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Patent Pleading Particulars

In patent infringement litigation, sufficient particulars of how an infringer infringes a patent must be included in a patentee’s pleading. How much detail is required? In a recent Federal Court decision, the court struck the statement of claim and dismissed the case because not enough details of how the defendant infringed each of the asserted claims. In Mostar Directional Technologies Inc. v Drill-Tek Corporation et al., 2017 FC 575, on a motion to strike brought by a defendant, the Prothonotary struck the pleading and dismissed the case on the basis the statement of claim pleaded no material facts as to “how” the defendants infringed the claims.

A patent gives the owner the exclusive right to practice the claimed subject matter in the country that granted the patent. Practicing the invention involves making, using, selling the invention or authorizing others to practice the invention.

A patent infringement action may be brought whenever someone intrudes within this exclusive right. This can include both direct infringement or inducing others to infringe the patent.

All pleadings must include a certain level of details to support the allegations, as the Supreme Court has stated (2011 SCC 42 at 22). The allegations of the pleading define the scope of the discovery process and the issues for trial.

It is incumbent on the claimant to clearly plead the facts upon which it relies in making its claim. A claimant is not entitled to rely on the possibility that new facts may turn up as the case progresses. The claimant may not be in a position to prove the facts pleaded at the time of the motion. It may only hope to be able to prove them. But plead them it must. The facts pleaded are the firm basis upon which the possibility of success of the claim must be evaluated. If they are not pleaded, the exercise cannot be properly conducted.

This is embodied in the Federal Courts Rules, the procedural rules for the court where most patent infringement proceedings occur (see my earlier post, Where Should You Launch Your Intellectual Property Case), which states in Rule 174, that “Every pleading shall contain a concise statement of the material facts on which the party relies…”

For pleadings of patent infringement actions, the courts have identified two types of material facts that should be pleaded, as described by the court in Dow Chemical Co. v. Kayson Plastics & Chemicals, (1966), 47 C.P.R. 1 (Ex. Ct) at para. 27:

(a) facts by virtue of which the law recognizes a defined right as belonging to the plaintiff; and
(b) facts that constitute an encroachment by the defendant on that defined right of the plaintiff.

At a most basic level, this includes identifying the patent and the specific claims of the patent that are asserted, and the right to the patent held by the plaintiff. This is particularly important if the chain of title is not clear, or if the plaintiff is not the owner, but an entity ‘claiming under the patentee’ as permitted under Section 55(1) of the Patent Act.

Once the patent is identified, in this way, the plaintiff must also include allegations which identify the activities of the defendant which are alleged to amount to infringement of the patent. One practice is for the patentee to effectively repeat or paraphrase the language of the claims to describe the activities of the defendant. In Mostar, the Prothonotary comments that:

I agree with the Plaintiff that this Court has recognized that there is no hard and fast rule against a plaintiff pleading the language of the claims of the patents at issue in the proceeding in order to meet part (b) of the Dow Chemical test. Each case must be assessed on its own facts, the evidence presented and the exact wording of the patent and the statement of claim. In some cases, the wording of the claim is such that it can be used as a model to describe exactly what the defendant has done that constitutes an encroachment on the rights of a plaintiff.

The Federal Court has been pushing parties to be more pro-active about preparing, exchanging and filing claim charts mapping patent claim elements to the allegedly infringing product and to the prior art. See for example a May 2016 practice notice suggesting the exchange of claim charts 90 days prior to PM(NOC) hearings. Requiring more detailed particulars at the pleading stage could be part of this initiative.

In Mostar, the plaintiff had not included the claim language but according to the decision had listed the claims of the patents being asserted and the names of the defendant’s allegedly infringing products. This was found to be insufficient:

I reject the Plaintiff’s assertion that the identification of the Defendants’ model names and the enumeration of the claim numbers comprising the Asserted Claims are sufficient to enable the Defendants to know how they have allegedly infringed the Asserted Claims.

While the Defendants acknowledged that they could file a bare-bones pleading that simply denied all allegations made against them, a pleading of such a nature is not what is intended by the Court when it makes reference to the ability to plead over…

In Mostar, while the statement of claim was struck, and the case dismissed, the court did make the dismissal without prejudice to the plaintiff to file a new action should “new, non-speculative circumstances arise.”

An investigation of the asserted patents, the claim language and the potentially infringing products can help clarify the level of detail that can be included in the statement of claim. Steps such as buying or accessing a potential infringers products, detailed online research, using a private investigators, or preliminary judicial steps may be needed to obtain sufficient detail to reduce the risk of having the claim struck or the proceeding dismissed at the pleading stage.

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