Copperhead Industrial Inc v Canada (Attorney General), 2018 FC 311

This case touches on the scope of section 52 of the Patent Act (“section 52”). The Federal Court (“FC”) explained that an order under section 52 will correct an error or mistake made in the Patent Office (“PO”) records. Such an order will not, alone, alter the effective date of a Patent Purchase Agreement or Patent Assignment Agreement. [35]

The FC ordered the variance of PO records related to Canadian Patent No 2,614,533 (“533 Patent”) and Canadian Patent No 2,919,266 (“266 Patent”), to reflect the name of the legal owner of the patents, Copperhead Industrial Inc. (“Copperhead”). [1,7] The main issue for the FC was to determine whether Copperhead had presented enough evidence to demonstrate that the owner of Patents 533 and 266 had not been correctly identified in the PO records by inadvertence or mistake. [15, 21] The FC was satisfied that Copperhead was the intended owner of the patents in issue, and that the misidentification of the legal owner was the result of an honest misunderstanding. [33, 36]

Background

This section 52 application arose within the context of a separate action in which Copperhead alleges that Changer and Dresser Inc (“Changer”) infringed the 533 and 266 Patents. Charger argued that “002152706 Ontario Ltd”, which was registered as the owner of the patents in the PO records, is not a legal corporation. They submitted that Mr. Kaeseler, the inventor of the patents, remains the owner of the property rights in the patents. [11]

Copperhead made an application under section 52, seeking to vary all entries to the title of the 533 and 266 Patents. [1] Copperhead claimed that when it acquired ownership of the 533 Patent from Mr. Kaeseler, the assignment agreement mistakenly identified Copperhead by its Ontario corporation number, 002152706, instead of its legal corporate name. [2-3] The respondent in this matter, the Attorney General, did not oppose the application. The FC accepted submissions from Changer as an intervener. [6]

In its decision, the FC addressed three issues [15]:

1. Whether Copperhead’s application fall within the FC’s jurisdiction;
2. If the FC should order the variance of the PO records; and
3. If there is a requirement to identify an effective date of variation for the PO records.

An honest mistake does not deprive Copperhead of the right to be identified as the owner of the patents

The FC starts its analysis by noting that once a patent has been issued, the Commissioner of Patents does not have the discretion to amend or address errors. Section 52 gives the FC the jurisdiction to order that any entry in the PO records relating to the title to a patent be varied or expunged. [16]

In analyzing its jurisdiction, the FC acknowledged that it does noes not have jurisdiction under section 52 when the proceeding requires for the FC to determine the ownership of a patent. [19] The FC concluded that it does have jurisdiction to consider Copperhead’s application, as there is no question of contested ownership. The FC’s role in this case is to decide if there is enough evidence to conclude that the owner of the 533 and 266 Patents have been incorrectly identified in the PO records. [21]

The FC then addresses the main issue: whether it should order the variance of the PO records. Changer argued that non-hearsay evidence from the relevant invertors and assignors is required to succeed in a section 52 application. Changer adds that in this case, the only evidence in support of the application is from the sole director and president of Copperhead, and that the evidence provided about the inventor’s intentions at the time of the assignment is hearsay. [22] The FC did not agree, finding that case law does not establish that is the evidentiary standard Copperhead had to meet. Citing Qualcomm Inc v Canada (Commissioner of Patents), 2016 FC 499, the FC writes that affidavit evidence is not required from all parties in a section 52 application if the FC is otherwise satisfied that the relief should be granted. [23-24] The FC was satisfied that the assignment agreement demonstrates that Copperhead was the assignee of the 533 and 266 Patents. [31]

Finally, the FC disagreed with Changer’s argument that a date of variation is required under section 52, noting that Changer did not support this argument with any authority. The FC reiterated that the effect of an order under section 52 is to rectify a mistake. “An order under section 52 of the Act alone does not alter the effective date of a Patent Purchase Agreement or Patent Assignment Agreement or other underlying contractual documents and there is no requirement to identify an effective date for an order to vary or expunge.” [34-35]

Commentary

In this decision, the FC commented on the scope of section 52. The FC analyzed its jurisdiction to decide on the application because of Charger’s argument on the effective date of an amended assignment, implying that the FC’s determination may result in a variation or amendment to a contract. [20] This would have been problematic, because the FC does not have jurisdiction to hear an order under section 52 when it must determine proper ownership of a patent “through the application and interpretation of contract law principles”. [19] This was not such a case, because there was no question of contested ownership – the issue was whether there was a mistake in the PO records. [21] Moreover, the FC found that the order to vary the PO records will not alter the effective date of a Patent Purchase Agreement or Patent Assignment Agreement. [35] Consequently, the FC was well within its jurisdiction to order the variance.