Federal Court of Appeal Overturns Federal Court’s Test for Patentable Subject Matter of Computer-Implemented Inventions

In a recent Canadian decision, the Federal Court of Appeal (FCA) rejected the Federal Court’s (FC) attempt to provide a general test for determining the patentable subject matter of computer-implemented inventions. Specifically, the FCA found that the FC erred in imposing a test that was not based on any binding authority.  The FCA remitted the patent applications at issue to the Commissioner of Patents (CP) for redetermination of patentability to be carried out on an expedited basis, in light of the most current version of the Manual of Patent Office Practice (MOPOP) and with the benefit of the FCA’s reasons.

Background

The case is an appeal by the Attorney General of Canada (AGC) from a decision of the FC that remitted two patent applications (CA 2695130 & CA 2695146) by Benjamin Moore & Co. (BMC) to the CP for redetermination of patentability with specific instructions. The patent applications relate to a computer-implemented colour selection system that allows users to visualize how different colours would look on a surface. The CP had rejected the applications as being directed to non-patentable subject matter under section 2 of the Patent Act, which defines an invention as “any new and useful art, process, machine, manufacture or composition of matter, or any new and useful improvement in any art, process, machine, manufacture or composition of matter”. The FC agreed that the CP had erred in applying a problem-solution approach to claim construction and assessment of patentable subject matter, but instead of remitting the applications without instructions, it imposed a three-step test proposed by the Intellectual Property Institute of Canada (IPIC), which was an intervener in the case. The test as set out in in paragraph 3 required the CP to: (a) purposively construe the claim; (b) ask whether the construed claim as a whole consists of only a mere scientific principle or abstract theorem, or whether it comprises a practical application that employs a scientific principle or abstract theorem; and (c) if the construed claim comprises a practical application, assess the construed claim for the remaining patentability criteria: statutory categories and judicial exclusions, as well as novelty, obviousness, and utility.

Issues

The main issue on appeal was whether the FC erred in setting out the test at paragraph 3 of its judgment and providing specific instructions to the CP on how to examine patent applications involving computer-implemented inventions. A secondary issue was whether BMC’s cross-appeal on the FC’s refusal to grant declaratory relief was moot or premature.

Outcome

The FCA allowed the appeal by the AGC and set aside paragraph 3 of the FC judgment. The FCA found that the FC erred in imposing a three-step test for determining the patentable subject matter of computer-implemented inventions. The FCA reasoned that the test was not based on any binding authority or established jurisprudence, but rather on submissions by IPIC, which were not fully tested or challenged by the parties. The test was also inconsistent with the SCC guidance on patentable subject matter. The FCA remitted the patent applications at issue to the CP for redetermination of patentability in light of the most current version of the MOPOP and with the benefit of the FCA’s reasons.

Additional Comments by the FCA

The FCA made several comments on the approach to be taken when considering the patentability of computer technology in its reasons.  However, in our view, the following comment at paragraph [86] may leave the door open for taking a fact dependent approach that may not follow the additional comments when considering computer implemented inventions.

As always, the determination of patentability is a highly fact specific exercise, and it is impossible to attempt to define the full spectrum of particular circumstances that may exist depending on the nature of a particular invention implemented by computer in these reasons. This is especially so, considering that the technology is becoming more and more complex with quantum technology and the advent of artificial intelligence.

For a detailed overview, visit: *Federal Court of Appeal Decisions: 2023 FCA 168