Introduction
Re-examination
Admissibility of prosecution history in evidence
Liability for patent infringement
Liability for damage before patent is granted
Factors to be considered for excessive prices
30-day time limit
Remedies
Eligible patents
12-month prescribed period
Civil procedure
This article is the second article in a series that highlights statutory changes and a selection of the most interesting patent cases reported in 2021.(1)
2021 saw changes in Canadian patent legislation and a variety of court decisions addressing rarely interpreted provisions of the Patent Act, early consideration of recently enacted provisions and new takes on central tenets of patent law.
See also a review of the key Trademark Law developments in Canada and a look back at life sciences IP and regulatory law highlights in 2021.
Teva Canada Innovation v Pharmascience Inc
Any person may request re-examination of a claim in a Canadian patent by filing with the Canadian Intellectual Property Office (CIPO) prior art consisting of patents, applications for patents open to public inspection and printed publications. The prior art must raise a substantial new question of patentability in order for the CIPO to initiate re-examination. A re-examination request may be filed at any time during the term of a patent and may be filed anonymously. A person requesting re-examination has no involvement in the procedure beyond the initial filing of prior art and the explanation of its pertinency.
But what if there is contemporaneous litigation concerning the patent? Should the CIPO re-examine the patent while a court is assessing its validity? The Patent Act and Patent Rules do not contemplate this possibility and provide no answer.
The Federal Court granted Teva's motion for a stay of the ongoing re-examination proceeding before the Re-examination Board of the CIPO with respect to Canadian Patent No. 2,760,802 until the discontinuance, settlement, or conclusion of all appeals from the related Federal Court judgment.(2) For further details about this case, see "Federal Court stays re-examination of glatiramer acetate patent pending appeal in PMNOC proceeding".
Admissibility of prosecution history in evidence
Historically, and as confirmed by the Supreme Court of Canada, the prosecution history of a Canadian patent application before the CIPO has not been admissible in court as an aid to construing the patent. For instance, the fact that a response to an examiner's report during prosecution amended a claim to add a limitation in order to overcome a prior art rejection would not be dispositive as to whether that limitation was an "essential element" of the claim when construing the issued patent.
Section 53.1 of the Patent Act, enacted on 13 December 2018, makes the prosecution history of a Canadian patent admissible in evidence in certain circumstances. More specifically, subsection 53.1(1) provides:
In any action or proceeding respecting a patent, a written communication, or any part of such a communication, may be admitted into evidence to rebut any representation made by the patentee in the action or proceeding as to the construction of a claim in the patent if
(a) it is prepared in respect of
(i) the prosecution of the application for the patent,
(ii) a disclaimer made in respect of the patent, or
(iii) a request for re-examination, or a re-examination proceeding, in respect of the patent; and
(b) it is between
(i) the applicant for the patent or the patentee; and
(ii) the Commissioner, an officer or employee of the Patent Office or a member of a re-examination board.
This recent provision was considered in three decisions in 2021.
CanMar Foods Ltd v TA Foods Ltd
The Federal Court of Appeal dismissed CanMar's appeal of a Federal Court decision granting TA Foods' motion for summary judgment and dismissing CanMar's patent infringement action.(3) Holding that the Federal Court should have refrained from taking into consideration foreign prosecution history (in this instance, the corresponding US Patent and Trademark Office prosecution history), the Court warned against extending the detailed language of section 53.1, which is limited to communications between the patentee and the Canadian Patent Office. That said, the Court made clear that it had no firm views on whether foreign prosecution history could ever be considered under section 53.1.
Western Oilfield Equipment Rentals Ltd v M-I LLC
As discussed above, the Federal Court of Appeal dismissed Western Oilfield's appeal of a Federal Court decision finding that certain claims of Canadian Patent No. 2,664,173 were valid and had been infringed.(4) The Court clarified that, although the appellants referred to it as the "file wrapper estoppel" provision, section 53.1(1) does not refer to an estoppel. Rather, the provision provides that certain communications between a patentee or applicant and the Patent Office pertaining to a patent or a patent application may be admissible as evidence in certain circumstances.
Bauer Hockey Ltd v Sport Maska Inc (CCM Hockey)
Although not necessary to its conclusions on obviousness, in this case the Federal Court of Appeal discussed section 53.1.(5) Rejecting the trial judge's broad interpretation that section 53.1 applies provided the issue is one of claims construction, the Court stated that certain portions of a patent's prosecution history may be admissible only "to rebut any representation made by the patentee in the action or proceeding as to the construction of a claim in the patent". The purpose of the section is to be a tool against patentees who take one position concerning the meaning of a claim during prosecution of a patent application, and another during litigation on the resulting patent.
Liability for patent infringement
McCain Foods Limited v JR Simplot Company
Subsection 55(1) of the Patent Act provides that "[a] person who infringes a patent is liable to the patentee and to all persons claiming under the patentee for all damage sustained by the patentee or by any such person, after the grant of the patent, by reason of the infringement".
The defendants, who were alleged to have infringed McCain's Canadian Patent No. 2,412,841, made a third-party claim under subsection 55(1) against a supplier of the technology used by the defendants in the alleged infringement.(6) Striking the third-party claim in its entirety, the Federal Court of Appeal held that the defendants lacked standing. Subsection 55(1) contemplates an infringer's liability "to the patentee and to all persons claiming under the patentee". As an infringer (according to the theory of its third-party claim), the defendants derived no rights from the patentee, and therefore could not reasonably be considered to be a person "claiming under the patentee".
Liability for damage before patent is granted
Western Oilfield Equipment Rentals Ltd v M-I LLC
Subsection 55(2) of the Patent Act provides that an infringer is liable to pay reasonable compensation to a patentee for any damage sustained by the patentee by reason of any act by the infringer occurring after the application is open for public inspection (18 months from the priority date) and before grant of the patent, if that act would have constituted an infringement of the patent if the patent had been granted on the date the application was open for public inspection.
As discussed above, the Federal Court of Appeal dismissed Western Oilfield's appeal of a Federal Court decision finding that certain claims of Canadian Patent No. 2,664,173 were valid and had been infringed.(7)
In its infringement analysis, the Court dealt with whether a party who engages in pre-grant infringement can avoid liability under subsection 55(2) by discontinuing the infringing activities prior to issuance of the patent, and whether liability under subsection 55(2) extends to a party whose pre-issuance infringement is by inducement.
The Court found that it would defeat the purpose of the provision if a party could avoid liability by discontinuing the activities before the patent issues or by inducing others to directly infringe.
Factors to be considered for excessive prices
Alexion Pharmaceuticals Inc v Canada (Attorney General)
The Patented Medicine Prices Review Board (PMPRB) is established under the Patent Act and can make orders concerning excessive prices of patented medicines in Canada.
In 2017, the PMPRB found that Alexion's SOLIRIS was excessively priced under section 85 of the Patent Act. In 2019, the Federal Court dismissed Alexion's application for judicial review (for further details, see "Federal Court upholds PMPRB's pricing decision regarding Alexion's Soliris"). On appeal, the Federal Court of Appeal found that the PMPRB's decision was unreasonable and remitted the excessive pricing decision to the PMPRB for redetermination.(8) The Court expressed concerns that the PMPRB did not provide adequate reasons for its decision and misunderstood its mandate under the Patent Act. The excessive pricing provisions in the Patent Act are directed at controlling patent abuse, not at controlling reasonable pricing, price-regulation or consumer protection at large. Canada (Attorney General) has applied to the Supreme Court of Canada for leave to appeal. For further details about this case, see "Federal Court of Appeal remits pricing decision on Alexion's Soliris to Patented Medicine Prices Review Board".
Merck Canada Inc v Canada (Health)
The Federal Court of Appeal affirmed a Federal Court decision(9) dismissing Merck's application for judicial review of the Minister of Health's refusal to list Canadian Patent No. 2,830,806 on the Patent Register pursuant to subsection 4(6) of the PM(NOC) Regulations.(10) Subsection 4(6) requires a patent list to be submitted to Health Canada within 30 days of issuance of the patent. The Federal Court of Appeal found that the Minister's refusal to extend the 30-day time limit was reasonable. For further details about this case, see "Federal Court of Appeal dismisses appeal and upholds strict interpretation of patent listing deadline for Keytruda formulation patent".
Apotex Inc v Eli Lilly Canada Inc
The Ontario Superior Court of Justice granted a summary judgment motion dismissing Apotex's claims for damages under common law, Ontario's Statutes of Monopolies and the Trademarks Act.(11) The Court confirmed that the Patent Act and the Patented Medicines (Notice of Compliance) Regulations constitute a complete code and that Apotex is limited to the remedies available under section 8 of the Regulations. For further details about this case, see "Ontario Superior Court dismisses Apotex's Statutes of Monopolies and Trademarks Act claims regarding olanzapine".
Apotex Inc v Pfizer Ireland Pharmaceuticals
The Ontario Superior Court of Justice granted a summary judgment motion dismissing Apotex's claims for treble damages and double costs under statutory and common law causes of action – that is, Ontario's Statutes of Monopolies and the common law of torts of conspiracy, unjust enrichment and nuisance.(12) Again, the Court confirmed that the Patent Act and the Patented Medicines (Notice of Compliance) Regulations constitute a complete code and that Apotex is limited to the remedies available under section 8 of the Regulations. For further details about this case, see "Ontario Superior Court dismisses Apotex's Statutes of Monopolies claims regarding sildenafil".
Canada's certificate of supplementary protection (CSP) regime came into force on 21 September 2017, consequent to Canada's commitments under the Comprehensive Economic and Trade Agreement between Canada and the European Union. CSPs can provide up to two years of supplementary protection for patents relating to drugs for which marketing authorisation in Canada has been delayed. Canada previously did not have any form of patent term adjustment, extension or supplementary protection. The European Union already provided supplementary protection by way of its supplementary protection certificate system.
There have now been a few cases interpreting the CSP provisions of the Patent Act and the Certificate of Supplementary Protection Regulations, including some in 2021.
Canada (Health) v Glaxosmithkline Biologicals SA
Pursuant to subsection 3(2) of the Certificate of Supplementary Protection Regulations, one of the bases on which a patent may be eligible for a CSP is if it contains "a claim for the medicinal ingredient or combination of all the medicinal ingredients" contained in the relevant drug.
The Federal Court had set aside the minister of health's decision refusing to grant a CSP to GSK in respect of Canadian Patent No. 2,600,905 and its drug Shingrix, a vaccine for shingles. The minister had concluded that patent claims reciting both the virus antigen and an adjuvant were not claims for the medicinal ingredient per se.
In its first appellate decision on CSPs,(13) the Federal Court of Appeal unanimously found that the Minister of Health's refusal to grant a CSP was reasonable, setting aside the Federal Court decision.(14) For further details about this case, see "Federal Court of Appeal finds Minister of Health's refusal to grant a CSP for SHINGRIX is reasonable".
Merck Canada Inc v Canada (Health)
A CSP is available only if the Canadian application for marketing authorisation is filed within 12 months of the first application for marketing authorisation among prescribed foreign countries.
Merck's Canadian application for marketing authorisation (ie, a new drug submission (NDS)) for the drug Belsomra (suvorexant) was filed within 12 months of its first application for approval filed with the United States Food and Drug Administration. However, Merck withdrew the NDS after it was unable to provide further data required by Health Canada and subsequently filed a second NDS, outside the 12-month window. Health Canada rejected Merck's CSP application referencing the first NDS as it did not result in a marketing authorisation.
The Federal Court found the minister of health's refusal to grant Merck a CSP was unreasonable and remitted the CSP application for redetermination.(15) The minister of health failed to address Merck's arguments concerning the purpose and object of the CSP provisions in the context of Canada's obligations under CETA. For further details about this case, see "Federal Court remits Belsomra CSP timing refusal for redetermination".
CanMar Foods Ltd v TA Foods Ltd
The Federal Court of Appeal affirmed a Federal Court decision granting a summary judgment motion dismissing CanMar's patent infringement claim on the basis of non-infringement.(16) Notably, the Court affirmed that expert evidence is not always required for the Court to properly construe the claims of the patent at issue.
ViiV Healthcare Company v Gilead Sciences Canada, Inc
The Federal Court of Appeal affirmed a Federal Court decision(17) granting summary judgment, by way of summary trial, dismissing ViiV's patent infringement claim against Gilead.(18) The decision provided commentary on the summary trial process. For further details about this case, see "Federal Court of Appeal finds summary trial appropriate, upholds dismissal of ViiV's action for patent infringement re: Gilead's BIKTARVY".
For further information on this topic please contact David Schwartz, Nicole Boyle, Robert Baker or Skylar Yoo at Smart & Biggar by telephone (+1 613 232 2486) or email ([email protected], [email protected], [email protected] or [email protected]). The Smart & Biggar website can be accessed at www.smartbiggar.ca.
Ryan Wong, articling student, assisted in the preparation of this article.
Endnotes
(1) For the first article in this series, see "Canadian patent law 2021: part one".
(2) 2021 FC 367.
(3) 2021 FCA 7.
(4) 2021 FCA 24.
(5) 2021 FCA 166.
(6) 2021 FCA 4.
(7) 2021 FCA 24.
(8) 2021 FCA 157.
(9) 2021 FC 345.
(10) 2021 FCA 224.
(11) 2021 ONSC 1588.
(12) 2021 ONSC 6345.
(13) 2021 FCA 71.
(14) 2020 FC 397.
(15) 2021 FC 1015.
(16) 2021 FCA 7.
(17) 2020 FC 486.
(18) 2021 FCA 122.