{"id":25984,"date":"2025-10-20T15:45:30","date_gmt":"2025-10-20T15:45:30","guid":{"rendered":"https:\/\/cpata-cabamc.ca\/?page_id=25984"},"modified":"2025-10-20T15:50:44","modified_gmt":"2025-10-20T15:50:44","slug":"guidelines-regarding-the-standard-of-due-care-the-impact-of-recent-federal-court-decisions-for-both-patent-agents-and-trademark-agents","status":"publish","type":"page","link":"https:\/\/cpata-cabamc.ca\/en\/your-practice\/professional-conduct\/ethical-analyses-and-guidance\/guidelines-regarding-the-standard-of-due-care-the-impact-of-recent-federal-court-decisions-for-both-patent-agents-and-trademark-agents\/","title":{"rendered":"Guidelines regarding the Standard of Due Care \u2013 the Impact of Recent Federal Court Decisions for both Patent Agents and Trademark Agents"},"content":{"rendered":"\t\t
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The due care standard is mandated in the <\/span>Patent Act<\/span><\/i>. However, the decisions of the Federal Courts interpreting and applying the due care standard are worthy of consideration by both patent agents and trademark agents because these decisions enunciate a number of relevant practice standards for both professions.<\/span>\u00a0<\/span>\u00a0<\/span><\/p>

The purpose of this article is to provide some general guidance to licensees about the current status of the due care standard, together with some relevant factors to consider, as articulated by the Federal Court of Appeal and in the CPATA Code of Professional Conduct for Patent Agents and Trademark Agents. This guidance does not replace licensees\u2019 own obligations to exercise sound professional judgement at all times in each matter in your clients\u2019 best interests.<\/span>\u00a0<\/span><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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The Due Care Standard in the Patent Act<\/em><\/u><\/strong><\/h3>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Under the Patent Act<\/em>, failure to pay a patent or patent application maintenance fee or failure to request examination by its prescribed due date triggers the sending of a Commissioner\u2019s Notice establishing a due date for taking missed action(s), together with payment of a late fee. The patentee or applicant must meet the due date set by the Notice to avoid deemed expiry of the patent or deemed abandonment of the application. A patent that is deemed expired or an application deemed abandoned resulting from a failure to meet the Notice due date may<\/em> have its deemed expiry reversed or be reinstated on request, if the Commissioner determines that the failure occurred in spite of the required due care having been taken. <\/strong>In the case of deemed abandonment resulting from a failure to request examination, the due care requirement only applies if the request for reinstatement is submitted more than 6 months after the original prescribed due date.<\/p>

CIPO has adopted a high standard when evaluating whether due care has been taken in each case. Fewer than 15% of over 300 CIPO final determinations since 2019 have concluded with a finding that due care was, in fact, taken. According to CIPO\u2019s published observations about the various reasons the due care standard was not found to have been met in many cases, these include:<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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  1. Relevant point in time<\/strong> – Many requests for reinstatement or reversal of expiry fail to provide an explanation of what was done after the Commissioner\u2019s Notice was received. If the request for reinstatement or reversal of deemed expiry focuses on the reasons why the original due date was missed, the Commissioner will not be able to make a determination that the failure occurred in spite of the due care required by the circumstances having been taken.<\/li>
  2. Unintentionality <\/strong>\u2013 It is mistakenly assumed by some applicants and patentees that it is sufficient to explain that the due date set by a Commissioner\u2019s Notice was missed unintentionally. The \u201cunintentional\u201d requirement only applies to restoration of the right of priority, late national phase entry, and certain extensions of time.<\/li>
  3. All authorized persons must take due care<\/strong> \u2013 as we will see from the jurisprudence, all persons that were authorized by the applicant or patentee must take due care to ensure that the relevant action and payment of the late fee are completed before the Commissioner\u2019s Notice due date. For example, if a foreign patentee instructs their local agent to retain a Canadian patent agent to represent them before CIPO, but hires an annuity firm to pay the maintenance fees, the patentee, patent agents (both local and Canadian), and annuity firm must all demonstrate that the required due care was taken. The Canadian agent may be operating under a limited scope retainer since they are not responsible for monitoring maintenance fee deadlines or paying the fees, but when a Notice is received, they agent may still need to forward the Notice to the appropriate party.<\/li><\/ol>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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    The Federal Court of Appeal has now issued two key decisions relating to the standard of care: Taillefer v. Canada (Attorney General),<\/em> 2025 FCA 28<\/a>, and Canada (Attorney General) v. Matco Tools Corporation,<\/em> 2025 FCA 156<\/a>.\u00a0 The decisions demonstrate how the Commissioner and courts are continuing to work through the rationale and parameters of what due care is required, and that the courts are setting a high bar for those seeking to rely on the due care standard.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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    The Taillefer <\/em>Decision <\/strong>(Taillefer v. Canada (Attorney General),<\/em> 2025 FCA 28)<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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    A patent agent had established a routine of communicating with his client, the patentee, by email to obtain instructions respecting payment of annual maintenance fees. At some point, the patentee\u2019s email filter started routing the agent\u2019s maintenance fee emails to the patentee\u2019s junk mail folder, where they were discovered some time after the patent was deemed expired. The Commissioner refused to reverse the deemed expiry, finding that the agent and the client had failed to exercise due care by ensuring they had an effective means for communicating in place.\u00a0<\/p>

    On application for judicial review by the applicant, the Federal Court upheld the Commissioner\u2019s determination and concluded that it was reasonable for Commissioner to have expected the patentee to ensure that the communication system between themselves and their agent was working so that reporting could be made and instructions given, and that both the patentee and agent should have considered steps that could have avoided the communication failure. The Court agreed with the Commissioner that agents should have appropriate communication mechanisms in place to ensure they are always able to communicate effectively with their clients. With the Federal Court of Appeal\u2019s dismissal of the patentee\u2019s appeal, the Taillefer <\/em>decision stands and confirms that those relying on the due care provisions of the Patent Act<\/em> must maintain reliable principal and backup communication channels to avoid, in the Federal Court of Appeal\u2019s words, \u201can accident waiting to happen\u201d. The bottom line is that if you get radio silence in response to your primary communication method with your client, you MUST try another way.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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    The Matco Tools<\/em> Decision <\/strong>(C<\/em>anada (Attorney General) v. Matco Tools Corporation,<\/em> 2025 FCA 156)<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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    As is often the case with Canadian patent applications, the applicant relied on multiple parties to handle different aspects of its patent application, including a Canadian patent agent as the representative before CIPO, local (US) counsel, and an annuity service provider. As the applicant had engaged the annuity service provider, they instructed US counsel to take no further action regarding payment of maintenance fees. US counsel in turn advised the Canadian agent that maintenance fees would be handled by a third party.<\/p>

    However, due to a data migration error when the annuity service provider assumed responsibility for the applicant\u2019s portfolio, this particular application was accidentally omitted, ultimately resulting in a missed maintenance fee payment. A Commissioner\u2019s Notice regarding the non-payment was received by the Canadian agent, who forwarded it to US counsel. Because US counsel had been given instructions to take no further action relating to maintenance fees, they did not send the Notice to the applicant. As the applicant was unaware of the default, the maintenance fee went unpaid, and the application was deemed abandoned.<\/p>

    The Commissioner refused to reinstate the application, finding that (1) the data migration error that gave rise to the missed anniversary due date was irrelevant to the due care analysis, since abandonment could have been avoided by proper handling of the Commissioner\u2019s Notice; (2) no satisfactory explanation was given for US counsel\u2019s failure to forward the Notice; and (3) there was insufficient evidence that the applicant had implemented sufficient safeguards such as adequate staff training, effective monitoring systems, or verification and quality control methods.<\/p>

    The Federal Court granted judicial review to the applicant, but this was overturned on appeal because the Court had failed to defer to the Commissioner\u2019s reasoning, and the Commissioner\u2019s due care analysis was reasonable. In allowing the Commissioner\u2019s appeal, the Federal Court of Appeal provided useful interpretive guidance to agents and clients:<\/p>