In 2024, we witnessed several notable developments in Canadian IP litigation. These included the Supreme Court granting leave for an appeal on the patentability of methods of medical treatment, a successful patent invalidity attack based on claim ambiguity, the emergence of generative AI tools (and the issues that come with them), and much more. Summarized below are some of the highlights of 2024 in Canadian IP litigation.
On February 12, 2025, join us for an insightful webinar as we provide an annual summary of key developments in Canadian IP litigation. This webinar offers a valuable opportunity for legal professionals and those interested in Canadian litigation to gain an overview of important court decisions, changes to rules, practice notices and other developments that shaped the Canadian IP landscape in 2024.
1. Resurgence of permanent injunctions
A permanent injunction is a powerful remedy that prohibits an infringer from continuing its infringing activity for the remainder of the patent term. Historically, injunctions were granted as a matter of course to successful patentees.1 However, in recent years, certain decisions of the Federal Court have cast some doubt on this practice:
- In 2023, Justice McVeigh denied a permanent injunction to a successful patentee for the first time in 30 years (AbbVie Corporation v JAMP Pharma Corporation, 2023 FC 1520).
- In 2022, Justice Lafrenière held that if there had been a finding of infringement, the patentee would not have been entitled to injunctive relief (Rovi Guides v Bell, 2022 FC 1388).
Following an appeal of the latter decision, the Federal Court of Appeal (FCA) has seemingly put to rest any potential concerns regarding a successful patentee’s presumptive entitlement to injunctive relief. In Rovi Guides, Inc v Telus Corporation, 2024 FCA 126, the FCA clarified that absent circumstances that would render injunctive relief inequitable, a plaintiff can generally expect to receive injunctive relief in Canada where a valid, unexpired patent has been infringed – including situations where the patent is close to expiry, and in situations where the plaintiff is licensing its invention rather than practicing it themselves. The FCA confirmed that the U.S. test for obtaining a permanent injunction – including the requirement for the patentee to establish that it has suffered irreparable harm – does not apply in Canada.
In the trademark context, pre-trial injunctive relief was granted in two separate provincial court matters: Amer Sports Canada Inc v Adidas Canada Limited, 2024 BCSC 3 and 9162-5327 Québec inc c 9422-5075 Québec inc, 2024 QCCS 81. In both cases, the court found that ongoing consumer confusion between the parties’ respective marks could cause an irreversible loss of distinctiveness of the applicants’ registered marks, which supported granting this extraordinary form of relief.
2. Continued expansion of site-blocking orders
Site-blocking orders are intended to combat online piracy by compelling third-party Internet Service Providers (ISPs) in Canada to block access to specific websites that are illegally distributing copyrighted content. The first ever site-blocking order was issued in Canada in 2019. Since then, site-blocking orders have continuously evolved to more effectively protect content owners against online piracy.
In Rogers Media Inc et al v John Doe 1 et al, 2024 FC 1082, site-blocking orders were extended to protect live content from multiple sports leagues and events, as well as future content for which the applicant can prove ownership, but without the need to file a new application. The Federal Court granted the applicants a two-year injunction that compels Canadian ISPs to block their subscribers’ access to pirated streams of live NHL, NBA, and other sports content in real time, i.e., as they are identified by the applicants.
Read our article “No parley for pirates: Federal Court (Canada) grants innovative remedy to combat sports piracy” discussing this decision.
More recently, in Bell Media Inc v John Doe 1 (Soap2day), 2025 FC 133, the Court granted a site-blocking order designed to combat a growing trend whereby infringing platforms that are successfully deactivated are promptly replaced by “copycat” sites. The order provided a summary mechanism for the applicants to add “copycat” sites within the scope of the order if they meet certain criteria, including if they make infringing content available to the public and operate in substantially the same way as the existing sites.
3. Supreme Court to revisit prohibition on claiming methods of medical treatment
For decades, courts have found a prohibition against patenting methods of medical treatment, reasoning that a patent should not monopolize the exercise of non-economic professional skills.2 However, the statutory basis and application of this prohibition have confounded the courts for many years, leading to inconsistent outcomes.3
For inventions related to the administration of drugs, the Federal Court had, for some time, adopted an approach that distinguished between claims defining a fixed dosage (which were considered patentable) and claims defining variable dosages (which were considered unpatentable methods of medical treatment). In Pharmascience Inc v Janssen Inc, 2024 FCA 23, the FCA rejected this bright-line approach and clarified that a patent claim constitutes a prohibited method of medical treatment only if “use of the invention (i.e., how to use it, not whether to use it) requires the exercise of skill and judgment.” While a fixed dosage and schedule may suggest that no professional skill and judgment would be required, it is not determinative as to whether a claim is patentable.
On September 19, 2024, the Supreme Court granted Pharmascience leave to appeal the above-noted decision. In its leave application, Pharmascience sought clarification from the Supreme Court regarding the proper framework for assessing whether a claimed invention monopolizes an unpatentable method of medical treatment. The appeal is expected to be heard in 2025.
4. Summary trial motion results in ownerless patent
In recent years, there has been an increase in the number of Canadian IP matters decided by way of summary judgment and summary trial. The main benefit of such proceedings is expediency—parties can achieve faster and more cost-efficient outcomes in appropriate cases. However, a 2024 decision with an unusual result potentially introduces a new risk to the pursuit of summary disposition.
Mud Engineering Inc v Secure Energy Services Inc, 2024 FCA 131, concerned a patent ownership dispute. In the underlying motion for summary trial, Mud Engineering sought dismissal of the defendant’s claim that they (and not Mud Engineering) were the rightful owners of the disputed patents. The Federal Court found that neither party had presented sufficient evidence to establish patent ownership, and consequently dismissed the motion, the counterclaim, and the main action. This result struck many as odd because it led to Mud Engineering’s infringement action being dismissed for lack of ownership without a trial, even though no other party has been found to be the rightful owner and Mud Engineering still owns the patent according to the Patent Office records. The Federal Court’s decision was upheld on appeal in a split decision from the FCA. The majority found that while s. 43 of the Patent Act creates a presumption of both patent ownership and validity, this presumption is “weak.” Once the defendant presents evidence displacing the presumption, the issue of ownership is decided on a balance of probabilities. The majority was not willing to re-weigh the trial judge’s factual finding that neither party had met their burden of establishing ownership, and that this finding was dispositive of the infringement action as a whole.
In a dissenting opinion, Justice Monaghan disagreed with requiring a patentee to prove ownership to succeed on summary trial. Justice Monaghan would have found that the Federal Court did not properly consider whether the defendant’s failure to establish that it was the rightful owner should have ended their ownership challenge such that Mud Engineering’s infringement action could proceed to trial on the remaining issues.
5. Patent found invalid for ambiguity
In Tekna Plasma Systems Inc v AP&C Advanced Powders & Coatings Inc, 2024 FC 871, the Federal Court held that most of the claims of the asserted patents were invalid for ambiguity – a rare finding. Claim ambiguity is rooted in subsection 27(4) of the Patent Act, which requires the claims of a patent to define “distinctly and in explicit terms the subject-matter of the invention for which an exclusive privilege or property is claimed.” This ensures that the public knows what it can and cannot do without infringing the patent. The ultimate question for assessing claim ambiguity is “whether it is impossible for the skilled person to know in advance whether or not something would be within the claims.”4 In this case, the central issue was the meaning of the term “depletion layer,” which both parties agreed was a coined term and not a term of art. The patent specification did not clearly define what a “depletion layer” is or how to objectively assess whether a particle has a “depletion layer” or not. As it was impossible for the skilled reader to know or determine whether a powder particle has a “depletion layer,” the Court held that most of the claims were ambiguous.
6. US parent company liable for patent infringement in Canada
In Munchkin, Inc v Angelcare Canada Inc, 2024 FCA 156, the FCA upheld the lower court’s finding that Munchkin, Inc. (the US parent company) is liable along with its wholly owned Canadian subsidiary for infringing activities in Canada. The FCA noted that a foreign entity does not need to perform the infringing activities themselvesto be held liable for infringement in Canada. The key questions are whether the infringing activities took place and whether the foreign entity made itself liable therefor, either by having common cause with a Canadian actor or otherwise being a party to the infringement. In this case, the evidence established that Munchkin, Inc. made design and marketing decisions that directly impacted its subsidiary’s infringing activities in Canada.
Read our articles “Angelcare and Playtex seal another win against patent infringer Munchkin” and “Angelcare and Playtex take out the trash: Diaper Genie patents are valid and infringed by Munchkin” discussing this case.
7. Artificial Intelligence (AI)
In recent years, the proliferation of AI tools has impacted various fields, including legal practice, introducing new challenges and considerations. AI tools were the subject of discussion in two recent decisions of the Trademarks Opposition Board: Industria de Diseño Textil, S.A. v Sara Ghassai, 2024 TMOB 150 and Monster Energy Company v Pacific Smoke International Inc, 2024 TMOB 211. In both matters, the applicant cited a case – Hennes & Mauritz AB v M & S Meat Shops Inc, 2012 TMOB 7 – that did not exist. The opposition board suggested that these references were the result of the applicant’s reliance on generative AI tools and that the fabricated cases were “AI hallucinations.” The opposition board noted the serious nature of relying on false citations, citing Zhang v Chen, 2024 BCSC 285, in which a Canadian lawyer was held personally liable for costs related to addressing false citations produced by AI.
As a result of the issues arising from the increasing use of AI, the Federal Court has issued a Practice Notice regarding the “Use of Artificial Intelligence in Court Proceedings,” which was most recently updated on May 7, 2024. As further summarized in the article “Artificial intelligence (AI) advocacy in the Federal Court”, the Notice mandates that all parties must disclose if AI was used in preparing court documents.
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The preceding is intended as a timely update on Canadian intellectual property and technology law. The content is informational only and does not constitute legal or professional advice. To obtain such advice, please communicate with our offices directly.
References
1. Valence v Phostech, 2011 FC 174.
2. Apotex Inc v Wellcome Foundation Ltd., 2002 SCC 77 at para 49.
3. Janssen Inc v Teva Canada Ltd, 2020 FC 593 at para 143.
4. Tekna Plasma Systems Inc v AP&C Advanced Powders & Coatings Inc, 2024 FC 871 at para 332.