than endorsing the new test set forth by the Federal Court, or altering it, the Court of Appeal set aside this aspect of the lower court's judgment and directed the Patent Office to redetermine the patentability of the applications in question based on the Patent Office's existing examination guidelines concerning computer-implemented inventions.

The Court of Appeal noted that there are open questions, including e.g. the role (if any) the concepts of novelty and ingenuity have in the assessment of subject-matter eligibility. The practical consequence appears to be that, until the Federal Court squarely addresses the manner in which subject-matter eligibility of a "pure" computer-implemented invention is to be assessed, the current Patent Office guidelines will be followed.

Under the current guidelines, the Patent Office will first "purposively" construe the claims, typically finding that all stated claim elements are "essential." However, the inclusion of a computer as an "essential" claim element will only impart patentability if "the computer cooperates together with other elements of the claimed invention and thus is part of a single 'actual' invention."

For now, the clearest path to patentability for a claim to a computer-implemented invention will be to:

1. Satisfy the Patent Office that the invention improves the functioning of the computer per se (e.g. increases processing speed or reduces power consumption); or
2. Include additional physical claim elements or steps (e.g drilling a well based on the output of the computer).

The Intellectual Property Institute of Canada (IPIC), which had intervened before the Federal Court of Appeal, has sought to appeal to the Supreme Court of Canada (Supreme Court file 41004).

Claim construction: when should a court look to an expert for guidance?

The claims of a patent must be construed in an informed and "purposive" way. This involves interpreting the language of the claims with reference to the patent as a whole and through the eyes of a person skilled in the art. Where the inventor defines a term as having a particular meaning, claims containing the defined term are to be construed accordingly (see, e.g., Biogen Canada Inc v Pharmascience Inc, 2022 FCA 143; and Google LLC v Sonos, Inc, 2022 FC 1116). Although courts often rely on expert opinions to construe undefined technical terms that are particular to the field of the invention, a question arises as to whether courts should rely on experts to construe non-technical terminology.

In dTechs EPM Ltd v British Columbia Hydro and Power Authority, 2023 FCA 115, the Federal...