Patent infringement limitation period in Alberta is six years and NOT two years states Alberta Court of Appeal

The Alberta Court of Appeal, in its five-judge decision^[1] released January 28, 2025, overturned the Alberta Court of King’s Bench (“ABKB”) decision in JL Energy Transportation Inc. v. Alliance Pipeline Limited Partnership^[2] et al, and re-instated the plaintiff JL Energy’s $638 million claim for patent infringement against various Alberta pipeline companies. Such patent infringement action had been previously dismissed by the ABKB, with costs, due to such action having been brought more than two years but less than six years after the Plaintiff had become aware of infringement of its patent occurring.

The Alberta Court of Appeal expressly  overruled the ABKB judge’s holding that the limitations period for patent infringement claims in Alberta is two years rather than six, confirming that such limitation period is actually six years. The five judges went on to hold that the Alberta Court of Appeal’s earlier decision in Canadian Energy Services Inc. v. Secure Energy Services Inc. 2020 ABQB 473 (“Secure Energy”), to the extent such decision pronounced the  limitation period for patent infringement claims in Alberta to be only two and not six years and which earlier C of A decision the ABKB considered itself to be bound by, should “no longer be followed.”

We had previously commented on the earlier JL Energy ABKB decision, noting its surprising holding that the limitation period for JL’s patent infringement claim was only two years. We suggested the ABKB should have held the limitation period for patent claims in Alberta to be six years, as such limitation period is specifically set out in s. 55.01 of the Federal Patent Act. Read our commentary here.

How the Alberta Court of Appeal made its decision

The Alberta Court of Appeal in JL Energy, in overturning the ABKB judge’s earlier decision, conducted its analysis and reached its conclusion as follows:    

Firstly, the Alberta Court of Appeal commented on s. 12 of the Alberta Limitations Act, which states:

12(1) The limitations law of Alberta applies to any proceeding commenced or sought to be commenced in Alberta in which a claimant seeks a remedial order (underlining added).

Thereafter, the Alberta Court of Appeal went on to conclude such provision needed to be read alongside s. 2(3) of the Alberta Limitations Act, which states:

2(3) Except as provided in subsection (4), this Act is applicable to any claim, including a claim to which this Act can apply arising under any law that is subject to the legislative jurisdiction of the Parliament of Canada, if:

(a) the remedial order is sought in a proceeding before a court created by the Province; or

(b) the claim arose within the Province and the remedial order is sought in a proceeding before a court created by the Parliament of Canada.

(4) This Act does not apply where a claimant seeks a remedial order the granting of which is subject to a limitation provision in any other enactment of the Province.

However, in light of s. 55.01 of the Federal Patent Act which expressly provides a limitation period of six (not two) years:

55.01 No remedy may be awarded for an act of infringement committed more than six years before the commencement of the action for infringement

The Alberta Court of Appeal concluded the reference in s. 2(3) in the Alberta Limitations Act to claims “to which this Act can apply,” read in context with the “choice of law” provision of S 12(1) of the Alberta Limitations Act, excludes causes of action created by federal statutes for which the Parliament of Canada has provided a discrete limitation period.

On such logic and legal rationale, the limitation period for claims of patent infringement in Alberta is as prescribed in the Federal Patent Act, namely six years and not two years.

Of note, the topic of “rolling” limitation periods was raised before the ABKB and was, likewise, raised at the appeal. Namely, whether patent infringement is a series of temporarily-consecutive separate acts where the limitation period runs from commencement of each individual act and, thereby, each have a “rolling” limitation period, or whether the limitation period commences from the initial act of infringement and such is the date for all subsequent infringing acts, even though the damages arising from that single breach may continue to accrue.

The Plaintiff in JL Energy before the ABKB argued that even if the action was outside a two-year limitation period from the initial infringement, the acts of infringement were individual successive acts still occurring, and thus at least those acts were within the two-year limitation period and thus the action thus had legal claim for those acts of infringement.

Following the earlier Secure Energy decision, the ABKB disposed of this argument, holding that:

“[T]he continued use of property, including intellectual property, does not constitute and ongoing tort.”

The Court of Appeal, however, noted that there was a plethora of authority on both sides of the argument, which demonstrated the issue of whether there is a “rolling” limitation may be fact-specific and not always clear-cut. The Alberta Court of Appeal observed that the wording of s. 55.01 of the Patent Act could support the view, contrary to the view taken by the ABKB, that each “act of infringement” creates a separate right to a remedy, and it is that right which is foreclosed after six years pass from each separate right.

However, on the facts of the JL Energy case, in light of the fact the Statement of Claim had been commenced within six years of not only the initial but rather all acts of infringement, at least vis-a-vis acts of patent infringement, the Court of Appeal commented that the question of a rolling limitation period vis-a-vis patent infringement appeared moot.

Parenthetically, however, the Court of Appeal observed that if the six year limitation period in s. 55.01 engages the “discoverability” principle, the limitations window could be longer, relying on a 2021 decision of Federal Court of Appeal in  Google Canada Corp v Paid Search Engine Tools, LLC 2021 FCA 63 as authority for such proposition.

Lastly, the Alberta Court of Appeal observed that the Plaintiff’s claim of infringement could potentially be both an infringement actionable under s. 55.01 of the Patent Act and a breach of the licence agreements assuming infringement occurred outside the scope of permitted use under the licence. The parties agreed that the breach of licence claims (a licence being a contract, and not a patent) are subject to the two year Alberta limitation period.

However, due factual uncertainties relating to the breach of license claims, whether a rolling limitation period should be applied to the licence breaches could not be fairly determined on appeal. In any event, in light of the longer limitation period of six years regarding patent infringement the Court of Appeal observed that whether there is (also) a rolling limitation period on license breaches in this case may not impact the Plaintiff’s claim of patent infringement.

Summary and comment

The Alberta Court of Appeal’s recent JL Energy decision definitively holding the limitation period for launching patent infringement claims in Alberta to be six years and not two years from (at least) the first act of infringement is a very welcome clarification.

By defining a longer limitation period, such clearly serves to better protect patentees from being denied recovery of damages for acts of infringement of valid patents in Alberta.

That said, and as noted herein, the Alberta Court of Appeal did not expressly decide (the issue having been said to be moot, as noted above, on the facts of this case) as to whether the six-year limitation period runs from the actual first date of infringement or from the actual first discovered date of infringement.  Similarly, the Alberta Court of Appeal did not find it necessary to decide whether each act of infringement is creates a “rolling limitation” with recoverability of damages for infringement applying to only to those separate acts of infringement occurring (or discovered?) less than six years prior to the commencement of the action.

If the limitation period for patent infringement is not subject to a rolling limitation and/or discoverability, this may place a higher onus on patentees to be more diligent and regularly conduct investigations as to any infringements in the market. This may be particularly difficult where the patent claims a method or process and where potentially infringing parties may not publicly disclose their methods or processes.  Even when the specifics of what a putative defendant is doing are discovered and known, legal opinions may need to be obtained confirming the activities fall within one or more of the claims of the patent. In such circumstances, it may be arguable when the patentee discovered their claim.

In addition, as was the fact pattern in JL Energy, necessary monetary funding to pay legal counsel to prosecute a patent infringement action, particularly one for large monetary damages which will be vigorously defended, may firstly need be secured from a third-party litigation-funder in order to have lawyers commence the claim. Getting such monetary funding from a litigation funder in place may take time (in the case of JL Energy, litigation funding was obtained and put in place from litigation-funder Omni Bridgeway). 

As well, as was again the case in JL Energy, earlier or other collateral litigation (or litigation in another jurisdiction on an equivalent patent to the Canadian patent) as to whether the patent under which the infringement action was intended to be brought was legally valid, may cause delay if it is desired to wait until such determination of validity is made by a Court.

All of which to say that steps such as the above (and as appears to have been the case in JL Energy) may take considerable time, all against a “ticking” clock.

Accordingly, due to the period of time that some of the aforementioned preliminary steps may take, and in light of remaining uncertainties in the law, parties should be diligent in regularly investigating potential infringements of any patents that they may possess.

Commensurate with such steps, consulting as soon as practicable with a patent lawyer and seeking legal advice regarding the timing of commencing an infringement action should help reduce challenges to actions being proscribed due to expiry of the six-year limitations period and any argument as to truncation of the monetary damages claim for acts of infringement prior to six years from filing the statement of claim.

Instituting infringement actions as soon as becoming aware of infringement should further diminish arguments as to the Plaintiff having “sat on its hands,” particularly in the context of a simultaneous application for an injunction to restrain further patent infringement.