Stuart Freen is a JD candidate at Osgoode Hall Law School
After a 12-year legal battle, Amazon may finally be able to get a patent in Canada on its “1-click” e-commerce system. The Federal Court granted an appeal in favour of Amazon last Thursday, completely overturning an earlier decision of the Commissioner of Patents. In what will be one of the most important Canadian patent cases of the year, Justice Phelan thoroughly rejected the notion that business methods are unpatentable subject matter and strongly rebuked the approach taken by the Commissioner.
The Patent Office originally rejected Amazon’s application way back in 2004. The Commissioner of Patents upheld that decision on appeal in 2009 on the basis that it was a business method (a category which she held was inherently unpatentable). The Federal Court rejected this finding, holding that there was no basis in Canadian law to support such an exclusion.
According to the Federal Court, the correct test for whether an invention is “art” under s. 2 of the Patent Act is: i) it must not be a disembodied idea but have a method of practical application; ii) it must be a new and inventive method of applying skill and knowledge; and iii) it must have a commercially useful result.
The Federal Court decision criticized the approach taken by the Commissioner of Patents on several issues, including claim construction. Justice Phelan wrote in his conclusions:
[78] The absolute lack of authority in Canada for a “business method exclusion” and the questionable interpretation of legal authorities in support of the Commissioner’s approach to assessing subject matters underline the policy driven nature of her decision. It appears as if this was a “test case” by which to assess this policy, rather than an application of the law to the patent at issue.
The Court ordered that the patent be re-examined with the direction that the claims constitute patentable subject matter.
The decision has already begun making an impact on the patent law bar. IP lawyer Richard Owens of Stikeman Elliott commented to the Globe & Mail that this decision is “the most important patent case in the last 10 years.” Howard Knopf of Macera & Jarzyna LLP was more measured, suggesting on his blog Excess Copyright that the decision will almost certainly be appealed due to the harsh tone taken by the Federal Court and the importance of the issues involved. A team of lawyers from McCarthy Tetrault have also weighed in with a case note on Barry Sookman’s blog.
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