In August of 2007, by way of a Practice Notice and with little or no consultation with the public or the intellectual property community, the Canadian Patent Office formally expressed its position that computer programs existing in a transitory state (i.e., signal claims) are forms of energy that do not contain matter and therefore do not constitute patentable subject matter under section 2 of the Patent Act. What little commentary there has been regarding this decision appears to have been focused on whether or not the Patent Office is correct in its assertion that signal claims are not patentable subject matter. This, however, may not yet be the most relevant consideration. Until this decision has been given due process of law and the Patent Office provides Applicants an opportunity to be heard, the most pertinent issue may be whether the Commissioner has the jurisdiction to make such a change.

 

The Patent Office has, until last August, expressly given the public an expectation that signal claims are considered to be patentable subject matter. Chapter 16 of the Patent Office’s Manual of Patent Office Practice, commonly referred to as the MOPOP, continues to state that signal claims are a patentable medium for computer-implemented inventions. Additionally, it has in fact been the practice of the Patent Office to allow patents containing claims to computer media in the form of transitory or propagated signals. The decision to alter from this position, which coincidentally occurred shortly after the United States Federal Circuit Court of Appeals made a similar decision, appears to have been made with virtually no opportunity for public comment.

 

As a result, a number of Applicants may have lost significant property rights by publicly disclosing what previously would have been a trade secret, with what may now be an unrealized expectation that they would obtain an enforceable patent right. It should be noted that signal claims provide a meaningful way to prevent potential infringers from avoiding liability by, for example, initiating in Canada via the internet the execution of a patented computer-implemented invention located on a server in another jurisdiction and providing the results of that execution inside Canada. Accordingly, an expectation, which has been given both by express notice and by past practice, that a signal claim constitutes patentable subject matter may have been a significant reason for an Applicant to decide to publicly disclose a proprietary invention.

 

Fortunately for such Applicants, Canadian law may limit the discretion of the Commissioner of Patents to alter what may and may not be patentable subject matter. As there are Applicants who will lose property rights by virtue of this decision, there are at least two ways in which the authority of the Commissioner in this regard may be fettered. First, the Common Law provides that, under certain circumstances, decisions of legislative delegates require procedural fairness, of which a major component is the right to be heard. By making this decision summarily, with little or no consultation and without providing her reasons, the Commissioner does not appear to have met the onus of this duty. Second, and perhaps even more persuasive, section 1(a) of the Canadian Bill of Rights states in part that no person may be deprived of property without due process of law. The exact nature of due process in this circumstance may be uncertain, but it very likely requires more than merely issuing a public notice.

 

Whether signal claims are ultimately deemed not to be patentable subject matter, any decision to alter this position should give proper consideration to both the rights and interests of Applicants, as well as to sound innovation policy. Canadian law appears to ensure this by requiring that such a decision, rather than being made summarily by a government official, is in the least reviewed by an authorized decision-maker, such as Parliament or a member of the judiciary.

 

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