With the world in the midst of the global COVID-19 pandemic, many organizations have transitioned their workforces to remote working. For some employees that may mean working outside of Canada to be closer to family members during the pandemic or to travel abroad for pleasure while continuing to work for the same organization. If an organization is interested in obtaining patent protection for a technology, having employees develop the technology outside of Canada may make the patent process more complex and may increase costs.

Foreign Filing Licenses

One very common patent filing strategy relied on by Canadian organizations is to first file a US provisional patent application to secure a filing date before proceeding to timely file either an international PCT application or regular patent applications in the jurisdictions where patent protection is desired. Depending on where the technology was developed or where an inventor of the technology resided while developing the technology, such filing strategy (or another filing strategy typically relied on by an organization) may not be automatically available.

Several countries place restrictions on where a first patent application for a technology may be filed based on where the inventors of the technology resided or where the technology was developed. Such countries include the United States, China, Russia, India, Spain, Italy, Portugal, Singapore, South Korea, Malaysia and Vietnam. Spain, for example, requires that a first patent application be filed in Spain if an invention is made in Spain. As another example, Vietnam requires that a first patent application be filed in Vietnam if an invention is made by a resident of Vietnam. Such requirements can in many cases be complied with by requesting a “foreign filing license” from the appropriate IP office and an actual first filing in those jurisdictions is not necessary. However, failure to obtain a proper foreign filing license and non-compliance with such requirements may invalidate a patent in at least the jurisdiction(s) whose requirements were not complied with.

To mitigate risk, organizations are encouraged to:

• work with their IP counsel to develop adequate policies which take into consideration the locations where their employees will be working;
• diligently document in which jurisdictions technologies were developed and where the inventors of those technologies resided while developing the technologies; and
• provide instructions well ahead of time to allow for foreign filing licenses to be considered and obtained (if required).

Execution of Documents

At various stages of the patent process it is necessary to execute documents (e.g. assignments, power of attorneys, etc.). Having employees who work outside Canada may make this more difficult.

It is good practice to have executed assignments from the inventors of the technology before a patent application for that technology is filed. With employees working abroad, it may take longer to obtain an executed assignment from them. Time differences may also make it more difficult to coordinate execution of documents.

Some documents need to be executed in person on an organization’s behalf. Some documents also need to be executed in the presence of witnesses and/or a notary. Not everyone will be comfortable or readily available to meet in person. A document may also need to be verified by a government authority, consulate, embassy, etc. These offices may not maintain regular hours during the pandemic or be readily accessible from an employee’s location.

It is important to allow for additional time to obtain executed documents. Furthermore, organizations should plan to designate at least one person as a signatory who has the authority to execute documents on behalf of the organization and who would be willing and available to meet in person.

Confidentiality

Confidentiality of a technology is always a concern and a patent application should ideally be filed prior to the technology being publicly disclosed. In many jurisdictions (e.g. Europe, China, etc.) it is not possible to obtain valid patent protection for a technology that has been publicly disclosed prior to filing a patent application. Some countries like Canada and the United States do provide a one-year grace period (i.e. a patent application can still be filed within one year of a public disclosure), however such grace period cannot be relied on for all jurisdictions.

With employees working abroad it can become more difficult to enforce an organization’s confidentiality policies. It may, for example, become unrealistic to enforce a strict organizational policy that all development of a technology must occur within the confines of the organization’s labs and that no information can leave the lab. It is important to regularly review and update an organization’s policies and agreements to ensure proper measures are in place to maintain the confidentiality of any important technologies. It is also important to educate employees who may have access to confidential information on the importance of keeping that information confidential and of the potential consequences of not doing so.

Concluding Remarks

The pandemic has changed how the world operates and works. Some employees may need to spend extended amounts of time outside of Canada. Others may choose to do so. Organizations should work with their IP counsel to ensure appropriate policies and procedures are in place to ensure that their patent objectives are not adversely impacted by employees who work abroad.

A recent decision from the Federal Court of Appeal addresses the extent of fair dealing as it relates to copyright, and whether tariffs set by copyright collectives are mandatory.

Background

York University (York) is a large university in Toronto. Access Copyright is a non-profit organization that represents a collection of copyright holders. In exchange for the payment of fees, Access Copyright grants licenses to businesses, universities, schools, and other groups to reproduce copyrighted works. These fees are then collected by Access Copyright and distributed to the copyright holders of the works.

Between 1994 and 2010, Access Copyright had a license agreement with York University under which professors at York were able to copy the works in Access Copyright’s collection in exchange for royalty payments. This license agreement was set to expire at the end of 2010.

In light of uncertainty regarding renewal of the license agreement, Access Copyright applied to the Copyright Board for an interim tariff, which was approved on December 23^rd 2010.

York initially complied with this interim tariff, but in July 2011 gave notice to Access Copyright that it wished to opt out of the tariff for the upcoming school year, beginning on September 1^st 2011.  Instead, York created its own fair dealing guidelines to assist members of the school in complying with s. 29 of the Copyright Act.   Under the guidelines, only ‘short excerpts’ could be copied. Short excerpts were defined by the university as 10% or less of a work, or no more than set threshold amounts of a work (no more than an entire encyclopedia entry, no more than an entire newspaper article or page, etc.). [1]

Access Copyright sued York, alleging that York had infringed copyright in works in its collection, and was therefore liable for the amounts due under the interim tariffs. York counterclaimed, seeking a declaration that all copying done pursuant to its guidelines represented fair dealing under s. 29 of the Copyright Act.

The Federal Court concluded that the tariffs imposed by Access Copyright were mandatory, and that York’s guidelines did not constitute fair dealing (2017 FC 669). This decision is an appeal from the Federal Court’s decision.

Fair Dealing

Fair dealing is an exception to copyright infringement, and is permitted by s. 29 of the Copyright Act, RSC 1985, c C-42, which reads:

Fair dealing for the purpose of research, private study, education, parody or satire does not infringe copyright.

What constitutes fair dealing is not defined in the Copyright Act. For this, one needs to turn to case law.

In 2012, the Supreme Court of Canada (SCC) released a decision (Society of Composers, Authors and Music Publishers of Canada v. Bell Canada, 2012 SCC 36) providing a two-pronged test for determining whether something is fair dealing:

The first is to determine whether the dealing is for the purpose of either “research” or “private study”, the two allowable purposes listed under s. 29.  The second step assesses whether the dealing is “fair”. (at para 13)

At the time of the SCC’s decision, research and private study were the only purposes permitted under fair dealing. Since then, education, parody, and satire have been added to s. 29 (Copyright Modernization Act, S.C. 2012, c. 20, s. 21).

To assess whether dealing is ‘fair’, the SCC in CCH Canadian Ltd. v. Law Society of Upper Canada, 2004 SCC 13 set out six considerations:

(1) the purpose of the dealing; (2) the character of the dealing; (3) the amount of the dealing; (4) alternatives to the dealing; (5) the nature of the work; and (6) the effect of the dealing on the work. (at para 53)

The Decision

The Federal Court of Appeal first addressed whether Access Copyright’s tariff was mandatory, and then went on to address whether York’s Guidelines constituted fair dealing.

Was the Access Copyright Tariff Mandatory?

The Court began by stating that although the copyright holders acting collectively under Access Copyright have no more legal rights than a copyright holder acting individually, the collective representation afforded by a large entity like Access Copyright gives copyright holders a significant advantage.

The Court performed a lengthy historical review of the relevant statutory provisions, and the context surrounding the historical changes made to these provisions. The Court concluded that the legislative intent remained substantially the same as it did in the early 20^th century, which was that “collective societies [such as Access Copyright] are not entitled to enforce the terms of their approved tariff against non-licensees.” (2020 FCA 77 at para 202)

In its analysis, the Court stated that “Acts of infringement do not turn infringers into licensees so as to make them liable for the payment of royalties” (2020 FCA 77 at para 205), emphasizing that there is a difference between paying royalties for a license, and paying damages for infringement. Since York had opted out of the license agreement, there was no consensual arrangement in place under which non-payment of a tariff could be enforced, and Access Copyright therefore could not enforce the tariff against York.

Were York’s Guidelines Fair Dealing?

To assess whether all copying pursuant to York’s guidelines constituted fair dealing, the Court reviewed the Federal Court’s finding for each of the six factors established by the SCC regarding what constitutes fair dealing, before assessing York’s arguments that those findings were incorrect.

The Federal Court of Appeal upheld the Federal Court’s conclusion that York’s guidelines were not fair dealing, and chose not to overturn its conclusion that the quantities of copies allowed by the guidelines went beyond what would be considered fair for educational purposes.

In its analysis, the Federal Court had stated that York’s guidelines could allow “numerous chapters [to] individually be segregated for use in different courses, effectively eviscerating the copyright protection on the book” (2017 FC 669 at para 311). Interestingly, the Federal Court of Appeal characterized this analysis as having “given more importance to a non-contentious point than it deserved…. In other words, the error may be palpable but it is not overriding” (2020 FCA 77 at para 279).

Since this was an appeal of a lower court’s decision, the standard of review for a finding of fact (such as whether the amount of the copying was trivial or significant) is whether there was a palpable and overriding error made by the lower court. The standard of review for a question of law is correctness. As York did not meet these standards by showing that the Federal Court had misunderstood or misapplied the law, nor did it establish that copying pursuant to its guidelines would qualify as fair dealing, the Federal Court of Appeal dismissed York’s appeal of the Federal Court’s decision that York’s guidelines were not ‘fair’.

Analysis

This decision is a significant setback for Access Copyright, calling into question the business model of organizations relying on tariffs like this.

This decision also confirms that educational institutions are not forced to pay tariffs in exchange for the use of copyrighted materials. Instead, fair dealing guidelines along with other licensing options (digital licenses, subscriptions, etc.) could be used to ensure copyright compliance.

One important takeaway of this decision is that it does not remove any of the rights that presently exist for copyright owners. When copyright is infringed, a copyright owner would still have recourse against an infringer. What this decision does affect, however, is the way that copyright compliance can be achieved by institutions.

On June 26^th 2020, both parties filed leave to appeal at the Supreme Court of Canada. [2]

[1]	York University, “Fair Dealing Guidelines for York Faculty and Staff (11/13/12),” 13 November 2012. [Online]. Available: https://copyright.info.yorku.ca/fair-dealing-guidelines-for-york-faculty-and-staff-111312/.
[2]	Supreme Court of Canada, “Supreme Court of Canada Bulletin of Proceedings,” 10 July 2020. [Online]. Available: https://scc-csc.lexum.com/scc-csc/bulletins/en/item/6906/index.do?q=39222.

 

Authors:  James Nottingham and Dana Turner-Ryan

 

Section 53.1 of the Patent Act

Section 53.1 of the Patent Act came into force on 30 October 2019 and contemplates the introduction of a patent’s prosecution history during claims construction. The relevant portion of the provision states:

Admissible in evidence

53.1 (1) In any action or proceeding respecting a patent, a written communication, or any part of such a communication, may be admitted into evidence to rebut any representation made by the patentee in the action or proceeding as to the construction of a claim in the patent if

(a) it is prepared in respect of

(i) the prosecution of the application for the patent,

(ii) a disclaimer made in respect of the patent, or

(iii) a request for re-examination, or a re-examination proceeding, in respect of the patent; and

(b) it is between

(i) the applicant for the patent or the patentee; and

(ii) the Commissioner, an officer or employee of the Patent Office or a member of a re-examination board.

This provision thus reverses longstanding Canadian jurisprudence rejecting the introduction of such extrinsic evidence in claims construction.

While a plain reading of the provision suggests that only the Canadian prosecution history is admissible and that it may only be introduced to rebut specific representations made by the patentee, the scope of the provision was unknown upon its enactment. Additionally, other jurisdictions like the United States have framed the use of prosecution history as “file wrapper estoppel”[1], whereby a patentee is blocked from recovering subject matter ceded via narrowing amendments to patent claims made during the prosecution of a patent. Whether Canadian courts would interpret Section 53.1 similarly was also unknown.

The Federal Court has now provided its judicial interpretation of Section 53.1 in three decisions and the scope of the provision has started to solidify. These decisions consider when recourse to the prosecution history is permissible and for what purpose, and whether foreign (i.e. non-Canadian) prosecution history is admissible.

Use of prosecution history is integrated in the claims construction process

In Bauer Hockey Ltd. v. Sport Maska Inc. (CCM Hockey) 2020 FC 624 [Bauer], the Court held that there are no requirements before considering prosecution history under Section 53.1. Grammond J stated that unlike in the United States where the use of prosecution history is described in terms of estoppel, section 53.1 expressly considers it in the context of claims construction. Further, he reasoned that since a patentee is always making representations to the court during patent litigation, reference to the prosecution history is “simply integrated in the interpretive process” of claims construction[2].

In this decision, the Court stated in its conclusion that the “interpretation put forward by [Bauer’s expert witness] is at odds with the language of the claims, seeks to ascribe a purpose that is not mentioned in the patent and cannot be reconciled with the prosecution history”[3]. Therefore, the Court indeed considered the prosecution history of the patent at issue, but it was not solely determinative in its claims construction analysis.

Foreign prosecution history is generally inadmissible

The issue of the admissibility of foreign prosecution history arose in Canmar Foods Ltd v TA Foods Ltd 2019 FC 1233 [Canmar] and Gemak v Jempak 2020 FC 644 [Gemak]. Both decisions generally interpreted section 53.1 as not substantially changing the existing state of Canadian patent law, which excludes the introduction of foreign prosecution history. However, in Canmar, a limited exception to this rule was contemplated.

In Canmar, the defendant argued that the US prosecution history of the patent at issue was admissible under section 53.1. Specifically, it was argued that the US prosecution history was admissible since the plaintiff had acknowledged in communications respecting its Canadian application that certain claims were amended to mirror those in its corresponding US application to overcome objections made by the US patent office[4]. Manson J stated that under “extraordinary circumstances”, such as when foreign prosecution history has been made part of the Canadian prosecution history, it may be admissible under section 53.1[5]. He further considered that the facts of this case constituted such circumstances[6].

However, the US prosecution history was not determinative in Canmar, as the Court held that “[r]egardless of the US Application prosecution history… the Defendant does not infringe the claims of the [patent at issue]”[7]. At least one commentator has considered that Manson J’s holding is thus obiter because the decision does not hinge on the US prosecution history, and further highlights that the US prosecution history is not actually referred to directly in the reasons[8].

Gemak also involved a defendant seeking to introduce the US prosecution history of the patent at issue in an infringement proceeding. Here, the Court found that section 53.1 was not triggered and that foreign prosecution history was inadmissible on the basis of statutory interpretation of section 53.1 and previous jurisprudence barring the introduction of foreign prosecution history[9]. Interestingly, Lafrenière J did not address Manson J’s holding in Canmar in this decision. However, it should be noted that the facts in this case may be distinguishable from Canmar because the plaintiff does not appear to have expressly acknowledged that a claim its Canadian application was amended to mirror that of a foreign application[10].

Practical considerations for patentees

In view of the decisions above, patentees and their patent agents should expect that the entire Canadian prosecution history of a patent will likely be considered under section 53.1 when courts construe patent claims. Increased care will thus be required during patent prosecution because it is less likely a patentee will regain ground ceded in the prosecution process.

Since there is some uncertainty at the Federal Court regarding the admissibility of foreign prosecution history where it is introduced as part of the Canadian prosecution history, the extent to which such prosecution history is admissible remains unclear. Therefore, it is likely prudent for patentees to be wary of expressly referring to foreign prosecution history, like in Canmar, while prosecuting a Canadian patent application.

 

Authors:  Leslie J. Chan and Dana Turner-Ryan

 

[1] The prosecution history of a patent is known as its “file wrapper” in the United States.

[2] Bauer at para 65.

[3] Bauer at para 113.

[4] Canmar at para 61 and para 70.

[5] Canmar at para 77.

[6] Canmar at para 70.

[7] Canmar at para 79.

[8] Sufficient Description, “Foreign Prosecution History Admissible under S 53.1 — or Is It?” 22 October 2019. [Online]. Available: http://www.sufficientdescription.com/2019/10/foreign-prosecution-history-admissible.html

[9] Gemak at paras 79-86.

[10] Gemak at paras 66-71.

The world has been in pandemic mode for more than eight months and researchers are working around the clock to find a vaccine against COVID-19. The New York Times reports that there are 38 vaccines in human clinical trials and at least 93 preclinical vaccines under active investigation in animals. Here are some patent updates tied to COVID-19 vaccines.

In China, the National Intellectual Property Administration issued its first COVID-19 vaccine patent to CanSino Biologics Inc. and the Academy of Military Sciences. The issued Patent No. CN111218459 describes Ad5-nCo, a vaccine that is based on human type 5 replication defective adenovirus. Ad5-nCo entered clinical trials in March. In May, Phase 1 safety trials showed promising results. In July, Phase 2 trials showed that the vaccine produced a strong immune response. The abstract of the issued patent reads:

…The vaccine uses the replication-deficient human type 5 adenovirus with combined deletion of E1 and E3 as a carrier, and uses HEK293 cells integrating the adenovirus E1 gene as a packaging cell line, and the protective antigen gene carried is an optimized design of 2019 new coronavirus (SARS‑CoV‑2) S protein gene (Ad5‑nCoV). After optimization of the S protein gene, the expression level in the transfected cells was significantly increased. The vaccine has good immunogenicity in mice and guinea pig models, and can induce the body to produce strong cellular and humoral immune responses in a short time…

In Russia, Gam-Covid-Vac, now renamed Sputnik V, has received a conditional regulatory approval pending positive results from its Phase 3 trials. The vaccine is patent pending and consists of two components, a recombinant adenovirus type 26 (rAd26) vector and a recombinant adenovirus type 5 (rAd5) vector, both carrying the gene for severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2) spike glycoprotein (rAd26-S and rAd5-S).

In the U.S., the U.S. Patent and Trademark Office has implemented a prioritized examination pilot program for certain COVID-19 related patent applications. Recently, a New York-based biotech company called Aquavit Pharmaceuticals, Inc. took advantage of the pilot program and filed a patent application for its self-administrable vaccine delivery method. The Chief Executive Officer, Sobin Chang, said that they are “in talks with multiple global scale pharmaceutical companies, vaccine makers, and major universities for collaborations and partnerships.”

Also in the U.S., an advanced vaccine mRNA-1273 is being developed by Moderna Therapeutics and the National Institutes of Health. The vaccine is based on messenger RNA to produce viral proteins in the body and has progressed to Phase 3 testing. In July, however, Moderna became tied up in some patent disputes over mRNA-1273. First, Moderna unsuccessfully challenged certain claims of an Arbutus Biopharma Corp. patent, which could have cleared out some of Moderna’s infringement concerns. Also, the National Institutes of Health may have filed an earlier patent application tied to mRNA-1273. In an August financial filing, Moderna says that “[they] cannot be certain that we were the first to make the inventions claimed in our patents or pending patent applications, or that we were the first to file for patent protection of such inventions, including mRNA-1273.”

 

**This article was originally published by The Lawyer’s Daily (www.thelawyersdaily.ca) a division of LexisNexis Canada Inc.

 

 

 

 

Patenting personalized medicine in Canada is a growth industry right now.  In a recent article in IAM’s Life Science 2020, two of our Oyen Wiggs lawyers,  Jennifer A Marles and Christina SW Kwok, provided their insights into what the future holds for this emerging area of medicine as it gains more traction.  Below is a summary of that article or you can download the full article as published.

Summary

Personalized medicine holds the future for healthcare delivery. Underpinning most personalized medicines are diagnostic methods, which rely on establishing a correlation between one or more biological markers and the existence of a specific disease or a response to a particular treatment.  Current administrative patent examination guidelines published by the Canadian Intellectual Property Office (the “CIPO”) create an obstacle for patenting certain diagnostic methods in Canada, and this has led to uncertainty as to the patentability of such technologies in Canada notwithstanding that there is no provision of Canadian law and no court decision that precludes patents from being awarded for such inventions.

Under the CIPO’s guidelines, whether a claim is considered patentable subject matter depends on how an examiner characterizes the problem that the claimed invention sets out to solve. In brief, if an examiner considers that the essential elements of a claim solve a “data acquisition problem”,  then the claim is considered directed to patentable subject matter. If an examiner considers that the essential elements of a claim solve a “data analysis problem”, then the claim is refused for being directed to non-patentable subject matter.

To avoid the negative outcomes created by the current guidelines, the best option for patent applicants is to try (where feasible) to characterize the problem to be solved as a data acquisition problem, rather than a problem that relates to how the data is analyzed or how insights obtained from the data are applied. The disclosure of a new analyte, or a new method of acquiring data about a particular analyte, are examples of a data acquisition problem.  The CIPO has, following these administrative guidelines, allowed patents for certain technologies in the diagnostics space that are aimed at addressing such data acquisition problems, demonstrating that with strategic crafting of the claims there may be some chance of obtaining a granted patent directed to certain diagnostic methods in light of these guidelines.

While the CIPO’s administrative guidelines are not considered to be in line with Canadian law and future guidance from Canadian courts will be required to gain further clarity as to the true patentability of such innovations in Canada, the recent Federal Court decision in Choueifaty v. Canada (Attorney General), 2020 FC 837 at the very least confirms that the CIPO’s guidelines are in error to the extent that they utilize a problem-solution approach to define the essential elements of the claims.  Thus, the process of challenging CIPO’s administrative guidelines is already underway.

For a more in-depth overview of CIPO’s current guidance on the examination of medical diagnostic methods and for some tips on how to draft claims most likely to be found patentable under the current guidance, you can download the full article below.