The Federal Court of Appeal (“FCA”) dismissed an appeal from a trial decision finding the claims at issue in a patent infringement case to be invalid for obviousness. In determining whether a person skilled in the art would have discovered the prior art, the FCA upheld the Federal Court’s (“FC”) application of a reasonably diligent search standard. The decision serves to caution companies that they should consider performing a reasonably diligent search of the prior art to prevent their patents from later being at risk of allegations of invalidity.
Background: Supertek Garden Hose Patent
Canadian Patent No. 2,779,882 (the “’882 Patent”), held by E. Mishan & Sons Inc. (“Mishan”), claimed a compact garden hose that expanded when water pressure was applied and contracted when such pressure was removed.  The hose was promoted for sale, predominantly through television commercials. Supertek Canada Inc., (“Supertek”) was a seller of as seen on TV products and supplied other hoses that embodied features of the patent. 
Mishan brought an action for injunctive relief and damages against Supertek. Mishan alleged that Supertek infringed the ‘882 Patent by marketing and selling hoses that incorporated the features of the ‘882 Patent. In response, Supertek alleged that certain claims of the ‘882 Patent were invalid due to obviousness.
The FC found that claims 1, 15, 28 and 42 of the ‘882 Patent were invalid for obviousness. In reviewing the prior art, the FC found that a person skilled in the art would have readily found and adapted a prior patent, US Patent No. 6.523,539 (the “McDonald Patent”), for a hose that expanded longitudinally when pressurized by using a pressure restrictor. Consequently, the FC dismissed the Mishan’s infringement claim. Mishan appealed the FC judgment on the grounds that the FC erred in selecting the McDonald Patent as part of the relevant prior art and in determining that claim 15 in the 882 Patent was obvious.
Prior Art: McDonald Patent
On appeal, Mishan argued that the McDonald Patent was not relevant prior art and would not have been found by the skilled person. Mishan contended that the test to determine what documents are to be included as relevant prior art is not based on whether a document was “findable” and, argued that the fact that the McDonald Patent was found by Superteks lawyer should not lead to a conclusion that it would have been found by the skilled person. The FC applied the test from Apotex Inc. v. Sanofi-Aventis, 2011 FC 1486, which held that the relevant prior art would include any document that the skilled person would locate by conducting a reasonably diligent search.  The FCA held that the finding of the FC that the person skilled in the art would have located the McDonald Patent in a reasonably diligent search was a finding of fact or mixed fact and law that would stand absent a palpable and overriding error.  The FCA found that the FC had sufficient evidence to find that the relevant prior art included the McDonald Patent and the FCA refused to interfere with the FC’s conclusion. 
Obviousness Analysis: Claim 15
Claim 15 of the ‘882 Patent read “the water hose of any of claims 1 to 14 wherein said hose is a garden hose.”  Claim 15 was dependent on claim 1, which described a two tube design for a water hose, with the outer tube being described as one made of “fabric material.” 
Mishan argued that the FC did not identify the inventive concept of claim 15 and did not correctly apply the test for obviousness as set out in Apotex Inc v Sanofi-Synthelabo Canada Inc, 2008 SCC 61.  The FCA found that although the FC did not explicitly recite the inventive concept of claim 15 as outlined in part (2) of the Sanofi test, the FC’s reasons revealed that the inventive concept was considered in assessing obviousness.  Mishan further argued that the FC erred in identifying all the differences between the prior art and claim 15 as outlined in part (3) of the Sanofi test. However, the FCA held that there was evidence to reasonably support the inference drawn by the FC that the differences between the McDonald Patent and what was claimed in the 882 Patent were obvious to the person skilled in the art. 
Decisions in other jurisdictions
The parties in this appeal were also involved in litigation in other countries, including Australia, France, the United Kingdom and the United States.  Mishan argued that the court should take cognizance of the United Kingdom and Australian decisions finding the counterpart patents to the ‘882 Patent to be valid and infringed. The FCA disagreed. The FCA held that those decisions were of little assistance as the FC decision was correctly based on the evidence before it and the law of Canada.