Tuesday, July 31, 2012

Scott Miller Successfully Sets Aside a Decision of the Commissioner of Patent Office to Irrevocably Lapse a Patent

Tuesday, July 31, 2012
Scott Miller and the MBM Litigation Team successfully sets aside a decision of the Commissioner of Patents to irrevocably lapse a patent - not once but twice!

Repligen Corporation v. Canada (2012 FC 931) is the second time the Federal Court has told the Commissioner of Patents that it is necessary to consider how a patent applicant will be effected by its decision before the Commissioner exercises its discretion under s.8 of the Patent Act.

The Repligen decision is important for two reasons: (1) It clarifies what a clerical error is under s.8 of the Patent Act and (2) provides direction as to the discretion of the Commissioner of Patents.

In Repligen, the patent holder, through an annuity company made annuity payments but these payments were applied to a different patent. The annuity company submitted sufficient funds and the correct patent owners name but two characters in the patent number were inverted. The Patent Office declared that the Repligen patent had lapsed irrevocably.

In the Federal Court’s original 2010 judicial review of this matter, the Commissioner of Patents was ordered to reconsider the exercise of its discretion under s. 8 of the Patent Act. Justice Lemieux had found that the Commissioner failed to properly exercise her discretion by only considering two factors: the delay in seeking correction of a reversal of two digits in the patent number and any possible third party prejudice. The Commissioner’s decision was set aside and reconsideration of the correction request by a different Patent Office official was ordered.

In sending back the decision to the Patent Office at the time, the Federal Court had offered direction as to what the relevant factors to be considered, in addition to the two previously considered, ought to be:

  • the impact on Repligen, the Applicant;
  • the fact that Repligen's payment was received by the Commissioner and appropriated to another patent;
  • the fact that Repligen's payments were made on the due date;
  • the remedial scope of section 8 that would have the effect that the '486 patent never lapsed for non-payment;
  • the purpose and object of the maintenance fee provision in the Act;
  • the possible prejudice to third party rights ought to be based on actual evidence, not the likelihood that third parties would be affected;
  • the necessity to weight and balance all relevant factors before exercising her discretion.

The July 27, 2012 decision by Justice Near set aside a second refusal by the Commissioner to exercise her discretion. The Court determined that the Commissioner had erred in the weighting and balancing of relevant factors, as noted above. In particular, it was determined that too much emphasis was put on the due diligence required of the Applicant and that considering s.8 as an extraordinary remedy put an undue burden on the requesting party. When considering the correction of this clerical error, the Court emphasizes that the proper considerations ought to have accorded significant weight to the possible impact on the Applicant, a balancing of this impact with the possible prejudice to the affected third party patent holder, and in particular a realization that both the Applicant and the affected third party made efforts to comply with maintenance fee provisions and that such payments were made in furtherance of the purpose of the legislation: to defray the costs of the Patent office and avoid deadwood patents.

The Federal Court has sent the Commissioner’s decision back to be reconsidered by a different decision-maker within the Patent Office.

For more information please contact Scott Miller


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