Date: 20020501
Docket: T-2792-96
Montréal, Quebec, May 1, 2002
Before: Richard Morneau, prothonotary
BETWEEN:
MERCK & CO., INC.
MERCK FROSST CANADA & CO.
ZENECA LIMITED
ASTRAZENECA UK LIMITED and
ASTRAZENECA CANADA INC.
Plaintiffs
(cross-defendants)
and
APOTEX INC.
Defendant
(cross-plaintiff)
ORDER
I. Plaintiffs' motion against Apotex
Following the examination of Apotex, as provided in para. 4 of this Court's order dated December 21, 2001, the Apotex representatives will have to answer the following questions and any further questions resulting therefrom: questions 7, 33, 34, 35, 36 and 38.
Undertakings 1, 2, 11 to 13, 15 and 16 will have to be answered by an update every three months.
Undertakings 5 and 17 will have to be answered within 30 days of this order.
Undertakings 6 and 7 I consider have been fulfilled. No further action is necessary.
This motion is otherwise dismissed.
Costs on this motion are awarded to Apotex.
II. Motion by Apotex against plaintiffs AstraZeneca UK Limited (Astra UK), Zeneca Limited (Zeneca) and AstraZeneca Canada Limited (Astra Canada)
A. Questions directed to Astra UK and Zeneca
In the continuation of the examination of the Astra UK and Zeneca representative Kevin Bill, as provided in para. 4 of this Court's order dated December 21, 2001, the said representative will have to answer the following questions and any further question resulting therefrom: questions 211, 223 to 225, 359, 365 and 366 (as to documents 2 and 9).
On Apotex's motion pursuant to Rule 246(1), the Court can only indicate that if in fact there is an objection to counsel answering, counsel for the plaintiffs must comply. However, Apotex should not abuse this position, especially if counsel for the plaintiffs in replying are actually seeking to clarify or move the debate forward.
Apotex's motion under Rule 237(3) is dismissed.
B. Questions directed to Astra Canada
In the continuation of the examination of Astra Canada's representative, as provided in para. 4 of this Court's order dated December 21, 2001, Astra Canada will have to answer the following questions and any further question resulting therefrom: questions 59 and 170.
This motion by Apotex (parts A and B) is otherwise dismissed.
Costs on this motion (parts A and B in general) are awarded to the plaintiffs.
Certified true translation
Suzanne M. Gauthier, LL.L. Trad. a.
Date: 20020501
Docket: T-2792-96
Neutral citation: 2002 FCT 505
BETWEEN:
MERCK & CO., INC.
MERCK FROSST CANADA & CO.
ZENECA LIMITED
ASTRAZENECA UK LIMITED and
ASTRAZENECA CANADA INC.
Plaintiffs
(cross-defendants)
and
APOTEX INC.
Defendant
(cross-plaintiff)
REASONS FOR ORDER
RICHARD MORNEAU, PROTHONOTARY
[1] The Court has before it a motion by each of the parties to resolve objections made during the examinations for discovery.
[2] These motions, which will be dealt with in turn in these reasons, beginning with that filed by the plaintiffs, are part of a proceeding involving allegations of infringement and invalidity of a patent dealing with the medication lisinopril. This medication is used in the treatment of hypertension.
Rules of law applicable to examination for discovery
[3] As MacKay J. said in Sydney Steel Corp. v. Omisalj (The), [1992] 2 F.C. 193, at 197:
. . . the standard for propriety of a question asked in discovery is . . . whether the information solicited by a question may be relevant to the matters which at the discovery stage are in issue on the basis of pleadings filed by the parties.
[4] Despite this general statement of principle, there are certain limits to the ambit of the examination for discovery. Inter alia, overly broad questions which amount to a fishing expedition are to be discouraged (see Reading & Bates Construction Co. v. Baker Energy Resources Corp. (1988), 24 C.P.R. (3d) 66 (F.C.T.D.), at 72).
I. Plaintiffs' motion against Apotex Inc.
[5] One of the major stumbling-blocks between the parties in the instant motion was the drawing of a line between what is relevant as a question at the first stage of determining whether there was an infringement, and what could eventually become relevant at the second stage in the reference on damages pursuant to Rule 107 of the Federal Court Rules (1998) ("the Rules").
[6] It should be recalled that on July 24, 2000 this Court ordered a reference in this case on the question of damages or profits. The relevant terms of that order read as follows:
l. This matter may proceed to trial without requiring the parties to adduce evidence at trial or to conduct discoveries on any issue of fact relating solely to:
(a) the quantum of damages arising from any infringement by the Defendant of Canadian Patent No. 1,275,350, or
(b) the Defendant's profits arising from any infringement by the Defendant of Canadian Patent No. 1,275,350.
. . . . .
4. This Order does not in any way restrict the Parties' oral or documentary discovery obligations or from filing evidence at trial regarding issues arising in this proceeding not listed in paragraph 1.
[7] According to the plaintiffs, this reference order should be seen as [TRANSLATION] "narrow", that is, it does not exclude questions regarding the scope of the infringement. Consequently, questions dealing with aspects such as the formulation or sale of lisinopril tablets are relevant since these acts are denied by the defendant Apotex and the said acts are not excluded by the reference order at this stage.
[8] As to Apotex, although it did not deny the narrow scope of the reference order, it considered that the fundamental nature of the defences it wished to put forward against allegations of infringement was such that the acts it might take once in possession of lisinopril were not relevant to the question of infringement.
[9] Apotex argued in defence essentially that the lisinopril which it is marketing does not infringe the patent in question, issued on October 16, 1990, because it bought its lisinopril from a third party, Delmar Chemicals Inc. ("Delmar") before the date the patent in question was issued - and so benefited from the protection of s. 56 of the Patent Act, R.S.C. 1985, c. P-4 - or that it bought lisinopril manufactured before the patent was issued, though in fact purchased after issuance of the patent - and s. 56 would apply here as well - or that it bought lisinopril in 1999 from a third party, Apothecary International Inc. ("A.I.I."), but the lisinopril was bought by A.I.I. in 1993 from Delmar while the latter was producing lisinopril in bulk under a compulsory licence which it held legitimately at the time - here it is s. 55 of the Patent Act that would assist Apotex.
[10] In short, Apotex here took a pragmatic approach to points in dispute in the pleadings and submitted in para. 21 of its written representations made against the instant motion that:
Any question of infringement will turn on whether any particular quantity of lisinopril acquired by Apotex was non infringing either because it was made before the ‘350 Patent issued, or because it was made and sold under licence.
[11] I agree that the structure of the instant motion should be viewed in accordance with Apotex's approach. Therefore, any question tending to further clarify what Apotex might have done with the lisinopril once in possession of it is not relevant at the stage of the alleged infringement. These questions may be relevant at the stage of the reference. What is crucial at this stage is whether at the time the lisinopril was purchased Apotex was in an infringement situation. Actions which it may have taken subsequently regarding this lisinopril - post-purchase actions - cannot alter the decision on this question.
[12] That being so, the Court must look at the categories of questions in issue.
Category 1
[13] This category contains various questions dealing with documents which might be in Apotex's possession.
[14] Questions 1 and 14 relate to information on sales or exports of lisinopril. As these acts are post-purchase, questions 1 and 14 will not have to be answered.
[15] On question 3, the relevant transcript and argument submitted in Court have satisfied me that this question has been sufficiently answered. No further answer will be necessary.
[16] On question 4, the fact the plaintiffs already have "receiving logs" gives them the relevant information they were seeking. In the circumstances, wanting to see other documents which may contain similar information seems to me to be in the nature of a fishing expedition so as to possibly find differences in the information. This question will not have to be answered. The same applies mutatis mutandis to question 8.
[17] Questions 5 and 6 deal with information on the preparation of the medication in tablet form. They thus concern a post-purchase action. They will not have to be answered.
[18] Question 7 will have to be answered. Although a distinction may be drawn between the date of payment and the date of purchase, it may be that in principle these dates coincide. Further, this question is relevant to para. 8 of Apotex's defence.
[19] Question 10 concerns a potential post-purchase situation. It will not have to be answered.
Category 2
[20] Question 15 to 17 in this category are essentially designed to discover who in Apotex was responsible at the time for creating and maintaining certain documents. For reasons set out by Apotex in paras. 36 and 37 of its written representations, it seems to the Court that there is nothing to add to the position taken by the witness in his replies. These questions will not have to be further answered.
[21] Question 18 seeks the unedited submission of a "receiving log". Although in principle I would be inclined to take the approach used by this Court in Glaxo Groups Ltd. v. Novopharm Ltd. (1996), 70 C.P.R. (3d) 300, and order that this entire document be filed as a relevant portion of it was filed, it appeared from Apotex's submissions that the plaintiffs did have an opportunity to make a visual examination of the entire document and did not find relevant information which was not filed. I therefore see no good reason in practice for again compelling the filing of the document requested. This question will not have to be answered.
Category 3
[22] The only question which remains in this category is question 19, which seeks to obtain "certificates of specification" for certain lots of lisinopril. Apotex's written submissions on this question have persuaded me that the question does not have to be considered further. It will not have to be answered. The same applies to questions 24 to 28.
Category 4
[23] Questions 29 and 30 in this category deal with the use for experimental purposes of certain lots of lisinopril purchased by Apotex. Here again, however, these questions relate to post-purchase activity. The question of experimental versus commercial use does not in any way alter the potential infringement from the outset at the time of the purchase by Apotex. These questions will not have to be answered.
[24] The other categories of questions in this motion deal with the challenge of invalidity made by Apotex to the patent at issue.
Category 5
[25] Questions 33 and 34 in this category wish to have Apotex indicate the parts of the documents on which it relies. Apotex replied that it relied on all of the 16 documents. This reply is unacceptable. Although we are not concerned here with a request for particulars, I nevertheless feel that it is appropriate for Apotex to answer questions 33 and 34 and to accordingly provide the particulars sought (see Dek-Block Ontario Ltd. v. Béton Bolduc (1982) Inc. (1998), 81 C.P.R. (3d) 232, at 235).
Category 6
[26] The questions in this category deal with the preparation of stable tablets under the patent. Apotex argued that some excipients cause the active ingredient to degrade.
[27] Question 35 seeks working papers on the use by Apotex of the excipient "microcrystalline cellulose" with lisinopril. This question relates directly to para. 19(m)(i) of Apotex's defence. Even if Apotex maintained that its tests supported its argument, that party does not have the final word on this matter and it is proper for the plaintiffs to wish to check the documents by themselves. This question will have to be answered.
[28] Question 36 seeks to obtain documents disclosing the results of stability studies on Apo-lisinopril, the lisinopril marketed by Apotex. Apparently Merck gave Apotex the same type of documents and it therefore seems reasonable to the Court for these documents to be filed by Apotex in return. This question will have to be answered.
[29] In my opinion, question 37 seeks information which is within the province of experts. Where Apotex draws a line between a stable and unstable product is not really relevant. It is for experts to draw that line. This question will not have to be answered. The same applies to questions 39 and 40.
Category 7
[30] Question 38 under this heading seeks to discover Apotex's sales figures for its lisinopril. Since in para. 19(m) of its defence Apotex argued that invention of the patent in question was obvious, it follows that in so doing Apotex raised commercial success. In James River Corp. of Virginia v. Hallmark Cards, Inc. (1997), 72 C.P.R. (3d) 157, at 163-4 (F.C.T.D.), the following comments were made:
That commercial success is a proper area for discovery is clear; see Corning Glass Works v. Canada Wire & Cable Co., supra, at 109 and Geo Vann Inc., supra, at 73. Also, in Unilever PLC v. Procter & Gamble, Inc. (1989), 24 C.P.R. (3d) 388, 23 C.I.P.R. 237 (F.C.T.D.), it was held that even though commercial success had not been expressly pleaded, questions on that subject related to a matter in issue and should be answered. The matter in issue is "obviousness". Obviousness had been pleaded by the defendants in their defence in the Unilever case and has been pleaded by the defendants in this action. The principle function of pleadings, as counsel notes, is to define with clarity the issues between the litigants and to give fair notice of the case that has to be met, so that the opposing party may direct evidence to those issues. Once a defendant pleads obviousness it will know that questions relating to commercial success are relevant. I do not think it is necessary for the plaintiff to expressly allege such in its reply pleading.
(My emphasis.)
[31] Question 38 will therefore have to be answered. I am not persuaded here that even if the information sought were given only secondary value, that value would be exceeded by the trouble involved in providing the said information.
[32] It now remains to decide on the fate of the undertakings made by Apotex and not yet filed.
Undertakings
[33] Undertakings 1, 2, 11 to 13, 15 and 16 will have to be answered by an update every three months.
[34] Undertakings 5 and 17 will have to be answered within 30 days of the order accompanying the instant reasons.
[35] Undertakings 6 and 7 I consider have been fulfilled. No further action is necessary.
[36] The Court must now consider Apotex's motion against the plaintiffs AstraZeneca UK Limited (Astra UK), Zeneca Limited (Zeneca) and AstraZeneca Canada Limited (Astra Canada) (collectively "the plaintiffs").
II. Apotex's motion against plaintiffs AstraZeneca UK Limited, Zeneca Limited and AstraZeneca Canada Limited
[37] It appears from this motion that in addition to the questions dealing with infringement of the patent at issue and its invalidity, the plaintiffs' status as holders of licences from Merck & Co. Inc. is also in question.
[38] The questions directed to Astra UK and Zeneca will be reviewed first (A). Subsequently, we will turn our attention to questions involving Astra Canada (B).
A. Questions directed to Astra UK and Zeneca
[39] Questions 60 to 63 seek to determine the identity of the members of the legal team, the "Zestril defence team", responsible for checking the markets for potential infringements of patents owned by the plaintiffs.
[40] It seems to the Court these questions will not have to be answered. The attempt here is to identify a legal team. This is very special, indeed privileged, information. Apotex did not identify the information which these persons might have. It simply believed they might have some. This comes close to being a fishing expedition.
[41] Questions 64 to 67 deal with the work of the said team. For the reasons given by the plaintiffs in their written representations, these questions also will not have to be answered.
[42] Questions 72 and 80 are not relevant and will not have to be answered.
[43] Questions 194, 202, 203, 205 to 209 and 212 arise from a document filed by Astra Canada but not filed by the plaintiffs Astra UK and Zeneca. Even admitting that this document No. 17 should have been filed by the latter plaintiffs, I think that Apotex is going too far regarding the omission of such filing. For the reasons given in para. 65 of the plaintiffs' written representations, these questions will not have to be answered.
[44] The same applies to question 200, which seeks to determine whether certain pages in document 17 come from a single document. This question is not relevant in view of the facts not admitted in the pleadings.
[45] In my opinion, question 211 involves relevant research which has not really been completed, since the research was limited to the United Kingdom. Accordingly it will have to be answered.
[46] On questions 223 to 225, if this has not already been done these questions will have to be answered.
[47] Questions 340 to 343 ask for the expression of an opinion. They accordingly will not have to be answered.
[48] Questions 345, 346, 347 and 352 have been sufficiently answered and no further answer will be necessary.
[49] Questions 359, 365 and 366 (regarding documents 2 and 9) deal with relevant situations and I do not consider that it is for the plaintiffs to determine whether these documents contain the relevant information. They will therefore have to be answered.
[50] On questions 378, 391, 393, 398 and 426, the position taken by the plaintiffs in their written submissions seems reasonable to me and it must be assumed that they will comply with that. On this basis, I do not intend to order here that they be answered.
[51] On question 391, the plaintiffs may limit their research to the parameters mentioned in the oral argument.
[52] Additionally, under Rule 237(3) Apotex is asking this Court to order Astra UK and Zeneca to select a representative who is better informed than the one examined, namely Kevin Bill, so that such other representative may be questioned about those companies.
[53] In their written representations in paras. 14 to 32, the plaintiffs convincingly answered the allegations made by Apotex in para. 14 of its notice of motion, and in para. 21 inter alia of its written representations. Based on the arguments made by the plaintiffs, I do not intend to allow this request by Apotex.
[54] Further, I dispose here of the request made by Apotex in its notice of motion that under Rule 246(1) this Court direct counsel acting for the plaintiffs not to answer the questions when counsel for Apotex object.
[55] On this motion, the Court can only indicate that if there is in fact an objection to counsel answering, counsel for the plaintiffs must comply. However, Apotex should not abuse this position, especially if counsel for the plaintiffs in replying are actually seeking to clarify or move the debate forward. The Court considers that it does not have to go any further here and relies on the great experience of the existing counsel to control the situation without any further involvement by the Court being required.
B. Questions directed to Astra Canada
[56] On questions 116, 156 and 165, although these questions are relevant to the plaintiffs' status as holders of licences, I am persuaded on the basis of the plaintiffs' written representations that they have answered the questions.
[57] Questions 59 and 170, which also concern the status of licence holder, are however relevant and should be answered.
[58] I am not persuaded that question 274 deals properly with the stability of the tablets and their degradation. It will therefore not have to be answered.
[59] On questions 298 and 299, these concern hypothetical situations which are a matter for experts. They will not have to be answered.
Montréal, Quebec
May 1, 2002
Certified true translation
Jacques Deschênes
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FEDERAL COURT OF CANADA
TRIAL DIVISION
Date: 20020501
Docket: T-2792-96
Between:
MERCK & CO., INC.
MERCK FROSST CANADA & CO.
ZENECA LIMITED
ASTRAZENECA UK LIMITED and
ASTRAZENECA CANADA INC.
Plaintiffs
(cross-defendants)
and
APOTEX INC.
Defendant
(cross-plaintiff)
REASONS FOR ORDER
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FEDERAL COURT OF CANADA
TRIAL DIVISION
SOLICITORS OF RECORD
FILE: T-2792-96
STYLE OF CAUSE: MERCK & CO., INC.
MERCK FROSST CANADA & CO.
ZENECA LIMITED
ASTRAZENECA UK LIMITED and
ASTRAZENECA CANADA INC.
Plaintiffs
(cross-defendants)
and
APOTEX INC.
Defendant
(cross-plaintiff)
PLACE OF HEARING: Montréal, Quebec
DATE OF HEARING: March 20 and 21, 2002
REASONS FOR ORDER BY: RICHARD MORNEAU, PROTHONOTARY
DATE OF REASONS: May 1, 2002
APPEARANCES:
Judith Robinson for the plaintiffs (cross-defendants) Merck & Co. Inc. and Merck Frosst Canada & Co.
Nancy P. Pei for the plaintiffs (cross-defendants) Zeneca
Denise Lacombe Limited, AstraZeneca UK Limited and AstraZeneca Canada Inc.
David Scrimger for the defendant (cross-plaintiff)
Ildiko Mehes
SOLICITORS OF RECORD:
Ogilvy, Renault for the plaintiffs (cross-defendants) Merck &
Montréal, Quebec Co. Inc. and Merck Frosst Canada & Co.
Smart & Biggar for the plaintiffs (cross-defendants) Zeneca
Toronto, Ontario Limited, AstraZeneca UK Limited and AstraZeneca Canada Inc.
Goodman, Phillips & Vineberg for the defendant (cross-plaintiff)
Toronto, Ontario
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