IP NEWS

Update on Amazon.com Decision: Federal Court of Appeal Refers Application Back to Patent Office

06/12/2011

The Patent Office has recently been tasked with revisiting its position in an ongoing dispute over the patentability of so-called “business methods” in Canada. On November 24, 2011, the Federal Court of Appeal (FCA) issued its decision in The Attorney General of Canada and The Commissioner of Patents v. Amazon.com, Inc., the latest appeal of a Patent Appeal Board (PAB) decision in 2009 which had denied patent protection to a “one-click” shopping system and method used by the online retail company Amazon.com, Inc. (Amazon). The scope of Amazon’s claims covered a system and method for exchanging customer information between a client machine and a merchant server in order to allow a user to buy an item at the client machine using user account information previously recorded on the merchant server.

In the decision, the FCA ordered the Commissioner to perform an expedited examination of the patent pursuant to the further guidance provided by the FCA, without specific directions as to allowance. The October 2010 Federal Court decision of Justice Phelan was set aside, essentially replaced by the FCA decision.

The FCA outlined the analytic framework which is to be applied by the Commissioner to determine when a claim would constitute patentable subject matter. The claims are to be analyzed using a “purposive construction”, that is, the identification of which elements of the claims would be considered “essential” to those skilled in the art. Based on this purposive construction, a determination is to be made whether the claim qualifies as one of the categories as outlined in s. 2 of the Patent Act, namely an art, process, machine, manufacture or composition of matter, or improvements thereof.

Of note is the FCA’s comment that when performing the claim construction, the Commissioner is to have “a mind open to the possibility that a novel business method may be an essential element of a valid patent claim”.

The FCA referred to the importance of the language of the Patent Act when assessing what should qualify as a patentable subject matter. For example, the creation of new “exclusions” or requirements to patentability were rejected in favour of the language as found in the Patent Act.

Using this framework, the Commissioner is ordered to perform his own assessment based on a purposive construction of the claims, and make the determination of allowance or rejection of the patent application in issue. In doing so, the court has left the door open to applicants seeking patent protection for inventions including novel business methods or software.

This article is for information purposes only and does not constitute legal or professional advice.

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