671905 Alberta Inc. v. Q Max Solutions Inc.

671905 Alberta Inc. v. Q Max Solutions Inc.
Court (s) Database
Federal Court Decisions
Date
2001-08-15
Neutral citation
2001 FCT 888
File numbers
T-1227-96
Notes
Digest
Decision Content
Date: 20010815
Docket: T-1227-96
Neutral Citation: 2001 FCT 888
BETWEEN:
671905 ALBERTA INC. and
M-I DRILLING FLUIDS CANADA INC.,
Plaintiffs
- and -
Q' MAX SOLUTIONS INC.,
Defendant
REASONS FOR JUDGMENT
GIBSON J.:
INTRODUCTION
[1] These reasons follow the trial of an action wherein the plaintiffs claim the following reliefs:
(a) a declaration that claims 1-18 of Canadian Patent 2,101,884, as reissued the 24th of March , 1998 (the "884 patent"), are valid and have been infringed by the defendant;
(b) a permanent injunction restraining the defendant, by its officers, directors, servants, agents or other persons controlled by it, directly or indirectly from making, constructing, using or vending to others to use, or inducing, procuring, assisting or systematically engaging for its own profit in aiding and abetting others to make, construct, use or vend to others to use a water-in-oil invert emulsion drilling mud and associated methods, kits and uses described and claimed in claims 1-18 of the 884 patent, or otherwise to infringe the claims of the 884 patent;
(c) reasonable compensation from the time of laying open of the application for the 884 patent, namely, the 30th of September, 1993, to the date of grant of the 884 patent namely, the 16th May, 1995 and damages or profits made by the defendant thereafter as the plaintiffs may elect after discovery on a reference;
(d) an order directing the defendant to forthwith deliver up to the plaintiffs all water-in-oil invert emulsions as above described made after the 30th of September, 1993 or that they be destroyed and such destruction be confirmed under oath;
(e) pre-judgment and post-judgment interest;
(f) costs on an enhanced scale; and
(g) further and other relief.
[2] In its defence and counterclaim, the defendant seeks the following relief:
(a) that the plaintiffs' action be dismissed;
(b) a declaration that the manufacture, use and sale of the defendant's Q'Max Mud does not infringe any of the claims of the 884 patent;
(c) a declaration that the 884 patent and each and every one of the claims thereof are invalid and void;
(d) costs on the plaintiffs' action and on the defendant's counterclaim, including expert fees; and
(e) further and other relief.
[3] By consent order dated the 13th of January, 1997, this Court ordered that the trial proceed without adducing evidence as to the extent of any infringement of any right under the 884 patent, as to damages flowing from any such infringement or profits arising from any such infringement and that those matters be the subject of a reference in accordance with the Rules of this Court. Thus, at the trial before me, no evidence was adduced on the foregoing issues.
THE PARTIES
[4] 671905 Alberta Inc. (the "numbered company plaintiff") is a company incorporated pursuant to the laws of the province of Alberta with its head office in Calgary, Alberta. M-I Drilling Fluids Canada Inc. ("M-I Drilling Fluids") is a company incorporated pursuant to the laws of Canada, also with its head office at Calgary, Alberta. The numbered company plaintiff was the assignee from J.K.F Investments Ltd. and Hour Holdings Ltd. of the 884 patent. J.K.F. Investments Ltd. and Hour Holdings Ltd. had been in turn the assignees of the named inventors in the 884 patent, James K. Fleming and Harold C. Fleming.
[5] James K. Fleming and Harold C. Fleming were, at the time the 884 patent was applied for and when it was issued, substantial owners of Fleming Oil Field Services Ltd. and a division of that company, Reef Mud. They were also the principal managers and operators of Fleming Oil Field Services Ltd.
[6] From the date of issuance of the 884 patent until the 28th of May, 1998, Fleming Oil Field Services Ltd. had the exclusive license to make, use and sell the invention described and claimed in the 884 patent, first by oral arrangement and later by written license. On the 28th of May, 1998 the numbered company plaintiff assigned the 884 patent to Fleming Oil Field Services Ltd. Effective the 1st of July, 1998, Fleming Oil Field Services Ltd. was amalgamated pursuant to the Canada Business Corporations Act[1] with it's then sole owner, M-I Drilling Fluids Canada Inc. The amalgamated corporation continued as M-I Drilling Fluids.
[7] The defendant Q'Max Solutions Inc. ("Q'Max") is a company incorporated pursuant to the laws of the Province of Alberta with its head office in Calgary, Alberta.
THE PATENT
[8] The 884 patent is entitled "Invert Emulsion Drilling Mud". The application for the 884 patent was filed on the 4th of August, 1993 and was laid open for public inspection on the 30th of September, 1993. The patent was granted and issued on the 16th of May, 1995, corrected on the 16th of October, 1997 and reissued on the 24th of March, 1998. The corrections made the 16th of October, 1997 were technical in nature and were in no sense in issue in the course of the trial of this action. The reissue of the patent added an abstract and the following paragraphs immediately preceding the claims:
It will be understood from the foregoing description that the salt referred to therein as "hydrated nitrogen-containing complex salt" is a hydrated nitrogen-containing double salt as that term would be understood by one of ordinary skill in the art and the references to "complex salt" and "complex salts" will accordingly be understood as references to "double salt" and "double salts" respectively.
Further, in the following claims, "nitrogen-containing complex salt" will be understood as meaning "nitrogen-containing double salt".
[9] The use of the expressions "complex salt", "complex salts", and "nitrogen-containing complex salt" in the 884 patent as issued, without the explanation as to their meaning provided by the foregoing paragraphs, was a matter of some debate during the trial.
[10] The abstract of the 884 patent as reissued is in the following terms:
A water-in-oil invert emulsion drilling mud is prepared with a hydrated nitrogen-containing double salt, as a brine solution in the aqueous phase, to prevent the hydration of subterranean formation clays. Suitable nitrogen-containing double salts include double salts containing alkali metal, alkaline-earth metal and ammonium nitrates and nitrites. The nitrogen-based invert emulsion mud of the present invention eliminates the use of calcium chloride in the prior art invert emulsion drilling muds, thereby reducing the environmental impact of the drilling operation.
The first three claims of the 884 patent are in the following terms:
1) A water-in-oil invert emulsion drilling mud comprising an emulsifier, a surfactant, a clay, an alkaline substance and a hydrated nitrogen-containing complex salt for reducing or preventing hydration of subterranean formation clays, wherein the concentration of water in the mud is in the range of from about 5 to 50% by volume and the concentration of the nitrogen-containing complex salt is in the range of from about 5 to 80% by weight of the aqueous phase.
2) A water-in-oil invert emulsion drilling mud according to claim 1, wherein the nitrogen-containing complex salt is a hydrated ammonium calcium nitrate or nitrite.
3) A water-in-oil invert emulsion drilling mud according to claim 1, wherein the nitrogen-containing complex salt is ammonium calcium nitrate decahydrate.
[11] The 884 patent includes 18 claims in total. While, as indicated earlier in these reasons, the plaintiffs seek a declaration that all 18 claims are valid and have been infringed by Q'Max, in the memorandum of fact and law filed on behalf of the plaintiffs in this matter, the plaintiffs indicate that the claims in issue are claim 3, as quoted above, claims 4, 5 and 6 according to claim 3, claim 9 according to claim 7 or 8 relating to an improved step in a method of drilling a borehole in which, among other things, a water-in-oil invert emulsion drilling mud is supplemented with ammonium calcium nitrate decahydrate ("ACND"), claims 10, 11, and 12 according to claim 7 or 8; claim 15 according to claim 14, a kit for formulating a water-in-oil invert emulsion drilling mud comprising, among other components, ACND; and claim 18 relating to the use according to claim 16 of ACND in a water-in-oil invert emulsion drilling mud for reducing or preventing hydration of subterranean formation clays.
[12] For ease of reference, the 18 claims of the 884 patent are reproduced as Schedule I to these reasons.
BACKGROUND
[13] Drilling muds or drilling fluids have long been in use in oil and gas well drilling operations. They are of essentially two types; water-based muds and oil-based muds. The 884 patent relates to an oil-based mud.
[14] In drilling operations, oil-based muds are used to aid in removal of cuttings made by the drill bit from the borehole to the surface. They also aid in the control of subsurface pressures, in the prevention of hydration of absorbent strata such as shales, clays, salts and gypsums through which the borehole is drilled and more generally provide a protective and stabilizing coating to permeable formations. Traditionally, and to a large extent to this day, calcium chloride or sodium chloride is used in the aqueous phase of an oil-based mud in a solution that produces a water-activity level equivalent to that in the shales through which the borehole is drilled. It is this balancing of water activity levels that prevents hydration of the shales which is a highly desirable result contributing to the protection of the integrity of the drill hole.
[15] If the drilling mud effectively performs its functions, the cuttings that are produced by the drilling and brought to the surface in the drilling mud are individually of significant size and collectively represent a large volume. One of the challenges faced in a drilling operation is the disposal of the cuttings which, when they arrive at the surface, particularly where an invert or oil-based drilling mud is used, are coated by oil and a significant amount of the salt that is comprised within the drilling mud. The oil is not environmentally friendly. Similarly, where the salt is calcium chloride or sodium chloride, the salt itself is not environmentally friendly.
[16] One of the means of disposal of cuttings is what is referred to in the industry as "land farming". Land farming involves removing the top soil from an area surrounding the drilling operation, spreading the cuttings over that area and subsequently replacing the top soil over the area covered by the cuttings.
[17] During the 1980s, environmental concerns with the practice of land farming increased. In the same period, Fleming Oil Field Services Ltd., which, through its Reef Mud Division, formulated and supplied drilling muds to the industry, began to use a "fertilizer" grade or "commercial" grade calcium nitrate, first as a "tracer" and later as a flocculent in water muds. The product was obtained from its supplier to the Canadian west and American northwest, Norske Hydro. The product was marketed by Norske Hydro as "Calcium Nitrate". In fact, the product was more accurately described as ammonium calcium nitrate decahydrate (5Ca(NO3)2.NH4NO3.10H 2O).
[18] Harold Fleming, a witness at the trial and one of the controlling shareholders of Fleming Oil Field Services Ltd. at the relevant time, attested that he recognized that ACND was capable of contributing to the biodegradation of the oil that coated cuttings and at the same time was a fertilizer capable of contributing to re-vegetation following land farming. He testified that he instructed Richard (Rick) Smith, who was employed by the Reef Mud Division of Fleming Oil Field Services Ltd. from June of 1987 to December of 1992 in roles as laboratory manager and client liaison and products sale manager, to conduct tests to determine whether or not ACND was a viable alternative salt in the formulation of invert emulsion drilling muds. This testimony was not consistent with that of Rick Smith himself. More will be said of this shortly.
[19] In 1989, Mr. Smith conducted laboratory tests and literature reviews with positive results. In 1992, field tests were conducted at what came to be known during the trial as the "Morrison Well". The invert mud incorporating ACND performed satisfactorily in the field tests.
[20] The application for the 884 patent followed in the summer of 1993, after Rick Smith had left Fleming Oil Field Services Ltd. The product, which came to be known as "Envirovert", was successfully marketed by Reef Mud to, among others, Shell Canada Limited.[2]
[21] In the last iteration of the defendant's statement of defence, the defendant admits that it had manufactured and transported for it an invert mud, made using ACND, known as "Q'Max Mud" and that it sold the Q'Max Mud to Shell Canada Limited.
TESTIMONY REGARDING THE DEVELOPMENT OF ENVIROVERT
[22] As averted to in the immediately preceding paragraphs of these reasons, there was some conflict in the testimony regarding the development of Envirovert . Mr. Harold Fleming, one of the owners of Fleming Oil Field Services Ltd. who was at all relevant times active in the management and operations of the company, testified that the impetus for development of a more environmentally friendly invert emulsion drilling mud than those which employed calcium chloride or sodium chloride was his and that he instructed Rick Smith in the work that he did.[3]
[23] Rick Smith testified that the initiative was his and that, while at all times in the environment of a relatively small corporate office he kept Harold Fleming informed, the inventive ingenuity, if such there was, was his.[4]
[24] I prefer the version of events provided by Rick Smith to that provided by Harold Fleming. While Mr. Fleming's testimony was, in general terms, very helpful, it was decidedly lacking in detail. He acknowledged in the course of his testimony that his recollection of dates and of the sequence of events was not good. By contrast, I found the testimony of Rick Smith to be more direct, detailed and precise. On the basis of my preference, the following is a summary of events leading up to the application for the 884 patent.
[25] In the autumn of 1988, Rick Smith and a representative of a chemical supplier met. In the course of the meeting, Mr. Smith learned that another organization had tested the use of calcium nitrate in an invert mud, with some success and with the approval or support of an environmental authority.
[26] Further, in the autumn of 1988, Fleming Oil Field Services Ltd. received an inquiry regarding supply of calcium nitrate. Mr. Smith was tasked with finding an economically viable source of adequate quantities of calcium nitrate. He identified Norske Hydro. Based on the information obtained by Mr. Smith, Harold Fleming and his brother James secured a contract with Norske Hydro under which Fleming Oil Field Services Ltd. obtained the right to purchase fertilizer grade calcium nitrate and to repackage it using its own trade name. As earlier indicated in these reasons, the early uses for the calcium nitrate were as a flocculent and a tracer. Mr. Smith set out to identify other possible uses.
[27] At least partially based on information that he had earlier obtained, Mr. Smith undertook to carry out testing regarding the viability of using the fertilizer grade calcium nitrate, in fact, ACND, as a component of invert emulsion drilling muds. Initial laboratory tests were done using a mineral oil base. The tests showed promise. In the result, Mr. Smith followed up with literature-based research that confirmed the potential. Further consultation in April of 1989 also provided support for the technical and commercial viability of an invert emulsion drilling mud employing calcium nitrate in the water phase.
[28] Little transpired on the project between the spring of 1989 and the summer and autumn of 1992 except that environmental concerns matured and thus rendered the project more attractive. The field testing at the Morrison Well followed, once again with positive results. According to Mr. Smith's testimony, no testing was done in relation to the presumed environmental advantages in land farming flowing from the use of commercial or fertilizer grade calcium nitrate.
[29] In December, 1992, Mr. Smith's employment with Fleming Oil Field Services Ltd. ended although Mr. Smith was briefly retained on contract in the early months of 1993 to organize his research and development materials relating to an invert emulsion drilling mud made with commercial grade calcium nitrate. He testified that he was not advised that Fleming Oil Field Services Ltd. or Harold Fleming and his brother contemplated patenting the product.
[30] In the early months of 1993, Mr. Smith's replacement at Fleming Oil Field Services Ltd. prepared or oversaw the preparation of the application for the 884 patent. On the 4th of August, 1993, the application was filed naming Harold C. Fleming and his brother James K. Fleming as the inventors.
OTHER ISSUES IN THE TESTIMONY
[31] There was some debate as to whether ACND is "calcium nitrate". The witnesses who addressed the issue were, I am satisfied, unanimous in their view that ACND is not a "reagent grade" of calcium nitrate that would be used in a laboratory environment as "calcium nitrate". That being said, I am satisfied on the testimony before me that ACND is a "commercial grade" of calcium nitrate and would be generally known in the trade as such. The product obtained by Fleming Oil Field Services Ltd. from Norske Hydro was marketed by Norske Hydro as "calcium nitrate", notwithstanding the fact that it was generally acknowledged by the witnesses before me to be ACND. Harold Fleming in his testimony, clearly identified the product obtained from Norske Hydro, re-bagged and marketed by Fleming Oil Field Services Ltd., as "Envirofloc, calcium nitrate". He testified:
The calcium nitrate was the product that we called Envirofloc and it came from Norsk Hydro, a regular bag of fertilizer that we had been using which we called Envirofloc.[5]
Later in his testimony, Mr. Fleming stated:
The Envirofloc and the calcium nitrate are one and the same product because that is the product that we bought from Hydro. That was Envirofloc, calcium nitrate.[6]
The testimony of other fact witnesses before the Court was generally to the same effect, as was the testimony of certain of the expert witnesses. I am satisfied that, in this action, nothing turns on the fact that ACND is a commercial grade of calcium nitrate and not a pure or reagent grade.
[32] Some controversy also surrounded the question of whether or not ammonium nitrate remained in the aqueous phase of an invert emulsion drilling mud after mixing. The witness Darrel Nagel testified to "... a very strong odour of ammonium breaking out" when fresh invert emulsion drilling mud was pumped into storage tanks at a particular drill site and a "stronger" odour when the mud, having gone down the well, returned to the surface[7]. By contrast, the general burden of the expert testimony before me was to the effect that the ammonium nitrate comprised within ACND would be instantaneously transformed into an unstable hydrated form of ammonia gas during the mixing of the aqueous phase of the invert emulsion drilling mud.[8] I accept the testimony of the defendant's experts in this regard and refuse to be drawn into the speculation regarding the presence of ammonium, or an ammonia smell, in relation to fresh invert emulsion drilling mud at a particular site. Once again, I am satisfied that nothing turns on this aspect of the testimony.
THE ISSUES
[33] Counsel for the plaintiffs asserts that the issues in this action are the following[9]:
1. Construction of the patent
a) identification of the ordinary person skilled in the art;
b) interpretation of claim 3 and particularly the words "A water-in-oil invert emulsion comprising...a hydrated nitrogen containing complex salt for reducing or preventing hydration of subterranean formation clays wherein the nitrogen containing complex salt is ammonium calcium nitrate decahydrate...";
c) the meaning of "kit" in claim 15.
2. Infringement of the patent
a) whether the defendant's Q'Vert drilling mud, admittedly made and sold in Canada infringes claims 3-6. Defendant asserts it avoids infringement since it says:
i) adding CaCl2 to the product avoids infringement;
ii) the escape of ammonium ions as ammonia gas as the product is used after it is made and sold avoids infringement;
b) whether defendant infringed and induced infringement of claims 9-12 and 18;
c) whether defendant's manufacture and sale of its Q'Vert drilling mud infringed claim 15 in that a kit as claimed was used in such manufacture.
3. Remedies
a) whether plaintiff is entitled, at its election, to an account of the profits made by the defendant from its infringing manufacture, use, sale and inducing infringement;
4. Validity - Plaintiffs understand that the following issues are maintained:
a) inventorship and alleged material mis-statement in the petition contrary to s.53(1) [of the Patent Act];
b) anticipation by:
(i) disclosure by or through the applicant contrary to s.28.2(1)(a) by the plaintiff's use at the Morrison Well in September 1992;
ii) disclosure contrary to s.28.2(1)(b) by the patents and publications cited in Schedule A to the Defence.
c) obviousness contrary to s.28.3;
d) allegations of lack of utility;
e) allegations of insufficient disclosure;
f) allegations of ambiguity with respect to the term "kit" in claim 15.
[34] Counsel for the defendant describes the issues rather differently at page 11 of the Written Argument of the defendant where the following appears:
1) The Patent is void because it was issued to the wrong inventors and not to persons entitled to a patent, the whole contrary to what was stated in the Petition ... .
2) Plaintiffs do not have valid title to sue in this case.
3) The claims in the re-issued patent of 1998 are not identical to those in the original Patent. Based on the general principle of non-retroactivity, Plaintiffs have no right of action for past infringement under the former patent given that they do not fall within the strict boundaries of the only exception to this principle, which is found at Section 47(2) of the Patent Act.
4) The re-issued patent is void because the invention claimed is not novel nor inventive and, in the alternative, the claims are overly broad and cover salts which do not result in the benefit disclosed in the patent.
5) With respect to the action for infringement per se and in addition to the arguments with respect to validity and the right to sue retroactively for past infringements, Plaintiffs have not established, on a balance of probability, that the Defendant infringed any of the claims either directly or indirectly. [some citations omitted]
[35] While the foregoing statements are very different, I am satisfied that, in substance, they largely overlap. I would summarize the issues in the following terms: first, construction of the 884 patent; second, validity of the 884 patent; third, the right of the plaintiffs to sue on the 884 patent; fourth, infringement by the defendant of the 884 patent; and finally, reliefs. The analysis which follows deals with the issues I have identified in the order in which I have listed them.
ANALYSIS
1) Construction of the 884 Patent
[36] A patent specification is addressed to persons skilled in the relevant art. In Consolboard Inc. v. MacMillan Bloedel (Saskatchewan) Limited[10], Mr. Justice Dickson, as he then was, wrote for the Court at page 521:
In my view it is a well established principle that a patent specification is addressed, not to the public generally, but to persons skilled in the particular art. I am further of the opinion that s.36(1) does not impose upon a patentee the obligation of establishing the utility of the invention.
Subsection 36(1) of the Patent Act, as it then read, is the equivalent of section 34 of the current Patent Act[11] (the "Act") dealing with the content of a specification and the claims. The two are to substantially the same effect.
[37] Mr. Justice Dickson continues at page 523 on the same issue and quotes the following passage from The Canadian Law and Practice Relating to Letters Patent for Inventions[12]:
The persons to whom the specification is addressed are "ordinary workmen", ordinarily skilled in the art to which the invention relates and possessing the ordinary amount of knowledge incidental to that particular trade. The true interpretation of the patent is to be arrived at by a consideration of what a competent workman reading the specification at its date would have understood it to have disclosed and claimed. [emphasis added]
The foregoing quotation from Fox, as adopted by Mr. Justice Dickson, was again quoted with approval by Mr. Justice Binnie on behalf of the Court in Whirlpool Corp. v. Camco Inc.[13] who added at paragraph [71]:
"Ordinariness" will, of course, vary with the subject matter of the patent. Rocket science patents may only be comprehensible to rocket scientists.
While we are certainly not dealing with a "rocket science" patent here, nonetheless, there was a difference between the parties as to who constituted "ordinary workmen" skilled in the art for the purpose of interpreting the 884 patent.
[38] Counsel for the plaintiffs urged that I should find that the person skilled in the art is a drilling fluid technical engineer who works with field engineers and lab technicians to solve drilling problems as they arise.[14]
[39] Counsel for the defendant cited the following passage from Whirlpool v. Camco [15] at paragraph [74]:
While the hypothetical "ordinary worker" is deemed to be uninventive as part of his fictional personality, he or she is thought to be reasonably diligent in keeping up with advances in the field to which the patent relates. The "common knowledge" of skilled workers undergoes continuous evolution and growth.
[40] Against the foregoing, counsel for the defendant urged that the defendant's expert Thomas Mondshine got it right when he testified:
A person that's skilled in the art that understands the chemistry of, say, an oil mud composition where they are mixed [sic] them, they [k]now how to formulate and design, are aware and familiar with ingredients and what they do and what invert works and how to test them and what the tests mean. That's someone skilled in the art.[16]
[41] Against the authorities, I prefer Mr. Mondshine's example to that of Dr. Chenevert. I conclude that a "drilling fluids technical engineer", a specialized problem solver, would be overqualified in relation to the concept of an ordinary workman skilled in the art. Having so concluded, it was not in dispute before me that, against the knowledge and perceptions of an ordinary workman skilled in the art, the Court is required to look at the whole of the disclosure and the claims to ascertain the nature of the invention, being neither benevolent nor harsh, but rather seeking a construction which is reasonable and fair to both the patentee and the public[17].
[42] As earlier noted in these reasons, the use of the expressions "complex salt", "complex salts" and "nitrogen-containing complex salt" in the patent as issued, without the explanation as to their meanings provided in the reissued patent, was a matter of some controversy during the trial. Subsections 47(1) and (2) of the Act, dealing with the reissue of patents, read as follows:
47. (1) Whenever any patent is deemed defective or inoperative by reason of insufficient description and specification, or by reason of the patentee's claiming more or less than he had a right to claim as new, but at the same time it appears that the error arose from inadvertence, accident or mistake, without any fraudulent or deceptive intention, the Commissioner may, on the surrender of the patent within four years from its date and the payment of a further prescribed fee, cause a new patent, in accordance with an amended description and specification made by the patentee, to be issued to him for the same invention for the then unexpired term for which the original patent was granted.
47. (1) Lorsqu'un brevet est jugé défectueux ou inopérant à cause d'une description et spécification insuffisante, ou parce que le breveté a revendiqué plus ou moins qu'il n'avait droit de revendiquer à titre d'invention nouvelle, mais qu'il apparaît en même temps que l'erreur a été commise par inadvertance, accident ou méprise, sans intention de frauder ou de tromper, le commissaire peut, si le breveté abandonne ce brevet dans un délai de quatre ans à compter de la date du brevet, et après acquittement d'une taxe réglementaire additionnelle, faire délivrer au breveté un nouveau
brevet, conforme à une description et spécification rectifiée par le breveté, pour la même invention et
pour la partie restant alors à courir de la période pour laquelle le brevet original a été accordé.
(2) The surrender referred to in subsection (1) takes effect only on the issue of the new patent, and the new patent and the amended description and specification have the same effect in law, on the trial of any action thereafter commenced for any cause subsequently accruing, as if the amended description and specification had been originally filed in their corrected form before the issue of the original patent, but, in so far as the claims of the original and reissued patents are identical, the surrender does not affect any action pending at the time of reissue or abate any cause of action then existing, and the reissued patent to the extent that its claims are identical with the original patent constitutes a continuation thereof and has effect continuously from the date of the original patent.
(2) Un tel abandon ne prend effet qu'au moment de la délivrance du nouveau brevet, et ce nouveau brevet, ainsi que la description et spécification rectifiée, a le même effet en droit, dans l'instruction de toute action engagée par la suite pour tout motif survenu subséquemment, que si cette description et spécification rectifiée avait été originalement déposée dans sa forme corrigée, avant la délivrance du brevet original. Dans la mesure où les revendications du brevet original et du brevet redélivré sont identiques, un tel abandon n'atteint aucune instance pendante au moment de la redélivrance, ni n'annule aucun motif d'instance alors existant, et le brevet redélivré, dans la mesure où ses revendications sont identiques à celles du brevet original, constitue une continuation du brevet original et est maintenu en vigueur sans interruption depuis la date du brevet original.
This action was commenced by statement of claim filed the 24th of May, 1996, before the 884 patent was reissued. Reliefs are claimed by the plaintiffs in relation to time periods pre-dating the date of reissue. Thus, the impact of the foregoing subsections, if any, on the interpretation of the patent as originally issued, is a relevant consideration. More will be said about this, as well as the alleged ambiguity of the term "kit", in the context of my analysis on validity of the patent and, more particularly, in the context of a discussion of sufficiency, or insufficiency, of disclosure.
2) Validity of the 884 Patent
a) Presumption of Validity
[43] Subsection 43(2) of the Act reads as follows:
(2) After the patent is issued, it shall, in the absence of any evidence to the contrary, be valid and avail the patentee and the legal representatives of the patentee for the term mentioned in section 44 or 45, whichever is applicable.
[emphasis added]
(2) Une fois délivré, le brevet est, sauf preuve contraire, valide et acquis au breveté ou à ses représentants légaux pour la période mentionnée aux articles 44 ou 45.
[je souligne]
[44] In Diversified Products Corp. v.Tye-Sil Corp.[18], Mr. Justice Décary, commenting on an earlier iteration of the presumption of validity provision of the Act, wrote at page 359:
...in my view, the most accurate description of the presumption is that of Pratte J. (as he then was) in the case of Rubbermaid (Canada) Ltd. v. Tucker Plastic Products Ltd. ...:
It is clear however, that this section "deals only with the incidence of proof, not with the standard of proof. It shows on whom the burden lies to satisfy the court, and not the degree of proof which he must attain":... . Moreover, once the party attacking the patent has introduced evidence, the Court, in considering this evidence and in determining whether it establishes the invalidity of the patent, must not take the presumption into account. It cannot be said that the presumption created by s. 47 is, as a rule, either easy or difficult to overcome; in some cases, the circumstances may be such that the presumption will be easily rebutted, while, in other cases the same result may be very difficult or even impossible to obtain.
See also, Windsurfing Int'l Inc. v. Les entreprises Hermano Ltée... .
The onus, which was on the appellant, can therefore be put as follows: applying the tests applicable to the pleas of anticipation and obviousness, which are not easy tests to meet as we shall see, did the appellant prove, on the usual standard of balance of probabilities, that the patent was invalid as having been anticipated or as being obvious? [citations omitted]
[45] The defendants introduced evidence on five issues before me regarding the validity of the 884 patent. They are the following: first, anticipation; second, obviousness; third, lack of utility; fourth, insufficiency of the disclosure under which I will deal with alleged ambiguity in claim 3 and in the use in claim 15 of the term "kit"; and finally, material misrepresentation in the petition or "wrong inventor".
b) Anticipation or Lack of Novelty
[46] The relevant portion of subsection 28.2(1) of the Act reads as follows:
28.2 (1) The subject-matter defined by a claim in an application for a patent in Canada (the "pending application") must not have been disclosed
(a) more than one year before the filing date by the applicant, or by a person who obtained knowledge, directly or indirectly, from the applicant, in such a manner that the subject-matter became available to the public in Canada or elsewhere;
(b) before the claim date by a person not mentioned in paragraph (a) in such a manner that the subject-matter became available to the public in Canada or elsewhere;
...
28.2 (1) L'objet que définit la revendication d'une demande de brevet ne doit pas_:
a) plus d'un an avant la date de dépôt de celle-ci, avoir fait, de la part du demandeur ou d'un tiers ayant obtenu de lui l'information à cet égard de façon directe ou autrement, l'objet d'une communication qui l'a rendu accessible au public au Canada ou ailleurs;
b) avant la date de la revendication, avoir fait, de la part d'une autre personne, l'objet d'une communication qui l'a rendu accessible au public au Canada ou ailleurs;
...
"Claim date" as referred to in paragraph 28.2(1)(b) is defined in section 2 of the Act by reference to section 28.1. I will not pursue the definition of that term further because it was not in dispute before me that citations in issue, save in respect of use at the Morrison Well, were proper citations. Counsel for the plaintiffs urges that such use in September, 1992 was less than a year before the date of filing of the application for the 884 patent and therefore was not anticipatory. More will be said of this shortly.
[47] In Beloit Canada Ltd. et al v. Valmet OY[19], Mr. Justice Hugessen, for the Court, wrote at page 297:
The relevant statutory provision for the purpose of assessing the plea of anticipation in the present proceedings is para. 28(1)(b) of the Patent Act. That paragraph directs an inquiry as to whether the claimed invention is
28(1)...
...
(b) . . .described in any patent or in any publication printed in Canada or in any other country more than two years before presentation of the petition . . .
...
It will be recalled that anticipation, or lack of novelty, asserts that the invention has been made known to the public prior to the relevant time. The inquiry is directed to the very invention in suit and not, as in the case of obviousness, to the state of the art and the common general knowledge. Also, as appears from the passage of the statute quoted above, anticipation must be found in a specific patent or other published document; it is not enough to pick bits and pieces from a variety of prior publications and to meld them together so as to come up with the claimed invention. One must, in effect, be able to look at a prior, single publication and find in it all the information which, for practical purposes, is needed to produce the claimed invention without the exercise of any inventive skill. The prior publication must contain so clear a direction that a skilled person reading and following it would in every case, and without possibility of error be led to the claimed invention. Where, as here, the invention consists of a combination of several known elements, any publication which does not teach the combination of all the elements claimed cannot possibly be anticipatory. [emphasis added]
It is to be noted that Mr. Justice Hugessen, in the foregoing quotation, was commenting on anticipation or lack of novelty under the terms of a prior iteration of the Act that also contemplated anticipation or lack of novelty based upon prior public use or sale in Canada and that provided for a two year grace period.
[48] In Pfizer Canada Inc. v. Apotex Inc.[20], Mr. Justice Richard as he then was, after reciting the foregoing quotation from Beloit[21], as adopted by Mr. Justice Décary in Tye-Sil[22], commented on the reasons of Mr. Justice Décary, concurred in by Justices Marceau and Pratte, otherwise than on the issue of obviousness, to the following effect at page 553 of Pfizer:
He [Mr. Justice Décary] added... that when prior knowledge or use is alleged, "evidence of this character should be subjected to the closest scrutiny" and "anyone claiming anticipation on that basis assumes a weighty burden".
He [Mr. Justice Décary] cited the following principles which should be applied to determine whether the prior use or prior art anticipated the invention:
1) does it teach the combination of all the elements claimed;
2) does it give the same knowledge as the specification of the invention itself;
3) does it contain clear and unmistakable directions so to use it;
4) whatever is essential to the invention or necessary or material for its practical working and real utility must be found substantially in the prior publication; and
5) an impractical and inoperable device cannot be an anticipation.
[49] In Free World Trust v. Électro Santé Inc. et al[23], Mr. Justice Binnie writing for the Court, and after affirming the test for anticipation from Beloit as one that is "difficult to meet", continued at paragraph [26]:
The legal question is whether the Solov'eva article [here the cited prior art read separately, item by item] contains sufficient information to enable a person of ordinary skill and knowledge in the field to understand, without access to the two patents, [here the 884 patent] "the nature of the invention and carry it into practical use without the aid of inventive genius but purely by mechanical skill"... . In other words, was the information given by Solov'eva "for [the] purpose of practical utility, equal to that given in the patents in suit"? Consolboard Inc. v. MacMillan Bloedel (Sask.) Ltd.,... or as was memorably put in General Tire & Rubber Co. v. Firestone Tyre & Rubber Co.,...:
A signpost, however clear, upon the road to the patentee's invention will not suffice. The prior inventor must be clearly