The Federal Court decision in the matter of Taillefer v. Canada (Attorney General), 2024 FC 259 released earlier this year has resulted in a number of ethics inquiries to CPATA, with questions such as what to do as a successor patent agent when you learn that a prior agent apparently failed in their duty of care to the detriment of the client, and whether an agent has met their own duty of care in a matter to effectively communicate with an unresponsive client. The Taillefer decision endorses the position of CIPO that patent agents have a higher duty of care threshold than licensees may have previously understood in relation to their communications with clients.
Authors such as Alan Macek in his March 20, 2024 blog “Due Care” Required to Overcome Missed Patent Deadlines, have commented on the import of the Taillefer decision on patent agent-client communications:
In Taillefer v. Canada (Attorney General), 2024 FC 259, the Federal Court considered the ‘due care’ provisions of the Patent Act for the first [time] since they are implemented in 2019. These provisions allow an applicant to reinstate a patent or patent application if an annual maintenance fee was not timely paid.
If an annual fee is not paid by the due date, the Patent Office must send a notice to the patent agent fixing a two month deadline for reinstatement. If this further deadline is missed, the applicant must establish the deadline was missed in spite of appropriate ‘due care’ being taken to meet the deadline.
Prior to 2019, an applicant could reinstate their patent or patent application simply by paying the required fees within 1 year of the missed deadline. No explanation was required as to why the fee was missed.
The sections of the Patent Act require that the patentee (or applicant in the case of a pending application) provide along with the request and fees, “the reasons for the failure to pay the prescribed fee and late fee before the later of the end of six months after the applicable prescribed date and the end of two months after the date of the notice”. The patent office will then determine if the failure “occurred in spite of the due care required by the circumstances having been taken” – see sections 46(5) and 73(3) of the Patent Act.
The facts in Taillefer were straightforward. A patent agent had established a routine of communicating with his client by email to obtain instructions respecting payment of annual maintenance fees. At some point, the email reminders from the agent ended up in the patentee’s junk mail folder, where they were discovered well after CIPO had sent reminders to the agent of record and then ultimately deemed the patent application abandoned. In response to an application to reinstate the application, the CIPO Commissioner decided that the agent and client had failed to exercise due care by ensuring they had in place an effective means for communicating. The Federal Court upheld this decision by CIPO, and found that it was reasonable for CIPO to have determined that an Applicant must ensure the communication system between themselves and their Agent is working so that reporting can be made and instructions given, and that they should have considered steps that could have avoided the communication failure. The Court agreed with CIPO that Agents should have appropriate communication mechanisms in place to ensure they are always able to communicate effectively with their clients.
The Taillefer decision confirms that those relying on the ‘due care’ provisions of the Patent Act have a high standard to meet.
Communications and the Code of Professional Conduct
There are numerous relevant rules in the Code that provide guidance to an agent when evaluating what communications systems you should have in place, what ‘effective communications’ means in context, and what ethical standard you will be held to in the event of a complaint.
The duty of Competence in Rule 1 establishes a duty to pay attention to the interests of your clients, and implement appropriate records, systems and procedures in order to conduct your professional business (Rule 1(2)(a)). Rule 1(4) provides that, “An agent must maintain appropriate office procedures and systems, including systems for meeting the requirements for all deadlines arising from client matters and for handling and maintaining client affairs without prejudicing them.” The Court’s decision in Taillefer is fully consistent with this ethical standard.
The Commentary to Rule 4(3) relating to Quality of Service provides that, “An agent has a duty to communicate effectively with the client. What is effective will vary depending on the nature of the retainer, the needs and sophistication of the client and the need for the client to make fully informed decisions and provide instructions.” Further the Commentary to Rule 4(6) states that “An agent must communicate in a timely and effective manner at all stages of a client’s matter or transaction.”
These Rules set high expectations and standards for the effectiveness and timeliness of communications between an agent and their clients at all stages of matters for which they are providing services. One could argue that the civil standard of due care established by Taillefer closely follows the ethical standards in the Code.
This being the case, there are times when despite all best efforts and due diligence, agents are still left with clients who fail to respond to communications of all types, leaving agents in a position of having no instructions to take steps needed to protect clients’ interests. How can this be avoided?
Managing client expectations and communications should be a continuous process. Best practices include:
- Obtaining full client contact information including mailing address, emails and all phone numbers at the outset;
- Entering into written retainer agreements with clients that set expectations regarding communication and that require clients to immediately advise of any changes to contact information;
- Confirming client instructions in writing, including with respect to methods of providing instructions and any changes to those instructions;
- When an application is underway or approved, taking steps to remind clients in writing of the deadlines for payment of annuities and maintenance fees, and confirming how these will be paid. State clearly what steps you will and will not take in the event a client fails to provide instructions and/or make required payments, and the risk of abandonment;
- If you are having difficulty obtaining instructions from a client through your regular method of communication, try reaching out by alternate means. If the client is unresponsive to email, consider phoning or mailing the client to seek instructions.
So much of the patent and trademark process is routinized and deadline-driven, but taking steps up front, throughout a retainer and at the end of a retainer to ensure clients understand where things stand can be of significant service to both your client and to you in the long run to reduce the risks of miscommunications and missed deadlines that might not always be possible to save.