Cases: Teva Canada Limited v. Pfizer Canada Inc. et al. Application for leave to appeal from the judgment of the Federal Court of Appeal 2014 FCA 138 refused with costs   

DrugVIAGRA® (sildenafil)

Nature of cases: Appeal from a pleadings motion in which Teva’s claim for punitive damages under Section 8 of the PM(NOC) Regulations was struck

Date of decisions: November 13, 2014

Summary

The Supreme Court of Canada has refused Teva’s application for leave to appeal the decision of the Federal Court of Appeal which had upheld an order striking its plea for punitive damages in an action pursuant to section 8 of the Patented Medicines (Notice of Compliance) Regulations(the “PM(NOC) Regulations).

Teva’s plea for punitive damages was made in the context of a section 8 action claiming damages for Teva’s alleged delayed market entry with its generic version of VIAGRA® (sildenafil). Pfizer moved to strike the plea and was successful before a prothonotary of the Federal Court who held in part that Teva’s claim for punitive damages was “an impermissible attempt to graft a civil punishment or fine onto a complete code of statutory damages.”  Through two rounds of appeal, a Judge of the Federal Court and three judges of the Federal Court of Appeal agreed with the prothonotary, holding that Teva’s pleading was properly struck. With the announcement, the issue has been definitively settled: punitive damages are not available in an action commenced pursuant to section 8 of the PM(NOC) Regulations.

The Federal Court of Appeal decision

The FCA Judgment was based on long-standing authority that has recognized section 8 as a compensatory scheme regulating compensation for “losses suffered” by a “second person” during the defined period. The Federal Court of Appeal considered that punitive damages, by their nature, are entirely inconsistent with a regime designed to compensate for losses suffered and held that Teva’s claim was properly struck.

The Supreme Court will weigh in on the legal framework for the quantification of section 8 damages having recently granted leave to appeal the Federal Court of Appeal judgment in Sanofi-Aventis et al. v. Apotex Inc. 2014 FCA 68 (“Ramipril”). Teva had in fact written to the Supreme Court after leave to appeal was granted suggesting that its appeal on the question of the availability of punitive damages could be heard together with that appeal. Teva’s invitation was rejected.  

Link to FCA decision

Teva Canada Limited v. Pfizer Canada Inc. 2014 FCA 138