Over the last few months the Federal Court of Appeal has dismissed three appeals in cases where:
- an agent inadvertently failed to pay maintenance fees on time and a later letter, sent unaware of the lateness or any notice of abandonment and purporting to pay the maintenance fees, could not be construed as a request for reinstatement;
- the applicant failed to pay maintenance fees at all and could not later try to revive the application by using the saving provision for top-up payments meant for insufficient payments under the small entity/large entity classification; and
- an agent inadvertently failed to respond to all requisitions for information made by the Commissioner, no notice of abandonment was sent to the applicant and no response to the requisition was given in the 12-month reinstatement period. In all three cases the result was the permanent loss of the patent applications.
One of the cases seems relatively straight forward. In Harry O. Wicks v. Commissioner of Patents, 2008 F.C.A. 96, fees were not paid and a notice of abandonment was given. No attempt was made to pay until long after the expiration of the reinstatement period and the applicant could not fit within the intended scope of s. 78.6(1), enacted to relieve against the effects of the Dutch Industries case1 to assist applicants, who before February 1, 2006 inadvertently paid small entity fees when large entity fees should have been paid by giving a year to make a top-up payment. The Court reasoned that not paying fees at all is not the same thing as not paying enough, and so 78.6(1) did not apply and the patent was lost.
To the lay inventor, the other two cases might appear more problematic. In each case, the agent made an inadvertent mistake. No notice was given by the Patent Office that there was a problem until it was too late and when attempts were made to fix the mistake it was said to be too late and that nothing could be done. What was it about the Patent Act that led to those results?
In Actelion Pharmaceuticals v. Commissioner of Patents 2008 F.C.A. 90, the patent agent made a clerical error regarding the filing date by about a year and therefore also about the date upon which maintenance fee payments were due. A payment was missed and therefore the application was deemed abandoned by s. 73(1)(c) of the Patent Act. A Notice of Abandonment was purportedly sent by the Commissioner, but the applicant said it was never received.
Unaware of having missed the payment and with less than a month remaining in the 12-month reinstatement period allowed for abandoned applications, the agents sent in the maintenance fee with a standard letter that included the language:
The Commissioner is hereby authorized to debit any additional fee or credit any overpayment associated with this communication directly from or to our deposit account…
The Patent Office replied after the reinstatement period had expired that because the payment had been missed and a request for reinstatement plus the maintenance fee and a late payment fee had not been made in the prescribed time, the application was dead.
The Patent Act requires that the applicant make the requisition for reinstatement, pay the maintenance fee and the late fee before the expiry of the 12 months from the date of the missed payment.
The Court could not construe the agent's letter as a request for reinstatement because the section requires an express request, whereas the implicit construction sought would mean that the Commissioner would have to infer that corrective actions be taken for whatever problem may threaten the status of the application.
The Court concluded that the onus is on the applicant to comply with the Patent Act and even the absence of the usual Notice of Abandonment did not alter that onus. Maintenance fees are to discourage proliferation of deadwood patents by requiring applicants to take steps to keep applications in good standing. The Commissioner has no discretion regarding reinstatement if the procedure is followed, so it was concluded that this is a strict, predictable regime that will result in the application becoming irretrievably abandoned if the applicant fails to take the proper steps.
Compare that to DBC Marine Safety Systems Ltd. v. Commissioner of Patents, 2008 F.C.A. 256. In the first Office Action report, the Examiner requested certain amendments to comply with the Actand Rules and also requested identification of prior art cited in corresponding U.K. and U.S. applications.
The U.S. prior art was already in the application or readily available online at the U.S. Patent and Trademark Office website. The applicant had no connection to the U.K. application; it was referenced in another pending Canadian application for a similar invention. Just saying that the applicant did not have the information on the U.K. application would have been enough to comply.
The Patent Act, s. 73(1)(a), deems applications abandoned if the applicant does not make a good faith reply to a requisition within six months. Prior to the Examiner's report in this case, Patent Office practice was changed in response to frequent failures to reply properly to prior art requisitions, and notice was given that complete silence regarding any requisition within the Examiner's report would mean that there was not a good faith response to that requisition and the application would be deemed abandoned.
The agent responded just days before the six-month deadline addressing the requested amendments, but made no response to the prior art request. The failure to respond to the second requisition was purely accidental. Nevertheless, it caused a deemed abandonment and the 12-month reinstatement period was started. The maintenance fee due a few months later was paid, but no notice was given that there was a deemed abandonment in effect. After the expiry of the reinstatement period and unaware of the deemed abandonment and expiry of the reinstatement period, the agent wrote to the Patent Office asking when the application would be examined. The Patent Office responded that a Notice of Abandonment had been filed, but there was no evidence that it was ever sent. It bore a date beyond the reinstatement period. Normal Patent Office practice was to notify the applicant within six months of a failure to respond to a part of an Office Action as a courtesy to allow corrections to take place in time to preserve the application or send a Notice of Abandonment if the six months had passed. This was not done in this case. The applicant, upon receiving the Notice of Abandonment, tried to reinstate the application, but the Commissioner refused, saying that there was no discretion to reinstate after the 12-month reinstatement period expired. The practice of notification is only a courtesy and the Patent Office accepts no responsibility for a failure to do so.
The Court found that the application became dead as a matter of law after expiry of the 12-month reinstatement period and that the Commissioner had made no reviewable decision to refuse reinstatement. The applicant argued that there was a failure of procedural fairness where the courtesy notices were not sent by the Patent Office in this case, although part of their usual practice was to do so.
The Court found that the Commissioner had no duty to provide notice that an application had not been reinstated where the statute clearly places the burden on the applicant to reinstate the application by following a specified procedure and paying certain fees.
This burden is not affected by usual Patent Office practice or its failure to follow it in a particular case.
The Patent Act confers a valuable statute-based monopoly on a patentee. In exchange for such exclusivity, the Act requires strict adherence to a set of obligations with the onus squarely on the applicant. The inventor and agent must be ever-vigilant to ensure that the application is maintained in good standing.