Law Times

PAGE 12 New guidance on business-method patents 'troubling' Lawyer hopes Canadian Intellectual Property Office directive won't be last word FOCUS Office in December 2011 granted Amazon.com Inc.' A cation for a one-click shopping system that related to the place- ment of online purchase orders with a single mouse click. Although a U.S. patent s patent appli- the one-click feature had issued in 1998, the Canadian intellec- tual property office subsequently refused to issue one to Amazon. On appeal, Canada' for BY JULIUS MELNITZER For Law Times fter protracted and sometimes confusing litigation, the Canadian Intellectual Property Federal Court of Appeal rejected the board' the office to re-examine whether the one-click patent was "patent- able subject matter. s analysis and ordered after, it granted the patent. "The court specifically reject- ed CIPO's requirement that pat- " Shortly there- entable subject matter must have a technological component," says Michael Ladanyi of Heenan Blaikie LLP. "Unfortunately, the decision left some uncertainty as to how business-method patents would be handled both by CIPO and the courts going forward. But that's not to say the case " Appeal Board shocked the intel- lectual property community with a definitive statement against the patentability of business method s in Canada. The board also cat- egorically stated that previous decisions allowing business- method patents were wrong. But in November 2011, the s Patent hasn't added some clarity to the law. the Federal Court of Appeal saw the board' there was not and there had never s patent regime. In the Federal Court' s view, tional business-method patent exclusion" existed in Canada as a radical departure from the coun- try' Both the Federal Court and s ruling that a "tradi- There's lingering uncertainty around busi- ness-method patents, says Michael Ladanyi. been any categorical prohibition on such patents. Rather, the test for what was patentable was the one enunciated by the Supreme Court of Canada' just include "new processes or products or manufacturing tech- niques" but embraced "new and innovative methods of applying skill or knowledge provided they produced effects or results com- mercially useful to the public." Shell had set out three con- ditions that an invention must meet in order to be patentable: it had to be a method of practical application that was more than an abstract idea; it had to be a new and inventive method of applying skill and knowledge; and it had to have a commercially useful result. As it, Canadian patent legislation should be construed "in ways that recognize changes in tech- nology such as the move from the industrial age to the elec- tronic one of today. the Federal Court saw in Shell Oil Co. v. Commissioner of Patents. In that case, the top court stated that a patentable "art" didn't s 1982 decision business-method patents were patentable if directed to subject matter that met the general test of what constituted an "invention" under s. 2 of the Patent Act. " This meant A DAILY BLOGOF CANADIAN LEGAL NEWS WWW.CANADIANLAWYERMAG.COM/LEGALFEEDS to transform something mate- rial into another form to meet the subject-matter requirement in the act. It was irrelevant, then, that the goods ordered by the one- click method didn't themselves undergo some physical change. The Court of Appeal sub- Finally, it wasn't necessary stantially affirmed the Federal Court' entable subject matter. It ruled that no legal rationale existed for excluding business methods as potential patentable subject matter. The Court of Appeal also rejected the intellectual property office' s reasoning regarding pat- subject matter had to be scientif- ic or technological in nature and agreed with the Federal Court' s June 4, 2012 • Law Times stance that patentable view that what was "technologi- cal" was subjective and unpre- dictable and couldn't of itself be a bar to excluding certain inventions as patentable subject matter. But the decisions still left a s host of questions unanswered regarding the fate of individual applications for business-meth- od patents and the intellectu- al property office did little to alleviate the uncertainty when it released three draft practice notices in April 2012. The notic- es describe the way in which the office proposes to examine pat- ent applications going forward. "The draft guidelines in their current form are quite trou- bling, Bereskin & Parr LLP. According to Bousfield, " says Ken Bousfield of the direction from the Federal Court of Appeal has done little to moderate the office' to claims examination. "Undeterred by the law or s approach the clear rebuke by both the Federal Court and the Federal Court of Appeal, CIPO appears once again to be returning to its twice-rejected form-and- substance approach for evalu- ating patentable subject matter, rebranding it as a search for inventive concept," he says. More particularly, Bousfield objects to the office's posi- tion that an inventive concept must have a physical existence, manifest a discernible effect or change or provide a solution to a technical problem. "The emphasis on techni- cal is difficult to reconcile with the decisions in both the Federal Court and the Court of Appeal that Canadian law does not require that inventions be tech- nological, lines will not be the final word on the topic. But if they are, they may hasten further litigation." As it turns out, "Hopefully, the draft guide- " says Bousfield. bar may not be unhappy with that prospect. "The entire profession is the patent waiting for the Supreme Court of Canada to sweep away all the mess POWERED BY CANADIAN LAWYER & LAW TIMES LegalFeeds_1/2-4x_June4_12.indd 1 www.lawtimesnews.com 12-05-30 9:03 AM patentable subject matter," says that exists around Bousfield. "One only hopes that this LT badly muddled area of law will be corrected soon."

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