OTTAWA, Ontario, this 7th day of November, 2005
PRESENT: THE HONOURABLE PAUL ROULEAU
BETWEEN:
SHOPPLEX.COM CORPORATION carrying on business as TEILHARD TECHNOLOGIES and JUXTACOMM TECHNOLOGIES INC.
and
REASONS FOR ORDER AND ORDER
[1] The respondent DataMirror Corporation ("DataMirror") appeals the order of Prothonotary Milczynski, dated June 9, 2005, in which the Prothonotary dismissed the respondent's motion to strike the plaintiffs' Amended Statement of Claim.
[2] The main action brought by the plaintiffs is for patent infringement. The plaintiffs claim rights arising from Canadian Patent No. 2,241,767 (the '767 patent). The 767 patent relates to computer software, and sets out processes for data distribution, data transformation, and computer readable memory. The defendant submits that none of the claims in the '767 patent are infringed by the defendant's software.
[3] The plaintiffs have already had the statement of claim struck once, by Prothonotary Lafreniere, on November 10, 2004. Prothonotary Lafreniere struck the original Statement of Claim because, " the Defendant cannot respond to the allegations of infringement, because the specific versions and components of its products are not identified, nor its purpose and manner of use."
[4] The plaintiffs produced an Amended Statement of Claim, and the defendants, once again, brought a motion to strike. Prothonotary Milczynski found that the plaintiffs had pleaded sufficient facts to establish that a reasonable cause of action exists. Prothonotary Milczynski notes, in her decision, that, "Reading the Amended Statement of Claim as a whole, the Plaintiffs have outlined the elements of the claim, and tied those elements to the process which is described in the Defendant's software."
[5] The defendant now brings an appeal of Prothonotary Milczynski's discretionary order, under Rule 51 of the Federal Court Rules. Rule 51 states as follows:
51. (1) An order of a prothonotary may be appealed by a motion to a judge of the Trial Division.
[6] The case law arising out of Rule 51 has made it clear that a Prothonotary's order should not be disturbed unless the order involved an improper exercise of discretion on the part of the Prothonotary. In Z.I. Pompey Industrie v. ECU-Line N.V., [2003] 1 S.C.R. 450, the Supreme Court noted that discretionary orders of prothonotaries ought to be disturbed by a motions judge only when they are clearly wrong, in the sense that the exercise of discretion was based on a wrong principle or misapprehension of the facts, or where the prothonotary improperly exercised his or her discretion on a question vital to the final issue of the case.
[7] The defendant argues that the Prothonotary improperly exercised her discretion on a question vital to the final issue of the case. The defendant submits that, at best, the Amended claim alleges that the defendant's software accomplishes the same goal as the purported invention of the patent. The defendant notes that the goal in not new, as noted in the patent itself.
[8] The defendant submits that the plaintiffs have not pleaded any new facts in the Amended Claim which, if taken as true, would allow for a claim of patent infringement. Prothonotary Milczynski disagreed with the defendant's argument, as do I, for the reasons that follow.
[9] It is trite law that a claim for patent infringement necessarily requires an analysis of the patent to determine the essential elements claimed in the patent. In the present case, the '767 patent can only be properly construed once the essential elements have been identified. Prothonotary Milczynski was of the opinion that the plaintiffs had provided sufficient particulars in the Amended Claim to allow the defendant to identify the plaintiffs' argument surrounding the patent claims, and the defendant's infringing material.
[10] The main argument raised by the defendant, which claims that the defendant's software merely accomplishes the same goal as the invention disclosed in the '767 patent, is an argument that is appropriately raised at trial, and not on a motion to strike or an appeal of a prothonotary's discretionary order. The defendant, in raising the argument that the software merely accomplishes the same goal, is claiming that the essential elements are different. If the essential elements of the defendant's software, properly construed by the trial judge, are different from the essential elements of the plaintiffs' software, as analyzed based on the '767 patent (given a presumption of validity), then the defendant is likely to succeed at trial (see Free World Trust v. Electro-Santé Inc (2000), 9 C.P.R. (4th) 168 (S.C.C.)).
[11] However, at the present stage, when the patent has not been properly construed, the defendant's argument, that the goals are merely the same, is ineffective.
[12] The defendant goes on to argue that the allegations in the Amended Claim are contradictory, and argues that there are three independent claims in the patent which are not infringed by the defendant (claims 1, 13, and 17). Once again, the argument that specific claims are dependent or independent is an argument best made at trial. As for the alleged contradictions raised by the defendants, the main argument is that the defendant is unable to discern if the allegations are alternative allegations of infringement, or cumulative allegations of infringement.
[13] The allegations of infringement must be responded to as they are set out. In paragraph 36 of the defendant's Written Representations, he notes that it does have sufficient data to prepare a defence, by stating four denials which will form part of the defence. He is fully aware of what case he has to meet. The defendant still expresses concern with respect to the cumulative or non-cumulative arguments with respect to the Amended Claim. He can deal with each of the denials on an independent basis, and, once the claims are properly construed by the duly appointed trial judge, the essential elements can be identified, and the case for infringement, or non-infringment, can properly be argued.
[14] The defence has not provided any evidence that the Prothonotary improperly exercised her discretion on a question vital to the final issue of the case (ZI Pompey, supra). The exercise of discretion by Prothonotary Milczynski was exercised properly, and will not be disturbed by this Court.
[15] This is certainly not a case of a bare assertion that the defendant has infringed the plaintiffs' rights. There are sufficient allegations of fact to support a cause of action in the Amended Statement of Claim. I subscribe to what the Court of Appeal has written in Merck and Co. v. Brantford Chemicals Inc., [2004] F.C.J. No. 1003, and the principle enunciated therein is applicable to the present situation. In that decision, the Court of Appeal wrote at paragraph 2:
In Sweet v. Canada (1999), 249 N.R. 17 (F.C.A.) at paragraph 19, Décary J.A., speaking for this Court, stated that although some elements may be missing and others incomplete, if a pleading contains enough information to allow the opposing party to know with some certainty the case to be met, the pleading should not be struck. Here the statement of claim sets out the patents and the allegations of infringement with a sufficient degree of detail as to the processes used. The Motions Judge concluded that the statement of claim pleaded material facts which, when taken to be true, disclose a reasonable cause of action for patent infringement. We have not been persuaded that the Motions Judge arrived at his decision on a wrong basis or was plainly wrong.
ORDER
The appeal is dismissed and the prothonotary's order shall stand. Costs to the respondent plaintiffs in any event of the cause.
JUDGE
FEDERAL COURT
NAME OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: T-1329-04
STYLE OF CAUSE: Shopplex.com Corporation carrying on business as Teilhard Technologies and Juxtacomm Technologies Inc. v. Datamirror Corporation
PLACE OF HEARING: Ottawa, Ontario by videoconference
Toronto, Ontario
Calgary, Alberta
DATE OF HEARING: November 1, 2005
REASONS FOR ORDER: ROULEAU D.J.
APPEARANCES:
| Timothy S. Ellam Calgary, Alberta |
|
| David M. Reive Toronto, Ontario
|
SOLICITORS OF RECORD:
| McCarthy Tétrault LLP Calgary, Alberta
|
|
| Dimock Stratton LLP Toronto, Ontario |