Date: 20040312
Docket: T-1446-93
Citation: 2004 FC 377
Toronto, Ontario, March 12th, 2004
Present: The Honourable Mr. Justice Russell
BETWEEN:
AB HASSLE AND ASTRA PHARMA INC.
Applicant
and
MINISTER OF NATIONAL HEALTH AND WELFARE
Respondent
REASONS FOR ORDER AND ORDER
The Motion
[1] This is a motion by AstraZeneca Canada Inc. ("AstraZeneca") on two files (T-260-04 and T-1446-93) for an order varying the Protective Order dated July 29, 1993, ("Protective Order") made on Court File No. T-1446-93 to allow the use of information subject to the Protective Order in the Application in T-260-04, subject to appropriate protective terms.
[2] There are also two cross-motions on the same files by Apotex Inc. ("Apotex") for an order striking the affidavit of Mr. Gunars A. Gaikis, sworn February 25, 2004, and any cross-examinations arising from that affidavit or, in the alternative, an order for leave to file the affidavit of Mr. Harry Radomski sworn March 5, 2004 on T-260-04.
[3] Mr. Gaikis' affidavit and cross-examination are a significant aspect of AstraZeneca's materials in the motions and his cross-examination on that affidavit by counsel for Apotex has given rise to a serious dispute between the parties concerning the legal ramifications of Mr. Gaikis' refusal to answer certain questions put to him by counsel for Apotex.
Background
[4] The motions relate to a dispute between the parties that has a significant history and concerns Apotex's Apo-Omeprazole brand of omeprazole capsules and several of AstraZeneca's relevant patents.
[5] On January 16, 2004, Mr. Justice O'Keefe, dismissed a proceeding in Court File No. T-2311-01, pursuant to which AstraZeneca had sought a prohibition order pursuant to the Patented Medicines (Notice of Compliance) Regulations ("Patent Regulations") seeking to prevent the issuance of a notice of compliance ("NOC") by the Minister of Health ("Minister") to Apotex in respect of Apotex's omeprazole capsules.
[6] The decision of Justice O'Keefe represented the latest decision of this Court finding that Apotex's allegations of non-infringement (made under the Patent Regulations) with respect to omeprazole capsules were justified.
[7] As a consequence of Justice O'Keefe's order, the Minister was no longer enjoined by reason of the operation of the Patent Regulations from issuing an NOC to Apotex in respect of Apotex's omeprazole capsules. Thus, on January 27, 2004, the Minister issued an NOC to Apotex for its omeprazole capsules.
[8] AstraZeneca, upon learning that Apotex had been granted an NOC for its omeprazole capsules, decided to challenge the NOC.
[9] AstraZeneca brought three applications, being Court File Nos. T-260-04, T-261-04 and T-262-04, each of which seeks an order quashing the Minister's decisions "not to require a second person to address" certain of AstraZeneca's patents and, in the case of T-260-04 and T-261-04, quashing Apotex's NOC.
T-1446-93
[10] While T-2311-01 represents the most recent of the Court's decisions relating to Apotex's omeprazole capsules and the Patent Regulations, T-1446-93 was the first.
[11] In that case, a predecessor to AstraZeneca, Astra Pharma Inc., and AB Hassle (collectively, "AstraPharma") brought an application under the Patent Regulations in response to a notice of allegation made by Apotex on April 27, 1993 ("April 1993 NOA") in respect of the medicine omeprazole.
[12] In the April 1993 NOA, Apotex alleged that, by making and selling omeprazole capsules, it would not infringe any claim for the medicine itself or any claim for the use of the medicine contained in the following Canadian Patents Nos.: 1,127,158 ("'158"), 1,129,417 ("'417"), 1,264,751 ("'751"), 1,292,693 ("'693"), 1,302,891 ("'891") and 1,234,188 ("'188").
[13] Pursuant to the final order granted in T-1446-93 of May 3, 1996, AstraZeneca's application for prohibition was dismissed in respect of the '751, '188, '693 and '891 Patents.
[14] However, the application was allowed in respect of the '158 and '417 patents and, accordingly, the Minister was prohibited from issuing an NOC to Apotex until after the expiration of the '158 and '417 patents.
[15] Although Apotex and AstraPharma filed separate appeals from the May 3, 1996 Order, these appeals were discontinued on February 12 and March 17, 1999, respectively.
[16] During the pendency of T-1446-93, the Protective Order was granted on the consent of the parties. Under the umbrella of that order, Apotex produced confidential information which AstraZeneca now seeks to introduce into T-260-04.
[17] The Protective Order contained a number of provisions designed to guard against the improper disclosure and use of confidential information. Two of these are reproduced below:
9. THIS COURT ORDERS that each of the persons to whom "Confidential Information" is disclosed pursuant to any paragraphs 4 to 8 shall:
(a) not disclose that information to anyone except others permitted to see it pursuant to this Order; and
(b) not use that information for any purpose except for the purpose of this litigation.
10. THIS COURT ORDERS that:
(a) the termination of proceedings in this proceeding shall not relieve any person to whom "Confidential Information" was disclosed pursuant to this Order from the obligation of maintaining the confidentiality of such information in accordance with the provisions of this Order;
(b) upon final termination of this proceeding (including appeals), each Party to this proceeding shall assemble and return to the original producing Party within 60 days all items containing "Confidential Information" produced pursuant to this Order, including all copies of such matter which may have been made, but not including copies containing notes that may have been placed thereon by counsel for the receiving Party, and shall obtain a receipt evidencing such return; and
(c) upon final termination of this proceeding (including appeals), all copies of "Confidential Information" containing notes in the possession of any Party shall be destroyed, immediately after which written notice of such destruction shall be given to counsel for the original producing Party.
[18] Given the timing of the discontinuance of the appeals from the May 3, 1996 Order and the content of subparagraphs 10(b) and (c) of the Protective Order, all confidential information, including documents designated as such produced by Apotex to AstraZeneca were to have been returned to Apotex or destroyed by AstraZeneca by no later than the end of May 1999.
Grounds For The Motions To Vary The Protective Order
[19] On January 27, 2004, the Minister issued an NOC to Apotex for its Apo-Omeprazole brand of omeprazole capsules 20 and 40 mg.
[20] On February 4, 2004, AstraZeneca initiated, in T-260-04, an application for judicial review of the decision made by the Minister relating to the issuance of that NOC to Apotex. The Minister is alleged to have decided that Apotex could rely on different formulations in addressing various formulation patents listed by AstraZeneca on the Patent Register. As a result, AstraZeneca is taking steps to quash the issuance of the NOC.
[21] By motion heard February 16, 2004, in T-260-04, AstraZeneca sought, inter alia, an expedited procedure for the hearing of its Application. In support of that motion, AstraZeneca filed the affidavit of Mr. Michael Cloutier, the President and CEO of AstraZeneca. That Affidavit was sworn on February 6, 2004.
[22] In his affidavit, Mr. Cloutier stated that the use of Apo-Omeprazole capsules as an alternative to AstraZeneca's LOSEC tablets will result in a very significant erosion of the sales of LOSEC tablets.
[23] At the hearing of AstraZeneca's motion on February 16, 2004, in T-260-04, Prothonotary Lafrenière indicated that he would be case managing the Application and that certain procedural steps should be expedited. As a consequence, an order dated February 18, 2004, issued in T-260-04, which provided, inter alia, that the Minister shall deliver the Minister's Record of Decision within 7 days and that AstraZeneca has 21 days thereafter within which to serve and file any affidavits it intends to rely on.
[24] AstraZeneca received the Minister's Record of Decision on February 23, 2004. The cover letter dated February 20, 2004, from counsel for the Minister states, inter alia, as follows:
Please note that though the request referred to "formulations", these have not been produced. Given the basis on which the challenged decision was made, they are not relevant to the application. If they were relevant, the Crown Respondents would object to their disclosure without a protective order or the consent of Apotex Inc., as they are confidential.
[25] The Minister's letter dated February 3, 2004, which is the subject of the judicial review application, was included amongst the Minister's Record of Decision documents. The letter dated February 3, 2004 states, inter alia, as follows:
... you have since suggested that the formulation that was disclosed by Apotex in the course of the proceedings in T-1446-93 may differ from that relied upon by Apotex in T-2026-99 and subsequent prohibition proceedings. You have also suggested that the Therapeutic Products Directorate ("TPD") should therefore have required Apotex to serve AstraZeneca with another Notice of Allegation in respect of the '693 and '891 patents before being eligible to receive its NOC.
...
With respect to your concerns about the formulation relied upon by Apotex in the various prohibition proceedings at issue, it is the TPD's view, in such circumstances, that should a second person enter the market with a product that deviates from that upon which it relied during prohibition proceedings under the Patented Medicines (Notice of Compliance) Regulations, the appropriate course of action is for the first person to pursue a remedy under the Patent Act.
[26] Consequently, AstraZeneca takes the position that the Minister's decision to issue Apotex an NOC for omeprazole capsules, as demonstrated by the aforesaid February 3 and 20, 2004 correspondence, appears to be based on a question of law, namely, that a second person generic does not need to rely on the same formulation in clearing different formulation patents on the Patent Register.
[27] However, upon a review of the balance of the documents in the Minister's Record of Decision, it was noted by AstraZeneca that there was included a letter dated November 29, 2001 from Dr. Sherman of Apotex which states as follows:
With respect to patents 1292693 ['693] and 1302891 ['891], we confirm that the formulation for which we seek approval remains that referred to in the Notice of Allegation dated April 23, 1993. We do not have a second formulation for this product.
[28] Consequently, AstraZeneca is concerned that while the Minister appears to have based his decision on a question of law, i.e. accepting the existence of different formulations, the Minister's Record of Decision includes a document from Apotex which suggests that Apotex has only relied on one formulation in respect of its omeprazole capsules. The letter arguably raises a factual issue relevant to the judicial review application in T-260-04.
[29] Court File No. T-1446-93 involved AstraPharma Inc., a predecessor of AstraZeneca, as an Applicant and the Minister and Apotex as Respondents. AB Hassle, as a patentee, was a co-applicant. The proceeding was commenced in response to a Notice of Allegation from Apotex in respect of omeprazole capsules and the '693 and '891 patents. A Protective Order dated July 29, 1993, issued in T-1446-93, and Apotex subsequently filed evidence under that Protective Order. Paragraph 9 of the Protective Order precludes the use of Confidential Information for any purpose except that litigation. Paragraph 13 of the Protective Order allows any party to waive in writing all or any part of its right under the Order and any party may seek an Order modifying the Protective Order.
[30] Consequently, the Protective Order in T-1446-93, precludes AstraZeneca from filing all of the evidence it wishes to file in T-260-04. This has occasioned a delay in the advancement of the Application in T-260-04 and has, according to AstraZeneca, increased the harm to AstraZeneca.
[31] AstraZeneca therefore requests an amendment to the Protective Order in T-1446-93 which would allow AstraZeneca to use confidential information from that proceeding in T-260-04. AstraZeneca also requests in T-260-04 that a protective order issue in that proceeding to protect confidential information, including that marked confidential under the Protective Order in T-1446-93. It is expected that the terms of such a protective order in T-260-04 can readily be agreed to by the parties.
Analysis
[32] AstraZeneca says it needs information on Court File T-1446-03 that is subject to the Protective Order because it is relevant to its judicial review challenge of the NOC issued by the Minister on January 27, 2004, in T-260-04. It also says that access to that information will result in no prejudice to Apotex and that, in fact, not to grant the relief sought would result in considerable prejudice to AstraZeneca and would be a travesty of justice because it would mean that Apotex could shield itself in the event that it has used different formulations in relation to the relevant patents. Furthermore, AstraZeneca says that the grounds of resistance put forward by Apotex in these motions are technical in nature and should not be allowed to defeat the compelling judicial and public interest that requires relevant formulation information to be before the Court when the judicial review is heard on T-260-04.
[33] The crux of the matter is that AstraZeneca wishes to challenge the Minister's assertion that he has no obligation to address different formulations and, if the Minister is wrong in this regard, it will be highly relevant for the Court to know whether or not different formulations have been used by Apotex in relation to the relevant patents.
[34] AstraZeneca also says that the purpose of a Protective Order is to maintain the confidentiality of highly sensitive information; it is not a method by which a party should seek to insulate itself against future challenges from having taken different positions in different proceedings. In fact, AstraZeneca points out that the Protective Order in this case has been varied once before by order of Richard J. dated May 7, 1997, to permit the parties to use the confidential information covered by the Protective Order for the purpose of proceedings in Court File No. T-1712-95.
[35] Apotex has raised various grounds as to why the Protective Order should not be varied to permit AstraZeneca to use the confidential information in T-260-04. It says that AstraZeneca, by its conduct at the discovery of Mr. Gaikis and through a breach of the Protective Order has disentitled itself to the relief sought in these motions. It also says that the information sought by AstroZeneca is irrelevant to the judicial review application in T-260-04 and that AstraZeneca is limited to its patent infringement remedies if different formulations have been used. Apotex also says that there is no evidence before me on these motions that there is, indeed, more than one formulation.
[36] For purposes of these motions, I have considered the various grounds of resistance raised by Apotex. On the evidence before me I am not prepared to regard the disentitlement arguments as determinative. Matters of relevance and the appropriateness of remedies should be left to the judge hearing the judicial review on T-260-04.
[37] My concern is whether AstraZeneca has made out a case for variation of the Protective Order on the principles established by the governing jurisprudence. In this regard, I take the words of MacKay J. in Smith, Kline and French Laboratories Ltd. v. Canada (Attorney General), [1989] F.C.J. No. 223 (T.D.), aff'd [1997] F.C.J. No. 689 (C.A.) as both a summary of the relevant legal principles and as a guide in the motions before me:
This Court has dealt with applications to vary its own "confidentiality orders" on previous occasions. In Halliburton Co. Et al. v. Northstar Drillstem Ltd. et al. (1982), 65 C.P.R. (2d) 122 (F.C.T.D.), Walsh J. refused to amend a confidentiality order so far as it related to information produced on discovery but did approve amending the order to permit disclosure of other confidential information to Alberta solicitors for the purpose of advising with respect to a prospective action in Alberta, but not for use as evidence in any action. In Algonquin Mercantile Corp. v. Dart Industries Canada Ltd., (unreported, F.C. T-831-82, November 4, 1983), McNair J. declined to vary terms of a confidentiality order, issued on consent of the parties, to permit persons other than those designated in the order to have access to confidential information in order to provide advice. In Control Data Canada Ltd. v. Senstra Corp., supra, Giles A.S.P., refused to grant an order to permit disclosure of information provided on discovery and other information subject to a confidentiality order where the purpose of the application was to seek advice from counsel in the United States about possible legal action under legislation of that country which action, if successful, might result in triple damages, an outcome deemed penal in nature by the Associate Senior Prothonotary.
In Apotex Inc. v. Attorney General of Canada et al. (1986), 10 C.P.R. (3d) 310 (F.C.T.D.), Madame Justice Reed declined to vary terms of a prior confidentiality order sought by one seeking to appeal an order rejecting its application to be added as an intervener to proceedings. In dealing with the matter she did not accept the general [page 558] principle of open judicial proceedings reflected in Rule 201(4) as sufficient ground for altering the original order sealing the court file as confidential. That factor would have been considered at the time of the original order. In her words [at page 312]:
Something more than an argument based on the general principle of the public nature of court proceedings must be given as a reason for altering the original order - some changed circumstances, or compelling reason not directly considered when the order was given.
Here the applicant submits that this test is met, that the changed circumstance is that the Minister of National Revenue is now trying to determine the plaintiff's correct income tax liability, a matter not considered at the time the orders were given. Further, it is submitted that enabling the Minister to review the information here sought in furtherance of his responsibilities under the Income Tax Act is a compelling reason for altering the orders.
In the audit initiated by the Minister the prices paid by the Canadian corporate respondent for cimetidine to non-arms's length non-resident suppliers are apparently under review. The applicant infers from the decision of Strayer J. in the trial of the original action and from information provided by counsel for the applicant when the appeal was heard that the Canadian corporate respondent paid more than the international market price for the drug but I do not find in the reasons of Strayer J. or in the Court's own record in prior proceedings any basis on which that inference can be more than speculation.
The respondents submit that these circumstances do not present a compelling reason for varying the order. They point to the absence of evidence by the applicant that the purposes sought by the Minister are not met by other information available to him now or through powers conferred by the Income Tax Act without seeking to vary the orders made to maintain confidentiality. They point as well to the fact that the information [page 559] sought was ordered produced, or was based on such information, by respondents other than the Canadian corporate respondent whose tax liability is of concern to the Minister.
Conclusion
I am not persuaded that the test set out in Apotex has been met by the applicant. I accept that review of the tax liability of the Canadian corporate respondent was not considered at least in the court action at the time the "confidentiality orders" were made and in a sense this is a new circumstance. But it is not a change in circumstances in relation to the issues between the parties in the action for which the information was produced. It is a completely new circumstance and I am not persuaded that it is a compelling reason for variation of the orders, though I have no doubt that it would serve the convenience of the Minister of National Revenue to have access to the documents here sought, which is in the Court's records, sealed as confidential, as a result of the coincidence of the action lawfully begun by the respondents.
On principle, where the court has ordered, with consent of the parties, that documents be sealed in confidence in the interests of seeking justice in the issues between parties to an action, the reason for varying the orders should be truly compelling, especially where the purpose for access is unrelated in any way and is in that sense collateral or ulterior to the action in which the documents are filed and sealed. Only in truly exceptional cases would it be warranted to change a "confidentiality order" in these circumstances. Indeed, even in the absence of an order the Court might well preclude use or access to information arising from discovery for purposes of a collateral action because of an implied undertaking that this information is to be used only for purposes of the action in which it is produced: Riddick, supra. If it were otherwise, confidence in the integrity of the judicial process, including the responsibility of the court to protect the interests of the parties in litigation, would be eroded.
[38] So the central issue before me, in my opinion, is whether, on the facts of this case, there is some change in circumstances or compelling reason to vary the Protective Order.
[39] In its Notice of Application of February 4, 2004 in T-260-04, AstraZeneca made it clear it would seek "appropriate variation" of the Protective Order to ensure the complete record from T-1446-93 is before the Court in T-260-04. The issue of different formulations is also raised in the Notice of Application and a letter of Apotex dated December 16, 1997, is referred to in which different formulations are mentioned.
[40] There are, in my opinion, sufficiently compelling reasons in this case to vary the Protective Order in the way requested by AstraZeneca.
[41] It is true that, strictly speaking, any change in circumstance is not in relation to issues between the parties in the action for which the confidential information was produced. But nor is it a completely new circumstance involving different parties, and the nature and history of the dispute over the relevant patents makes it difficult to sever and isolate different actions in the way suggested by Apotex. Smith Kline, supra, does not rule out variations even where "the purposes for access is unrelated in any way and is...collateral or ulterior to the action in which the documents are filed and sealed" provided the reasons for varying the order are "truly compelling." In this case, I think they are. This is not a case where a third party is seeking access to evidence for a completely collateral purpose. This is the latest round in a long fight between the parties that requires the information in T-1446-96 to enable the judge who hears the judicial review in T-260-04 to address and dispose of one of the important issues that Astrazeneca has raised in its Notice of Application.
[42] Apotex has, using the words of MacKay J. in Smith Kline, supra, indicated that "confidence in the integrity of the judicial process" is at stake here. In my opinion, on the facts before me, this requires that the confidential information be accessed and available to the judicial review process. To do otherwise would be to grant essentially Apotex immunity in relation to the grounds for challenging the NOC that AstraZeneca has raised. I cannot believe this was something contemplated by the parties or the Court when the Protective Order was originally issued. It is also, in my opinion, a sufficiently compelling reason to vary the Protective Order.
ORDER
THIS COURT ORDERS that
1. The Protective Order in T-1446-93 shall be amended to allow AstraZeneca to use confidential information covered by that Protective Order for the purpose of the Application in T-260-04, provided that the confidential information be treated as such in accordance with the protective order in T-260-04 referred to below;
2. A Protective Order shall issue separately in T-260-04 to protect confidential information, including that marked confidential under the Protective Order in T-1446-93;
3. The form of the Protective Order in T-260-04 shall be agreed to by consent of the parties, if possible, and provided to the Court for approval. In the absence of consent either party may seek an appropriate form of Protective Order by way of motion before the Court;
4. The parties shall, by consent if possible, provide Prothonotary Lafrenière with their proposals for adjusting the timetable established by his order of February 18, 2004, concerning the Application in T-260-04. If consent is not possible, then the parties shall contact Prothonotary Lafrenière immediately with a view to arranging a conference discussion to adjust the timetable;
5. Leave is hereby granted to file the affidavit of Mr. Harry Radomski, sworn March 5, 2004, in accordance with the cross-motions.
6. All of the above shall be without prejudice to Apotex to bring any action outside of the Application in T-260-04 that is may consider appropriate concerning any use that AstraZeneca may have made of the confidential information covered by the Protective Order in T-1446-93 and for any breach of that order or patent infringement;
7. The costs in these motions shall be at the discretion of the judge who hears the Application in T-260-04.
"James Russell"
J.F.C.
FEDERAL COURT
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: T-1446-93
STYLE OF CAUSE: AB HASSLE AND ASTRA PHARMA INC.
Applicant
and
MINISTER OF NATIONAL HEALTH AND WELFARE
Respondent
PLACE OF HEARING: TORONTO, ONTARIO
DATE OF HEARING: MARCH 9, 2004
REASONS FOR ORDER
AND ORDER BY : RUSSELL J.
DATED: MARCH 12, 2004
APPEARANCES:
Mr. J. Sheldon Hamilton
Ms. Y. Kang FOR THE APPLICANT
Mr. Nando de Luca
Ms. Julie Rosenthal FOR THE RESPONDENT
SOLICITORS OF RECORD:
Smart & Biggar
Barristers & Solicitors
Toronto, Ontario FOR THE APPLICANT
Goodmans LLP
Barristers & Solicitors
Toronto, Ontario FOR RESPONDENT
FEDERAL COURT
TRIAL DIVISION
Date: 20040312
Docket: T-1446-93
BETWEEN:
AB HASSLE AND ASTRA PHARMA INC.
Applicant
and
MINISTER OF NATIONAL HEALTH AND WELFARE
Respondent
REASONS FOR ORDER
AND ORDER
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