Knowledge & News

Impact of Covid-19 extensions on third party rights to use patents in Canada

20 May 2020

There is no denying the worldwide impact of COVID-19 and the resultant challenges faced by businesses. In view of these extraordinary circumstances, most patent related deadlines in Canada that were due on or after March 16th, 2020, have been voluntarily extended by the Commissioner of Patents to June 1st, 2020, with the possibility of further extensions if circumstances continue. While the current extension is well justified, the Commissioner’s authority to extend deadlines is limited. Canadian patent owners and applicants should be aware that the current extension will not delay the onset of third party rights when a maintenance fee or a request for examination was originally due before March 16th and has been missed. Additionally, it is an open question of statutory interpretation whether or not the current extension will delay the onset of third party rights when a maintenance fee or a request for examination was or is originally due between March 16th and May 31st, inclusive, and not addressed. If not delayed by the current extension, third party rights begin six months after the original due date for paying a maintenance fee or for requesting examination. It is, therefore, potentially risky to rely on the current extension to pay a maintenance fee or to request examination in Canada six months or more after the original due date.

Designated Days

The Commissioner has granted the current extension under subsection 78(2) of the Patent Act. This statutory provision enables the Commissioner to “designate” any day “on account of unforeseen circumstances and if the Commissioner is satisfied that it is in the public interest to do so.” The effect of a “designated day” is similar to a weekend or a recognized holiday – a time period fixed under the Patent Act or Rules, in respect of any business before the Patent Office, for doing anything that ends on a designated day is extended to the next day that is not a designated day, a weekend or a recognized holiday (see subsection 78(1) of the Patent Act). In view of the COVID-19 pandemic and resultant restrictions, the Commissioner has so far designated all days between March 16th and May 31st, inclusive.[1] As a result, most patent related deadlines have been extended to June 1st, 2020.

Notably, not all patent related deadlines in Canada are extended when ending on a designated day. The Commissioner has no power under subsection 78(2) to extend deadlines in respect of business that is not before the Patent Office, such as PCT deadlines and deadlines to appeal to the Federal Court.

Third Party Rights Generally

Third party rights allow for the use of a patented invention, and otherwise infringing acts, to be committed by a party who is not the patentee without infringement and, therefore, without liability and without prior permission. These rights are relatively new in Canada and are only triggered in specific circumstances set out in section 55.11 of the Patent Act.

Currently, third party rights are triggered if an applicant or a patentee fails to pay a maintenance fee or fails to request examination (and pay the associated examination fee) by the applicable prescribed date. Normal statutory provisions permitting late maintenance fee payments and late examination requests are explicitly not taken into account when determining if third party rights are triggered and when those rights begin. If triggered, third party rights begin six months after the day on which the maintenance fee or the request for examination was due under the relevant subsection of the Patent Act. The end of third party rights is beyond the scope of this article, but typically aligns with the day the missed maintenance fee or the missed examination request is subsequently submitted to the Patent Office with any applicable late fees.

Third Party Rights Triggered Before Designated Days

If a maintenance fee or a request for examination was due before the current period of designated days (i.e. before March 16th, 2020) and has been missed, third party rights will begin six months after the missed due date, regardless of whether those rights start on a designated day or not. The six month wait before the onset of third party rights is not a time period for doing anything before the Patent Office and, therefore, is not extended by the Commissioner’s authority to designate days under subsection 78(2) of the Patent Act. While the additional time provided by the normal statutory provisions for late maintenance fee payments and for late examination requests is also typically six months and would be extended when ending on a designated day, this extension to the normal statutory provisions for late maintenance fee payments and late examination requests does not affect third party rights. The beginning of third party rights is based on the day the maintenance fee or the request for examination was due under the relevant subsection of the Patent Act, without taking into account the normal statutory provisions for late maintenance fee payments and late exam requests.

Third Party Rights Triggered During Designated Days

The situation becomes more complicated, and less certain, if the original due date for a maintenance fee or a request for examination falls on a designated day and is missed.

As discussed above, the triggering of third party rights is explicitly tied to the prescribed dates set out in the relevant subsections of the Patent Act for maintenance fees and requests for examination, namely subsections 27.1(1), 35(2) and 46(1) of the Patent Act (the “fee and exam subsections”). Similarly, the six month wait before the onset of third party rights is explicitly tied to the day on which the maintenance fee or the request for examination was due “under [the fee and exam subsections]” (see subsection 128(d) of the Patent Rules, for example).

It is an open question whether or not an extension under subsection 78(1) of the Patent Act, which is not one of the fee and exam subsections, extends the prescribed dates in the fee and exam subsections themselves. Similarly, it is an open question whether or not extending the time period for paying a maintenance fee or for requesting examination, under subsection 78(1) of the Patent Act, extends the day on which the maintenance fee or the request for examination was due under the fee and exam subsections.

If an extension under subsection 78(1) of the Patent Act does not extend the prescribed dates in the fee and exam subsections themselves, and/or does not extend the day on which the maintenance fee or the request for examination was due under the fee and exam subsections, it would be possible for third party rights to be triggered and/or begin before a maintenance fee or a request for examination is ever due – for example, if the original due date fell on a designated day and more than the subsequent six months were also designated by the Commissioner under subsection 78(2) of the Patent Act.

In the view of these authors, an extension under subsection 78(1) of the Patent Act extends at least the day on which a maintenance fee or a request for examination is due under the fee and exam subsections, such that third party rights cannot begin before a maintenance fee or a request for examination is ever due.

However, until a Canadian court considers the effect of an extension under subsection 78(1) of the Patent Act on third party rights under section 55.11 of the Patent Act, the interaction of these statutory provisions will remain an open question. Accordingly, relying on an extension under subsection 78(1) of the Patent Act, such as the current extension granted in view of COVID-19, to pay a maintenance fee or to request examination six or more months after the original due date could give rise to third party rights and is potentially risky for Canadian patent owners and applicants.

[1] May 16th, 17th and 18th have not been designated by the Commissioner under subsection 78(2) of the Patent Act. However, these days are a weekend and a recognized holiday (Victoria Day) and have the same effect as if designated under subsection 78(2) of the Patent Act.

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Authors

Dane Smith

Dane Smith Associate Toronto (Canada) Canadian Patent Agent, Barrister and Solicitor

Rachael Taljaard

Rachael Taljaard Patent Agent Trainee Toronto (Canada)

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