[1] On September 15, 1998, Brantford Chemicals Inc. applied to the Commissioner of Patents, pursuant to paragraphs 65(2)(c) and (d) of the Patent Act, R.S., c. P-4, s. 1, for a compulsory licence under Canadian Patent 1,275,349 of Merck & Co., Inc. for the manufacture and sale of sodium enalapril-sodium iodide and sodium enalapril derived from sodium enalapril-sodium iodide, on the grounds of abuse by Merck of its exclusive rights under its patent.

[2] On January 29, 1999, the Commissioner refused Brantford's application. On February 11, 1999, Brantford sought reconsideration of the January 29, 1999, decision. The Commissioner dismissed the reconsideration application on February 23, 1999.

[3] On April 28, 1999, Brantford filed a new application. This time, the Commissioner concluded that Brantford had made a case for relief and directed Brantford to serve the application on Merck.

[4] On May 21, 2002, Merck brought a motion before the Commissioner, asking for a declaration that Brantford was barred from proceeding with its application on the grounds of issue estoppel (estoppel per rem judicatam) (see [1975] 2 S.C.R. 245">Angle v. Minister of National Revenue, [1975] 2 S.C.R. 245 at 253-254) and functus officio.

[5] On October 18, 2002, the Commissioner dismissed Merck's motion. Merck appealed to the Federal Court. On April 2, 2004, von Finckenstein J. dismissed Merck's appeal. This is an appeal of the decision of von Finckenstein J.

ANALYSIS

[6] We are of the opinion that this appeal must fail because Merck has not demonstrated that the doctrines of res judicata or functus officio are applicable.

Standard of Review

[7] von Finckenstein J. applied a standard of reasonableness simpliciter to the review of the Commissioner's decision. It is not necessary for us to comment on this determination because on even the most intrusive standard of review, Merck's appeal cannot succeed.

Res Judicata

[8] The requirements of res judicata are that the same question has been decided, that the judicial decision that is said to create the estoppel was final and that the parties or their privies in both proceedings are the same. It is only necessary for us to deal with the finality of the decision.

[9] The procedure on an application under section 65 of the Patent Act that is relevant in this case is set out in section 68 of the Act. Section 68 provides:

68. (1) Every application presented to the Commissioner under section 65 or 66 shall

(a) set out fully the nature of the applicant's interest, the facts on which the applicant bases his case and the relief that he seeks; and

(b) be accompanied by statutory declarations verifying the applicant's interest and the facts set out in the application.

(2) The Commissioner shall consider the matters alleged in the application and declarations referred to in subsection (1), and, if satisfied that the applicant has a bona fide interest and that a case for relief has been made, he shall direct the applicant to serve copies of the application and declarations on the patentee or his representative for service and on any other persons appearing from the records of the Patent Office to be interested in the patent, and the applicant shall advertise the application in the Canada Gazette and the Canadian Patent Office Record.

68. (1) Toute requête présentée au commissaire en vertu de l'article 65 ou 66_:

a) expose complètement la nature de l'intérêt du demandeur, les faits sur lesquels le demandeur fonde sa requête, ainsi que le recours qu'il recherche;

b) est accompagnée de déclarations solennelles attestant l'intérêt du demandeur, ainsi que les faits exposés dans la requête.

(2) Le commissaire prend en considération les faits allégués dans la requête et dans les déclarations, et, s'il est convaincu que le demandeur possède un intérêt légitime et que, de prime abord, la preuve a été établie pour obtenir un recours, il enjoint au demandeur de signifier des copies de la requête et des déclarations au breveté ou à son représentant aux fins de signification, ainsi qu'à toutes autres personnes qui, d'après les registres du Bureau des brevets, sont intéressées dans le brevet, et le demandeur annonce la requête dans la Gazette du Canada et dans la Gazette du Bureau des brevets.

[10] Merck argues that Brantford's application must be full and complete and that the Commissioner's decision to refuse to entertain an application is a final decision. In support of the argument that subsection 68(2) connotes a final decision, Merck submits that under subsection 70(2) of the previous Act, both the French and English texts speak of a prima facie case, a term that does not appear in the texts in subsection 68(2) of the current Act.

[11] We do not find this argument persuasive. First, unlike the case in many administrative tribunal statutes, there are no express words in section 68 suggesting that a decision under that section is a final one.

[12] Second, the decision under section 68 is made on an ex parte application. The party applying for the compulsory licence must first satisfy the Commissioner that a case for relief has been made. Only if the Commissioner decides that a case for relief has been made are the documents to be served on the patentee. It is only at that time that the patentee becomes a party to the proceedings to determine whether the applicant should receive a compulsory licence.

[13] Third, the only effect of the "screening" decision in favour of an applicant under subsection 68(2) is to the require the patentee, if it desires to do so, to oppose the application. It will only be after the Commissioner considers the opposition and the submissions of both the applicant and the patentee that a decision will be made that may result in an order for the granting of a compulsory licence.

[14] For these reasons, we are of the view that von Finckenstein did not err when he concluded that the decision of the Commissioner under subsection 68(2) was not a final decision.

[15] That is sufficient to dispose of Merck's res judicata argument. However, we would also observe that there is no mutuality of parties in respect of the Commissioner's subsection 68(2) decision. Merck was not a party to any proceedings when that decision was made.

[16] Merck, however, says that in the section 68 proceedings, the Commissioner was standing in the shoes of Merck and that the Commissioner and Merck were privies for the purpose of the proceedings.

[17] We must say that we find this argument somewhat puzzling. As Merck was not a party itself, the argument must be that the Commissioner was a party and that Merck was a privy of the Commissioner. We do not see how the administrative tribunal itself can be a party in respect of a decision being made by that tribunal. If the Commissioner was not a party, Merck cannot be a privy of any party to the section 68 proceedings.

Abuse of Process

[18] During oral argument, there was brief mention of abuse of process. We would only observe that we see no reason in an appropriate case why the Commissioner could not, in the exercise of his discretion, determine that proceedings brought by an applicant for a compulsory licence were abusive of his process. The Commissioner made no such finding in this case and the point need not be considered further.

Functus Officio

[19] Merck's functus officio argument relies again on the characterization of the Commissioner's decision as final because the doctrine of functus officio only applies in the case of final decisions. We have already determined that the decision here was not final. Accordingly, the doctrine of functus officio has no application.

CONCLUSION

[20] For these reasons, we will dismiss the appeal with costs to Brantford Chemicals Inc. against Merck & Co., Inc. in the sum of $10,000 inclusive of disbursements and GST.

"Marshall Rothstein"

J.A.

FEDERAL COURT OF APPEAL

NAMES OF COUNSEL AND SOLICITORS OF RECORD

DOCKET: A-204-04

STYLE OF CAUSE MERCK & CO., INC.

Appellant

and

BRANTFORD CHEMICALS INC.

Respondent

and

COMMISSIONER OF PATENTS and ATTORNEY GENERAL OF

CANADA

Respondents

PLACE OF HEARING: TORONTO, ONTARIO

DATE OF HEARING: FEBRUARY 2, 2005

REASONS FOR JUDGMENT

OF THE COURT: (ROTHSTEIN, EVANS and MALONE JJ.A)

RENDERED FROM THE

BENCH: ROTHSTEIN J.A.

APPEARANCES BY:

Mr. G. Alexander Macklin, Q.C.

Ms. Constance Too FOR THE APPELLANT

Mr. H. Radomski

Mr. N. DeLuca FOR THE RESPONDENT (BRANTFORD CHEMICALS

INC.)

No appearance FOR THE RESPONDENT (COMMISSIONER OF

PATENTS and ATTORNEY GENERAL OF CANADA)

SOLICITORS OF RECORD:

Gowling Lafleur Henderson LLP

Ottawa, Ontario FOR THE APPELLANT

Goodmans LLP

Toronto, Ontario FOR THE RESPONDENT (BRANTFORD CHEMICALS

INC.)

John H. Sims, Q.C.

Deputy Attorney General of Canada FOR THE RESPONDENT (COMMISSIONER OF

PATENTS and ATTORNEY GENERAL OF CANADA)

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Merck & Co. Inc. v. Brantford Chemicals Inc., 2005 FCA 48

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2005 FCA 48