Money, money, money ! Federal Court of Canada rules on payment of maintenance fees by associate agent

2008-01-01

M
ONEY,MONEY,MONEY!FEDERALCOURTOFCANADARULESON
PAYMENTOFMAINTENANCEFEESBYASSOCIATEAGENT

A
LEXANDRASTEELE*
LEGERROBICRICHARD,
LLP
L
AWYERS,PATENT&TRADEMARKAGENTS
TheFederalCourtofCanadarecentlyreversedadecisionbytheCommissionerof
Patentsrefusingtoprosecuteapatentapplicationonthebasisthatthemaintenance
feeshadbeenpaidbyapersonwhoisnottheapplicantnorthepatentagentof
record.[SarnoffCorporationv.TheAttorneyGeneralofCanada,2008FC712,
HughesJ.,June6,2008].
TheFacts
SarnoffCorporationfiledaCanadianpatentapplicationin1999.Atthetime,thefirmof
Gowlingswasappointedasitspatentagent.Gowlingspaidallmaintenancefeesuptothe
fifthanniversaryofthepatentapplicationonbehalfofSarnoffCorporation.In2004,the
prosecutionoftheapplicationwastransferredtothefirmofDimockStattonwhopaidthe
sixthandseventhanniversarymaintenancefees.Thesefeeswerereceived,acceptedand
processedbytheCanadianPatentOffice.
Shortlyafterthepaymentoftheseventhanniversaryfees,DimockStrattonwasinexplicably
contactedandinformedbythePatentOfficethattherewasnorecordofitsappointmentas
agent,orassociateagent,despitethefactthattheonlineCanadianPatentsDatabaselistedthe
firmasagentforthispatentapplication.DimockStrattonwasfurtheradvisedbythePatent
Officeoftheabandonmentofthepatentapplicationbasedonthefactthatthemaintenance
feeswerenotpaidbytheappropriateperson.
DimockStrattonimmediatelyrequestedthereinstatementoftheapplicationanditre-
submittedtheseventhanniversaryfeesandpaidtheeighthanniversaryfees.ThePatent
Officeagainrespondedthatthefeescouldonlybepaidbytheauthorizedcorrespondent.
Sincethetwelvemonthperiodforreinstatementhadpassed,thepatentapplicationwasnow
deemedirrevocablyabandoned.Gowlings,theformeragentsforSarnoffCorporation,also
sentalettertothePatentOfficerequestingthereinstatementoftheapplicationandre-

©CIPS,2008.*LawyerwithLEGERROBICRICHARD,LLP,amultidisciplinaryfirmoflawyers,andpatentandtrade-
markagents.PublishedintheSeptember2008issueofWorldIntellectualPropertyReport.Publication
142.216.

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submittingtheseventhandeighthanniversaryfees,butthePatentOfficeagainrespondedthat
thereinstatementperiodhadexpiredandtheapplicationwasirrevocablyabandoned.
SarnoffCorporationappealedthedecisiontotheFederalCourtofCanada.Thequestionin
issuewaswhethertheCommissionerofPatentswascorrectindeemingthatthepatent
applicationtobeabandonedonthebasisthatthemaintenancefeeshadbeenpaidbyan
allegedlyimproperperson.
TheFederalCourtJudgement
JusticeHugheswasseizedoftheapplicationforjudicialreviewofthedecisionofthe
CommissionerofPatents.Themainissuebeingoneofinterpretationofthelaw,thestandard
ofreviewtobeappliedwasthatof“correctness”,thuspermittingtheFederalCourtto
substituteitsdecisiontothatoftheCommissionerofPatents.
TheCourtbeganitsanalysisbydefiningeachofthepersonslistedinthePatentActandwho
mayplayaroleduringthecourseofapatentapplication,forexamplean“inventor”,an
“applicant”,a“patentee”,a“legalrepresentative”,a“patentagent”,etc.ThePatentActalso
definesan“authorizedcorrespondent”who,accordingtolaw,istheonlypersonwithwhom
theCommissionerofPatentsshallcommunicateinrespectofanapplication.Anauthorized
correspondentiseithertheinventor,(providedthereisnoassignmentofthepatentrights),or
apatentagentorassociatepatentagent.Anyactcarriedoutbyapatentagentoranassociate
patentagentisdeemedtohavetheeffectofanactmadebyorinrelationtothepatent
applicant.Iftheinventorassignsitsrights,thentheassigneebecomesthenewapplicantanda
noticetotheeffectofthechangeinownership,aswellastheappointmentofanewagent
mustbesubmittedthePatentOffice.Furthermore,apatentagentmaydesignateanassociate
patentagent:anoticetothiseffectmustbesubmittedtothePatentOffice.Nothinginthe
PatentActstateswhenthenoticeofappointmentofapatentagent,orassociatepatentagent,
mustbefiledintothePatentOfficeandwhateffect,ifany,thismayhaveonanyactionsby
theapplicantoritsagentinrespectofmaintenancepayments.
Whereaninterpretationofastatuteorregulationwouldleadtoanabsurdresult,orunjust
consequences,thatinterpretationshouldberejected:DutchIndustriesLtd.v.Canada,[2003]
4F.C.67.
TheCourtfoundthattheevidencewasfarfromconclusiveastowhethertheDimockStratton
firmwasinfacttheagent,orassociateagent,forSarnoffCorporation.Inthiscase,Gowlings
hadappointedDimockStrattonasassociateagent.DimockStrattonthereafterpaidthe
maintenancefeeswhichwerereceived,acknowledgedandacceptedbythePatentOffice.
Surprisingly,thePatentOfficecouldnotexplaintoJusticeHugheswhyitswebsiteclearly
showedDimockStrattonasagentofrecordforSarnoffCorporationandwhyitrepeatedly
contactedthisfirmifthepositionwasthatDimockStrattonwasnottheappropriatepersonto
becommunicatingwiththePatentOfficeonbehalfofSarnoffCorporation.TheCourtfound
thatthecircumstancesofthiscaseweresufficienttodeterminethattheCommissionerof

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PatentshadactedunreasonablyinrefusingtoreinstateSarnoffCorporation’spatent
application.
JusticeHughesaddedthatanundulyrestrictiveapproachtocommunicationswiththePatent
Officeinrespectofpaymentsofmaintenancefeesdoesnotaccordwiththegenerally
acceptedlawsofagency.Inhisview,thepaymentofmaintenancefeesisaclericalmatter,
whichdoesnotrequiringanyparticularskill;theapplicantitself,ortheapplicant’snamed
agent,shouldbethereforebeabletopaythosefeesasitisultimatelyuptotheapplicantto
decidewhethertokeeptheapplicationaliveornot.TheCourtfurtheraddedthatthe
seeminglyminorfaultofhavingmaintenancefeesactuallypaid,receivedandrecordedbya
firmwhich,atthetime,maynothavebeenthepatentagent,orassociateagent,ofrecord
wouldresultinawhollydisproportionatelossofrightstoapatentmonopolyonthisbasis
alone.Asthefeeswerepaidinfullandontimebyoneagentratherthananother,thiswas
sufficientfortheCourttojustifyitsdecisiontosetasidetheCommissionerofPatents’
decision.
TheCourtthereforeorderedthatthedecisionofthePatentOfficedeemingSarnoff
Corporation’spatentapplicationtobeabandonedbesetasideandorderedthattheapplication
bereinstated.
Conclusion
Thiscaseservesasaremindertopatentapplicants,inventorsandagentsalikethatany
changesintitle,orinthedesignationofanagent,mustbeproperlyrecordedwiththePatent
Officewithoutdelay.AfollowupisalsorecommendedtoconfirmthatthePatentOfficehas
infactproperlyrecordedsuchchanges.Onewouldthinkthatthepaymentoffeesbyany
personshouldbesufficienttokeepapatentapplicationalive,butasthiscaseshows,
communicationswiththePatentOffice,whetherforfinancialorsubstantivematters,remains
limitedtothosewhohaveaninterestintheapplication.

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