Software Supplier Not Liable in Patent Infringement Action

In 2006, dTechs epm Ltd.’s (“dTechs”) filed an application for a patent related to “… a system of detection of patterns indicative of theft of electrical utilities, such as in the indoor cultivation of marijuana” (the “087 Patent”). dTechs’ founder was a former sergeant with the Calgary Police Service who, through his work conducting investigations into illegal drugs, became interested in methods for identifying marijuana grow-ops by tracing the location of electricity theft.

A few years later, British Columbia Hydro and Power Authority (“BC Hydro”) entered into a series of contracts with Awesense Wireless Inc. (“Awesense”), a wireless technology start-up, for the supply of portable electricity sensors and related software services. One of the supply agreements contemplated Awesense sourcing technology for a program being developed by BC Hydro for detecting and preventing electricity theft. Awesense supplied the theft detection software that was ultimately integrated into BC Hydro’s system.

In 2017, dTechs brought an infringement action against BC Hydro and Awesense, claiming both defendants, separately or acting in concert, directly or indirectly, had infringed its patented processes. dTechs alleged that BC Hydro’s system, supplied by Awesense, relied on the same methods described in the 087 Patent and infringed specified claims.

The Federal Court’s Decision

After considering the parties’ evidence and interpreting the asserted claims, the Federal Court dismissed dTechs’ infringement action with reasons reported at 2021 FC 190. The Court held the 087 Patent to be invalid on the grounds of anticipation and obviousness and not infringed by BC Hydro.

As for Awesense, the Court noted it had only supplied software to BC Hydro, and did not itself perform any of the essential steps of the method described in the 087 Patent. Accordingly, Awesense could not have infringed the asserted claims:

[178] There is no infringement of a patent in selling an article that does not in itself infringe the patent, even when the vendor knows that the purchaser buys the article for the purpose of using it in the infringement of the patent (Uponor at para 285). Awesense’s supply of hardware and software to BC Hydro cannot in itself infringe the asserted claims.

The Court found Awesense exercised no control over the manner in which BC Hydro used the software and there was no evidence that Awesense ever induced BC Hydro to infringe the asserted claims, or to support an allegation of infringement by common design.

The Court therefore concluded that neither BC Hydro nor Awesense, individually or together, infringed the asserted claims of the 087 Patent.

Authors: Larissa Fulop and Shadi Varkiani