Background:

• Steelhead LNG (ASLNG) Ltd. and Steelhead LNG Limited Partnership ("Steelhead") hold a patent related to a near-shore or at-shore floating liquefied natural gas (FLNG) facility, Patent No. 3,027,085.
• ARC Resources Ltd., Rockies LNG Limited Partnership, Rockies LNG GP Corp., and Birchcliff Energy Ltd. ("Respondents") were involved in a consortium seeking to develop an FLNG project in British Columbia, relying on Steelhead's preliminary designs.

Federal Court Decision:

• The Federal Court found that the Respondents had not infringed on Steelhead's patent, as the patented invention was never physically constructed or used.

Federal Court of Appeal Analysis:

• Steelhead argued that the Respondents "used" their patented invention by disclosing Steelhead’s FLNG facility designs to stakeholders for commercial advantage.
• The appellate court rejected Steelhead's expansive interpretation of "use," affirming that it requires the actual utilization of the claimed invention (the FLNG facility), not just reliance on its conceptual designs.
• The court distinguished the case from Eurocopter v. Bell Helicopter Textron by emphasizing that the patented apparatus in that case had been physically constructed and promoted for sale, unlike the unbuilt FLNG designs in this case.

Conclusion:

• The court upheld the original judgment, dismissing the appeal and confirming that the Respondents had not infringed the patent because no FLNG facility containing Steelhead's patented elements had been built or used.

Implication:

• The case emphasizes that patent infringement under Section 42 of the Patent Act requires the utilization of the invention as claimed in the patent, not just a reliance on its conceptual design.