Date: 20050415
Docket: A-579-04
Citation: 2005 FCA 134
Present: SHARLOW J.A.
BETWEEN:
APOTEX INC.
Appellant
(Plaintiff by counterclaim)
and
ELI LILLY AND COMPANY and ELI LILLY CANADA INC.
Respondents
(Defendants by counterclaim)
and
SHIONOGI & CO. LTD.
Respondent
(Defendant by counterclaim)
Dealt with in writing without appearance of parties.
Order delivered at Ottawa, Ontario on April 13, 2005.
REASONS FOR ORDER BY: SHARLOW J.A.
Date: 20050415
Docket: A-579-04
Citation: 2005 FCA 134
Present: SHARLOW J.A.
BETWEEN:
APOTEX INC.
Appellant
(Plaintiff by counterclaim)
and
ELI LILLY AND COMPANY and ELI LILLY CANADA INC.
Respondents
(Defendants by counterclaim)
and
SHIONOGI & CO. LTD.
Respondent
(Defendant by counterclaim)
REASONS FOR ORDER
SHARLOW J.A.
[1] On February 28, 2005, the Commissioner of Competition filed a notice of motion for an order seeking leave to intervene in this appeal. The appeal is from Eli Lilly and Co. v. Apotex Inc. (2004), 35 C.P.R. (4th) 155 (F.C.), in which Hugessen J. allowed the motion of the respondents for summary judgment dismissing part of Apotex's counter claim in a patent infringement action.
[2] Apotex had alleged that Lilly breached section 45 of the Competition Act, R.S.C. 1985, c. 34, by acquiring from Shionogi & Co. Ltd. certain patents, thus acquiring sole control of all of the commercially viable process for making cefaclor. In granting summary dismissal of those allegations, Hugessen J. concluded that section 45 of the Competition Act can apply to an agreement involving the exercise of patent rights, but that the acquisition by Lilly of the patents in issue did not constitute a breach of section 45.
[3] The scope of the proposed intervention is set out in the first paragraph of the Commissioner's submissions on the motion to intervene, which reads as follows:
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This is an application by the Commissioner of Competition for an order granting her leave to intervene in the within appeal, in order to present submissions, and affidavit evidence regarding the development and meaning of the Intellectual Property Enforcement Guidelines (2000) (the "IPEGs") and similar U.S. and E.U. guidelines, with respect to the following two issues raised by this appeal:
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(i) whether section 50 of the Patent Act precludes the application of section 45 (and section 36) of the Competition Act (the "Act") to an assignment(s) of a patent(s); and
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(ii) whether the learned motions judge was correct in stating that his conclusions with respect to the above issue are fully compatible with the IPEGs issued by the Commissioner.
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[4] Thus, the purpose of the proposed intervention, as I understand it, is to permit the Commissioner to make submissions about the correctness of certain conclusions of law stated in the decision under appeal, as well as the comment that those conclusions are consistent with the Commissioner's Intellectual Property Enforcement Guidelines. These are submissions that deal essentially with the theory of competition law.
[5] Apotex has indicated its consent to the Commissioner's intervention. For reasons that will become apparent, the respondents have not yet filed a motion record in relation to the motion to intervene.
[6] In support of the intervention motion, the Commissioner submitted the affidavit of Gwillym Allen, a Commerce Officer employed by the Commissioner in the Competition Bureau, sworn on February 25, 2005. Mr. Allen's affidavit reads in part as follows:
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3. The Commissioner has not commenced an investigation or inquiry under the Competition Act (the "Act") into the matters referred to or dealt with in the within litigation. Her proposed role is limited to contributing to this Court's consideration of the proper interpretation of the Act and the Patent Act, by assisting the Court incoming to an understanding of the role of the Act, and her published guidelines, with respect to intellectual property (IP) rights.
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4. More specifically, the Commissioner's interest in the within appeal relates solely to the following findings of Hugessen J. in reliance on the Federal Court of Appeal's decision in Molnlycke AB v. Kimberley-Clark of Canada Ltd. et al. (1991), 36 CPR (3d) 493:
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(a) "... the Patent Act does not have the effect of insulating from liability under the Competition Act any and every agreement which may also have to do with the exercise of patent rights. However, where an agreement deals only with patent rights and is itself specifically authorized by the Patent Act, any lessening of competition resulting therefrom, being authorized by Parliament, is not "undue" and is not an offence under section 45." [emphasis added]
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(b) that this finding was "fully compatible with the [IPEGs] issued by the Competition Bureau."
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[7] Lilly served Mr. Allen with a direction to attend for cross-examination on his affidavit. The direction to attend includes a requirement to bring the following documents:
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1. any and all letters, e-mails or other communications between Apotex Inc., its agents or counsel with commissioners, employees or counsel for the Competition Bureau and any notes relating to such communication;
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2. all notes, memos, letters, communication and other documents concerning the subject proceeding or the interpretation of section 45 or the impact of the subject proceeding on the enforcement activities of the Bureau under the Act;
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3. all notes, memos, letters, communications and other documents concerning the interpretation of Molnlycke AB v. Kimberly-Clark; and
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4. all notes, memos, letters, communications and other documents relating to the Bureau's analysis of the facts of the within proceeding as performed using the framework outlined in paragraph 7 of the Allen affidavit including but not limited to any decision made.
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[8] Before me is a motion by the Commissioner to strike the quoted portion of the direction to attend on the basis that the requested documents are not relevant to the Commissioner's motion to intervene, that they are confidential records of a law enforcement agency, and that the requests are overly broad, vague and general and constitute an impermissible fishing expedition. This is in substance a motion for relief under Rule 94(2) (Federal Courts Rules, 1998, SOR/98-106). Rule 94(2) reads as follows:
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94 (2) On motion, the Court may order that a person to be examined or the party on whose behalf that person is being examined be relieved from the requirement to produce for inspection any document or other material requested in a direction to attend, if the Court is of the opinion that the document or other material requested is irrelevant or, by reason of its nature or the number of documents or amount of material requested, it would be unduly onerous to require the person or party to produce it.
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94 (2) La Cour peut, sur requête, ordonner que la personne ou la partie pour le compte de laquelle la personne est interrogée soient dispensées de l'obligation de produire pour examen certains des documents ou éléments matériels demandés dans l'assignation à comparaître, si elle estime que ces documents ou éléments ne sont pas pertinents ou qu'il serait trop onéreux de les produire du fait de leur nombre ou de leur nature.
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[9] Following the reasoning of Hugessen J. in Merck Frosst Canada Inc. v. Canada (Minister of Health) (1997), 80 C.P.R. (3d) 550 (F.C.T.D.), affirmed (1999), 3 C.P.R. (4th) 286 (F.C.A.), a document would be relevant to the cross-examination of Mr. Allen if its production may assist the Court in determining whether the intervention should be permitted. Such assistance might be obtained, for example, if the document is likely to speak to one or more of the factors to be taken into account in permitting the intervention.
[10] According to Rule 109(2), an applicant for leave to intervene in an appeal must establish that the proposed intervention "will assist the determination of a factual or legal issue related to the proceeding". The factors to be considered in determining whether to grant leave to intervene are set out in Canadian Union of Public Employees (Airline Division) v. Canadian Airlines International Ltd., [2000] F.C.J. No. 220 (QL) (F.C.A.), at paragraph 8:
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1) Is the proposed intervener directly affected by the outcome?
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2) Does there exist a justiciable issue and a veritable public interest?
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3) Is there an apparent lack of any other reasonable or efficient means to submit the question of the Court?
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4) Is the position of the proposed intervener adequately defended by one of the parties to the case?
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5) Are the interests of justice better served by the intervention of the proposed third party?
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6) Can the Court hear and decide the cause on its merits without the proposed intervener?
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[11] I do not propose to discuss all of the submissions of Lilly in support of its request for documents, but I will address what appear to me to be the two most important points.
[12] First, Lilly is seeking production of some of the listed documents in order to explore the possibility that the Commissioner has a motive for the intervention other than the wish to assist the Court with legal submissions. Lilly seems to be of the view that the Commissioner's motion to intervene would be undermined if the Commissioner is found not to be "neutral". In my view, information about the Commissioner's underlying motive for seeking to intervene in this appeal would not assist the Court in determining whether to permit her proposed intervention which, as stated above, relates solely to issues of law.
[13] Second, it appears that some of the submissions of Lilly are based on the incorrect premise that the Commissioner is challenging the correctness ofMolnlycke AB v. Kimberly-Clark of Canada Ltd. (cited above). I do not read the Commissioner's proposed intervention as involving anything more than a challenge to the correctness of certain statements in the decision under appeal in this case.
[14] Having reviewed Mr. Allen's affidavit and all of the submissions of the parties, I must agree with the Commissioner that the documents sought by Lilly are not relevant. Lilly is entitled to cross-examine Mr. Allen on his affidavit, but in my view Mr. Allen should be relieved of the obligation to produce documents.
J.A.
FEDERAL COURT OF APPEAL
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: A-579-04
STYLE OF CAUSE: APOTEX INC. and ELI LILLY AND COMPANY and
ELI LILLY CANADA INC. and SHIONOGI & CO. LTD.
MOTION DEALT WITH IN WRITING WITHOUT APPEARANCE OF PARTIES
REASONS FOR ORDER BY: SHARLOW J.A.
DATED: April 13, 2005
WRITTEN REPRESENTATIONS BY:
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William Miller/Randall Hofley/Belinda Peres
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FOR THE PROPOSED INTERVENER COMMISSIONER OF COMPETITION
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H.B. Radomski/David Scrimger/Miles Hastie
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FOR THE APPELLANT
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A. David Morrow/Colin B. Ingram
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FOR THE RESPONDENT SHIONOGI & CO. LTD.
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Patrick Smith/John Norman FOR THE RESPONDENTS
ELI LILLY AND COMPANY
AND ELI LILLY CANADA INC.
SOLICITORS OF RECORD:
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Department of Justice
Hull, Quebec
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FOR THE PROPOSED INTERVENER COMMISSIONER OF COMPETITION
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Goodmans LLP
Toronto, Ontario
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FOR THE APPELLANT
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Smart & Biggar
Ottawa, Ontario
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FOR THE RESPONDENT SHIONOGI & CO. LTD.
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Gowling Lafleur Henderson LLP
Ottawa, Ontario
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FOR THE RESPONDENTS
ELI LILLY AND COMPANY
AND ELI LILLY CANADA INC.
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