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

• Jurisdiction: Federal Jurisdiction (Canada)
• Court: Federal Court (Canada)
• Judge: Snider, J.
• Citation: (2011), 401 F.T.R. 74 (FC),2011 FC 1323
• Date: 18 November 2011

Wenzel Downhole Tools v. Nat.-Oilwell (2011), 401 F.T.R. 74 (FC)

MLB headnote and full text

Temp. Cite: [2011] F.T.R. TBEd. DE.008

Wenzel Downhole Tools Ltd. and William Wenzel (plaintiffs) 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 (defendants)

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 (plaintiffs by counterclaim) v. Wenzel Downhole Tools Ltd and William Wenzel (defendants by counterclaim)

(T-1327-05; 2011 FC 1323)

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

Federal Court

Snider, J.

November 29, 2011.

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 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 utilitiy or remedies. In the result, the plaintiffs' infringement action was dismissed and the defendants' counterclaim allowed and a declaration of invalidity granted.

Patents of Invention - Topic 1026

The specification and claims - Construction of a patent - General - The Federal Court discussed the extent to which a patent specification could play a role in the construction of the claims - The court stated that "The question is always what the person skilled in the art would have understood the language of the claim to mean. For this purpose, the language the patentee has chosen is usually of critical importance. However, the jurisprudence teaches that, where necessary, the whole of the patent, and not only the claims, should be considered ... The Court should construe the claims in light of the description in the specification, assisted by experts as to the meaning of technical terms if such terms cannot be understood by the Court from reading the specification ... But, as strongly cautioned by the jurisprudence, the specification may not be used to expand or contract the substance of what is claimed ..." - See paragraph 40.

Patents of Invention - Topic 1030

The specification and claims - Construction of a patent - "Person skilled in the art" - What constitutes - 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 Federal Court defined the "person of ordinary skill in the art" for purposes of construing the '630 Patent - See paragraphs 42 to 46.

Patents of Invention - Topic 1031

The specification and claims - Construction of a patent - Essential and non-essential elements - The Federal Court stated that an essential element was one that, if it were changed, would affect how the invention worked - See paragraphs 38 and 39.

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 Federal Court stated that before considering the issues of invalidity and infringement, the court had to construe the relevant claims of the '630 patent - The court reviewed the applicable principles of claims construction - The court, thereafter, construed the claims of the '630 Patent, noting that the court's construction would inform the analysis of the infringement and validity issues - See paragraphs 33 to 78.

Patents of Invention - Topic 1582

Grounds of invalidity - Lack of "inventive ingenuity" (obviousness) - Test for obviousness - The Federal Court referred to the test for obviousness - See paragraph 150.

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 Federal Court held that claims 1 and 2 of the patent were invalid for anticipation; however, in case it erred in that conclusion, the court opined that claims 1 and 2 of the '630 Patent were also invalid for obviousness - See paragraphs 147 to 206.

Patents of Invention - Topic 1602

Grounds of invalidity - Anticipation - Test for - The Federal Court referred to Supreme Court jurisprudence which provided that the issue of whether an invention was anticipated by the prior art required that the court have regard to two questions: 1. Was the subject matter of the invention disclosed to the public by a single disclosure? and 2. If there was such a clear disclosure, was the working of the invention enabled by that disclosure? - The court elaborated on this analysis, especially what constituted public disclosure - See paragraphs 82 to 90.

Patents of Invention - Topic 1605

Grounds of invalidity - Anticipation - 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 claimed that the bearing assemblies contained in core barrels, devices used in the oil and gas industry for decades, anticipated the subject-matter of the '630 Patent, rendering it invalid - The Federal Court concluded that there were differences between a core barrel and the '630 Patent bearing assembly sufficient to defeat the claim of anticipation with respect to the core barrel as prior art - See paragraphs 91 and 92.

Patents of Invention - Topic 1605

Grounds of invalidity - Anticipation - 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 was a piece of equipment for use in the drilling of oil and gas wells - The defendants claimed that the invention of the '630 Patent was anticipated by a drilling motor bearing assembly (the 3103 assembly) designed, built and used in a drilling operation prior to the '630 Patent filing date of October 1, 1990 - The Federal Court found that the bearing assembly described in claims 1 and 2 of the '630 was anticipated by the 3103 assembly - Therefore, claims 1 and 2 were invalid - See paragraphs 91 to 145.

Patents of Invention - Topic 1607

Grounds of invalidity - Anticipation - Evidence - The Federal Court stated that "the evidence relevant to anticipation consists solely of the prior art as understood by the skilled person" - See paragraph 85.

Cases Noticed:

Whirlpool Corp. et al. v. Camco Inc. et al., [2000] 2 S.C.R. 1067; 263 N.R. 88, 2000 SCC 67, refd to. [para. 33].

Free World Trust v. Electro Santé Inc. et al., [2000] 2 S.C.R. 1024; 263 N.R. 150; 9 C.P.R.(4th) 168; 2000 SCC 66, refd to. [para. 33].

Catnic Components Ltd. et al. v. Hill & Smith Ltd., [1982] R.P.C. 183 (H.L.), refd to. [para. 38].

Eli Lilly Canada Inc. v. Apotex Inc. et al. (2008), 323 F.T.R. 56; 63 C.P.R.(4th) 406; 2008 FC 142, refd to. [para. 40].

Eli Lilly Canada Inc. v. Novopharm Ltd. et al., [2007] F.T.R. Uned. 828; 58 C.P.R.(4th) 214; 2007 FC 596, refd to. [para. 40].

Shire Biochem Inc. et al. v. Canada (Minister of Health) et al. (2008), 328 F.T.R. 123; 67 C.P.R.(4th) 94; 2008 FC 538, refd to. [para. 40].

Janssen-Ortho Inc. et al. v. Canada (Minister of Health) et al. (2010), 361 F.T.R. 268; 2010 FC 42, refd to. [para. 40].

Sanofi-Synthelabo Canada Inc. et al. v. Apotex Inc. et al., [2008] 3 S.C.R. 265; 381 N.R. 125; 2008 SCC 61, refd to. [para. 82].

Weatherford Canada Ltd. et al. v. Corlac Inc. et al. (2011), 422 N.R. 49; 2011 FCA 228, reving. (2010), 370 F.T.R. 54; 84 C.P.R.(4th) 237; 2010 FC 602, refd to. [para. 85].

Baker Petrolite Corp. et al. v. Canwell Enviro-Industries Ltd. et al., [2003] 1 F.C. 49; 288 N.R. 201; 211 D.L.R.(4th) 696; 2002 FCA 158, refd to. [para. 86].

Bauer Hockey Corp. et al. v. Easton Sports Canada Inc. (2010), 366 F.T.R. 242; 2010 FC 361, affd. (2011), 414 N.R. 69; 2011 FCA 83, refd to. [para. 87].

Lux Traffic Controls Ltd. v. Pike Signals Ltd., [1993] R.P.C. 107, refd to. [para. 87].

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. 89].

Gibney v. Ford Motor Co., [1967] 2 Ex. C.R. 279; 52 C.R.P. 140 (Ex. Ct.), refd to. [para. 90].

Novopharm Ltd. v. Eli Lilly & Co. (2010), 376 F.T.R. 227; 2010 FC 915, refd to. [para. 117].

Coco v. Clark (A.N.) (Engineers) Ltd., [1969] R.P.C. 41 (Ch.), refd to. [para. 126].

Pre-Cam Exploration & Development Ltd. v. McTavish, [1966] S.C.R. 551; 57 D.L.R.(2d) 557, refd to. [para. 129].

Windsurfing International Inc. v. Tabur Marine (Great Britain) Ltd., [1985] R.P.C. 59 (C.A.), refd to. [para. 150].

Pozzoli SPA v. BDMO SA, [2007] F.S.R. 37; [2007] EWCA Civ. 588, refd to. [para. 150].

Almecon Industries Ltd. v. Nutron Manufacturing Ltd. (1996), 108 F.T.R. 161 (T.D.), affd. (1997), 209 N.R. 387; 72 C.P.R.(3d) 397; 69 A.C.W.S.(3d) 1108 (F.C.A.), leave to appeal refused (1997), 224 N.R. 157 (S.C.C.), refd to. [para. 160].

Pfizer Canada Inc. et al. v. Apotex Inc. et al. (2009), 385 N.R. 148; 2009 FCA 8, refd to. [para. 196].

Consolboard Inc. v. MacMillan Bloedel (Saskatchewan) Ltd., [1981] 1 S.C.R. 504; 35 N.R. 390, refd to. [para. 209].

Eli Lilly Canada Inc. et al. v. Novopharm Ltd. (2010), 405 N.R. 1; 85 C.P.R.(4th) 413; 2010 FCA 197, refd to. [para. 209].

Pfizer Canada Inc. et al. v. Canada (Minister of Health) et al. (2011), 423 N.R. 180; 2011 FCA 236, refd to. [para. 210].

Statutes Noticed:

Patent Act, R.S.C. 1985, c. P-4, sect. 28.3(b) [para. 148]; sect. 28.2 [para. 81].

Counsel:

Grant S. Dunlop, for the plaintiffs/defendants by counterclaim;

Kim D. Wakefield and Dennis R. Schmidt, for the defendants/plaintiffs by counterclaim.

Solicitors of Record:

Ogilvie LLP, Edmonton, Alberta, for the plaintiffs/defendants by counterclaim;

Fraser Milner Casgrain LLP, Edmonton, Alberta, for the defendants/plaintiffs by counterclaim.

This case was heard in Edmonton, Alberta, on September 19-21, 26-29 and October 3, 5, and 13, 2011, before Snider, J., of the Federal Court. Confidential reasons for judgment were filed on November 18, 2011 and the public reasons reported below were filed on November 29, 2011.