Recent Decisions October 2002
I. FEDERAL COURT DECISIONS
(a) Patents
1. Chao v. Superclip, Everjoy Asia and Wong, June 25, 2002, FCTD (Nadon J.) Patent Infringement/Summary Judgment
A motion for summary judgment brought by defendants Everjoy and Wong seeking to dismiss the plaintiff’s claim of patent infringement, in respect of the plaintiff’s patent “Eyeglass Device having Auxiliary Frame”. The two defendants sold allegedly infringing devices to co-defendant Superclip, who in turn sold these products to consumers within Canada. Defendants Everjoy and Wong claim that: (1) they have not made or sold clip-on products in Canada, nor have they induced a third party to do so; (2) title to products passed to Superclip before they were brought to Canada; (3) the Court is without jurisdiction as to Everjoy, which is domiciled and resides in Hong Kong; and (4) the products do not infringe the patent.
Held: Motion dismissed. The Court determined that there were issues of credibility and that the case should proceed to trial, where proper cross-examinations can take place. In particular, there is evidence supporting the plaintiff’s position that the defendants have infringed the patent. Furthermore, some of Wong’s evidence is contradictory and suspect, including evidence involving what percentage of Everjoy he owns, whether or not the product in question had been sold to any other Canadian companies prior to being sold to Superclip, as well as an admission, contrary to previous testimony, that Wong may have personally brought a sample of the product to Canada. In addition, portions of a licence and manufacturing agreement between Everjoy and Superclip that was submitted as evidence had been deleted. Wong claims that the deleted subject matter has no bearing on this case. However, the Judge did not agree, stating that the payment and shipment terms are crucial to determining when title to the products may have passed to Superclip. These inconsistencies were sufficient in the eyes of the Court to justify a trial.
2. Pfizer Canada v. Apotex, July 19, 2002, FCTD (Heneghan J.) Application for Prohibition/NOC Sought by Generic Producer to Permit Applications for Listings on Provincial Formularies Prior to Expiry of Patent/Section 55.2(1)/Patented Medicines (Notice of Compliance) Regulations
Application by Pfizer for an order prohibiting the Minister of Health from issuing a NOC to Apotex in respect of azithromycin capsules until after expiry of the Canadian patent for the medicine.
Held: Application allowed. Apotex served Pfizer with a Notice of Allegation because it wanted to obtain a NOC for its version of azithromycin prior to expiry of the patent, in order to apply for listing on provincial formularies. Apotex undertook, notwithstanding the issuance of the NOC, that it would not make, construct, use or sell the capsules other than as deemed to be non-infringing pursuant to s. 55.2(1) of the Patent Act. Apotex cannot rely on the provincial legislative regime to justify its application for a NOC. The provincial legislation does serve a regulatory purpose over the use and sale of drug products, but only after the federal process has been completed. The provincial regimes are subordinate to the federal scheme mandated by the Food and Drug Act and Regulations. Apotex seeks an interpretation of s. 55.2(1) which is contrary to the purpose of the Patent Act and to s. 5 of the NOC Regulations. The activities in which it seeks to engage are not entitled to the exemption against infringement provided in s. 55.2(1). The NOA is not justified. The Minister is prohibited from issuing a NOC until after expiry of the patent.
3. Illinois Tool Works et al. v. Cobra Fixations et al., July 29, 2002, FCTD (Pelletier J.) Infringement/Intention/Improper Use/ Commercial Success
Action for infringement of a patent for a "Self-drilling Threaded Insert for Drywall." The invention is a wall anchor that is inserted into drywall and can be used to hang pictures. The plaintiffs' anchor is employed with a long screw that causes the tip of the anchor to bend. The defendants' WallDriller product was intended for use with short screws. The plaintiffs contend that one can prove infringement by employing the defendants' device with a long screw, despite the fact that it was not the defendants' intention that the device be used in such a manner.
Held: The patent claims are valid and not infringed. The Court held that the use of a long screw and a wall anchor tip that bends are essential elements of the plaintiffs' invention. The absence of these elements from the defendants' WallDriller device precludes a finding of infringement. The Court commented that the intentions of the parties are of no significance when determining the issue of infringement; however, the Court nevertheless went on to accept material evidence submitted by the defendants showing that the WallDriller device was never intended for use with long screws. The Court rejected the plaintiffs' attempt to establish infringement by showing that the defendants' device could be used with a long screw in a manner that would cause it to infringe the plaintiffs' device. The Court held that employing the defendants' device with a long screw would destroy or substantially impair its utility and no consumer would knowingly use the device in such a fashion. The Court commented that it would be a "curious turn of events" if infringement could be established by showing that the defendants' device could be "forced" to take a form which would cause it to infringe the plaintiffs' device.
The defendants' counterclaim alleging invalidity was dismissed. However, the Court noted that the commercial success of the plaintiffs' device does not remove the doubt as to obviousness. The commercial success of an invention can be evidence of inventiveness responding to a real need in the marketplace. Commercial success can also arise from many causes other than inventiveness, such as clever marketing. A plaintiff's recourse to an argument of commercial success may be taken as an admission of weakness.
4. Bayer AG v. Apotex and Canada (Minister of National Health and Welfare), August 22, 2002, FCTD (Rouleau J.) Application for Prohibition/Appeals from Dismissal of Motions to File New Evidence, Produce Documents and Amend Notice of Application/Patented Medicines (Notice of Compliance) Regulations
Appeals by Bayer from three orders rendered by the Prothonotary. In the main proceeding, Apotex had served Bayer with a Notice of Allegation and Bayer had commenced an application to prohibit the Minister from issuing a NOC to Apotex. In separate administrative proceedings, the Minister subsequently advised Apotex that its drug Submission was rejected for deficiencies in screening. In one motion, Bayer sought leave to file new evidence, namely the affidavit of a pharmacist expressing the opinion that the Minister would likely reject the Apotex Submission. In a second motion, Bayer sought the production of any screening deficiency notice or rejection letters relating to the rejection of the Apotex Submission. In the third motion, Bayer sought to amend its notice of application. The Prothonotary dismissed the motions to file new evidence and for production of documents, and allowed the motion to amend the notice of application in part.
Held: Appeals from the motions to file new evidence and for production of documents dismissed; appeal from the motion to amend the notice of application allowed in part. Concerning the first motion, the pharmacist's affidavit contains no evidence whatsoever that is pertinent to the court application. NOC applications normally call for two complete and distinct procedures. The administrative procedure before the Minister is not the concern of Bayer in the court proceeding, where the function of the Court is to determine validity or non-infringement. Concerning the second motion, the NOC Regulations impose no obligation on Apotex to provide Bayer with the letter of deficiencies. Should Apotex wish to further pursue their Notice of Allegation, Apotex would be under a continued obligation to provide Bayer with any new material submitted to the Minister. Turning to the third order, Bayer should be permitted to amend its notice of application to allege that the Apotex Notice of Allegation is not in compliance with the NOC Regulations because its Submission was rejected by the Minister due to screening deficiencies, and it was therefore never a submission for a NOC as defined in s. 5(1) of the NOC Regulations.
5. Toba Pharma v. Canada (Attorney General), September 3, 2002, FCTD (Blais J.) Patent Register/Regulations Impose Strict Time Constraints for Filing Patent List/Patented Medicines (Notice of Compliance) Regulations, ss. 4(3), 4(4) and 4(6)
Application for judicial review of a decision of the Minister of Health refusing to list a patent on the Patent Register maintained pursuant to the NOC Regulations. Toba Pharma was granted NOCs for the drug Sevoflurane. A patent was granted after issuance of the NOCs, but Toba did not file a patent list within 30 days of grant, as prescribed by s. 4(4) of the NOC Regulations. Toba filed a supplement to a new drug submission (SNDS) for the purpose of recording changes in the manufacturer's name and product name, and attempted to file a patent list with it. The Minister decided that the NOC Regulations do not permit the inclusion of a patent on the Register by filing a further SNDS, and refused to list the patent on the Register. Toba sought leave for judicial review of the decision.
Held: Application for judicial review dismissed. Subsections 4(3), 4(4) and 4(6) of the NOC Regulations address the strict timing requirements for patent lists. The Minister correctly concluded that Toba did not satisfy the requirements of s. 4 of the Regulations, because it failed to file the patent list within 30 days after grant of the patent. A subsequently filed SNDS cannot be considered an appropriate opportunity to file a patent list.
6. Schmeiser v. Monsanto, September 4, 2002, FCA (Isaac, Noël, Sharlow, JJ.A.) Patent Infringement/Evidence/Award of Relief
Appeal by Schmeiser from a finding of patent infringement, award of damages and granting of an injunction. Cross-appeal by Monsanto on award of damages. The Monsanto patent covers a genetic insert that is used in plant cells to make plants resistant to glyphosate, a compound used in herbicides. Schmeiser never purchased or received seeds containing the patented gene from any third-party, although it is suspected that seeds may have accidentally “arrived” on his farm by accidental spillage or by pollination. Schmeiser sprayed a glyphosate-containing herbicide on parts of his farm, and noticed that some of his canola plants survived the spraying. He kept the seeds of those plants and replanted them the following year. Samples of Schmeiser's canola crop were later tested and found to contain a significant proportion of the patented gene. Accordingly, the trial judge found Schmeiser liable for patent infringement as a result of planting and selling canola crop from seeds that contained the patented gene. On appeal, Schmeiser argued that: (1) the trial judge erred in determining Monsanto's patent rights; he argued that he should not be liable for simply growing canola crop that contained the patented gene unless he took advantage of its glyphosate-resistant quality; (2) the trial judge erred by not adequately considering how the Monsanto gene came to be in his crop; (3) the trial judge erred in his factual findings, and in particular, for admitting illegally obtained testing evidence; and (4) the trial judge erred in determining the appropriate relief.
Held: Appeal and cross-appeal dismissed. The Court of Appeal held that the trial Judge correctly applied the principles applicable to the construction of patent claims when he found Schmeiser liable for patent infringement by merely planting a crop of canola that contained the patented gene. The Court also found that (i) the conflicting right of the ownership of the plant versus the holder of a patent for a gene found in the plant is not relevant to the determination of infringement; (ii) Mr. Schmeiser was not an "innocent infringer" because he knew or should have known the plants were glyphosate-resistant, and (iii) the trial judge correctly found that Monsanto did not waive any exclusive rights by the spread of the seeds through the movement of pollen or accidental spillage. The Court held that the trial judge did not err in his factual findings or in admitting testing evidence obtained illegally. With respect to the grant of relief, the Court considered 3 issues. First, Schmeiser argued that a prohibition in planting any seeds is too broad. The injunction would prevent him from reusing any of his canola seed and would force him to buy new seed each year. The Court upheld the trial judge's order and stressed that Schmeiser can save his canola seed as long as he does not know or ought to know the seeds are glyphosate-resistant. Second, Schmeiser argued that the damage award was excessive as he received no financial benefit from the fact his crop included glyphosate-resistant canola. The Court upheld the trial judge's decision that the profit from the sale of the infringing crop is to be used as a base for the damage award, and not the difference between that profit and the profit from the sale of an alternative crop. Third, the Court reconsidered the amount of damages awarded by the trial judge, and rejected Monsanto’s claim that the award was too low.
(b) Copyright
1. Society of Composers, Authors and Music Publishers of Canada v. Canadian Association of Internet Providers et al., May 1, 2002, FCA (Evans, Linden, Sharlow JJ.A.) Judicial Review/Copyright Board/Music Royalties/Internet/Tariff 22/Copyright Infringement/Section 2.4(1)(b) Copyright Act/ Real and Substantive Connection Test
Application for judicial review by SOCAN to set aside the first phase Copyright Board decision of October 27, 1999, which excluded most intermediaries from liability to pay royalties for copyrighted music transmitted on the Internet. The Board had held that a royalty can be imposed on those who post music on a server located in Canada, to which users have access, but that the normal activities of Internet intermediaries (those whose only role in the Internet transmissions is to operate a server on which music is stored, or to provide a recipient with Internet access) do not constitute a "communication" for the purpose of the Copyright Act. Accordingly, the Board held that a royalty should not be imposed upon those intermediaries.
Held: Application dismissed in part. The Court upheld the Copyright Board's ruling that Internet access providers were not liable for royalty payments, when acting strictly as conduits. When a content provider has posted music on a host server, the operator of the host server is then providing the "means necessary" to enable the content provider to communicate by telecommunication, for the purposes of s. 2.4(1)(b) of the Copyright Act. An Internet intermediary's performance of activities which are ancillary to the provision of disk space, such as housing and maintaining servers, or monitoring hits to webpages, do not involve any act of communication and do not affect the intermediary's ability to receive protection under s. 2.4(1)(b). Also, the normal activities of Internet access providers or host server operators do not implicitly "authorize" content providers to communicate material they have posted on the server to end users, and do not thereby infringe copyright in the material posted.
The Court reversed the Copyright Board's decision on two points. First, the Court held that if the Internet intermediary performed caching activities, it was not acting merely as a conduit, and those operating a cache should be subject to payment of royalties. Despite the fact that the cache enhances the speed of transmission, and reduces cost to the Internet access provider, the operation of a cache is not a practical necessity for communication, for the purposes receiving protection under s. 2.4(1)(b) of the Copyright Act. Furthermore, the operator of a cache infringes the exclusive right of the copyright owner to communicate a musical work to the public, since the cache operator selects which material will be cached, and programmes the computer to transmit it from the cache when it is requested. Therefore the cache operator is not merely a passive transmitter of data.
Second, the Court held that the jurisdictional application of the tariff should extend to foreign-based sites with a real and substantial connection to Canada. SOCAN is only entitled to a royalty in respect of copyright infringements that occur in Canada. The Board's ruling, that a communication by telecommunication occurs at the place from which the transmission originates, is reviewable because it determined a general question of law that was not confined to the evidence in this particular case. Here, the location of the communication should not be determined solely by that of the host server, since the Internet communications in question are only ever effected at the request of the end user, who may be located in Canada, and may be less likely to purchase a recorded copy of music received over the Internet. The reason the Copyright Act protects copyright owners from infringements in Canada is to protect the economic value of the author's work in the Canadian market. SOCAN's members would be left with little compensation for such potential loss of music sales in the Canadian market if the communication were held to occur only at the location of the host server. The issue is to determine the test for locating the communications that would be most consistent with the policy of the Copyright Act.
The Court held that a royalty may be made payable in Canada in respect of communications by telecommunication that have a real and substantial connection with Canada. The principal infringing activity is communication by the content provider, but copyright material is not communicated until it is received on the end user's computer, therefore the location of the host server cannot alone determine when the communication occurs. The real and substantial connection test also involves determining the location of the infringing activity of authorizing a communication, that occurs when a content provider posts copyright material on a host server. Some latitude should be given to the Copyright Board to determine, case-by-case, how to apply the real and substantial connection test. The most important connecting factors will likely be the location of the content provider, the end user and the intermediaries, in particular the host server.
With respect to the standard of review, the Court held that the Board's interpretation of the provisions of the Copyright Act were reviewable on a standard of correctness, while deference was due to the Board's application of the provisions to the facts.
2. Theresia Winkler v. Samuel Roy et al., September 12, 2002, FCTD (Gibson J.) Copyright Ownership/Reversionary Interest /Section 57(3) Copyright Act/Section 14(1) Copyright Act
Application for, inter alia, a declaration of copyright ownership in two books. The applicant was the only named beneficiary in the will of the author of The Black Donnellys and Vengeance of the Black Donnellys. The author had however previously assigned all rights in the works to one of the defendants.
Held: The applicant only succeeded marginally. The assignment to the defendants is not void under s. 57(3) of the Copyright Act because the applicant is not "a subsequent assignee or licensee for valuable consideration". While the applicant did not have actual notice of the prior assignment, the bequest to the applicant was not an assignment of copyright as it simply provided that any money from sales of the author's books be paid to the applicant, with no bequest of the residual of his estate. Furthermore, any alleged assignment or licence was not "for valuable consideration" since there is no evidence that a contract, express or implied, existed between the applicant and the author that led to him naming the applicant as his beneficiary. Although the assignment to the defendants purported to assign the reversionary interest in the author's copyright, pursuant to s. 14(1) the reversionary interest becomes part of the author's estate, with the result that the defendant's copyright will expire in 2007, on the 25th anniversary of the author's death.
(c) Practice
1. Vas-Cath v. Sakharam D. Mahurkar, August 21, 2002, FCTD (Hugessen J.) Summary Judgment/ Settlement Agreement
Motion by Mahurkar under the old Patent Act for summary judgment based on an alleged settlement as documented in an exchange of correspondence between the solicitors representing the two parties. The correspondence clearly indicated that the execution of a formal settlement agreement was contemplated. No agreement was ever executed.
Held: Motion dismissed. The law is clear that a mere agreement to agree is not enforceable. Hugessen J. commented that there was nothing in the evidence that would allow the Court to conclude that there was anything more than an agreement to agree. Looking at the whole course of dealings between parties, both prior to and often subsequent to the conclusion of an alleged agreement, a court may find that what on its face appears to be only an agreement to agree is in fact a binding contract; but this is an exception to the general rule which would require evidence that the parties intended by their exchange of documents to bind themselves finally.
2. Ragdoll Productions et al. v. Jane Doe et al., August 28, 2002, FCTD (Pelletier J.) Anton Piller Order/Compensatory Damages /Scale of Damages/Effect of Absence of a Statement of Defence
The plaintiffs had executed "rolling" Anton Piller Orders on the defendants. On reviewing the execution of the orders, the Court converted the interim injunction to an interlocutory injunction. When the plaintiffs moved for default judgment, the defendants filed a responding record - the defendants did not file a Statement of Defence and did not file any evidence, but simply argued the insufficiency of the plaintiffs' evidence.
Held: Judgment issued in favour of the plaintiffs; damages awarded. Pursuant to r. 184 of the Federal Court Rules, the absence of a statement of defence means that all of the allegations must be taken as denied, with the result that the plaintiffs must establish entitlement to the relief claimed by affidavit evidence. The standard of proof on applications for judgment in default should be the same as on review motions, namely whether, on a balance of probabilities, infringement has occurred. The review order judicially determined that infringement had occurred and, in the absence of evidence to the contrary, is conclusive of that issue. Even though the injunction was granted on the basis that there would otherwise be irreparable harm, this does not preclude the plaintiffs from now claiming damages. Regarding the quantum of the damages, the fact that the defendants do not keep accounting records should not enable it to defeat a claim for damages. Damages awarded in accordance with the scale applied by the Federal Court. These damages are compensatory, not nominal. Although the scale is imperfect, it is always open to the defendants to provide evidence to show that the amount awarded is inappropriate.
II. OPPOSITION BOARD DECISIONS
1. Hudson's Bay v. Sears Canada, July 2, 2002 (Folz) Section 30(b)/Use as a Trade Mark/Descriptiveness/Particulars of Section 12(1)(b) Ground
Use-based application for UN DÉCOR COORDONNÉ À PRIX ABORDABLE for various home furnishings and retail department store and catalogue sales services. À PRIX ABORDABLE disclaimed. Opposition based, inter alia, on s. 30(b) because the applicant has not used the mark as claimed because the mark is not used to distinguish the applicant's wares and services from those of others and s. 12(1)(b).
Held: Application refused. The s. 30 ground succeeded because the evidence showed that the applied for mark always appears with the applicant's TOUT POUR LA MAISON & Design mark and the Board Member did not think that the average consumer would, as a matter of first impression perceive UN DÉCOR COORDONNÉ À PRIX ABORDABLE as a separate mark. Even though the applied for mark appears in a different size and style of font, the descriptive nature of the words would result in the average consumer responding to the words not as a trade mark for the services but as indicating that the applicant sells co-ordinating items for each room in the house at a low price. Although the mark is not clearly descriptive with respect to the wares, the s. 30 ground succeeded with respect to the wares as well because the Board Member was of the view that the use of the applied for mark on flyers, in catalogues and on banners in stores was more akin to use with services than with wares.
The descriptiveness ground of opposition failed because it consisted of a reproduction of the words of s. 12(1)(b) without any supporting allegations of fact. The applicant pleaded in its counter statement that there was insufficient detail in the statement of opposition for it to respond. If this were a case where the supporting allegations of fact were obvious from the highly descriptive nature of the mark, the Board Member may have found the s. 12(1)(b) ground to have been sufficiently pleaded. Also, if the applicant had not raised the issue in its counter statement but had proceeded with evidence and argument this might have shown that it understood the case to be met; but once the applicant raised the issue in its counter statement, it was up to the opponent to correct the deficiency. If the ground had been sufficiently pleaded, it would have succeeded with respect to the services.
2. Hudson's Bay v. Sears Canada, July 2, 2002 (Folz) Section 30(b)/Use as a Trade Mark/Descriptiveness/Particulars of Section 12(1)(b) Ground
Use-based application for CO-ORDINATION FOR EVERY ROOM…AFFORDABLY for various home furnishings and retail department store and catalogue sales services. Opposition based, inter alia, on s. 30(b) because the applicant has not used the mark as claimed because the mark is not used to distinguish the applicant's wares and services from those of others and s. 12(1)(b).
Held: Application refused. The s. 30 ground succeeded because the evidence showed that the applied for mark always appears with the applicant's WHOLE HOME & Design mark and the Board Member did not think that the average consumer would, as a matter of first impression perceive CO-ORDINATION FOR EVERY ROOM…AFFORDABLY as a separate mark. Even though the applied for mark appears in a different size and style of font, the descriptive nature of the words would result in the average consumer responding to the words not as a trade mark for the services but as indicating that the applicant sells co-ordinating items for each room in the house at a low price. Although the mark is not clearly descriptive with respect to the wares, the s. 30 ground succeeded with respect to the wares as well because the Board Member was of the view that the use of the applied for mark on flyers, in catalogues and on banners in stores was more akin to use with services than with wares.
The descriptiveness ground of opposition failed because it consisted of a reproduction of the words of s. 12(1)(b) without any supporting allegations of fact. The applicant pleaded in its counter statement that there was insufficient detail in the statement of opposition for it to respond. If this were a case where the supporting allegations of fact were obvious from the highly descriptive nature of the mark, the Board Member may have found the s. 12(1)(b) ground to have been sufficiently pleaded. Also, if the applicant had not raised the issue in its counter statement but had proceeded with evidence and argument this might have shown that it understood the case to be met; but once the applicant raised the issue in its counter statement, it was up to the opponent to correct the deficiency. If the ground had been sufficiently pleaded, it would have succeeded with respect to the services.
3. Danielle Jones v. Dragon Tales Production, July 10, 2002 (Herzig) Section 30(i)/Copyright Infringement/Distinctiveness
Proposed-use application for THE ADVENTURES OF DUDLEY THE DRAGON & Circle Design for a wide variety of wares and services including paints for hobby use, strollers, belt buckles, colouring books and production of television and radio programs. Opposition based, inter alia, on s. 30(i) because the applicant could not have been satisfied that it is exclusively entitled to use the mark because the applicant is not the owner of copyright in the dragon that is a central element of the mark, and non-distinctiveness because the applicant is not the owner of the copyright.
Held: Opposition rejected. The Board Member rejected the applicant's submissions that the opponent misstated the provisions of s. 30(i) by including the word "exclusively" and that bad faith on the part of the applicant must be pleaded in order to rely on s. 30(i). In order for the s. 30(i) ground to succeed, the opponent must make out a prima facie case of copyright infringement. In the present case, there are too many points of dissimilarity, and too few points of similarity, between the dragons to conclude that there has been substantial copying.
The mere existence of copyright cannot of itself prevent a mark from being distinctive - marketplace circumstances are required to negate distinctiveness.
4. Intergold v. Cameron Doherty, July 17, 2002 (Martin) Distinguishing Guise/Use as a Trade Mark
Use-based applications for Commerce Ring Design, Nurse Ring Design and Teacher's Ring design for commerce rings, nurse's rings and teacher's rings, respectively. Oppositions based, inter alia, on the marks not being registrable because they are purely ornamental and do not meet the definition of a trade mark.
Held: Applications refused. The marks are three-dimensional designs that are the primary ornamental feature of the applicant's rings. The ornamental nature has been recognized by the applicant who has obtained industrial design registrations. The marks are therefore distinguishing guises; the lack of evidence of the marks having acquired distinctiveness as of the filing of the applications results in the applications failing to meet the requirements of s. 13(1)(a). The applicant also failed to meet the legal burden of showing that the applied for marks are capable of functioning as ordinary trade marks.
5. Molson Breweries v. Labatt Brewing, July 30, 2002 (Folz) Distinctiveness /Descriptiveness
Proposed use application for BEER & Design for periodical publications, namely newsletters and booklets. BEER disclaimed. Opposition based, inter alia, on non-distinctiveness because the word BEER is generic and clearly descriptive. No evidence filed by either party.
Held: Application refused. It is reasonable to assume that the publications would relate to beer and therefore the mark is clearly descriptive of the publications. The Board Member rejected the applicant's argument that the average consumer would respond to the mark as an acronym, rather than as the word "beer".
6. TMC Distributing v. Raymond Gorsy, August 20, 2002 (Herzig) Section 30(e)/Intent to Use
Proposed use application for HARMONIC for hundreds of wares and services. Opposition based, inter alia, on s. 30(e) because the applicant does not himself intend to use the mark.
Held: Application refused. The opponent evidenced that significant financing is required to procure private products such as those listed in the application. It also evidenced that the applicant was recently discharged from bankruptcy and that the major private label suppliers had not been approached by the applicant. This satisfied the opponent's burden with respect to s. 30(e) and the applicant's evidence did not address this issue.
7. Highliner Foods v. Raymond Gorsy, August 21, 2002 (Herzig) Confusion
Application for LA CAPITAINE for various wares and services, some based on use, some based on proposed use. Opposition based, inter alia, on s. 12(1)(d) due to a likelihood of confusion with the opponent's trade mark POULET DU CAPITAINE registered for chicken portions.
Held: Application refused only in respect of food-related wares and services.
8. Hermetic Order of the Golden Dawn v. David Griffin, August 28, 2002 (Herzig) Section 30(b)
Use-based application for HERMETIC ORDER OF THE GOLDEN DAWN for printed publications namely books and booklets. Opposition based, inter alia, on s. 30(b) because the applicant has not used the mark since the date claimed.
Held: Application refused. The opponent's evidence was to the effect that there was no use of the mark by the applicant in Canada at any time. As the applicant did not file any evidence, he did not meet the onus to substantiate his use.
III. SECTION 45 DECISIONS
1. Sim & McBurney v. Madison Chemical, July 4, 2002 (Savard) Sufficiency of Evidence
MAXAM registered for polyurethane coatings.
Held: Registration expunged. The affiant stated that the mark was in use and provided technical data sheets concerning the MAXAM product. Although the Registrar was willing to infer that the data sheets would probably be provided to customers at the time of transfer of the wares, the sheets were dated after the relevant time period.
2. Pitblado Buchwald Asper v. 8 Hockey Ventures, July 4, 2002 (Savard) Indirect Control by Licensing Agent /Hearsay /Sufficiency of Evidence
WINNIPEG JETS registered for a variety of merchandise and hockey-related services.
Held: Registration amended to delete wares not covered by the evidence. The requesting party unsuccessfully argued that the evidence of the affiant (a representative of the registrant's licensing agent) was hearsay - the Registrar held that there was no reason to think that the affiant's statements were not based on personal knowledge or a review of the business files, as claimed. The fact that the licensing agent was responsible to the trade mark owner for maintaining control over the character and quality of all licensed wares (and did in fact maintain such control) satisfies s. 50(1). Royalty statements were accepted as showing that the sales occurred during the relevant time period.
IV. PATENT APPEAL BOARD DECISIONS
1. Re Patent Application 374,547, Commissioner's Decision #1114, April 20, 1988 Review of Final Action Rejection/Section 2 Patent Act
A request by Eli Lilly for review by the Commissioner of Patents of the Final Action on an application filed on April 2, 1981. The application relates to a method for accelerating natural cell removal by applying to the skin four components: a cleanser, a cream, a lotion and a tonic. The Examiner based his rejection on s. 2 of the Patent Act, stating that the claims are directed to a method of medical treatment which is outside the definition of invention (Tennessee Eastman v. Commissioner of Patents, 1974, S.C.R. 111). The applicant submitted several documents discussing numerous Canadian court decisions and foreign jurisprudence dealing with the patentability of medical and non-medical methods of treatment. The applicant argued that the claimed method is not directed towards a surgical procedure or the treatment of a disease and that no professional skills are required to carry out the method. The applicant contended that the invention is directed towards a skin cell renewal cosmetic regime to increase the rate of skin cell turnover without skin irritation.
Held: Final Action Rejection maintained. The invention is not directed to a cosmetic method, but to a treatment of living portions of the human body. In the Australian case, Joos v. The Commissioner of Patents (1973, R.P.C. No. 3, p. 65), the subject matter involved the treatment of keratinous material, such as hair and nails, which is inanimate matter, not living matter. The treatment of such inanimate matter was held to be a cosmetic treatment in that case. The Patent Appeal Board held the subject invention to be different from Joos in that the subject method is directed towards living cells. The Patent Appeal Board cited Tennessee Eastman as indicating that a method of treatment may be likened to a medical treatment of living tissues, as is found in the applicant's method, and may be applied at times by persons that may or may not be in the medical field. Furthermore, the Patent Appeal Board considered the applicant's method to be in the same category of subject matter as that in the case of Imperial Chemical Industries (ICI) Limited v. The Commissioner of Patents 51 C.P.R. 102, in that there is an intent for the method to improve the function or health of a particular living part of the body, not merely to add cosmetic improvement even though that condition may be present. From ICI, if a medical treatment and a cosmetic treatment occur together as a result of the substance used, no patent may issue for either treatment. The Patent Appeal Board affirmed the refusal of the claims for being directed to unpatentable subject matter.
2. Re Patent Application 440,304, Commissioner's Decision #1141, May 17, 1989 Review of Final Action Rejection /Patentability /Section 28.3 of the Patent Act
A request by the Clorox Company for review by the Commissioner of Patents of the Final Action on an application filed on November 2, 1983. The invention relates to the form of a charcoal briquet and a method of forming it in a particular configuration to obtain a burn phase after an ignition phase has provided visual ash over a predetermined percentage of the area of the briquet. In the description, the inventor refers to two formulae which were developed to describe the geometric relationships between the surface area, volume and density of the briquet. In the Final Action, the Examiner rejected the application for lack of invention in view of US 1,258,849 and GB 392,015. Also, the Examiner rejected the application for lack of patentable subject matter under s. 2 and s. 28.3 of the Patent Act. The Examiner also argued that the shape of the briquet is not new and the method of constructing it is obtained by the process of calculation. The Examiner referred to various decisions to support the rejection of the application as non-patentable subject matter, including Lips (1959, R.P.C., pp. 36-37), a Commissioner's decision published in CPOR October 5, 1976, and Schlumberger (56 C.P.R. (2d) 204). In Lips, the judge said that a product does not have to be new for a claim to "[a] product…made by the process of claims…" to be patentable, The judge also added that the process by which the product is made, to be patentable, must contain physical steps that are novel in some way. In Lips the judge decided that the claimed invention was not an invention because the only novelty lay in some mental steps that are performed prior to the manufacture of the product. The CPOR decision stated that the process for making a new article must particularize novel physical steps rather than mental steps. In Schlumberger, the judge decided that the only novel feature of the invention lay in the discovery of some calculations and the mathematical formulae to be used in the calculations. The judge decided that the mathematical formulae must be assimilated to a 'mere scientific principle or abstract theorem' which is not patentable under s. 28.3 of the Patent Act.
The applicant argued that the invention is a briquet that is structurally defined in the claims, not a mathematical relationship between the various parameters of the briquet. The applicant argued that the claims are therefore patentable under s. 28.3. The applicant further argued that both Lips and CPOR October 5, 1976 are not applicable to the present case, because both cases pertained to novelty and did not deal with patentable subject matter. The applicant argued that the present case is different from Schlumberger because in the present case, the claims include physical steps which include producing the briquet having the specified dimensional relationships, whereas in Schlumberger the steps were entirely mental.
Held: The Patent Appeal Board agreed with the applicant's argument that the invention lay in the briquet and not in the mathematical formulae themselves, and that the patent application could not be rejected for lack of patentable subject matter. The Board, however, concluded that all of the claims are invalid, in that none of them clearly define the invention sufficiently, namely, none of them properly include both formulae that appear to be important to the invention.
3. Re Patent Application 2,149,244, Commissioner's Decision #1251, March 21, 2002 Review of Final Action Rejection/Section 28.3 Patent Act/Obviousness
A request by International Nitrogen Service for review by the Commissioner of Patents of the Final Action on an application entitled "Non-Cryogenic Production of Nitrogen for On-Site Injection in Downhole Drilling", filed on June 14, 1994. The application relates to a method of drilling oil, gas or geothermal wells in which an inert gas is used as a drilling fluid to remove drill cuttings from around the drill bit. The inert gas is preferably nitrogen, which is supplied on-site using a non-cryogenic source such as a membrane separation system. In the Final Action, the Examiner cited numerous references to reject all claims stating that the references teach that nitrogen rich inert gas may be produced on-site for use in oilfield operations using membrane separation technology. The applicant argued that the cited references illustrate many uses of nitrogen in the oilfield but that none suggests the use of non-cryogenically produced nitrogen as a drilling fluid.
Held: Final Action Rejection maintained. The applicant disclosed in the patent application that the use of nitrogen as a drilling fluid was known. Further, by 1990 membrane separation technology had been developed to a stage where nitrogen produced by membrane separation was being used in many applications. An unimaginative skilled technician would have known about the use of a gas as opposed to a drilling mud to clear out the bore hole. A technician would also have been aware of the possibility of causing explosions from sparks created by the drill bit cutting into the rock. A technician would have further known about the inert nature of nitrogen making it a suitable gas and the cited references would have led the technician to the concept of using membrane separation in a well drilling environment. The Patent Appeal Board felt that with this knowledge in hand, the technician would have been led directly and without difficulty to the alleged invention which is disclosed and claimed in the instant application. The refusal of the claims was affirmed for being obvious at the claim date and failing to comply with s. 28.3 of the Patent Act.
V. FOREIGN DEVELOPMENTS
PCT Time Limits
Japan and Slovakia have withdrawn their "notices of incompatibility" with respect to the amendment to PCT Article 22(1) of April 1, 2002, which required contracting states to provide a time limit of at least 30 months for national/regional phase entry in the PCT application process. Japan will apply a 30-month time limit, effective as of September 1, 2002. Slovakia will apply a 31-month time limit, effective as of August 1, 2002. In each case, the new time limits will apply to applications for which the former 20-month time limit has not expired prior to the respective effective dates, and for which the appropriate Article 22(1) submissions have not been filed.
