Litigation / Foreign Patent Litigation / Canada

Patent Litigation in Canada

Summary

Canadian Federal Procedure and Provincial procedure outside Quebec follows that of England. However, differences exist in connection with amendments during proceedings and also in substantive law having regard to the nature of infringement.

Points in Substantive Law

Split Court System

The Canadian judicial system comprises two sets of courts: federal courts having jurisdiction throughout Canada and provincial courts. Both types of courts have jurisdiction over patent infringement actions but only the federal courts have jurisdiction over actions for impeachment (revocation) of a patent. This does not, however, preclude a defendant in an action brought in a provincial court from defending the action on the basis of invalidity of the patent being sued upon.

Licensee's Right to Sue

One peculiarity of the Canadian statute should be noted. While in most countries an exclusive licensee has rights to sue under a patent that is licensed to it, Canadian law somewhat unusually extends this right to all licensees.[1] If the patentee declines to enter the action as a co-plaintiff, he must be named as a co-defendant.

Nature of Patent Infringement

Canadian courts have adopted a "purposive construction" approach that provides for some degree of flexibility in claim construction. Infringement may be found even where the article or act in question falls outside the exact scope of the claim if the substance of the invention is taken.

The statute does not provide a remedy for contributory infringement, but induced infringement is actionable.

The traditional rule that contributory infringement was not actionable may, however, now be subject to change. It has for example bee held that it was an infringement of a patent claiming a combination of mechanical integers to sell such integers in unassembled form as a kit of parts.[2]

Case law indicates that sale or use in Canada of the product of a process covered by a Canadian patent is an infringement thereof.[3]

Infringement Actions

Court Procedure

Interlocutory injunctions may be issued but are not all that likely if the patent is new or its validity challenged. In deciding on whether to grant an interlocutory injunction the court will consider

Interlocutory actions are normally heard on the basis of affidavit evidence. The plaintiff must show that he has not delayed in seeking relief. In urgent cases, an order might be made ex parte but this is rare.

The plaintiff seeking the injunction must give a cross undertaking in damages in the event the case is decided against him at full trial.

Discovery proceedings in Canada depends upon the province in which the action is brought. Ontario, where most patent actions are brought generally follows English High Court procedure with each party being required to list and, subject to claims of privilege, make available to the other side the documents in its custody or control that are relevant to the issues pleaded (other provinces are more akin to the United States and allow a party to wait until it is asked before it has to produce documents). Limited deposition practice (called "examination") exists in Canada. Pre trial examination of a party, typically a designated officer, is normal and some jurisdictions may also allow pretrial examination of a non-party witness, for example an inventor.

One difference from English procedure that can affect the course of patent litigation in Canada lies in the question of possible amendment of the patent during litigation. In Canada amendment can only be effected by way of disclaimer or reissue proceedings brought in the Patent Office and not by way of a motion in the course of the infringement proceedings themselves.[5]

Damage awards in Canada are based on the plaintiff's actual loss. Unlike the position in England, the plaintiff cannot opt for an account of the defendants profits (unless this is in fact the only way in which one can obtain a measure of plaintiffs loss). The limitation period in Canada is generally 6 years, except in Quebec where a two year statute of limitation provision applies.

Infringement proceedings in Canada typically take two to five years to obtain a first instance decision.