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Writing the Next Chapter in Amazon.com’s 1-Click Story

April 1, 2011

The next chapter in the Amazon.com “1-Click” patent application story is being written at the Canadian Federal Court of Appeal. After a surprisingly unequivocal victory in the lower Federal Court last fall, Amazon is now facing an appeal by the Canadian Patent Office. At issue is the manner in which patent claims should be interpreted when assessed for patentable subject matter.

In its written submissions before the Court of Appeal, the Patent Office continues to argue for a two-part test when assessing patentable subject matter. In particular, the Patent Office calls for a two-part analysis, namely, what it now terms a “framing” analysis – that is, the claim construction approach used when assessing validity and infringement – and an “actual invention” analysis. The latter analysis, according to the Patent Office, is essential to determine whether what has actually been invented justifies the grant of a patent monopoly. Somewhat counterintuitively, the Patent Office argues that the essential elements of an invention may differ in both analyses.

Amazon’s written submissions are quick to point out that the two-part “framing” and “actual invention” analysis advanced by the Patent Office bears a striking resemblance to the “form and substance” analysis that was firmly rebuffed in the previous decision of the lower Federal Court. Amazon maintains that the Federal Court’s approach – drawn from two recent landmark Supreme Court cases – is correct. That is, there should be only one analysis – known as purposive construction – used in all stages of assessing a claimed invention.

Interestingly, the Patent Office appears to have abandoned its earlier contention that business methods are not patentable per se. However, it continues to argue that an “art” or “process” as defined by the Patent Act requires a physical act (or series of acts) that causes a change in character or condition of a physical object.

Many outside observers have been keenly following the proceedings in this case. Not content to sit on the sidelines, the Canadian Life and Health Insurance Association and the Canadian Bankers Association have recently been granted leave to intervene in the appeal. Both organizations are concerned that the outcome of the Amazon decision would allow for the patenting of ideas and mental steps such as the processes found in financial industries.

Finally, in a bit of interesting timing, the Commissioner of Patents was recently replaced. The outgoing Commissioner, Mary Carman, had presided over the original refusal of Amazon’s 1-Click patent application and subsequent court challenges to date. Observers have noted that the incoming Commissioner has an information technology background, leading to some speculation that we might expect a shift in Patent Office policy with respect to patentable subject matter. Only time will tell. In the meantime, the current appeal continues, with oral arguments scheduled for June 21, 2011, in Toronto. A decision may not come until even later this year.

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Stephen M. Beney, B.Sc. (Physics), is a partner in Bereskin & Parr LLP's Electrical & Computer Technology practice group. 

Paul Horbal, B.A.Sc., M.Sc. (Elec. Eng.), J.D., is an associate lawyer with Bereskin & Parr LLP's Electrical & Computer Technology practice group.

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Author(s):

Paul Horbal Paul Horbal
B.A.Sc., M.Sc. (Elec. Eng.), J.D.
Partner
416.957.1664  email Paul Horbal
Stephen Beney Stephen Beney
B.Sc. (Physics)
Managing Partner
905.817.6102  email Stephen Beney