CaseTeva Canada Limited v Pfizer Canada Inc, 2014 FCA 138

Drug: VIAGRA (sildenafil citrate)

Nature of case: Section 8 damages proceeding under Patented Medicines (Notice of Compliance) Regulations

Date of decision: May 27, 2014

Summary

Norton Rose Fulbright were successful in convincing the Federal Court of Appeal to uphold the judgment of Mr. Justice de Montigny determining that punitive and exemplary damages are not available under section 8 of the Patented Medicines (Notice of Compliance) Regulations, SOR/93-133 (the Regulations).  Accordingly, the court struck the related paragraphs from the statement of claim of Teva Canada Limited (Teva) in the action brought against Pfizer Canada Inc., Pfizer Inc., and Pfizer Ireland Pharmaceuticals (collectively, Pfizer) for damages in connection with its generic version of Pfizer’s drug, VIAGRA®.

Background

Following the dismissal of Pfizer’s prohibition proceeding by the Supreme Court in Teva Canada Limited v Pfizer Canada Inc, 2012 SCC 60, Teva commenced an action claiming damages and a variety of other relief including punitive and exemplary damages in connection with its purported delayed market entry for its Novo-Sildenafil product.  

Pfizer successfully moved to strike Teva’s statement of claim before Madam Prothonotary Aronovitch; an appeal from her decision was dismissed by Mr. Justice de Montigny, causing Teva to bring the matter before the Court of Appeal.  On both appeals, Teva took the position that the inherent power of the courts to award punitive and exemplary damages was not fettered by section 8 of the Regulations. Teva focused on that part of subsection 8(4) which provides that the Court make anyorder for relief by way of damages in respect of a generic manufacturer’s loss that the circumstances require.

Section 8 proceedings limited to compensatory relief

Writing for the Court of Appeal, Mr. Justice Mainville rejected Teva’s arguments holding that “punitive and exemplary damages cannot be available when the statutory regime underlying the claim explicitly or implicitly precludes them”. The Court reaffirmed that section 8 is a “complete code” or “comprehensive scheme” for liability under the Regulations and that its language displaces any inherent jurisdiction to award punitive or exemplary damages, which are neither “suffered” nor compensate a “loss” as required by section 8.

Following a well-established line of authority, the Federal Court of Appeal held that subsection 8(4) is limited to an award of compensatory damages in respect of any losses referred to in subsection 8(1) suffered during the relevant period.  The Court also rejected Teva’s argument that subsection 8(5) could support the punitive and exemplary relief sought holding that the discretion created by subsection 8(5) is limited to the adjustment of compensatory damages only.  

Link to decision

Teva Canada Limited and Pfizer Canada Inc, 2014 FCA 138