Federal Court Adopts New Framework for Assessing Subject-Matter Eligibility and Directs CIPO To Use it
The Canadian Patent Act provides that no patent shall be granted for any mere scientific principle or abstract theorem. Computer algorithms are generally considered by the Canadian Intellectual Property Office (“CIPO”) as falling within this excluded category. For years now, CIPO has routinely refused patent applications for computer-implemented inventions as being directed to such excluded, or “non-statutory,” subject matter using a “problem/solution” approach.
Under the problem/solution approach, examiners first construe the claims of a patent application to determine what elements are essential. Under the prevailing jurisprudence, what is then required is to determine whether the essential claim elements amount to a practical application of the claimed solution; i.e., do they comprise a physical existence, or manifest a discernible effect or change? However, CIPO instead applies its problem/solution analysis, in which claim elements that are considered by CIPO not to contribute to solving a problem described within the description (and as such, not to comprise part of what CIPO considers to be the “actual invention”) are read out of the claim, whether deemed by CIPO to be essential or not. This approach has been regularly used by Canadian examiners to inappropriately distill claims to mere algorithmic steps, providing a basis for denying such claims.
The problem/solution approach was espoused by CIPO in its most recent practice notice, which was surprisingly issued in response to a Federal Court decision, Choueifaty v. Canada (Attorney General), 2020 FC 837, which expressly rejected the problem/solution approach.
We now have another decision. This one sets out a legal framework and directs CIPO to use it. Benjamin Moore & Co. v. Attorney General of Canada, 2022 FC 923 [“Benjamin Moore”] was an appeal from a decision of the Commissioner of Patents to refuse two patent applications filed by Benjamin Moore & Co., CA2695130 and CA2695146, on the basis that their computer-implemented claims for selecting colours comprised merely abstract steps and, as such, were non-statutory.
The Federal Court held that the Commissioner incorrectly applied the problem/solution approach, and remitted the Benjamin Moore applications to CIPO for reassessment. The Federal Court also instructed CIPO to use the following framework, proposed by an intervener, the Intellectual Property Institute of Canada:
a. Purposively construe the claim;
b. Ask whether the construed claim as a whole consists of only a mere scientific principle or abstract theorem, or whether it comprises a practical application that employs a scientific principle or abstract theorem; and
c. If the construed claim comprises a practical application, assess the construed claim for the remaining patentability criteria: statutory categories and judicial exclusions, as well as novelty, obviousness, and utility.
The Federal Court noted that the “practical application” requirement had been previously interpreted by the Federal Court of Appeal to mean that “because a patent cannot be granted for an abstract idea, it is implicit in the definition of ‘invention’ that patentable subject matter must be something with physical existence, or something that manifests a discernible effect or change.” (Benjamin Moore at para. [35], citing Canada (Attorney General) v. Amazon.com Inc., 2011 FCA 328 at para. [66])
The Federal Court also rejected the Respondent’s arguments that “the Court should decline to direct the Commissioner to adopt the Appellant’s interpretation of the jurisprudence, just as it should decline to direct CIPO to apply the proposed framework,” and “that the Practice Notice is an operational policy” which courts should generally refrain from reviewing. The Federal Court disagreed that CIPO’s practice notice is a mere policy, as “it sets out the approach to be followed by CIPO’s examiners.” (Benjamin Moore at para. [48]) The Federal Court further remarked that “the determination of the proper legal test to be applied is a question of law well within the purview of [the] Court.” (Benjamin Moore at para. [52])
Takeaways
While CIPO’s current problem/solution-based practice notice was issued after the Commissioner’s refusals of the ’130 and ’146 applications, it is expected that the Benjamin Moore decision will have some bearing on the practice notice, given the Commissioner’s reliance on the same approach in refusing the Benjamin Moore applications.
Furthermore, CIPO has shown a tendency in the past to base its practice notices on a misinterpretation of the law. In Benjamin Moore, the Federal Court has provided a clear legal framework with little room for misinterpretation. It is unlikely that a new practice notice will be issued while the decision is still capable of appeal, but the Benjamin Moore framework is now binding on Canadian patent examiners. Applicants should review the status of their existing Canadian patent applications and reconsider their approach to pending non-statutory subject-matter objections or whether applications recently abandoned on this basis should be reinstated.