Federal Court Strikes Patent Infringement Action Where Plaintiff Could Not Articulate How Its Rights Were Infringed
June 16, 2017
| Dominique T. Hussey, L.E. Trent Horne and Jeilah Y. Chan
A patent owner cannot sue in the hopes that the necessary facts to support infringement will emerge during discovery. From the outset, a plaintiff must be able to frame its rights and how those rights have been infringed. Where a pleading broadly and generally asserted that a number of the defendant's systems infringed more than 150 claims of 4 patents, the Court struck it out for disclosing no reasonable cause of action and constituting an abuse of process.
Mostar Directional Technologies Inc. v. Drill-Tek Corporation, 2017 FC 575
Mostar provides directional drilling services for projects in the oil and gas industry, including measurement while drilling, or MWD. Used in precision drilling, MWD sends signals from the drill string to the surface providing information as to the direction and location of the drill string. Mostar is the owner of a number of patents relating to MWD.
In a statement of claim filed in the Federal Court, Mostar asserted that systems offered by Drill-Tek infringed its MWD patents. The claim generally alleged that 4 of Drill-Tek's systems infringed more than 150 claims of 4 patents, but without specifically explaining which systems infringed which patent claims. While Mostar provided some information in response to Drill-Tek's demand for particulars, it did not tie the features of Drill-Tek's systems to the elements of the asserted claims. Drill-Tek successfully moved to strike the claim for disclosing no reasonable cause of action and abuse of process.
In a patent infringement case, the claim must clearly show the rights owned by the plaintiff, together with material facts that show an encroachment on those rights by the defendant. If these two elements are not present, the claim will be struck for disclosing no reasonable cause of action.
On some occasions, the Court has upheld infringement allegations where the pleading recited the language of a patent claim, together with an allegation that the defendant's product or method fell within the language of that claim. This is permissible when the wording of the claim can be used as a model to describe exactly how the defendant has encroached on the plaintiff's rights. But Mostar's claim did not recite the language of the asserted claims, rather broadly alleged that a number of patent claims were infringed by a number of systems.
Mostar unsuccessfully argued that Drill-Tek was capable of filing a bare-bones deny-all defence and that the details of infringement would be addressed during the discovery process. In rejecting this argument, the Court noted that a mere denial would not allow the defendant to file an informed pleading responding to the allegations of infringement. Since Mostar was unable to articulate how its patents were infringed, the claim disclosed no reasonable cause of action. The Court also found that an action commenced without evidentiary foundation in the hopes that something may turn up on discovery constituted an abuse of process.
During the hearing of the motion, Mostar was asked if it could plead the material facts to show how Drill-Tek encroached on its patent rights. Since it could not do so, the claim was struck without leave to amend and the action was dismissed. The dismissal was without prejudice to the ability to file a new claim in the event new and non-speculative circumstances arose.
Drill-Tek was awarded its costs of the motion and the action in the amount of $20,000.
For further information on how to protect and enforce your intellectual property rights, contact Dominique Hussey, Trent Horne, Jeilah Chan, or another member of the Intellectual Property Litigation team.
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