Drug: escitalopram

Lundbeck was successful in obtaining a Prohibition Order preventing Apotex from coming to market until after the expiration of one of its patents. Consequently, Apotex started an action to impeach the patent. In response, Lundbeck counterclaimed with allegations of infringement. In the present motion, Apotex seeks to have the infringement counterclaim struck.

The Courts have consistently held that quia timet infringement proceedings cannot be sustained when filed on the basis of the actions of a second person in filing an ANDS and sending a NOA. However, in this case, Apotex in its Statement of Claim, is also seeking a declaration of non-infringement. The Court agreed that this was material difference from the previous line of jurisprudence. The Court held that, in seeking a declaration of non-infringement Apotex is proposing to put before the Court the same information that would be the subject of the infringement counterclaim. Thus, it cannot be improper or abusive for Lundbeck to seek from the Court declarations and remedies opposite to what Apotex is seeking, on the same factual matrix as Apotex put in issue. Thus, the counterclaim should not be struck.

By this motion, Apotex also sought an order requiring Lundbeck to pay security for costs into Court for its counterclaim. The Court held that security for costs are referable to the costs of the plaintiff’s claim and as Apotex is the instigator of the main action and as Lundbeck’s counterclaim is dependent upon that action and relies on the same facts, ordering Lundbeck to pay post security for Apotex’ full costs of defending the claim would be tantamount to ordering it to pay security for Apotex’ costs of pursuing the action. If Apotex’ expected costs of defending the counterclaim could be shown to exceed its costs of the main action, security should be given but only for that excess. However, no such excess was shown on the evidence. The Court also took into consideration the presence of some Lundbeck assets in Canada as well as the substantial worldwide revenues and assets of Lundbeck. The Court concluded that Lundbeck should be exempted from the requirement to post security for costs.