Wenzel Downhole Tools Ltd. et al. v. National-Oilwell Canada Ltd. et al.

• Jurisdiction: Federal Jurisdiction (Canada)
• Court: Court of Appeal (Canada)
• Judge: Nadon, Gauthier and Mainville, JJ.A.
• Citation: (2012), 443 N.R. 173 (FCA),2012 FCA 333
• Date: 10 October 2012

Wenzel Downhole Tools v. Nat.-Oilwell (2012), 443 N.R. 173 (FCA)

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[French language version follows English language version]

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Temp. Cite: [2013] N.R. TBEd. JA.024

Wenzel Downhole Tools Ltd. and William Wenzel (appellants) v. National-Oilwell Canada Ltd., National Oilwell Nova Scotia Company, National Oilwell Varco Inc., Dreco Energy Services Ltd., Vector Oil Tool Ltd. and Frederick W. Pheasey (respondents)

(A-477-11; 2012 FCA 333; 2012 CAF 333)

Indexed As: Wenzel Downhole Tools Ltd. et al. v. National-Oilwell Canada Ltd. et al.

Federal Court of Appeal

Nadon, Gauthier and Mainville, JJ.A.

December 20, 2012.

Summary:

Bill Wenzel was the named inventor and Wenzel Downhole Tools Ltd. was the registered patent holder of Canadian Patent No. 2,026,630 (the '630 Patent). The patent related to a "method of increasing the off bottom load capacity of a bearing assembly". The bearing assembly designed by Bill Wenzel was a piece of equipment intended for use in the drilling of oil and gas wells. Bill Wenzel and Wenzel Tools (plaintiffs) sued the defendants, alleging patent infringement through the manufacture and sale or rental of bearing assemblies that were identical in all material respects to those protected by the '630 Patent. The defendants, while conceding infringement, counterclaimed, alleging invalidity of claims 1 and 2 on the basis of anticipation, obviousness and inutility.

The Federal Court, in a decision reported 401 F.T.R 74, held that claims 1 and 2 of the '630 Patent were invalid either on the basis of anticipation or obviousness. Given those findings, the court did not consider the issues of utility or remedies. In the result, the plaintiffs' infringement action was dismissed and the defendants' counterclaim allowed and a declaration of invalidity granted. The plaintiffs appealed.

The Federal Court of Appeal dismissed the appeal, upholding the judge's decision that the patent was invalid for anticipation and obviousness. Manville, J.A., concurring in the result, disagreed that the trial judge's finding of invalidity on the basis of obviousness should be upheld.

Patents of Invention - Topic 1001

The specification and claims - General - The Federal Court of Appeal stated that "There are various ways of drafting a product claim. The so-called "Jepson claim" (or "German claim") is one ... this Jepson form is described as 'one which attempts to recite, at the beginning of a claim, elements that are shared with the prior art, and then to recite those features which the applicant has contributed to the art'" - See paragraph 49.

Patents of Invention - Topic 1032

The specification and claims - Construction of a patent - Particular patents - At issue was the infringement and validity of Canadian Patent No. 2,026,630 (the '630 Patent) - The patent related to a "method of increasing the off bottom load capacity of a bearing assembly" - The bearing assembly was a piece of equipment intended for use in the drilling of oil and gas wells - The trial judge construed the claims of the '630 patent - In particular, the judge held that the difference between Claim 1 which used the words "generally aligned" and Claim 2 which used the words "generally parallel" in defining a containment chamber was of no significance (i.e., they meant the same thing) - On appeal, the Federal Court of Appeal saw no reason to interfere with the judge's interpretation - See paragraphs 13 to 54.

Patents of Invention - Topic 1582

Grounds of invalidity - Lack of "inventive ingenuity" (obviousness) - Test for obviousness - [See Patents of Invention - Topic 1589 ].

Patents of Invention - Topic 1589

Grounds of invalidity - Lack of "inventive ingenuity" (obviousness) - Particular patents - Canadian Patent No. 2,026,630 (the '630 Patent), granted in 1994, related to a "method of increasing the off bottom load capacity of a bearing assembly" - The bearing assembly designed by the inventor was a piece of equipment intended for use in the drilling of oil and gas wells - The defendants asserted that the claims of the '630 patent were invalid, in that they were made obvious by a number of prior inventions - The trial judge opined that claims 1 and 2 of the '630 Patent were invalid for obviousness, referring to the "obvious to try" approach - On appeal, the Federal Court of Appeal ruled that the judge should not have referred to the "obvious to try" approach in this case - However, the court did not believe it should intervene where the judge undertook a careful and objective analysis of all the relevant factors - See paragraphs 91 to 107.

Patents of Invention - Topic 1602

Grounds of invalidity - Anticipation - Test for - The Federal Court of Appeal stated that the test for anticipation by disclosure through a product was an objective one - The court stated that becoming available meant that the public had an opportunity to assess the information that was the invention - It did not require that one actually took advantage of that opportunity - Once the opportunity was established as a fact, the court would apply the legal test for anticipation developed in Sanofi (SCC 2008) (full disclosure of all the essential elements of the invention and enablement) to the information that the fictional person of ordinary skill in the art would derive from the fictional examination - See paragraphs 67 and 68.

Patents of Invention - Topic 1605

Grounds of invalidity - Anticipation - Particular patents - The plaintiffs owned Canadian Patent No. 2,026,630 (the '630 Patent) related to a "method of increasing the off bottom load capacity of a bearing assembly" - The bearing assembly was a piece of equipment for use in the drilling of oil and gas wells - At issue was whether the claims were anticipated by a drilling motor referred to as the "3103 assembly", which was manufactured and rented to a third party for use in drilling an oil well in Texas prior to the filing date of the '630 Patent - The trial judge found that the bearing assembly described in claims 1 and 2 of the '630 Patent was anticipated by the 3103 assembly - Therefore, claims 1 and 2 were invalid - The Federal Court of Appeal refused to disturb the decision - The court discussed, inter alia, anticipation by disclosure in the case of rented items - See paragraphs 55 to 90.

Cases Noticed:

Sanofi-Synthelabo Canada Inc. et al. v. Apotex Inc. et al. (2008), 381 N.R. 125; 2008 SCC 61, refd to. [para. 9].

International Corona Resources Ltd. v. LAC Minerals Ltd., [1989] 2 S.C.R. 574; 101 N.R. 239; 36 O.A.C. 57, refd to. [para. 19].

Baker Petrolite Corp. et al. v. Canwell Enviro-Industries Ltd. et al. (2003), 288 N.R. 201; 2002 FCA 158, refd to. [paras. 19, 113].

Bauer Hockey Corp. et al. v. Easton Sports Canada Inc. (2011), 414 N.R. 69; 2011 FCA 83, refd to. [para. 19].

Weatherford Canada Ltd. et al. v. Corlac Inc. et al. (2011), 422 N.R. 49; 2011 FCA 228, refd to. [paras. 19, 113].

Lux Traffic Controls Ltd. v. Pike Signals Ltd., [1993] R.P.C. 107, refd to. [para. 22].

Windsurfing International Inc. v. Tabur Marine (Great Britain) Ltd., [1985] R.P.C. 59 (C.A.), refd to. [para. 31].

Pozzoli SPA v. BDMO SA, [2007] F.S.R. 37; [2007] EWCA Civ 588, refd to. [para. 31].

Housen v. Nikolaisen et al., [2002] 2 S.C.R. 235; 286 N.R. 1; 219 Sask.R. 1; 272 W.A.C. 1; 2002 SCC 33, refd to. [paras. 43, 114].

Folding Attic Stairs Ltd. v. The Loft Stairs Co., [2009] EWHC 1221, refd. to. [para. 56].

Synthon BV v. Smithkline Beecham plc, [2005] N.R. Uned. 180; [2006] 1 All E.R. 685; [2005] UKHL 59, refd to. [paras. 73, 119].

Beloit Canada Ltd. v. Valmet Oy (1986), 64 N.R. 287; 8 C.P.R.(3d) 289 (F.C.A.), refd to. [para. 102].

Calgon Carbon Corp. v. North Bay City et al. (2008), 375 N.R. 372; 64 C.P.R.(4th) 337; 2008 FCA 81, refd to. [para. 113].

Director of Investigation and Research, Competition Act v. Southam Inc. et al., [1997] 1 S.C.R. 748; 209 N.R. 20, refd to. [para. 114].

Diversified Products Corp. and Brown Fitzpatrick Lloyd Patent Ltd. v. Tye-Sil Corp. (1991), 125 N.R. 218; 35 C.P.R.(3d) 350 (F.C.A.), refd to. [para. 115].

Free World Trust v. Electro Santé Inc. et al., [2000] 2 S.C.R. 1024; 263 N.R. 150; 2000 SCC 66, refd to. [para. 125].

General Tyre and Rubber Co. v. Firestone Tyre and Rubber Co., [1972] R.P.C. 457 (C.A.), refd to. [para. 127].

Merrell Dow Pharmaceuticals v. H.N. Norton & Co., [1996] R.P.C. 76 (U.K.H.L.), refd to. [para. 134].

Gibney et al. v. Ford Motor Co. of Canada Ltd., [1967] 2 Ex. C.R. 279; 52 C.P.R. 156, refd to. [para. 156].

Authors and Works Noticed:

Chitty on Contracts (30th Ed. 2008), p. 238, ss. 33-063, 33-077 [para. 78, 152].

Cole, Paul, CIPA Guide to the Patent Acts (7th Ed. 2011), para. 2.06 [para. 129].

Hayhurst, William L., The Art of Claiming and Reading a Claim, in Henderson, Gordon F., Patent Law of Canada (1994), pp. 177 to 220 [para. 49].

Henderson, Patent Law of Canada (1994), pp. 177 to 220 [para. 49].

Smith, Patrick S., and Cameron, Donald M., The Supreme Court's Sanofi decision: three years later (2012), 27 C.I.P.R. 281, generally [para. 91]; paras. 24, 25 [para. 119].

Terrel on the Law of Patents - see Thorley, Simon, Miller, Richard, Burkill, Guy, and Birss, Colin, Terrel on the Law of Patents.

Thorley, Simon, Miller, Richard, Burkill, Guy, and Birss, Colin, Terrel on the Law of Patents (15th Ed. 2000), para. 7.11 [para. 129].

Counsel:

Timothy S. Ellam, Kara L. Smyth and Steven Tanner, for the appellants;

Kimberley Wakefield and Dennis Schmidt, for the respondents.

Solicitors of Record:

Ogilvie LLP, Edmonton, Alberta, for the appellants;

Fraser Milner Casgrain LLP, Edmonton, Alberta, for the respondents.

This appeal was heard at Edmonton, Alberta, on October 10, 2012, before Nadon, Gauthier and Mainville, JJ.A., of the Federal Court of Appeal. The decision of the court was delivered at Ottawa, Ontario, on December 20, 2012, and the following opinions were filed:

Gauthier, J.A. (Nadon, J.A., concurring) - see paragraphs 1 to 107;

Mainville, J.A., concurring - see paragraphs 108 to 161.