Executive Summary: Key Legal and Evidentiary Issues

• The core issue was whether the appellant’s patent infringement claim was governed by the two-year limitation period under Alberta’s Limitations Act or the six-year limitation under section 55.01 of the Patent Act.

• The Alberta Court of Appeal held that the federal limitation period applies to patent infringement claims, overturning the summary dismissal based on the provincial statute.

• The Court clarified that claims created under federal statutes with specific limitation periods fall outside the scope of provincial limitations legislation.

• The decision found that the “Secure Energy” precedent should no longer be followed regarding limitation periods for patent claims in Alberta.

• The argument that each act of infringement potentially creates a fresh cause of action was deemed unresolved and inappropriate for summary dismissal, leaving it to be addressed at trial.

• Allegations of breach of license and disclosure of confidential information were acknowledged but not fully determined, as they require factual findings at trial.

Background and parties involved

JL Energy Transportation Inc. (JL) owns intellectual property related to the use of natural gas mixtures to improve hydraulic efficiency in high-pressure gas pipelines and associated facilities. It licensed this technology to various entities under the Alliance name for use in specific pipelines.

The dispute emerged when JL claimed that Alliance Pipeline Limited Partnership and related respondents were using the technology in lateral pipelines not covered by the license agreements. These pipelines included the Septimus (operational in September 2010), Prairie Rose (July 2011), and Tioga (September 2012) laterals.

Initial dismissal and limitation dispute

JL filed a statement of claim on May 11, 2016. The case management judge concluded that JL had sufficient knowledge of the alleged infringement by November 27, 2013. Under Alberta’s Limitations Act, this placed JL outside the two-year limitation period. As a result, the judge summarily dismissed the claim.

However, JL argued that the six-year limitation period in section 55.01 of the Patent Act applied instead. The legal question centered on which statute governed the claim: the provincial Limitations Act, or the federal Patent Act.

Appeal and appellate court ruling

The Alberta Court of Appeal, in its 2025 decision (2025 ABCA 26), overturned the summary dismissal. The Court found that patent infringement is a statutory cause of action created by federal law (section 55 of the Patent Act) and thus falls under the federal six-year limitation in section 55.01.

The Court clarified that the Limitations Act does not apply to claims “to which this Act can apply,” meaning it cannot override a limitation period set out in a federal statute. The reasoning followed principles of statutory interpretation and constitutional boundaries, ruling that the Secure Energy decision had incorrectly applied provincial limitations to federal rights.

Rolling limitation period and unresolved claims

The Court addressed JL’s argument that each day of unauthorized use of its patented technology constituted a new act of infringement, potentially resetting the limitation period. It concluded that this issue was fact-dependent and could not be resolved without trial. Similarly, claims of breach of license agreements and disclosure of confidential information could not be summarily adjudicated and were preserved for trial.

The Court explained that the function of the license agreements in the litigation was mostly defensive—the respondents might argue their use was permitted under the licenses, and JL’s response would be that such use exceeded the licenses' scope.

Reconsideration of precedent and procedural history

In a separate but related 2024 ruling (2024 ABCA 175), the Court had already granted JL permission to argue that the precedent set in Secure Energy Services Inc v Canadian Energy Services Inc, 2022 ABCA 200 should be reconsidered. The appellate court accepted JL’s position that Secure Energy may have been flawed regarding the application of limitation periods to patent infringement claims and continuous torts.

Outcome

The Alberta Court of Appeal set aside the dismissal, rejected the respondents’ applications for summary judgment, and remitted the matter for trial. It held that the six-year federal limitation applied and that genuine issues of material fact, including the potential for rolling limitations and license scope, precluded summary judgment.