Date: 20071101
Docket: A-364-07
Citation: 2007 FCA 350
CORAM: NADON
J.A.
SEXTON
J.A.
SHARLOW
J.A.
BETWEEN:
APOTEX INC.
And
APOTEX PHARMACHEM INC.
Appellants
and
LES LABORATOIRES SERVIER,
ADIR, ORIL INDUSTRIES,
SERVIER CANADA INC.,
SERVIER LABORATORIES (AUSTRALIA) PTY LTD.
and SERVIER LABORATOIRES LIMITED
Respondents
REASONS FOR JUDGMENT
NADON J.A.
[1]
This is an
appeal from a decision of Madam Justice Snider of the Federal Court, 2007 FC
837, dated August 10, 2007, which allowed the motion of the respondents
(“Servier”) for an order striking those paragraphs of the Defence and
Counterclaim pertaining to the issue of “inventorship” in respect of Canadian
patent 1,341,196 (the “ ‘196 patent”).
[2]
In the
paragraphs at issue in their pleadings, the appellants (“Apotex”) submit that
the ‘196 patent is invalid because the individuals named therein as the
inventors were not the first and true inventors of the invention found in the
patent.
[3]
In
bringing it motion to strike under Rule 222(1)(a) and (f) of the Federal
Courts Rules, Servier says that the impugned paragraphs do not disclose a
cause of action or defence and that they amount to an abuse of process.
[4]
The
learned Judge first concluded that Servier had met the burden of demonstrating
that Apotex could not possibly succeed on the issue of “inventorship” raised in
the impugned paragraphs of its Defence and Counterclaim. Specifically, the
Judge accepted Servier’s interpretation of paragraph 61(1)(b) of the
pre-October 1, 1989 Patent Act (the “old Act”), R.S.C. 1985, c. P-4, that
where conflicting claims to the “inventorship” of a patent had been directed by
the Commissioner of Patents (the “Commissioner”), it was no longer open to
third parties to challenge the validity of a patent on that ground. As a
result, it necessarily followed, in the Judge’s view, that the impugned
paragraphs did not disclose a reasonable cause of action or defence.
[5]
The Judge
then turned to the second ground relied upon by Servier in bringing its motion,
namely abuse of process. She concluded that the impugned paragraphs constituted
an attempt by Apotex to challenge a consent order of this Court dated December
12, 2000, (the “consent order”) which, in her view, Apotex ought to have
challenged directly. Hence, that attempt was an abuse of process. She also
concluded that the impugned paragraphs constituted a collateral attack on the
consent order, which should not be allowed.
[6]
For those
reasons, the Judge struck, without leave to amend, the following paragraphs or
portions thereof of the Defence and Counterclaim:
(a) the
statement “in order to themselves “create” the inventorship of the
subject-matter of
the
Agreement” in paragraph 26 of the Defence and Counterclaim;
(b)
paragraphs 48 to 54 of the Defence and Counterclaim;
(c) paragraph
65 of the Defence and Counterclaim;
(d) paragraph
68 of the Defence and Counterclaim; and
(e) the
statement “and allocate among themselves overlapping claims to a number of ACE
inhibitor
compounds that did not reflect the actual inventorship of those compounds or
their
constituent classes, or the determinations of inventorship made by the
Commissioner
of Patents in 1996” in paragraph 71 of the Defence and Counterclaim.
[7]
Before
proceeding any further, it will be useful to reproduce Rule 221(1):
|
221. (1) On motion, the Court may, at any time,
order that a pleading, or anything contained therein, be struck out, with or
without leave to amend, on the ground that it
(a) discloses no reasonable cause of action
or defence, as the case may be,
(b) is immaterial or redundant,
(c) is scandalous, frivolous or vexatious,
(d) may prejudice or delay the fair trial of the
action,
(e) constitutes a departure from a previous
pleading, or
(f) is otherwise an abuse of the process of
the Court,
and
may order the action be dismissed or judgment entered accordingly.
[Emphasis added]
|
221. (1) À tout moment, la Cour peut, sur requête,
ordonner la radiation de tout ou partie d’un acte de procédure, avec ou sans
autorisation de le modifier, au motif, selon le cas :
a) qu’il ne révèle aucune cause d’action
ou de défense valable;
b) qu’il n’est pas pertinent ou qu’il est
redondant;
c) qu’il est scandaleux, frivole ou vexatoire;
d) qu’il risque de nuire à l’instruction
équitable de l’action ou de la retarder;
e) qu’il diverge d’un acte de procédure
antérieur;
f) qu’il constitue autrement un abus de
procédure.
Elle
peut aussi ordonner que l’action soit rejetée ou qu’un jugement soit
enregistré en conséquence.
[Je souligne]
|
[8]
Apotex makes a number of submissions
as to why its appeal ought to be allowed. First, with respect to that part of
Servier’s motion pertaining to Rule 221(1)(a), it says, relying on Apotex
Inc. v. Eli Lilly and Co. (2001), 13 C.P.R. (4th) 78, that
because paragraph 61(1)(b) of the old Act was a complicated and
infrequently considered statutory provision, it was not the proper subject of a
motion to strike. Apotex further says that the Motion Judge determined the fate
of the motion on the basis of facts which did not arise from the pleadings
before her. Apotex also submits that Servier was barred from bringing a second
motion to strike in the absence of special circumstances. Finally, Apotex says
that the Judge erred in her “fresh” consideration of paragraph 61(1)(b)
of the old Act.
[9]
With
respect to that part of the motion pertaining to Rule 221(1)(f), Apotex submits
that the Judge erred in concluding that the impugned paragraphs constituted an
attempt on its part to “relitigate” the issue of “inventorship” dealt with in
the conflict proceedings which resulted in the consent order. Apotex further
says that consent orders are only binding as between the parties thereto and
that, as a result, it cannot be said that the issue of “inventorship” of the
claims of the ‘196 patent had been decided by the consent order.
[10]
Apotex also
says that because the consent order is of no precedential value with respect to
the substantive issue arising from the “inventorship” allegations which it makes,
it therefore cannot be said that a determination of this action, inconsistent
with the consent order, would impair the integrity of the judicial system.
[11]
For the
reasons that follow, I conclude that this appeal should be allowed.
ABUSE OF PROCESS
[12]
I begin
with the abuse of process point. To place this issue in its proper context, it
will be useful to reproduce paragraphs 7 to 10 of the Judge’s Reasons:
[7]
Generally speaking, the 196 Patent claims the compound perindopril, which is
sold in Canada and
elsewhere under the registered trademark name of COVERSYL.
[8]
The process leading to the issue of the 196 Patent began on October 1, 1981
when one of the Plaintiffs in this action, Adir, filed Application 387,093 (the
093 Application) in Canada. The 093 Application named Michel Vincent,
George Remond and Michel Laubie, as Inventors. In separate applications, two
other claimants also applied for the issuance of patents covering certain
compounds. As provided for in the Old Act, certain of the claims in the 093
Application were placed into conflict with claims in other applications. In
table form, the specifics of the applications and the claims in conflict are as
follows:
|
Applicant
|
Application
No.
|
Date of
Application
|
Claims in
Conflict
|
|
Adir
|
… (the 093
Application)
|
Oct 1, 1981
|
C19, C25 to
C28, C33 and C34, C39 and C40
|
|
Schering
|
… (the 336
Application)
|
Oct 20,1981
|
C19, C39 and
C40
|
|
Hoechst
Aktiengesellschaft (Hoechst)
|
… (the 787
Application)
|
Aug 28, 1981
|
C19, C25 to
C28
|
|
Hoechst
|
… (the 453
Application)
|
Dec 23, 1982
|
C33 and C34
|
[9] In
four decisions dated August 8, 1996, the Commissioner of Patents made
determinations related to inventorship, pursuant to s. 43(7) of the Old Act.
In sum, the effect of his decision was that certain of the claims were awarded
to Adir, and others to each of Hoechst and Schering. Of particular relevance,
the Commissioner awarded the subject matter of the conflict claims C19, C39 and
C40 to Schering and not to Adir. In table form, the conclusions of the
Commissioner are as follows:
|
Claim No.
|
First Invention Date
|
Claim Awarded To
|
Claims Refused To
|
|
C19
|
Aug 8, 1980
|
Schering
(336 App’n)
|
Adir (093 App’n)
Hoechst (787 App’n)
|
|
C25, C27
|
May 8, 1981
|
Hoechst
(787 App’n)
|
Adir (093 App’n)
|
|
C26, C28
|
Oct 2, 1980
|
Adir
(093 App’n)
|
Hoechst (787 App’n)
|
|
C33
|
Oct 8, 1981
|
Hoechst
(453 App’n)
|
Adir (093 App’n)
|
|
C34
|
Dec 29, 1981
|
Hoechst
(453 App’n)
|
Adir (093 App’n)
|
|
C39, C40
|
Aug 8, 1980
|
Schering
(336 App’n)
|
Adir (093 App’n)
|
[10] This
was not the end of the matter. In accordance with s. 43(8) of the Old Act, six proceedings
were commenced by way of actions in the Federal Court for the determination of
the parties’ respective rights in relation to the subject matter of the
conflict claims. All of the proceedings were consolidated pursuant to the Order
of Justice Joyal dated May 27, 1997 (Court File No. T-228-97). Subsequent to
completion of discoveries in the consolidated actions, an Order on consent was
issued by Justice Nadon on December 12, 2000. That Order provided for an
allocation of the claims of the three Applications. Some claims were awarded to
Adir, others to Aventis Pharma Deutschland (Aventis, successor to Hoechst) and
others to Schering. The result, for Adir, was the issuance of the 196 Patent.
Relevant to this action by the Plaintiffs [Servier], the claims awarded to
Adir, pursuant to s. 43(8) of the Old Act, included claims 1, 2, 3, and 5 which
are asserted against the Defendants [Apotex] as having been infringed.
[13]
As the
Judge makes perfectly clear, a number of conflicting applications were made to
the Patent Office in respect of certain compounds. As a result, the
Commissioner made four decisions, pursuant to subsection 43(7) of the old Act,
with respect to the issue of “inventorship”. Following the Commissioner’s
decisions, proceedings were commenced by way of actions in the Federal Court so
as to determine the respective rights of the applicants. However, prior to the
actions going to trial, I issued an order on consent on December 12, 2000,
which allocated the claims between the various applicants. In the result, the
‘196 patent was issued in the name of the respondent Adir. At issue in these
proceedings are claims 1, 2, 3 and 5 of that patent, which Servier says Apotex
has infringed.
[14]
After
setting out the principles pertaining to the doctrine of abuse of process enunciated
by the Supreme Court in Toronto (City) v. CUPE Local 79, [2003] 3 S.R.C.
77, the learned Judge asked herself two questions: (i) whether the allegations
found in the impugned paragraphs of Apotex’s pleadings amounted to relitigation;
and (ii) if so, whether the relitigation amounted to an abuse of process. She
answered both questions in the affirmative.
[15]
In my
view, the Judge was clearly wrong in so concluding. It cannot be said that Apotex,
in making the allegations found in the impugned paragraphs, is attempting to
relitigate the issue which was determined by the consent order. Indeed, Apotex
was not a party to the proceedings which led to the consent order. Contrary to
the assertion made by the Judge at paragraph 80 of her Reasons, Apotex could
not have challenged the consent order because it does not and could not have
had the status of a party in the conflict proceedings.
[16]
As I
indicated earlier, in concluding as she did, the Judge relied on the Supreme
Court’s decision in CUPE, supra. More recently, this Court, in Sanofi-Aventis
Canada Inc. v. Novopharm Limited et al, 2007 FCA 163, April 23, 2007, fully
considered the doctrine of abuse of process. Neither decision, in my view, is
helpful to Servier.
[17]
In CUPE,
the issue was whether a labour arbitrator could, in the context of a grievance,
reconsider the guilt of a person convicted of sexual assault and, as a result,
dismissed from his employment. In concluding that the person’s guilt could not
be relitigated, the Supreme Court applied the doctrine because the employee,
who had been found guilty of sexually assaulting a boy under his supervision,
was attempting to adduce before the arbitrator evidence proving his innocence
with respect to the charges for which he had been convicted and sentenced to 15
months in prison.
[18]
In those
circumstances, it was not surprising that the Supreme Court concluded that
allowing the employee to attempt to prove his innocence in the grievance
proceedings would constitute an abuse of process. As Arbour J. said at
paragraph 56 and 57 of her Reasons:
56 …
I am of the view that the facts in this appeal point to the blatant abuse of
process that results when relitigation of this sort is permitted.
The grievor was convicted in a criminal court and he exhausted all his avenues
of appeal. In law, his conviction must stand, with all its consequent legal
effects. Yet
as pointed out by Doherty J.A. (at para. 84):
Despite the arbitrator’s
insistence that he was not passing on the correctness of the decision made by
Ferguson J., that is exactly what he did. One cannot read the arbitrator’s
reasons without coming to the conclusion that he was convinced that the
criminal proceedings were badly flawed and that Oliver was wrongly convicted.
This conclusion, reached in proceedings to which the prosecution was not even a
party, could only undermine the integrity of the criminal justice system. The
reasonable observer would wonder how Oliver could be found guilty beyond a
reasonable doubt in one proceeding and after the Court of Appeal had affirmed
that finding, be found in a separate proceeding not to have committed the very
same assault. That reasonable observer would also not understand how
Oliver could be found to be properly convicted of sexually assaulting the
complainant and deserving of 15 months in jail and yet also be found in a
separate proceeding not to have committed that sexual assault and to be
deserving of reinstatement in a job which would place young persons like the
complainant under his charge.
57
As a result of the conflicting decisions, the City of Toronto would find itself
in the inevitable position of having a convicted sex offender reinstated to an
employment position where he would work with the very vulnerable young people he
was convicted of assaulting. An educated and reasonable public would
presumably have to assess the likely correctness of one or the other of the
adjudicative findings regarding the guilt of the convicted grievor. The
authority and finality of judicial decisions are designed precisely to
eliminate the need for such an exercise.
[Emphasis
added]
[19]
In Sanofi-Aventis,
supra, we concluded that Sanofi-Aventis, a patentee, was abusing the
process in seeking to relitigate an allegation of invalidity made by a generic manufacturer
when it had earlier failed, in different proceedings, to establish that a
similar allegation made by a different generic drug manufacturer was not
justified. Although the parties to the two proceedings were not the same, i.e.
different generic drug manufacturers, the party whose proceedings were found to
be abusive, i.e. Sanofi-Aventis, was a party to both proceedings. That is not
the case in the present matter.
[20]
The
doctrine of abuse of process seeks to prevent relitigation in situations where
the strict requirements of issue estoppel are not met, but where
permitting the litigation to proceed would be contrary to the integrity of the
court’s process and to the good administration of justice (see Doherty J.A.’s
Reasons in CUPE v. Toronto (City) (2003), 55 O.R. (3d) 541 at para. 65).
In that light, the words of Kerr L.J. at page 137 of his Reasons in Bragg v.
Oceanus Mutual Underwriting Association (Bermuda) Ltd., [1982] 2 Lloyd’s
Rep. 132, C.A., are entirely apposite:
To take the authorities
first, it is clear that an attempt to religitate in another action issues which
have been fully investigated and decided in a former action may
constitute an abuse of process, quite apart from any question of res
judicata or issue estoppel on the ground that the parties or their
privies are the same. It would be wrong to attempt to categorize the situations
in which such a conclusion would be appropriate. However, it is
significant that in the cases to which we were referred, where this conclusion
was reached, the attempted relitigation had no other purpose than what Lord
Diplock described as:
… mounting a collateral
attack upon a final decision … which has been made by another court of
competent jurisdiction in previous proceedings in which … (the party
concerned) had a full opportunity of contesting the decision of the court by
which it was made
[Emphasis
added]
[21]
I am
entirely satisfied that the impugned paragraphs do not constitute a collateral
attack on the consent order. In the end, I am of the view that whether Apotex
can raise the issue of “inventorship” as a ground of invalidity will ultimately
depend on the interpretation of paragraph 61(1)(b) of the old Act. If
that provision is read so as to foreclose that possibility when a conflict has
been directed, then Apotex’s challenge will not succeed. However, should the
Court ultimately agree with Apotex’s interpretation of the provision, then
Apotex will have a fighting chance if it can prove its allegations. However,
not having been involved in the proceedings which led to the consent order,
Apotex was never in a position to challenge the assertions of “inventorship”
made in those proceedings and which resulted in the consent order.
[22]
For these
reasons, I am of the opinion that the Judge was wrong to conclude that the
impugned paragraphs constitute an abuse of process.
Reasonable
Cause of Action oR Defence
[23]
I now turn
to the Rule 221(1)(a) point, i.e. whether it is plain and obvious that
the impugned paragraphs disclose no reasonable cause of action or defence. In
my view, the Judge also erred in giving an affirmative answer to that question.
[24]
There is
no disagreement between the parties that the relevant test is that set out by
the Supreme Court in Hunt v. Carey Inc., [1990] 2 S.C.R. 959, where the issue
before the Court was whether those portions of the Statement of Claim, wherein
the plaintiff alleged that the defendants had conspired to withhold information
concerning the effects of asbestos fibres, disclosed a reasonable cause of
action. A motion to strike was brought under Rule 19(24) of the British
Columbia Rules of Court, a Rule almost identical to our Rule 221(1).
[25]
After a
careful review of both English and Canadian jurisprudence on point, the Supreme
Court, at page 980, explained the test governing provisions similar to our Rule
221(1) in the following terms:
Thus, the
test in Canada governing the application of provisions like Rule 19(24)(a) of
the British Columbia Rules of Court is the same as the one that governs an
application under R.S.C. O. 18, r. 19: assuming that the facts as stated in the
statement of claim can be proved, is it "plain and obvious" that the
plaintiff's statement of claim discloses no reasonable cause of action? As
in England, if there is a chance that the
plaintiff might succeed, then the plaintiff should not be "driven from the
judgment seat". Neither the length and complexity
of the issues, the novelty of the cause of action, nor the potential for the
defendant to present a strong defence should prevent the plaintiff from
proceeding with his or her case. Only if the action is certain to fail
because it contains a radical defect ranking with the others listed in Rule
19(24) of the British Columbia Rules of Court should the relevant portions of a
plaintiff's statement of claim be struck out under Rule 19(24)(a).
[Emphasis added]
[26]
The Supreme
Court then turned its attention to the specific issue before it, i.e. whether
it was “plain and obvious” that the plaintiff’s allegation concerning the tort
of conspiracy disclosed no reasonable cause of action. More particularly, the
issue was whether the plaintiff’s plea of conspiracy outside of a commercial
context stood any chance of success.
[27]
In order
to resolve the issue, the Supreme Court reviewed both English and Canadian case
law. With respect to English law, the Court concluded that the law in England was to the effect that a
plaintiff could not succeed with a tort of conspiracy unless he or she was able
to demonstrate that the purpose for which the conspirators acted was to harm
the plaintiff. At page 189 of his Reasons in Lonrho Ltd. v. Shell Petroleum
Co. (No. 2), [1982] A.C. 173, Lord Diplock explained the English position
in the following terms:
… The civil
tort of conspiracy to injure the plaintiff’s commercial interests where that is
the predominant purpose of the agreement between the defendants and of the acts
done in execution of it which caused damage to the plaintiff, must I think be
accepted by this House as too well-established to be discarded, however
anomalous it may seem today. It was applied by this House 80 years ago in Quinn
v. Leathem, [1901] A.C. 495, and accepted as good law in the Crofter
case [1942] A.C. 435, where it was made clear that injury to the
plaintiff and not the self-interest of the defendants must be the predominant
purpose of the agreement in execution of which the damage-causing acts were
done.
[Emphasis
added]
[28]
The
Supreme Court then turned to the situation in Canada. It started its discussion by pointing
out that the law in this country, with respect to the tort of conspiracy, was
not on all fours with the law in England
as set out in Lonhro, supra. The Court referred to its decision in Canada
Cement LaFarge Ltd. v. British Columbia Lightweight Aggregate Ltd., [1983]
1 S.C.R. 452, where at pages 468, 471 and 472, Mr. Justice Estey made the
following remarks:
The question
which must now be considered is whether the scope of the tort of conspiracy in
this country extends beyond situations in which the defendants' predominant
purpose is to cause injury to the plaintiff, and includes cases in which this
intention to injure is absent but the conduct of the defendants is by itself
unlawful, and in fact causes damage to the plaintiff.
…
Although the law
concerning the scope of the tort of conspiracy is far from clear, I am of the
opinion that whereas the law of tort does not permit an action against an
individual defendant who has caused injury to the plaintiff, the law of torts
does recognize a claim against them in combination as the tort of conspiracy
if:
(1) whether the means
used by the defendants are lawful or unlawful, the predominant purpose of the
defendants' conduct is to cause injury to the plaintiff; or,
(2) where the conduct of
the defendants is unlawful, the conduct is directed towards the plaintiff
(alone or together with others), and the defendants should know in the
circumstances that injury to the plaintiff is likely to and does result.
In situation (2)
it is not necessary that the predominant purpose of the defendants' conduct be
to cause injury to the plaintiff but, in the prevailing circumstances, it must
be a constructive intent derived from the fact that the defendants should have
known that injury to the plaintiff would ensue. In both situations,
however, there must be actual damage suffered by the plaintiff.
[Emphasis
added]
[29]
Its review
of Canada Cement LaFarge, supra, led the Supreme Court to
point out that in cases falling under Mr. Justice Estey’s second scenario, it
may not be necessary in Canada to prove actual intent on the
part of the conspirators. Thus, faced with conflicting case law, the Supreme
Court made it clear that it was not appropriate, in the context of a motion to
strike, to decide what constituted “good law” on the issue. The Court went on
to say that notwithstanding the fact that the pleadings showed that a difficult
or important point of law was at issue, there was no call to strike the
Statement of Claim. To the contrary, the Court said at pages 990 and 991:
… where a
statement of claim reveals a difficult and important point of law, it may well
be critical that the action be allowed to proceed. Only in this way can we be
sure that the common law in general, and the law of torts in particular, will
continue to evolve to meet the legal challenges that arise in our modern
industrial society.
[30]
At issue
with respect to the Rule 221(1)(a) point is paragraph 61(1)(b) of
the old Act, which provides as follows:
|
61. (1) No patent or claim in a patent shall be
declared invalid or void on the ground that, before the invention therein
defined was made by the inventor by whom the patent was applied for, it had
already been known or used by some other person, unless it is established
that
…
(b) that other person had, before the issue of
the patent, made an application for patent in Canada on which conflict
proceedings should have been directed;
[Emphasis added]
|
61. (1) Aucun brevet ou aucune revendication dans
un brevet ne peut être déclaré invalide ou nul pour la raison que l’invention
qui y est décrite était déjà connue ou exploitée par une autre personne avant
d’être faite par l’inventeur qui en a demandé le brevet, à moins qu’il ne
soit établi que, selon le cas :
[…]
b) cette autre personne avait, avant la
délivrance du brevet, fait une demande pour obtenir au Canada un brevet qui
aurait dû donner lieu à des procédures en cas de conflit;
[Je souligne]
|
[31]
The specific
question before the Motion Judge was whether it was “plain and obvious”, by
reason of paragraph 61(1)(b), that Apotex could not possibly succeed on
the question of “inventorship”. The question was not whether the Motion Judge preferred
one interpretation over the other, but rather, whether the meaning of the
paragraphs was a foregone conclusion. In my view, it was not.
[32]
After a
review of the cases pertaining to paragraph 61(1)(b), the Judge makes
the following comments. First, at paragraph 52 of her Reasons, she states that the
cases support Servier’s proposed interpretation. Then, however, at paragraph
53, she states that because the cases “[do] not directly rule on the issue
before me”, she will make a fresh determination of the meaning of the
paragraph. The Motion Judge then proceeds to determine which interpretation is
the correct one, performing a purposive and contextual interpretation of paragraph
61(1)(b), which leads her, at paragraphs 61 and 62, to the following
conclusion:
[61] An
interpretation of s. 61(1)(b) as suggested by the Plaintiffs is consistent with
the principles identified in Free World Trust, consistent with both the
s. 61(1)(b) and conflict proceeding lines of authority, and helps, not hinders,
the patent system embodied in the Old Act. On this purposive interpretation of
the statutory provisions of the Old Act, it is entirely consistent to separate
out the concept of inventorship for “special treatment”. By preventing a
finding of invalidity where conflict proceedings have been directed, the
foundation concept of the Old Act – first inventorship – is protected. On the
other hand, no special provisions are contained within the Old Act that would
protect a patentee from other grounds of invalidity attacks. Accordingly, those
other grounds may be raised in the usual course. In my view, this is the result
that Parliament intended.
[62]
Furthermore, it should be emphasized again that such an interpretation would be
limited to precluding parties where there is no “missed conflict” from
advancing an allegation of prior inventorship. Other grounds for questioning
the validity of a patent are unaffected.
[33]
Because of
her preferred interpretation of the paragraph, she then concludes, at paragraph
64 of her Reasons, that she is satisfied that Apotex “… cannot meet the
requirements of s. 61(1)(b) of the Old Act”, and that, as a
result, “… it is plain and obvious that the impugned provisions of the Defence
and Counterclaim disclose no reasonable cause of action and should be struck”.
[34]
At paragraph
39 of its written submissions, Apotex submits, rightly in my view, that “if the
responding party has put a conflicting interpretation ‘worth considering’, it
is not plain and obvious that the claim will not succeed”. Although it is clear
the Motion Judge correctly understood the “plain and obvious” test enunciated
in Hunt, supra, she did not answer the question of whether or not
Apotex’s proposed interpretation was “worth considering” or whether it had any
chance of success. Rather, she reached her own conclusion on the disputed point
of statutory interpretation. That, in my view, constitutes an error on her
part. I therefore turn to the issue of whether or not Apotex’s proposed
interpretation has any chance of success.
[35]
I begin by
stating the interpretation which the Judge accepted as being the correct
interpretation of paragraph 61(1)(b). That is that a third party cannot raise
“inventorship” as a ground of invalidity where there is no “missed conflict”,
i.e. where there was an application for a patent in respect of which conflict
proceedings could have been directed and were in fact directed.
[36]
On the
other hand, Apotex argues that paragraph 61(1)(b) cannot be limited “to
instances where conflict proceedings should have been directed, but were not in
fact directed” (paragraph 69 of Apotex’s Memorandum of Fact and Law). In its view,
the paragraph includes all situations where a conflict should have been
directed, and this whether or not it was in fact directed. Apotex submits that
that approach is consistent with the legislative intent and case law.
[37]
With
respect to legislative intent, Apotex says that section 61 was added to the old
Act by reason of the Privy Council’s decision in Rice v. Christiani, [1931]
A.C. 770, wherein the Privy Council found that a Danish invention, which had
been kept secret and confidential and never made available to the public, was
sufficient to invalidate a Canadian patent on the basis that another inventor
was “the first and true inventor”.
[38]
The
specific purpose of section 61, Apotex says, was to undo the effect of Rice,
supra, and to realign Canadian patent law with that of England and the United States. Specifically, it says that
the purpose of section 61 was to prevent prior inventors from carrying back the
date of their invention unless they had disclosed or used their invention in a
manner that it had become available to the public in Canada or that they had, prior
to the issue of a patent, filed an application for patent in Canada.
[39]
At
paragraphs 82 to 84 of its Memorandum, Apotex makes a further argument:
82. Paragraph
61(1)(b) contemplates an anticipation/novelty attack which is not based
on public disclosure or use. An allegation of prior inventorship could fit
within that scenario. In such cases, the subsection says that a patent shall
not be invalidated unless it is shown that, prior to the issuance of the
impugned patent, the alleged earlier inventor had made a patent application “on
which conflict proceedings should have been directed”.
83. Read
in context, the phrase “conflict proceedings should have been directed” simply
means that the circumstances that justify conflict proceedings pursuant to
subsection 43(1) of the Old Act must have existed. In other words, it
must be shown that the alleged earlier inventor’s application and the
application from which the impugned patent issued contained “one or more claims
defining substantially the same invention” or the “claims of one application
described the invention disclosed in the other application”.
84. So
construed, the intent of paragraph 61(1)(b) would be served if conflict
proceeding not only ought to have occurred but also did occur
(but, because they were not properly resolved, the impugned patent was able to
be issued). Indeed, the purpose of paragraph 61(1)(b) would be even
better served by showing that the Patent Office itself did, in fact, identify
“substantially the same invention” in a co-pending application.
[40]
Apotex also
says that had it been Parliament’s intention to prohibit a third party’s right
to raise “inventorship” as a ground of invalidity where conflict proceedings
had been directed by the Commissioner, more explicit wording would have been
expected.
[41]
Finally,
Apotex says that the interpretation arrived at by the Motion Judge is not
consistent with the fact that the scope of conflict proceedings is limited to
the parties involved in those proceedings. Hence, since third parties have no
standing to intervene in those proceedings, one would have expected Parliament
to make it clear that those third parties could not question first
inventorship.
[42]
With
respect to the case law, Apotex says that the jurisprudence in respect of
“conflict proceedings” supports its proposed interpretation. Firstly, it says
that two of the cases relied on by the Motion Judge, Texaco Development
Corp. v. Schlumberger Ltd. (1967), 49 C.P.R. 225 (Ex. Ct.) and Nakoosa
Packaging Corp. v. Amca International Ltd. (1989), 27 C.P.R. (3d) 153
(F.C.T.D.), are “directly contradictory to the conclusions made by the Motion
Judge at paragraph 55 of her Reasons for Order” (paragraph 110 of the
Appellants’ Memorandum). Second, they say that both Radio Corp. of America
v. Hazeltine Corp. (1977), 33 C.P.R. (2d) 211 (F.C.A.) and Air Products
and Chemicals, Inc. v. Bayer Aktiengesellschaft (1979), 55 C.P.R. (2d) 1984
(F.C.T.D.) support their point of view. This leads Apotex to say, at paragraph
117 of its Memorandum:
117. In
sum, contrary to the conclusions of the Motion Judge, the case law in respect
of the scope of conflict proceedings is irreconcilable with both the Motion
Judge’s interpretation of paragraph 61(1)(b) of the Old Act and
the Motion Judge’s interpretation of the very cases she cites in respect of the
scope of conflict proceedings. It is respectfully submitted that, on the
above-mentioned jurisprudence, there is no basis in law for upholding the
Motion Judge’s disposition. It can hardly be said that it is plain and obvious
that there is a legislative intent to render patents born out of conflict
proceedings “unimpeachable” on the issue of inventorship. To the contrary, it
is plain and obvious that a party may challenge inventorship in proceedings
subsequent to conflict proceedings that result in the grant of a patent.
[43]
Apotex then
makes a number of submissions with regard to those cases which the Motion Judge
referred to as pertaining to the interpretation of section 61(1) -- namely: Aventis
Pharma Inc. v. Apotex Inc., 2005 FC 1283, AT&T Technologies Inc. v.
Mitel Corp. (1989), 26 C.P.R. (3d) 238, and this Court’s decision in Pfizer
Canada Inc. v. Canada (Minister of Health), 2007 FCA 209. Apotex says that
the question before the Court in all three cases was not the one that was
before the Motion Judge and that, as a result, they do not support the Judge’s
interpretation.
[44]
Hence, in
Apotex’s submission, “the authorities cited by Servier and relied upon by the
Motion Judge to support the Court’s interpretation of paragraph 61(1)(b)
are far from making the result plain and obvious” (see Apotex’s Memorandum,
para. 118).
[45]
In Pfizer
Inc. v. Canada, [1999] F.C.J. No. 1598
(Court file A-469-99, Judgement dated October 14, 1999), this Court, in
dismissing an appeal from a decision of Lemieux J. of the Federal Court who had
struck out in its entirety the plaintiffs’ Statement of Claim on the ground
that their interpretation of various statutory provisions could not possibly
succeed, made the following remarks:
[1] We
agree with the learned Motions Judge that it is plain and obvious that the
appellant cannot succeed. Neither the World Trade Organization Agreement
Implementation Act (the WTO Act) nor the Agreement on Trade Related
Aspects of Intellectual Property Rights (the TRIPS Agreement) purport to
extend the period of protection for patents issued prior to the coming into
force of the Statute.
[2] In
order for the appellant to succeed on this appeal, this Court must be prepared
to accept what are at best tenuous arguments relating to statutory
interpretation. For example, the appellant argues that section 45 of
the Patent Act was not amended under and pursuant to the WTO Act because of
oversight on the part of Parliament. In our respectful view this argument lacks
merit. The Motions Judge rejected this and other tangential arguments and in so
doing he did not err in striking the appellant's amended statement of claim
under paragraph 221(1)(a) of the Federal Court Rules.
[3] In
light of this conclusion, it is unnecessary for us to express any view as to
the validity of the statutory bars contained in sections 5 and 6 of the WTO
Act. The appeal will be dismissed with costs.
[Emphasis
added]
[46]
After
careful consideration of Apotex’s argument and the cases to which it refers us,
I am satisfied that it cannot be said that its proposed interpretation of
paragraph 61(1)(b) is either tenuous or devoid of any merit. I should
add that there are no reported decisions on point with respect to the proper
interpretation of paragraph 61(1)(b) and that none of the cases referred
to by the Judge and the parties clearly point to the interpretation favoured by
the Judge.
[47]
Consequently,
I conclude that it is not “plain and obvious” that Apotex cannot succeed on the
issue raised in the impugned paragraphs.
[48]
For these
reasons, I would therefore allow the appeal, set aside the decision of the
Federal Court and dismiss Servier’s motion to strike. I would allow Apotex its costs
herein and below.
“M.
Nadon”
“I
agree.
J.
Edgar Sexton J.A.”
“I
agree.
K.
Sharlow J.A.”
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