Federal Court of Appeal splits over anticipation in Wenzel v. National Oil

The Federal Court of Appeal recently released a split decision on the issue of anticipation through prior use of an invention.  The majority affirmed the trial-court decision that the public must simply have the theoretical opportunity to access the prior art invention in order to constitute an anticipatory disclosure.  In reliance upon Baker Petrolite Corp. v. Canwell-Enviro Industries Ltd. 2002 FCA 158, much was made of the fact that it need not be proven that a person in possession of a prior art product actually reverse-engineered a product nor does it matter that the analysis would be time-consuming or difficult.  Justice Mainville, however, noted that this possibility of analysis applies to whether the disclosure is an enabling disclosure, not whether the disclosure occurred.  That is, the test is a two-step test of whether a disclosure occurred on the facts and, then, whether that disclosure was an enabling disclosure. Mainville J.A. questioned whether the actual disclosure had been made out on the facts.

The case, Wenzel Downhole Tools v. National Oil Well Canada Ltd. 2012 FCA 333, was an appeal from the decision of Snider J. allowing National Oil Well’s counterclaim invalidating Canadian Patent No. 2,026,630 (the ‘630 Patent) on the basis of anticipation and obviousness.   Wenzel’s appeal included issues of claim construction and obviousness, however, the Court was unanimous in affirming Snider J.’s judgment on these issues, despite finding a ‘non-fatal’ error in the obviousness analysis.

The dispute at the FCA centered on the prior use of a drilling tool referred to as the 3103 assembly.  The 3103 assembly, it was agreed, embodied the invention.  If it was made available to the public within the meaning of the Patent Act then it would be prior art against the ‘630 patent.

The 3103 assembly is a sealed drilling tool that was designed by Ken Wenzel (who was related to the patentee of the ‘630 patent, Bill Wenzel, but was not affiliated with the invention of the ‘630 patent) and was rented out to Ensco Technology Company (Ensco) for use.  In analyzing the facts of the case, Justice Snider stated that since Ensco was “free at law and equity to use whatever information could be gathered during the rental” including the availability of Ken Wenzel for consultation, even though Ken Wenzel was not consulted, this was analogous of the availability of a book in a library that anticipates a patent even though no one has read the book.  Additionally, Justice Snider stated that as anyone at Ensco was free to dismantle the drilling tool, this was analogous to “lifting a hood” to view the inner workings of the 3103 assembly.  As such, based on the availability of opportunities to access information related to the 3103 assembly, Snider J. concluded that the 3103 assembly was made available to the public through the rental by Ensco.

Gauthier J.A., for the majority, agreed with Justice Snider’s approach in determining whether a prior use of a product was deemed to be made available to the public.  More particularly, Gauthier J.A. stated that becoming available means that:

“the public, as defined earlier, had an opportunity to access the information that is the invention.  As previously mentioned, it does not require that one actually take advantage of this opportunity.”

As such, once the opportunity is established as a fact, the prior art is deemed to be available and the legal test for anticipation as defined in Apotex Inc. v. Sanofi-Synthelabo Canada Inc. [2008] 3 S.C.R. 265  may then be applied.  In this case, the fact that the renter could have dismantled the tool, despite the fact that the applicable equipment for doing so was not on site, was sufficient to establish that Ensco had a sufficient opportunity to access the internal structure of the tool.  In addition, the Court noted that someone could have asked Wenzel for details of the internal construction of the tool, and the tool might have broken (but did not) in which case it would have been fished out in pieces, means that there were circumstances under which Ensco might have come into possession of the details of the product.

In contrast,  Mainville J.A., in his dissent, noted that as Ken Wenzel did not actually convey any information about the 3103 assembly to Ensco and that the 3103 assembly cannot be dismantled easily without being taken to a repair shop.  Mainville J.A.  also noted that the situation was that of a rental, not a sale, and the evidence from Ken Wenzel was that any repair would be done off-site in a repair shop, never in the field.  Accordingly, Mainville J.A. was of the view that the Respondent had not discharged its evidentiary burden of showing that the invention had been disclosed in fact.

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