November 28, 2011

In its November 24, 2011 decision, the Federal Court of Appeal has ordered the Canadian Commissioner of Patents (the "Commissioner") to re-examine the "one click" patent application of Amazon.Com Inc. ("Amazon") on an expedited basis.  In doing so, the Federal Court of Appeal has affirmed that Canadian patent law does not exclude business methods per se from patentable subject matter.  Despite being patent pending for over 10 years, Amazon must still wait to see whether it can obtain Canadian patent protection for its "one click" method.

Earlier this year, we reported that the Commissioner appealed the Federal Court's decision to overturn its finding that Amazon's Canadian Patent Application No. 2,246,933, claiming the "one click" business method, was not statutory subject matter (see our earlier cases comments One-Click Has Its Day In (Canadian) Court and The Patent Office Appeals the Amazon Decision).  Filed in 1998, Amazon's application was directed to enabling a customer to purchase an item over the internet.  In 2004, a Canadian patent examiner rejected the claims on the basis of both obviousness and nonpatentable subject matter. Amazon subsequently appealed the Examiner's rejection.  The Commissioner ultimately accepted the findings of a Patent Review Panel, and overturned the Examiner's rejection on the basis of obviousness, but rejected the claims of the application for non-compliance with Section 2 of the Patent Act as non-patentable subject matter.

In overturning the Commissioner's decision, the Federal Court previously found that the Commissioner had erred by concluding, among other things, that the application's claims did not meet a technical or technological requirement for patentability.  In agreeing with the lower court, the Federal Court of Appeal stated that the Commissioner should be wary of devising or relying on tests that the Commissioner found to be implicit in the meaning of "art", "…even if they are intended only to summarize principles derived from the jurisprudence interpreting some aspect of the statutory definition of 'invention'. The focus should remain on the principles to be derived from the jurisprudence. Catch phrases, tag words and generalizations can take on a life of their own, diverting attention away from the governing principles."

Despite affirming that Canadian jurisprudence does not support business methods being unpatentable, the Federal Court of Appeal partially allowed the Commissioner's appeal, finding that the lower court inappropriately took it upon itself to perform the requisite purposive construction of the claims of the application.  According to Justice Sharlow, anyone "…who undertakes a purposive construction of a patent must do so on the basis of a foundation of knowledge about the relevant art, and in particular about the state of the relevant art at the relevant time."  Without benefit of such knowledge (i.e. expert evidence), the Federal Court was not in a position to undertake such an analysis.  As a result, the Federal Court of Appeal referred the construction of the patent claims back to the Commissioner.

Now, Amazon (and everyone else) will have to wait until the Commissioner completes its re-examination of the patent application to see whether any patent will issue, if at all.  On the other hand, we may see this matter appealed to an even higher authority.

Read more: And The Saga Continues: Amazon Sent Back To The Patent Office (authors: Isabelle Chabot and Alexandre Abecassis).