The Markman And The Grandfather: Federal Court Determines Claim Construction By Partial Summary Judgment And Interprets The Prior Use Defence

• Published date: 25 January 2022
• Subject Matter: Intellectual Property, Patent
• Law Firm: Aird & Berlis LLP
• Author: Amy Grenon and Lawrence Veregin

In Kobold Corporation v. NCS Multistage Inc., 2021 FC 1437, the Federal Court addressed two often pondered questions in Canadian patent law: can the court decide the construction of a patent's claims before trial, and when can a prior user rely on a prior use defence to infringement?

By granting partial summary judgment, the Court provided a final ruling on claims construction while directing the remaining issues, including infringement, to be determined at trial. The Court also interpreted the new prior use defence set out in s. 56 of the Patent Act, though it deferred the final ruling on the merits-which would require a determination of infringement-to trial.

This decision is part of a general trend of the Court to employ, where possible, simplified procedures in patent actions, including eschewing the need for expert evidence to construe non-technical claims¹ and allowing complex pharmaceutical litigation to be determined by summary trial.² It remains to be seen whether this case opens the door to procedures for determining claims construction prior to trial.

Background

Kobold Corporation and NCS Multistage Inc. both provide fracking equipment for the oil and gas industry. Kobold commenced an action against NCS alleging that four of NCS's tools used in fracking infringe Kobold's patent. In particular, all four of NCS's tools use an allegedly infringing device, the "Blue Bullet." NCS has used some form of the Blue Bullet with its tools since 2012-three years before the 2015 claim date of Kobold's patent. However, variations of the Blue Bullet had been developed and deployed over time.

NCS brought a motion for summary judgment to resolve the action based on s. 56 of the Patent Act, arguing that its prior and continuing use of the Blue Bullet device is a complete defence to any patent infringement claim, notwithstanding the modifications to the original 2012 Blue Bullet device. To determine the applicability of this defence, the Court needed to first construe the claims and consider whether the NCS's activities fell within the scope of the claims, then assess whether NCS could avail itself of s. 56.³

The Markman: Motions for Claims Construction Come to Canada?

The Court held it could make a determination on claims construction, but could not do so on infringement due to insufficient evidence, and therefore it could not make a final determination on the prior use defence. Rather than dismiss the entire motion, the Court made its construction of the claims...