Hot on the heels of the US Supreme Court ruling in Bilski, the Canadians have jumped back on the business method bandwagon.
This is a significant result for Canada, noting that the recent Patent Office practice has been particularly unfavourable for business methods and various forms of computer implemented technology.
Historical Context
In 2009, the Canadian Patent Office Board of Appeals rejected Amazon's infamous "one-click" patent.
In essence, the Board's position was that, "since patenting business methods would involve a radical departure from the traditional patent regime, and since the patentability of such methods is a highly contentious matter, clear and unequivocal legislation is required for business methods to be patentable".
Following the Board decision, applicants encountered substantial difficulties in obtaining patents for various forms of computer implemented technology. Examiners would adopt a "form and substance" approach for assessing patentable subject matter, and require that "inventive" characteristics be technological in nature.
Not wanting to go down without a real fight, Amazon appealed the decision to the Federal Court.
Overview of Federal Court Decision
To summarise the decision in a few words: the Court saw nothing in the law to prevent business methods like that of Amazon from patentability.
The Federal Court threw out the "form and substance" approach, to a degree reprimanding the Commissioner for establishing new criteria for patentability above and beyond that which is set out in the legislation. Furthermore, the Court noted that there was not, nor has there ever been, legislative provisions preventing the patenting of business methods.
The Court suggested the following test for assessing patentable subject matter:
(ii) It must be a new and inventive method of applying skill and knowledge.
(iii) It must have a commercially useful result.
The court went on to confirm that it was not necessary for material objects to be physically altered. Accordingly, there is scope to protect business methods and the like without necessarily requiring implementation via a computer or the like.
The Court also rejected the Commissioner's requirement for the "inventive" subject matter (i.e. that which differentiates an invention from the prior art) to be technological in nature. In the Court's view, no such requirement existed in Canadian law, and it was not within the Commissioner's jurisdiction to introduce one. After all, it is not the place of the Patent Office to mandate policy decisions in relation to patentability; that is for the legislature.
Practical Ramifications
In a nutshell, when it comes to patentability of business methods, software, and other computer implemented technology, Canada is now one of the greenest pastures. The new liberal standard for assessing patentable subject matter brings Canada back into close alignment with Australia and the US and, noting cultural similarities between the jurisdictions, that can only be a good thing.
It seems unlikely that the Office will appeal the Federal Court decision, so this applicant-favourable situation is likely to persist for quite some time.
Of course, the position on what constitutes patentable subject matter will continue to develop differently between jurisdictional boundaries. It is possible to deal with the associated risks through the active and careful development of a patent portfolio. And, of course, that is something with which Shelston IP is well placed to assist.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
