By: Jenna Wilson
A version of this article was published by LexisNexis in The Lawyers Weekly, 20 January 2012
In last month’s decision in Amazon.com v. Commissioner of Patents (2011 FCA 328), the Federal Court of Appeal provided no small comfort by confirming the primacy of claim language in evaluating the patentability of patent application claims and the patent eligibility of so-called “business method” inventions. At the same time, however, the decision will create uncertainty for patent owners and applicants as they wait to see just how the court’s reasons for judgment will be applied.
Amazon had arisen as a result of the Commissioner of Patents’ rejection of Amazon’s patent application for its “one-click” online ordering system and method on several grounds, including an exclusion of “business methods” from patentability, a claim analysis that seriously diverged from the purposive claim construction mandated by the Supreme Court of Canada, and an importation of a requirement of a “technological” contribution to the field of knowledge. The Federal Court returned the application for expedited examination by the Patent Office, ruling that business methods were not per se unpatentable, the “technological” requirement was overly restrictive, and that under a proper claim construction, Amazon’s claims recited patentable subject matter. On appeal, the various issues resolved to the high level questions of what analytical framework should be applied when determining whether a patent application should be refused on the basis of lack of patentable subject matter, and what constituted a patentable “art” or “process”, which Amazon’s application claimed.
On the first issue, the Commissioner argued that the analysis was based on what the inventors had “actually invented” independent of any construction of the patent claims, while Amazon supported an analysis based on a purposive claim construction. The Federal Court of Appeal ruled the analysis of patent-eligible subject matter did indeed require a purposive claim construction based on “the subject matter defined by the claim”, and not a divination of the inventor’s “actual invention”.
On the question of what constituted patentable subject matter, the court substantially agreed with the Federal Court’s conclusion based on the leading cases on patentable arts and processes, holding that the Commissioner’s requirement of a “technological” contribution to knowledge was “highly subjective and unpredictable in its application”, and that there was no Canadian jurisprudence that conclusively established that “business methods” could not be patentable.
Despite the comfort that comes with following established jurisprudence, however, these rulings left room for a certain amount of unpredictability. Although the court confirmed that purposive construction of the claims—which is a question of law—was the proper basis for patentability analysis, the court declined to construe Amazon’s patent application claims. The court stated that it was inappropriate for the lower court to have attempted a construction based on the record before it, because purposive construction requires knowledge of the state of the relevant art. In the patent office, the court noted, assistance regarding the state of the art comes to the Commissioner from the applicant’s submissions and the patent office staff, while courts generally require expert evidence. Since the lower court did not have the benefit of expert evidence, its construction was not necessarily well informed. This conclusion was viewed as somewhat surprising, given that the patent application file history itself would have included the patent examiner’s citations and explanation of the relevant prior art.
Also in its discussion of purposive construction, the court drew on examples in the Patent Act stating that novelty and non-obviousness of an invention must be assessed specifically with reference to the claimed subject matter, and concluded that while other statutory conditions for patentability—including patentable subject matter—did not expressly refer to “the subject matter defined by the claim”, there was no reason why the same defined subject matter should not be considered. But shortly after declaring the subject matter of the claim to be the basis of a patentability analysis, the court went on to state that “what the inventor has actually invented” was still a “relevant and necessary” question in the context of novelty, obviousness, and patentable subject matter.
Furthermore, on the subject of the patentability of business methods, the Federal Court of Appeal appeared to retreat from the fairly expansive definition of a patentable “art” based on the Supreme Court’s 1981 decision in Shell Oil Co. of Canada v. Commissioner of Patents, and proposed a new definition. Under Shell Oil, the courts had defined a patentable art as a new and innovative method of applying skill or knowledge to produce commercially useful results, provided the art was not merely a disembodied idea, but had a “method of practical application”; this teaching was applied by the lower court in Amazon. While the Federal Court of Appeal agreed that patentable subject matter must have a physical existence, or manifest a discernible effect or change—a requirement they tagged the “physicality” requirement—the court would not go so far as to agree that the physicality requirement was met by simply by the invention having a “practical application”.
The Federal Court of Appeal thus stopped short of finding Amazon’s invention patentable as the lower court had done, and provided the Commissioner another chance to examine the application based on a purposive construction and new guidance on patentability. However, given the potential relevance of the “actual invention” and the need for something more than a mere practical application in a claimed art or process, it is not clear how the Patent Office will approach the renewed examination of Amazon’s application, or the examination of other applications reciting business method-like inventions.