Court finds that invalid disclaimers invalidates the claims.

August 18, 2010

Shmuel Hershkovitz, Paradox Security Systems Ltd. and Pinhas Shpater v. Tyco Safety Products Canada Ltd.

This decision underscores the importance of filing proper disclaimers to patent claims.  Disclaimers may be filed with the patent office by a patentee after the issuance of a patent to unilaterally renounce or disclaim those portions of the claimed invention that were inadvertently included within the scope of the claims as a result of mistake, accident or inadvertence.  Disclaimers therefore have the effect of narrowing the scope of the claims (i.e. the area where competitors may not tread).  Disclaimers that attempt to broaden the scope of a claim are invalid.

In the present case, soon after the issuance on October 5, 1999 of Canadian patent number 2,169,670 (the ‘670 patent) relating to telephone line couplers used to connect electronic equipment to phone lines while providing electrical isolation, the appellant patentee Paradox Security Systems Ltd. (Paradox) sent a demand letter to the respondent Tyco Safety Products Canada Ltd. (Tyco) alleging  patent infringement.  Tyco denied all allegations of infringement and asserted that the ‘670 patent was invalid.  On October 6, 2003, Paradox filed a disclaimer to certain claims.

Much time at trial before the Federal Court was devoted to whether the disclaimer actually had the effect of adding new inventive elements to the patent claims, and thereby improperly broadening the scope of the claims.  The Court found that the disclaimer did add new inventive elements, and that the disclaimer was therefore invalid.  Further, the Court found that the appellants failed to establish that they had sought the disclaimer as a result of “mistake, accident or inadvertence” and so the disclaimer was found to be invalid on that ground too.  Moreover, by filing the disclaimer to the ‘670 patent, the patentee was in effect conceding that their original patent was too broad in scope, and therefore invalid as issued.  Since the disclaimer was held to be invalid, the Court dismissed the appellant’s action for patent infringement, and declared the ‘670 patent to be invalid.

The plaintiffs appealed to the Federal Court of Appeal, but the lower court’s ruling was upheld.  The Court stated the following which should be heeded by patentees:

“[T]he Federal Court has found that the disclaimer, by broadening the original claims in the patent, is invalid. Were it otherwise, parties could use disclaimers to broaden their patents and obtain increased rights of exclusivity over those elements, thereby changing the overall bargain and circumventing the oversight of the Patent Office …
There is a distinction between inventive elements and essential elements. In a disclaimer, one cannot add inventive elements, as that will broaden the scope of the patent. But adding essential elements can narrow the scope of the patent … the more essential elements there are in the patent’s claims, the narrower they get.”

DISCLAIMER: This publication is intended to convey general information about legal issues and developments as of the indicated date. It does not constitute legal advice and must not be treated or relied on as such. Please read our full disclaimer at www.stikeman.com/legal-notice.