Patent disclaimers: use with caution

In a unanimous decision released on 19th July 2010 the Federal Court of Appeal confirmed a 2009 Federal Court ruling which held that a disclaimer cannot be used to broaden the scope of a patent and must necessarily result from a good-faith mistake, accident or inadvertence in the original patent specification.

This case related to electronic circuitry – more specifically, opto-couplers used in electronic alarm panels for isolating the circuitry from outside interference or electrical surges. The two patents in issue claimed certain allegedly novel means for isolating electronic circuitry, but failed to specify the manner in which the means were to be disposed in order to achieve the result promised in the patents. Shortly after the first of its two patents was issued, the patentee Paradox threatened to sue Tyco (then known as DSC) for infringement. DSC replied by alleging invalidity of the patent.

The matter appeared to end there, but three years later Paradox filed disclaimers against its patents (both of which had issued by then) in an attempt to overcome the objections raised years before by Tyco. In the litigation Paradox contended that the disclaimers narrowed the scope of the claims of its patents, but in fact the disclaimers added various elements to the claims to describe the disposition of the opto-couplers of the invention.

The trial judge held that the disclaimers were invalid, as were the underlying patents themselves, for various reasons. Three principal grounds were considered by the Federal Court of Appeal.

First, the Federal Court of Appeal held that a disclaimer cannot be used to add previously unclaimed inventive elements to the claims of the patent. The purpose of a disclaimer is to reduce the scope of a patent and not to broaden it or to change the point of invention as originally disclosed in the specification. As a result of this decision, patentees would be well advised to examine closely the language of a disclaimer which they are thinking of filing against a patent. The disclaimer must clearly disclaim matter already claimed and not seek to add or propose additional elements.

While addressing this subject, the Federal Court of Appeal made several observations on the nature of the “bargain” entered into between an inventor and the patent office in order to secure a patent. The court reiterated that this bargain lies at the very foundation of Canadian patent law. If a patentee wishes to widen the scope of a patent’s claim, the proper procedure is reissuance, which requires examination by the patent office, because the patentee is in effect seeking to re-open the bargain represented by the patent. The court confirmed that patentees cannot try to circumvent reissuance by the summary disclaimer procedure, in which there is no patent office examination.

Second, the Federal Court of Appeal confirmed the lower court’s ruling that if a disclaimer is challenged in litigation, it is incumbent on the patentee to establish that the disclaimer was filed because of “mistake, accident, or inadvertence” in the original specification. This language comes from Section 48.1 of the Patent Act and serves to ensure that the need for a disclaimer arises for good-faith reasons. The court implicitly confirmed that the relationship between inventors and the patent office must necessarily be predicated on good faith in order for the patent system to function properly. At trial, Paradox had not established to the judge’s satisfaction that there had been mistake, accident or inadvertence. The Federal Court of Appeal refused to reverse this finding and rejected Paradox’s suggestion that the standard for establishing such mistake, accident or inadvertence is low, such that any evidence would be sufficient to justify a disclaimer.

Finally, the Federal Court of Appeal confirmed in no uncertain terms that the filing of a disclaimer constitutes an admission that the original claims of the patent were too broad. The form which must be completed by a patentee when applying for a disclaimer under the Patent Rules contains a statement that the original claim was too broad. Paradox had argued that this statement was a mere formality and could not be considered an admission in law. Here again, the Federal Court of Appeal disagreed, stating that the filing of a disclaimer in the patent office is a “significant, formal, public act” which binds the patentee and cannot be resiled.

The consequences are draconian: if the disclaimer is ruled to be invalid, the patentee cannot revert to the original claim because in seeking to obtain the disclaimer, the patentee filed a formal document in which he or she admitted that the original claim was too broad and thus invalid.

The Federal Court of Appeal’s decision joins a growing body of Canadian cases on disclaimers and contains vital guidance for the future use of disclaimers in Canada. The lessons to be drawn by patentees from this case are many:

• If you are considering filing a disclaimer, be aware of the consequences: the disclaimer will be held to be an admission that the disclaimed claim was overly broad and thus invalid.
• Ensure that the claim or portion thereof which you seek to disclaim was originally claimed as a result of a good-faith “mistake, accident, or inadvertence” – and be prepared to establish the nature of such mistake, accident or inadvertence if challenged in court.
• Ideally, disclaimers should disclaim entire claims or portions thereof. In no event should you attempt to add additional elements which were not previously claimed.
• Although this was not discussed in the Federal Court of Appeal’s decision, act with diligence. Undue tardiness might suggest lack of good faith and invalidate the disclaimer or, failing that, might be a bar to equitable remedies for infringement of the disclaimed patent.