Protecting Canadian innovation

This is a Success Story about Canadian technology protection, and a landmark decision that will help protect Canada's innovation capacity, now and in the future.

Background

In 1998, a key patent held by Communications Research Centre Canada (CRC), the federal government centre of excellence for communications R&D, came under fire from two giant multinationals, Corning and Furukawa. Both claimed that they were the first to invent one of CRC's most famous patented discoveries. Corning became involved when a Dr. Elias Snitzer, who had initiated the patent interference proceedings, had assigned the company his patent rights and Furukawa became involved when it bought Lucent's optical division.

The invention at the heart of the dispute was the phase mask used to fabricate fibre Bragg gratings. The mask reflects a predetermined narrow or broad range of wavelengths of light incident on the grating, while passing all other wavelengths of light. This is recognized as one of the four major discoveries in optical communications, following the invention of optical fibres, lasers and optical amplifiers.

The case had to be fought in the U.S. because the patent in dispute was a U.S. patent. It is common practice for organizations to file patents in the U.S. because the U.S. represents the world's major Intellectual Property market.

U.S. patent law is unique in that the invention date takes precedence over the patent-filing date. Adding to the difficulties, was the fact that for economic activities pre-dating the 1994 ratification of the North American Free Trade Agreement (as was the case with the 1992 invention of the phase mask patent), any non-U.S. evidence proving the invention date is considered inadmissible.

The fight

CRC President Gerry Turcotte was willing to fight. "Government labs spend somewhere around CAD$2B developing Intellectual Property, and it's important that we protect our investment if we are to derive any commercial value from it," says Turcotte.

CRC, which has an annual budget of about CAD$60M, faced an uphill and costly battle. Jeet Hothi, CRC's Technology Transfer Manager, prepared the case and spearheaded the fight.

Legal fees to hire U.S. patent lawyers amounted to about CAD$1M, which was split with Connecticut-based United Technologies Corporation (UTC), CRC's cross-licence partner who shares a portfolio of patents covering the manufacturing process for Bragg gratings. The decision to fight the case was based on the fact that the patent is a major revenue generator for CRC, bringing in over CAD$3M in 2001-2002. CRC and UTC also felt they had a sound case.

Victory

In August 2002, CRC and UTC claimed victory when the U.S. Patent Office Tribunal ruled that CRC was the first to invent the phase mask.

Furukawa's claims were dismissed because the company couldn't prove an earlier invention date.

Corning's claims were dismissed when evidence showed that Dr. Elias Snitzer, the supposed inventor, derived the invention from CRC. The same evidence was used to prove the conception date in the U.S. because it came via an article CRC inventor Dr. Ken Hill had submitted to an American research journal in September 1992 a month prior to the established October 1992 invention and filing dates. The U.S. Patent Office ruled that Dr. Snitzer, who was serving as the journal's guest editor at the time, had changed his patent application to reflect the phase mask discovery after he had received Dr. Hill's article.

The evidence was enough to give CRC and UTC a clear-cut victory. It was the first time that the Canadian Government had fought against two major multinational companies - Corning and Furukawa - to protect a patent. The fact that the battle was fought and won under U.S. intellectual property law has solidified the case as a Canadian success story.

For more information, please contact Jeet Hothi.