Apotex Inc. (Apotex) denies infringement
and claims that the '206 Patent is invalid. After many months of productions of
documents, discoveries and expert reports, the trial began on January 12, 2009.
The 31-day evidentiary phase of the trial concluded on February 24. Final
argument is scheduled to begin on April 6, 2009.
[2]
On
February 26 – two days after the completion of the evidentiary phase of the
trial – Apotex brought a motion to admit further evidence into the trial. The approximately
3000 pages of evidence which Apotex seeks to be admitted consist of affidavits
sworn in other Federal Court or Patent Office proceedings, transcripts from
depositions taken on January 13 and 14, 2009 in the United States, together
with videotapes of the depositions, and file history information for certain
Canadian and US patents (collectively referred to as the Motion Documents). In
the alternative to admitting the Motion Documents as evidence, Apotex requests
that the Court order the issuance of a commission, letters rogatory or other
document to examine certain persons who would be able to speak to the matters
dealt with in such evidence. Novopharm Limited (Novopharm), the Defendant in
companion Court File No. T-1161-07, supports Apotex in this motion. Sanofi and
Schering object to the admission of this evidence.
[3]
Although
leave to re-open its case was not explicitly requested in this motion, Apotex
agrees that it is seeking such leave to re-open. Accordingly, I have treated
this motion as a motion by Apotex to re-open its case and to admit the further
evidence.
[4]
For
the reasons that follow, I conclude that, with the exception of two Canadian
patent file histories, the Motion Documents should not be admitted. Further, I
decline to exercise my discretion to order the issuance of a commission,
letters rogatory or other document for the examination of witnesses outside Canada.
I. Nature of
the Evidence
[5]
I
begin by reviewing the nature of the Motion Documents. As noted, the evidence
falls into three broad categories. The first – and most important to Apotex –
consists of affidavits by four individuals who were employed as scientists by
Warner-Lambert Company (Warner-Lambert). These affidavits were sworn at various
times between 1995 and 2006 in proceedings in Canada related to
the drug quinapril. In their affidavits, Dr. Milton L. Hoefle, Mr. Sylvester R.
Klutchko, Mr. George Bobowski and Dr. John D. Topliss speak to the work carried
out in the Warner-Lambert laboratories in and around 1980. In the submission of
Apotex, these documents do no more than set out “factual stuff”; in the
affidavits, the employees merely set out what they did and what they wrote down
in their notebooks.
[6]
The
second type of document consists of the transcripts and videotapes of the
depositions of Dr. Hoefle, Mr. Klutchko and Mr. Bobowski conducted in the United
States
on January 13 and 14, 2009. The three former employees of Warner-Lambert were
questioned by a U.S. attorney on behalf of Apotex, pursuant to an
order dated January 11, 2009 of Judge Denise Page Hood of the United States
District Court, Eastern District of Michigan, Southern Division. Counsel for
Schering and Sanofi, on the invitation of Apotex, attended at and participated
in the depositions.
[7]
The
third category of documents consists of various Canadian and U.S. patents and
patent file histories. A number of such documents were attached to the
affidavits already referred to or were exhibits produced during the depositions.
Finally, Apotex seeks to admit a certified copy of the file history for Canadian
Patent No. 1,341,330 (the '330 Patent), including the '330 Patent itself, and a
certified copy of the file history for Canadian Patent No. 1, 205,476 (the '476
Patent), including the '476 Patent itself.
II. Admission
of the documents
A. What is the test?
[8]
I
do not think that there is any disagreement among the parties as to the overall
test for the re-opening of a case and the admission of the documents. In simple
terms, the task before me is to determine whether the admission of the Motion Documents,
at this stage of the trial, would cause more harm than good. If it would, the
evidence will be kept out.
[9]
Beyond
this general question, the parties disagree somewhat with respect to the legal
tests that Apotex must meet in order to succeed in this motion. On the one
hand, they agree that, in addition to the threshold issue of relevance, there
are four relevant factors that should be considered: 1) whether the evidence is
necessary, 2) whether it is reliable, 3) whether Apotex has acted with due
diligence, and 4) whether there will be prejudice to the parties.
[10]
However,
Schering and Sanofi also allege that Apotex must, in addition, seek leave of
the Court to re-open the trial by satisfying the legal test, as identified by
the Supreme Court of Canada in 671122 Ontario Ltd. v. Sagaz Industries
Canada Inc., 2001 SCC 59, [2001] 2 S.C.R. 983. This 2‑part test asks:
1.
Would
the evidence, if presented at trial, probably have changed the result?
2.
Could
the evidence have been obtained before trial by the exercise of reasonable
diligence?
[11]
In
my opinion, the Sagaz analysis unnecessarily complicates the present
matter. For one, the test may not be directly applicable because the Sagaz
decision dealt with a motion to lead fresh evidence after judgment had already
been rendered. This is clearly distinguishable from the present case where judgment
has not been rendered; the parties have not yet even entered into final
arguments. Moreover, the two considerations that are encapsulated by the Sagaz
test are covered by the four factors that were identified by the parties.
[12]
Another
approach would be to consider this evidence to be hearsay. The evidence likely
meets the broad definition of hearsay as it consists of out-of-court statements
that are offered for the truth of the matter asserted (R. v. Starr, [2000]
2 S.C.R. 144).
Under the principled approach to the hearsay rule, the Court should apply a
principled approach to the question of admissibility of hearsay evidence. The
questions of reliability and necessity must be examined. Once again these
factors are included in the list of factors identified above.
B. Is the evidence relevant?
[13]
I
am prepared to accept for purposes of this motion, without deciding, that the
evidence would be relevant to the issues of obviousness and first inventorship.
This factor favours admitting
the evidence.
C. Is the evidence necessary?
[14]
Apotex
submits that admission of the Motion Documents is warranted on the facts of
this case. Apotex points to its strenuous efforts to obtain evidence through the
use of U.S.
Court
procedures— efforts that
were delayed by the actions of Pfizer, Inc. (successor to Warner-Lambert). The
procedures culminated in the depositions of three witnesses in Michigan. Given that
these three witnesses are unavailable to appear in our trial, the test of
“reasonable necessity” is, in Apotex’s view, met.
[15]
The
problem with Apotex’s submission on this point is that there are other
procedures for bringing evidence into the Federal Court without resorting to
this procedure which avoids the underlying premise of our courts that evidence
should be taken orally.
[16]
I
am also concerned that Apotex’s prior inaction in introducing the documents in
its case in-chief, despite having had possession of certain of the affidavits,
seriously undermines its assertion that the evidence is necessary.
[17]
Overall,
this factor favours not admitting the evidence.
D. Is the evidence reliable?
[18]
Apotex
points to a number of facts which, in its opinion, establish the reliability of
the evidence:
·
The
affidavits constitute sworn or affirmed testimony, in some cases on more than
one occasion;
·
The
affidavits were not produced for a particular situation/litigation and do not
relate to work for which the affiants would not have had an incentive to
overstate the nature or extent of their work;
·
The
evidence in the depositions was not provided on a voluntary basis;
·
The
depositions were recorded visually and audibly, thereby alleviating concerns
about being able to observe demeanour; and
·
Counsel
for Schering and Sanofi were present at the depositions and were given the
opportunity to object and to pose questions.
[19]
The
fact that the affidavits were sworn or affirmed in prior proceedings is of some
– but not significant – comfort on the question of reliability. My more serious
problem with the affidavits is that I have no evidence before me that the truth
of those affidavits was tested in the earlier proceedings. Further, I have no
way of testing whether the affiants had an incentive to exaggerate or misstate
the contents of the affidavits. Taken to its extreme, if the Court accepts that
the swearing or affirmation of an affidavit is sufficient to establish
reliability of the truth of the contents, there would be no need for viva
voce evidence at trial.
[20]
Apotex
submits that the contents of the affidavits and the depositions contain
“factual stuff”, such as what the scientists did and what they wrote down in
their laboratory notebooks. Although this may be the case, it does not
necessarily follow that reliability of the evidence need not be tested. Surely,
facts may be disputed – even simple ones such as dates and who said what.
[21]
Apotex
also relies on the fact that the depositions were recorded in a manner that
allows the Court to assess the demeanour of the witnesses. I have reviewed the
transcripts of the depositions and I am not convinced that they overcome the
problems of not having the witnesses before the Court. I observe that the
witnesses appeared to be confused on a number of occasions. It is possible that
this confusion could be quickly cleared up during a proper Court appearance
(even by way of videoconference) with full examination-in-chief and
cross-examination.
[22]
Moreover,
I am not persuaded that Schering and Sanofi were provided with meaningful
rights to participate in the depositions despite having been invited. Their
participation was considerably handicapped by the fact that they were advised
of the depositions less than two days before they took place. I understand that
no documents were provided in advance to either Schering or Sanofi. Given that
the trial in Toronto was sitting
on both days of the depositions, the lead counsel on the files for Schering and
Sanofi were unable to attend the depositions, leaving the task to counsel who –
although obviously qualified – would have had far less familiarity with the
issues at trial. I conclude that the rights of participation offered to
Schering and Sanofi provide little comfort on the question of reliability. The
rights can, in no way, be characterized as equivalent to the ability to
cross-examine in a trial.
[23]
Considering
the problems with the reliability of the evidence, I conclude that this factor
favours not admitting the Motion Documents. This conclusion would extend to the
various documents that were appended to the affidavits and the deposition
exhibits.
E. Did Apotex exercise due
diligence?
[24]
As
I have earlier noted, Apotex asserts that it proceeded with all due diligence
to obtain the evidence that it now wishes to admit. Apotex submits that it
acted reasonably by giving notice to the Court and the opposing parties
throughout the trial that it might later attempt to admit evidence related to proceedings
that were developing in the U.S. Because of the difficulties encountered in
the U.S. proceedings,
Apotex alleges that they were left with no choice but to proceed with the Motion
Documents at the time that it did.
[25]
There
are serious flaws in Apotex’s reasoning on this point.
[26]
Apotex
has (or ought to have known) about the earlier affidavits of the witnesses that
were sworn between 1995 and 2007. They are all part of publicly available
Federal Court records or records of the Patent Office. It appears that Apotex’s
focus, in its U.S. proceedings,
was initially to pursue documents it thought were in the possession of Pfizer,
Inc. It was only when every possible door slammed on these efforts that “Plan
B” was pursued; only then did Apotex contemplate the admission of the evidence
now before me. Even the depositions were taken with a view to returning to the United
States District Court, Southern District of New York to seek a reconsideration
of that Court’s quashing of an earlier subpoena.
[27]
At
the commencement of the evidentiary phase of the trial, Apotex was well aware
that there was evidence from former Warner-Lambert scientists that was
potentially relevant to the pleaded issues at trial. Apotex was in possession
of most, if not all, of this evidence. Yet, throughout the entirety of the
evidentiary phase, it did not seek to introduce this evidence in its case
in-chief.
[28]
In
my view, Apotex chose, as a matter of strategy, not to introduce this evidence
at the appropriate time at trial. It chose, as a matter of strategy, to pursue
a course of action that effectively split its case and deprived the opposing
parties of an opportunity to challenge this evidence.
[29]
I
agree with Apotex that delay, in and of itself, is not a ground for denial.
However, on the facts before me this factor of due diligence weighs heavily
against Apotex.
F. Will prejudice be suffered if
the evidence is admitted?
[30]
Both
Sanofi and Schering submit that they would be prejudiced by the admission of
the Motion Documents at this stage. Apotex submits that neither Sanofi nor
Schering has adduced evidence to prove their assertion that they would suffer
prejudice if the Motion Documents were admitted. In the absence of such
evidence, Apotex argues that their claims of prejudice should be given little
weight by this Court.
[31]
In
my opinion, a number of considerations give rise to prejudice.
·
Given
the importance of cross-examination to the trial process, I view the process
proposed by Apotex in this case to be inherently prejudicial. I do not think
that Sanofi and Schering need to identify the specific areas where they would
choose to exercise this right. The fact is that they would be deprived of a
fundamental right with respect to 3000 pages of evidence.
·
Apotex’s
proposed procedure fails to take into consideration the fact that Sanofi and
Schering would also be deprived of any ability to respond the Motion Documents.
Once again, there is inherent prejudice.
·
It
is also too late to cross-examine Apotex’s expert witnesses on the matters
raised by the Motion Documents.
·
I
am also concerned with the integrity of our judicial process. All parties, who
are currently in the process of preparing final argument, would now have 3000
more pages to consider without the benefit of seeing how the evidence would be
presented if Apotex were to conduct an examination-in-chief or how
cross-examination would affect the evidence. This may well affect the quality
of the final arguments that are put before this Court.
[32]
In
sum, I am satisfied that there is prejudice to Sanofi and Schering.
G. Conclusion on admissibility
[33]
Considering
all of the factors, I am not persuaded that the Motion Documents (subject to
the exception discussed below) should be admitted. In the most general of
terms, the harm of admitting the evidence outweighs the good of letting it into
the trial at this stage.
III. The File
Histories of the '330 Patent and the '476 Patent
[34]
In
my view, the situation with respect to the file histories and patents for the '330
Patent and the '476 Patent is somewhat different. I am prepared to accept that
these documents satisfy the threshold for relevance to the issues of
obviousness and first inventorship.
[35]
Pursuant
to s. 13(2) of the Patent Act, R.S.C., 1985, c. P-4, “every
court, judge and person shall…admit in evidence, without further proof and
without production of the originals [such documents]”. Accordingly, the file
histories of the '330 and the '476 Patent would, generally, be admissible into
evidence. The question still remains as to whether I should exercise my
discretion to re-open the evidentiary portion of the trial to do so.
[36]
As
I have ruled in admitting the file history of the '206 Patent, upon request by
Schering, the file history will be of limited use. The file history simply
demonstrates, without further proof, that the documents therein were placed on
the file of the Patent Office on the dates that appear on any Patent Office
stamps on any of the documents and have been kept on that file. However, the
file wrapper does not and cannot speak to the truth of any matter contained in
any document in the file history.
[37]
For
this reason, unlike the balance of the Motion Documents, I can see no
significant prejudice to Sanofi or Schering in admitting the file histories. I
will allow the admission of the certified copies of the file history for each
of the '476 Patent and the '330 Patent and the relevant patents into these proceedings.
IV. Letters of
Request and Commission
[38]
In
the alternative to the admission of the additional evidence, Apotex submits
that the Court should use the procedures set out in the Federal Courts Rules
(See r. 271 and 272) to allow for the taking of trial evidence of four
witnesses – Mr. Bobowski, Dr. Hoefle, Mr. Klutchko and Mr. Ernest Nicolaides
(the Warner-Lambert witnesses) – in Michigan or Colorado.
[39]
The
issuance of a commission to obtain evidence is an extraordinary procedure which
should only be granted where special circumstances and the proper
administration of justice requires it (Canada (Minister of Citizenship and
Immigration) v. Seifert, 2004 FC 1010, 257 F.T.R. 91 at para. 10,
reconsidered on other grounds 2004 FC 1711, 49 Imm. L.R. (3d) 40, aff’d 2005
FCA 105, 332 N.R. 79, leave to appeal to S.C.C. refused [2005] S.C.C.A. No.
230). The decision to set up a commission is discretionary. In adjudicating
between the parties on such a discretionary matter, the Court must not only
consider the rights of the parties but the effects that its decision might have
on the administration of justice generally (Canada (Minister of Citizenship
and Immigration) v. Fast, 2001 FCT 594, 206 F.T.R. 58 at para. 15
(T.D.)). On the facts before me, I am not satisfied that the issuance of a
commission is warranted.
[40]
To
begin, I note that two factors are in favour of the granting of Apotex’s
request. I will accept, without deciding, that the anticipated testimony of the
Warner-Lambert witnesses would be, at least at a very low threshold, relevant
to the issues of obviousness and first inventorship. I am also satisfied that
the Warner-Lambert witnesses, as residents of the United States could not be
forced to appear in this Court.
[41]
Nevertheless,
I note the significant problems with the issuance of a commission, in this case
and at this time, in these proceedings.
[42]
The
timing of this request, coming after the close of evidence and a short time
before the scheduled commencement of final argument, is extremely problematic.
There is no question that the issuance of a commission would thwart the trial
schedule. Subpoenas would have to be issued in the relevant jurisdictions, the
individuals might or might not object, acceptable timetables and travel
arrangements would have to be made; all of this will take time. There is a
serious danger that the trial that was to be concluded by April 15, 2009 would
drag on for months.
[43]
Apotex
appears to suggest that the additional evidence could be dealt with separately.
Frankly, I cannot see how a separation of this evidence into a separate phase
could work without placing undue burden on the parties and the Court.
[44]
As
discussed above, Apotex has known for months that it would like to rely on the
evidence that these persons might be able to give and also that it was having
little success in its attempts to use U.S. legal procedures to
obtain certain evidence from Pfizer, Inc. This is not a case where the
existence of a witness has only come to light; Apotex has (or ought to have
had) knowledge of the affidavits that were sworn by the Warner-Lambert
witnesses in earlier proceedings. There was nothing to prevent Apotex from
requesting the issuance of a commission prior to trial. This path was
successfully followed by Apotex in a previous case (the perindopril trial).
[45]
On
a minor point, I note that Apotex did not directly ask any of the
Warner-Lambert witnesses (other than Dr. Nicolaides) to come to Canada to testify.
Thus, while I am satisfied that the Warner-Lambert witnesses cannot be forced
to testify in Canada, I am not
persuaded that Apotex did everything that it could to persuade the witnesses to
testify in person at this trial.
[46]
In
sum, I am of the view that the issuance of a commission at this time in the
trial would seriously and negatively affect the administration of justice.
Accordingly, having regard to r. 271 and all of the facts in this case, I am
not prepared to order the trial of the Warner-Lambert witnesses out of Canada.
V. Conclusion
[47]
For
the above reasons, Apotex’s motion will be dismissed, subject to the exception
that the '330 and '476 Patents and their file histories will be admitted on the
terms described above. The evidence admitted by this Order will also be
evidence for the purposes of Court File No. T-1161-07.
[48]
Schering
seeks elevated costs. While Sanofi and Schering are entitled to their costs, I
do not believe that the circumstances warrant elevated costs.
POSTSCRIPT
[1]
These
Reasons for Order are un-redacted from confidential Reasons for Order which
were issued on March 19, 2009 pursuant to the Second Amended Protective Order
dated February 28, 2008.
[2]
The Court
canvassed counsel for the parties whether they had concerns if the reasons were
issued to the public without redactions. On March 23, 2009, the parties
advised they were in agreement that there are no portions of the confidential
Reasons for Order that should be redacted or otherwise edited.
ORDER
THIS COURT
ORDERS that:
1.
the
'330 and '476 Patents and their file histories will be admitted as exhibits in
this trial and in the trial of T-1161-07, on the terms described herein;
2.
the
balance of the motion is dismissed;
3.
a
copy of these Reasons for Order and Order is to be placed in Court File
No. T‑1161-07; and
4.
costs
are awarded to Sanofi and Schering, in any event of the cause, in accordance
with Column III of Tariff B.
“Judith
A. Snider”
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