Date:
20080304
Docket:
A-328-07
Citation:
2008 FCA 88
CORAM: LINDEN J.A.
SEXTON J.A.
RYER
J.A.
BETWEEN:
AKTIEBOLAGET
HÄSSLE
Appellant
and
APOTEX INC.
Respondent
REASONS FOR JUDGMENT OF THE
COURT
(Delivered
from the Bench at Toronto, Ontario, on March 4, 2008)
SEXTON J.A.
[1]
This is an
appeal by Aktiebolaget Hässle (the “appellant”) from the order of the Federal
Court (the “Motions Judge”) who concluded that it was not plain and obvious
that the invalidity action launched by Apotex Inc. (the “respondent”) was moot
due to the expiry of the patent in question.
[2]
The motion
in this appeal arises within the context of an invalidity action involving
Canadian Letters Patent No. 1,264,751 (the “‘751 patent”) owned by the
appellant. The patent claims novel salts of the compound omeprazole, which is
useful as a gastric acid secretion inhibiting agent. The respondent wished to
market its generic version of omeprazole.
[3]
In
September 2001, the respondent delivered a notice of allegation (“NOA”) that
the ‘751 patent was invalid. On October 24, 2001, the appellant and AstraZeneca
Canada Inc. commenced a proceeding pursuant to the Patented Medicines
(Notice of Compliance) Regulations (SOR/93-133) (the “NOC Regulations”)
seeking an order prohibiting the Minister of Health (the “Minister”) from
issuing a notice of compliance to the respondent for omeprazole magnesium
tablets until after the expiry of the ‘751 patent. On June 20, 2003, Justice Campbell
granted the requested prohibition order (2003 FCT 771).
[4]
The
respondent commenced an impeachment action against the appellant on November
17, 2003. The respondent’s Statement of Claim, amended on October 29, 2004 and
November 22, 2005, requested “A declaration that each of the claims of Canadian
Letters Patent No. 1,264,751 is invalid, void and of no force or effect”.
[5]
This Court
upheld the prohibition order of Justice Campbell on November 1, 2004 (2004 FCA
369) and the Supreme Court of Canada denied leave on April 21, 2005 (File No.: 30716).
[6]
The invalidity
action has been set down for a ten-day trial commencing in February 2009. The
‘751 patent expired on January 23, 2007. On March 8, 2007, the
appellant filed a notice of motion seeking an order dismissing the action in
its entirety.
[7]
Madam
Prothonotary Tabib refused to grant the appellant’s motion for an order
dismissing the action in its entirety for mootness, finding that she could not
conclude that it was plain and obvious that the determination of the proceeding
could have no legal effect or consequences on the parties. For similar reasons,
she found that it was not plain and obvious that the respondent no longer had
standing to pursue the action.
[8]
The
Motions Judge exercised his discretion de novo, pursuant to the
principle that where an order is discretionary, it must be reviewed de novo
if the questions raised in the motion are vital to the final outcome, or if the
decision is based upon a wrong principle of law or upon a misapprehension of the
facts (Merck & Co., Inc. v. Apotex Inc. 2003 FCA 488, [2004] 2
F.C.R. 459).
After reviewing
the case law on point in this appeal, he agreed with Prothonotary Tabib that it
was not plain and obvious that the action was moot, and thus dismissed the
appeal.
[9]
There are
two issues in this appeal:
- Should the action be dismissed
because the action is moot?
- Should the action be dismissed
because the respondent lacks standing?
[10]
When the
lower court judge has made a discretionary decision, it will usually be afforded
deference by the appellate court. In
an interlocutory matter of this kind, a Court of Appeal will not interfere with
the discretion exercised by a judge of first instance unless it is shown that
the motions judge proceeded on an erroneous principle of law, or some
misapprehension of the facts or that the decision resulted in some injustice to
the appellant: Citipage Ltd. v. Barrigar & Oyen (1993), 49 C.P.R.
(3d) 1 (F.C.A.) at 3.
[11]
The choice
of the appropriate test to apply in deciding whether or not a matter is moot is
a question of law. The decision of whether to hear a moot action is
discretionary: Borowski, infra, at paragraphs 15 & 16.
[12]
This
matter seems to have been confused by the fact that, in their Notice of Motion,
the appellant relied on – but was not limited to – Rule 221, which is the rule
to strike pleadings. However, the appellant’s Notice of Motion specifically asked
for “an Order dismissing the action in its entirety.” We would comment that it
makes no sense to rely on the rule to strike pleadings when aiming to dismiss
an action in its entirety on the ground of mootness. The jurisdiction to strike
a proceeding for mootness arises from the inherent jurisdiction of a court to
control its own process. As a result, the reliance on Rule 221 was misconceived
(in the decisions below and by the appellant) since this was a request
for an order to dismiss the proceeding in toto on the ground of
mootness.
[13]
However,
the Motions Judge did recognize at paragraph 5 of his reasons for order that
courts have the power to dismiss an action for mootness by way of their
inherent power to control their own process (and independently of Rule 221). Unfortunately,
the Motions Judge erred in law by attempting to subsume the “plain and obvious”
test in Rule 221 to the question of mootness at paragraph 15 of his reasons: “Notwithstanding that the
Court’s right to dismiss an action on the grounds that it is moot is not
limited to the circumstances set out in Rule 221, that rule serves as a useful
guide.” He then relied on a statement by Prothonotary Hargrave in British
Columbia Native Women’s Society v. Canada, [2000] F.C.J. No. 588 (QL) at
paragraph 6 where the Prothonotary noted, “A proceeding may be struck out for
mootness… such a moot claim will plainly and obviously not succeed, in the
sense that it will not produce a practical result…” There is nothing in
Prothonotary Hargrave’s statement that suggests that the legal question to
employ is whether an action is “plainly and obviously” moot. The correct
approach for this Court to employ is to simply decide whether or not the action
is moot. It is helpful to point out that the leading Supreme Court
jurisprudence dealing with mootness makes no reference to a “plain and
obvious” test when addressing the issues of mootness: Borowski, infra,
and Doucet, infra. The “plain and obvious” test comes from the
Supreme Court of Canada case of Hunt v. Carey [1990] 2 S.C.R. 959, which
remains the leading case on the test for a motion to strike a pleading as
disclosing no cause of action.
[14]
The
Supreme Court of Canada has established the criteria for determining whether a
matter is moot in Borowski v. Canada (Attorney
General)
[“Borowski”], [1989] 1 S.C.R. 342, 57 D.L.R. (4th) 231, [1989] S.C.J.
No. 14
(QL) at paragraph 15. There
is no question that the invalidity action involving an expired patent is moot: the
thing that the respondent seeks to be declared invalid no longer exists: see Bayer
v. Apotex (2004) 32 C.P.R. (4th) 449 (F.C.A.). The real question at bar is
whether this Court should exercise its discretion to hear the moot dispute. The Motions
Judge, given that he found the action was not moot, did not have to deal with
the issue of discretion as to whether the action should proceed. It is
therefore necessary for this Court to consider the question of discretion.
[15]
The
Supreme Court of Canada in Doucet-Boudreau v. Nova Scotia (Minister of Education) 2003 SCC 62, [2003] 3 S.C.R.
3, 232 D.L.R. (4th) 577 (“Doucet”) confirmed the three Borowski
factors to consider when deciding whether to exercise the discretion to
hear a moot appeal (at paragraph 18):
(1) the presence
of an adversarial context;
(2) the concern
for judicial economy; and
(3) the need for
the Court to be sensitive to its role as the adjudicative branch in our political
framework.
These factors are not to be employed in a
mechanistic manner: Borowski, supra, at paragraph
42.
[16]
In this
appeal, we are not concerned about the need for the Court to be sensitive to
its role as the adjudicative branch in our political framework given that this
action merely concerns the validity of a patent.
[17]
The
existence of an adversarial context in the present case depends on the
respondent at some future date commencing an action for damages pursuant to
section 8 of the NOC Regulations. The respondent claims that the section 8
action will commence pending success in this action, success in another action involving
Canadian Patent No. 1,292,693 (which also relates to omeprazole), and
overturning the corresponding prohibition orders ab initio. We would
point out that at the moment there are no other live proceedings which would be
impacted by the Court allowing this action to proceed. This Court in Sanofi
Aventis v. Apotex (2006) 53 C.P.R. (4th) 447 held that a
potential claim under section 8 of the NOC Regulations was too speculative to
warrant a Court hearing an appeal relating to an expired patent. While we therefore
have some doubt regarding the existence of an adversarial context in this case,
we need not base our decision on this issue in light of the reasons to dismiss
the proceeding on the grounds of judicial economy.
[18]
The
concern for judicial economy strongly militates against allowing this action to
proceed. Factors under this heading to consider include whether a resolution of
this case would be in the public interest (Borowski paragraph 37),
whether anything in the action raises important issues that may be evasive of
review (Doucet at paragraph 20; Borowski at paragraph 36), and
whether the case will be of “brief duration” (Borowski at paragraph 36).
In the present case, all of these considerations warrant dismissing the action.
In
terms of a whether a resolution of this case is in the public interest, it
should be pointed out that the Statement of Claim of the respondent simply asks
for “a declaration that each of the claims of the ‘751 Patent is invalid, void
and of no force and effect.” Given that this case is only about a claim for the
invalidity of an expired patent and nothing else, the interests in this case do
not extend beyond the parties. Moreover, there is nothing about this action
that suggests that there are important issues raised that are evasive of review. The grounds of
invalidity alleged – anticipation, obviousness, double patenting, and inutility
– are all legal issues that are often dealt with in other proceedings. Nor
would this be a case of brief duration: even ignoring the possibility of
appeals, the action is scheduled to take ten days alone. Essentially, the
respondent has provided no compelling reason to justify the unacceptable drain
of judicial resources that would result if this action were allowed to proceed.
Indeed,
it could be argued that if this case were as pressing as the respondent
suggests, one might have expected a trial to have already taken place given
that this action was commenced in 2003.
[19]
For these
reasons, this Court will decline to exercise its discretion to allow the moot
action to continue. Since
we have concluded that the matter is moot and should be dismissed in this
regard, there is no reason to address the issue of standing.
[20]
Given the
foregoing, we would allow the appeal. The action should be dismissed in its
entirety for mootness. We would disallow costs because it appears that the
appellant created the confusion in the decisions below by referring to Rule 221
in its Notice of Motion and arguing, in addition to the law of mootness, the
law with regard to striking out pleadings when it should not have been
applicable.
[21]
The Court
further orders that there be no costs in the action which will be dismissed.
"J.
Edgar Sexton"
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