The Federal Court of Canada has ruled that the Canadian Intellectual Property Office (CIPO) cannot reverse its own decision to accept a reinstatement request if all of the requirements for reinstatement set forth in the Patent Act are satisfied, even if it subsequently realises that the reinstatement request was received from a person not authorised to make the request under the Patent Rules. However, the court also ruled that a subsequent refund of the reinstatement fee negated the reinstatement, resulting in irrevocable abandonment of the application.
Excelsior Medical Corporation v Attorney General of Canada (2011 FC 407) involved a Patent Cooperation Treaty application that entered the national phase in Canada on December 2 2002, naming Vasca Inc as the applicant. The national phase application was filed by a first Canadian firm, which was appointed as the applicant's patent agent and representative for service in Canada.
In September 2006 Vasca assigned the patent application to Excelsior Medical Corporation. A different firm was selected to continue to prosecute the patent application on behalf of the new owner, Excelsior, and the file was transferred in early March 2007. At the time of the file transfer, the application had fallen provisionally abandoned on July 10 2006 for failure to pay the fifth anniversary maintenance fee. In order to reinstate the application, a request for reinstatement would have to be filed by July 10 2007, accompanied by payment of the overdue maintenance fee and a reinstatement fee.
On July 9 2007 the new firm filed a letter with CIPO requesting reinstatement and submitting payment of the required reinstatement and maintenance fees. However, the reinstatement request letter does not appear to have been accompanied by a formal appointment of the new firm as the new patent agent of record.
By way of background, Section 6(1) of the Patent Rules states that:
"Except as provided by the Act or these Rules, for the purpose of prosecuting and maintaining an application the Commissioner shall only communicate with, and shall only have regard to communications from, the authorized correspondent."
The term 'authorised correspondent' is defined in Section 2 of the Patent Rules; generally, if a patent agent has been appointed before CIPO, that patent agent is the 'authorised correspondent'. Accordingly, for any pending Canadian patent application, only the appointed patent agent of record can pay a maintenance fee to CIPO. In order to revoke the appointment of the current patent agent and appoint a new patent agent, Section 20 of the Patent Rules requires that a notice of the revocation and appointment be signed by the applicant and submitted to the commissioner of patents.
However, in Excelsior CIPO initially accepted the reinstatement request and fee payments submitted by the new firm, even though the new firm was not the 'authorised correspondent'. CIPO's official copy of the reinstatement request letter filed by the new firm was stamped to indicate that the reinstatement request had been approved on July 19 2007, and on August 8 2007 CIPO mailed a notice of reinstatement to the former firm, which was still the patent agent of record.
Two weeks later, on August 22 2007, CIPO purported to retract its decision to accept the reinstatement request. CIPO sent a letter to the former firm advising that the previous notice of reinstatement should be disregarded because the reinstatement request and maintenance fee were not submitted by the authorised correspondent. On the same date, CIPO wrote to the new firm to the same effect and offered to refund the maintenance fee and reinstatement fee payments upon request.
On December 10 2007 the new firm requested that the fees be refunded and CIPO issued the requested refund on June 18 2008.
On December 23 2009 the new firm filed a letter with CIPO, including a formal appointment of the new firm as the associate patent agent, which would have made them the "authorized correspondent" for the application. The letter stated that the document was intended "to reflect the de facto appointment which was in place" on July 9 2007 when their initial reinstatement request had been filed.
On January 28 2010 CIPO wrote to the new firm advising that the application was "dead" and "beyond the point of reinstatement". Excelsior then filed an application for judicial review with the Federal Court of Canada.
The court noted that the previous Canadian judgments dealing with the payment of maintenance fees fell into two main categories:
- situations where there was no effort made to pay the required fees until after the expiry of the relevant time period; and
- situations where the fees were tendered within the relevant time period, but the commissioner refused to accept them because they were not tendered by the patent agent of record.
The court distinguished both of these categories of decision from the facts in Excelsior.
In the first category of cases the Federal Court of Appeal had held that if the statutory requirements for reinstatement set forth in Section 73(3) of the Patent Act were not satisfied by the applicable deadline, the application would have fallen irrevocably abandoned on the reinstatement deadline by operation of statute. The operation of the statute cannot be overridden by the erroneous issuance of a notice of reinstatement by the commissioner. However, those cases were distinguishable from Excelsior, in which the statutory requirements for reinstatement had been satisfied before the deadline, albeit by someone other than the "authorized correspondent" contemplated in the Patent Rules.
In the second category of cases, the Federal Court had upheld CIPO's right to refuse to accept maintenance fee payments improperly submitted by the applicant or by any party other than the patent agent of record. However, those cases were distinguishable on the grounds that in Excelsior CIPO had initially accepted the unauthorised party's reinstatement request, and the question then became whether CIPO could subsequently reverse that acceptance.
The court ruled in the applicant's favour on this point, holding that CIPO had no authority to reverse its own prior acceptance of the reinstatement request, even though it had been submitted by an unauthorised party. Accordingly, the application was held not to have fallen irrevocably abandoned on the July 10 2007 reinstatement deadline. Unfortunately, the court also held that the subsequent refund of the reinstatement and maintenance fees that had been requested and obtained by the new firm resulted in irrevocable abandonment as of the date of the refund. The court stated:
"In the present case, the letter tendering the maintenance fees (9 July 2007) was very specific as to the patent application in question and as to the fees to be paid. Once that letter and fees had been received and accepted by the Commissioner during the period where the application was alive, that was the end of the matter. The Commissioner had no authority to undo the situation.
However, that is not the end of the matter. In the letter of August 22, 2007 from the Patent Office to the firm that had paid the maintenance fee, the Office offered a refund upon request. In December 2007, that firm requested a refund. In June 2008, that refund was given. Therefore, there were no maintenance fees paid effective as of June 2008. The patent application was truly dead at that time when the refund was given."
Finally, regarding the attempt by the new firm in 2009 to file an appointment document reflecting their de facto appointment, which had been purportedly in place before the July 10 2007 reinstatement deadline, the court dismissed this as a "'Hail Mary' play" which had been rightly rejected by CIPO. The Federal Court of Appeal has previously ruled that "only an appointment or a revocation filed with the Commissioner… can operate a change and neither can take effect before being filed with the… Commissioner".
An appeal of the Excelsior decision is pending before the Federal Court of Appeal.
Meanwhile, patent applicants and their agents should carefully consider any request for a refund of an official fee, particularly any fees associated with reinstatement of an abandoned application, since such requests can preclude subsequent court challenges of CIPO's refusal to reinstate the application. Also, if responsibility for an application is to be transferred to a new patent agency firm, applicants should be diligent in ensuring that the new firm obtains an appropriate revocation and appointment document signed by the applicant and files it with CIPO, to give effect to the transfer, in advance of any applicable deadline.
For further information on this topic please contact Stephen J Ferance at Smart & Biggar/Fetherstonhaugh by telephone (+1 604 682 7780), fax (+1 604 682 0274) or email ([email protected]).