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SMALL ENTITY STATUS CORRECTION
The Issue
According to the Federal Court of Canada, an error in claiming small entity status results in invalidity of the patent or application concerned. The issue is exacerbated by a flawed definition of "small entity".
The Opportunity
The Canadian Patent Act has been amended to provide a one-time "window of opportunity" (from February 1, 2006 to January 31, 2007) during which fees paid at small entity rate may be "topped up" to large entity rate.
Our Recommendation
Bereskin & Parr very strongly recommends that the opportunity be taken to top up all fees paid at the small entity rate, regardless of whether or not it is believed that small entity status was properly claimed.
Background
The Patent Act amendment (known as Bill C-29) is a result of case law (Dutch Industries) to the effect that patents issued on applications in respect of which small entity status was inappropriately claimed are considered invalid as having been abandoned for failure to pay the correct fees.
One of the judges of the Court of Appeal in the Dutch Industries case commented that: "no patent applicant or patent holder will dare to pay any fee on the "small entity" scale, because any error in the determination of small entity status could lead to the loss of all rights under the patent application and any resulting patent, unless the error is discovered and corrected within the statutory time limits for late fee payments."
Canadian law does not provide for correction of good faith errors.
Regrettably, Bill C-29 does nothing to clarify the definition of a "small entity". The Court of Appeal in Dutch Industries noted that there are several traps in the existing definition.
Against this background, Bereskin & Parr very strongly recommends that all applicants and patentees take the opportunity provided by this Bill to top up fees on all patents and applications that currently are in force.
The top up amount is the difference between the fees actually paid and the fees that would otherwise have been payable had small entity status not been claimed. Fees to be topped up pursuant to this Bill include the filing fee, the examination fee, the issue fee, and all maintenance fees, in addition, to any reexamination fee.
As a guide, typical top-up fees probably will average in the order of $1,000 Canadian, depending upon the age and payment history of any existing patent or application. Fees will range from $150, at a minimum, in an application which has just been filed, to about $2,000 at a maximum, for an application which was filed at the end of 1989, when maintenance fees came into force.
Should you wish to take advantage of this one-time opportunity, please provide us with your instructions in writing. We will be happy to provide a cost estimate on request.
Questions should be directed to the Bereskin & Parr professional you normally deal with, or you may contact Philip Mendes da Costa at pmdcosta@bereskinparr.com.
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