The Federal Court denies leave to amend a pleading after liability stage of trial
Teva Canada Limited (formerly Novopharm) has been denied leave to amend their Statement of Defence and Counterclaim after the first phase (liability) of the bifurcated action has been heard and determined in its favour, but before the start of discoveries on the second phase (alleged losses) of the litigation.
The Court disagreed with the way the pleading was amended. For example, rather than proposing an amended pleading with the amendments underlined pursuant to Rule 79(1), a “Fresh as Amended” version was filed that blurred the old with the new. As a result, any amendments that referred to liability issues were refused as amendments made after trial, including 1) a new cause of action under the Trade-marks Act; 2) the identity of the “first person”; and 3) the period during which Teva’s losses can be compensated. Amendments that go to the quantification of damages would potentially be allowable, but they were so intertwined with the liability issues that Teva’s proposed pleading was not permissible as it was currently drafted.
Teva had also sought a scheduling order that would ensure the trial was heard within 18 months, but this was also denied due to the many unknowns resulting from the suggested changes to the pleadings.
Motion to Set Aside Default Judgment Dismissed
Default judgment was granted against the Defendants in a previous decision. In particular, the Court found, inter alia, infringement of the Plaintiffs’ registered trade- marks. The Defendants brought this motion to set aside the default judgment. The Court denied the motion.
The Court reviewed the evidence relating to the knowledge of the Defendants in respect of the judgment against them. The Court set out the three part test to be applied for setting aside a default judgment, namely that the moving party establish that it has a reasonable explanation for the failure to file a Statement of Defence; that it has a prima facie defence on the merits to the claim; and has moved promptly to set aside the default judgment. The Court found that the Defendants failed to meet either the first or third prong of the test, the motion was dismissed with costs