Recent Decisions April 2004
I. FEDERAL COURT DECISIONS
(a) Patents
1. F. Hoffmann-La Roche v. Commissioner of Patents, November 25, 2003 FCTD (O'Reilly J.) Failure to Pay Maintenance Fees/Lapse/Application for Judicial Review
Application for judicial review following notice to the applicant that its patent had lapsed for failure to pay maintenance fees. The applicant had succeeded in having its patent reissued. Upon reissue, however, it failed to pay the proper maintenance fees required for reissued patents and, instead, paid the fees corresponding with a newly issued patent. The applicant never received notice that its maintenance fees were overdue until after the patent had expired and it was too late to do anything about it. There were two issues before the Court. First, whether the Commissioner of Patents had done anything that could be challenged by way of judicial review and, second, whether there was a legal basis on which the Court could order relief in light of the strict terms of the Patent Act.
Held: Application for judicial review dismissed with costs to the respondent. The Court rejected the Commissioner's submission that no decision or order had been made that could be used to found an application for judicial review. Instead, the Court relied on the language in s. 18.1(3) of the Federal Court Act providing for judicial review in respect of any "decision, order, act or proceeding of a federal board, commission or other tribunal". Accordingly, the Court found the language was broad enough to encompass the Commissioner's notice to the applicant that its patent had lapsed. The Court rejected the applicant's argument that the duty of fairness required the Commissioner to give notice before making a declaration for failure to pay a maintenance fee. It noted that the usual purpose of notice is to allow a person to make representations to the decision maker before an adverse determination is made against him or her. It found that in this case a requirement to give notice would be at odds with the clear legislative intent to place the burden of compliance squarely on patent holders - "it is clear that the Commissioner has no authority to relieve against the consequences of underpaying a maintenance fee… Notice would not provide patent holders a chance to comply.” Hence, the Court found that there was no legal basis for imposing a duty on the Commissioner to provide notice. The Court also rejected the applicant's argument that the circumstances gave rise to a duty to provide notice under the doctrine of legitimate expectations. It noted that the doctrine requires decision makers to provide those whose interests are at stake an opportunity to make submissions, and that the Commissioner could not have conveyed the impression that a patent holder's interests would not be impinged without notice and an opportunity to make representations. Absent this latter element the Court held the doctrine of legitimate expectations was inapplicable. The Court further rejected the applicant's argument that it had authority to provide relief on equitable grounds. It found the language of s. 46(1) of the Patent Act was clear and could not be undone by equity. Finally, the Court rejected the applicant's argument that the Commissioner was estopped from declaring that its patent had lapsed because it had accepted a lesser amount than that which was owed. The Commissioner had failed to advise that the applicant had not paid the proper amount. The applicant argued such silence meant that the Commissioner had given its assurance of compliance. The Court, however, found that such an argument could not be allowed in light of the language of the Patent Act. Noting an earlier decision, it concluded "there is not a single case in which an estoppel has been allowed in such a case to defeat a statutory obligation of an unconditional character. … I see no basis in this case on which to recognize an estoppel against the Commissioner. There is no leeway in the Patent Act. Nor does the Commissioner have any discretion".
2. Brian M. Didone and Manfred Harle v. Michael Peter Sakno, December 31, 2003 FCTD (Russell J.) Patents/ Judicial Review/Appointment/ Revocation of Agent/ Multiple Inventors
Application for judicial review. The patent application at issue was filed on January 16, 2001, with a petition identifying Sakno as the sole inventor and as the owner of the whole interest in the invention and appointing Dennison Associates ("Dennison") as agent. A dispute arose between Sakno and the employer of Didone and Harle regarding ownership of the invention. On September 10, 2001, Sakno wrote to Dennison and specifically withdrew Dennison's authority. On September 18, 2001, representing themselves as agent for the Respondent, Dennison wrote to the Patent Office to cancel the appointment (as associate agent) of David French (“French”), who had been acknowledged as associate agent in June 2001. Also on September 18, 2001, Dennison wrote to CIPO requesting the addition of Didone and Harle as co-inventors. On September 19, 2001, CIPO sent a letter to French advising that his appointment as associate agent was cancelled. On September 21, 2001, Dennison submitted an affidavit essentially reiterating the factual allegations set out in the letter of September 18, 2001. On September 19, 2001, Sakno executed a revocation and cancellation of Dennison’s appointment, appointing French, who had been acknowledged as associate agent in June 2001, as his sole patent agent. On September 25, 2001, the Patent Office sent a letter to Dennison indicating that, based on Dennison's letter of September 21, 2001, and on the understanding that Dennison was agent for Sakno, Didone and Harle had been added as co-inventors. Also on September 25, 2001, the revocation of Dennison and appointment of French was received by CIPO. On September 27, 2001, CIPO sent a letter to French acknowledging the revocation of Dennison and the appointment of French, and also sent a letter to Dennison advising that Dennison was no longer patent agent of record for Sakno. Also on September 27, 2001, Dennison sent a letter to Sakno stating that they had never acted for him but had always acted for the employer of Didone and Harle. Sakno was unaware of the steps that had been taken by Dennison since their letter of September 10, 2001, and only learned of them when he reviewed the file history following receipt of the September 27, 2001, letter from Dennison. On November 20, 2001, Sakno received confirmation from CIPO that Didone and Harle had been added as co-inventors. In that letter, the Commissioner took the position that, since there was no "common patent agent of record" acting on behalf of both Sakno and Didone and Harle, the identity of the "authorized correspondent" would be determined in accordance with s. 2 of the Patent Rules. On January 31, 2002, Dennison provided CIPO with an Appointment of Agent signed only by Didone and Harle. On February 8, 2002, the Chairman of the Board, wrote to Sakno, Didone and Harle to advise that, pursuant to s.2 of the Patent Rules, Sakno as the first named inventor was the "authorized correspondent". Judicial review of that decision was sought.
Held: Application dismissed. Section 18.1(2) of the Federal Court Act provides that an application for judicial review must be made within thirty days after the time the decision was first communicated to the party affected thereby, or within such further time as a judge may allow. The decision on revocation of Dennison was first communicated to the applicants by letter dated September 27, 2001. The Applicants (Didone and Harle) chose not to challenge the revocation when they received notice of it on September 27, 2001, because such a challenge could have thwarted their plan to advance the inventorship interests of the Applicants by having them recognized on the record at the Patent Registry. Having decided to leave the revocation decision unchallenged to further their cause, they cannot now challenge it at this late date because it has resulted in consequences that they did not foresee when they adopted their subterfuge. The application is therefore time-barred. In the event the application is not time-barred, the decision of the Board can be broken down into two conclusions: (a) in order to revoke an appointment patent agent it is sufficient for one of several applicants to sign the revocation; and (b) the Respondent validly revoked Dennison as patent agent as of September 24, 2001. The first conclusion is a matter of law and the second, which applies the law to the facts, is a question of mixed law and fact. On the first question, the standard of review is correctness, and on the second, it is reasonableness simpliciter. Section 20(3) of the Patent Rules provides that the appointment of a patent agent may be revoked by submitting to the Commissioner a notice of revocation signed by the applicant or that patent agent. In the case of multiple applicants, a valid appointment as patent agent requires authority from all of the applicants. If one of the applicants subsequently withdraws that authority, then the patent agent no longer enjoys the authority of all of the applicants and notification of this fact to CIPO by any one of the applicants is sufficient to effect the revocation. To require notification by all of the applicants is impractical and would lead to undesirable consequences. Where a patent agent represents the parties on one side of a dispute, it would be impossible to have all parties involved sign a revocation. And if this were the case, then to allow the patent agent to continue as the agent of record for all of the parties would be an inaccurate reflection of the actual situation and an invitation to abuse. In any event, a valid revocation occurred in this case because, at the time of the revocation, there was, in fact, only one applicant (Sakno) and he provided a revocation of Dennison that was validly accepted by CIPO. Didone and Harle were added as co-inventors in September, 2001, when CIPO informed Dennison of this fact. It was not until January 31, 2002, that Dennison provided the Patent Office with an appointment of agent signed by Didone and Harle. Thus, at the time of the revocation decision in September, 2001, or indeed at any time subsequent to this, there was no notice of appointment signed by all of the applicants appointing Dennison as patent agent in accordance with s. 20(2) of the Patent Rules. Therefore, the Board was correct to conclude that "there is no common patent agent of record appointed by all three applicants". It would be absurd if parties who are able to persuade CIPO to accept them as co-inventors on the basis of an understanding that is incorrect could then insist that their own agent, who has ceased to represent one of the applicants, cannot be removed without their consent. The fact that the notice of revocation of Dennison was forwarded to CIPO by French is irrelevant; it was signed by Sakno and it was obvious from the notice and cover letter in what capacity French was forwarding the notice. It is also irrelevant whether Sakno intended to become the authorized correspondent; nothing in the document said that Dennison should only be removed if French was appointed. Having received clear notice of the revocation, it is difficult to see how CIPO could have continued to treat Dennison as agent of record. The Board did not err, even if a standard of correctness were applied.
3. AstraZeneca v. Apotex and Canada (Minister of Health), January 16, 2004 FCTD (O'Keefe J.) Leave to File Affidavit/Federal Court Rule 312 of the Federal Court Rules/Standard of Review of Prothonotary's Decision /Patented Medicines (Notice of Compliance) Regulations
Appeal by Astrazeneca from a decision of the Prothonotary granting leave to Apotex to file an affidavit that appended a revised product monograph. The revised product monograph differed from the original product monograph referenced in Apotex' NOA. Furthermore, Apotex had previously defended the original product monograph by obtaining an order for leave to file affidavit evidence and defended appeals of that order to both the Federal Court Trial Division and the Federal Court of Appeal.
Held: Appeal allowed. Since the Prothonotary's decision did not raise questions vital to the final issue of the case, the Court held that it should only exercise discretion de novo if the Prothonotary was clearly wrong. The factors to be considered in whether filing of additional affidavits pursuant to r. 312 are: relevancy of the proposed affidavit, absence of prejudice to the opposing party, assistance to the Court, and the overall interest of justice. The Court held that the Prothonotary's decision was clearly wrong. It is not in the overall interests of justice that leave be granted to file this affidavit, with the revised product monograph, due to Apotex' approach of using the original product monograph and supporting it until just before the hearing date.
4. Pfizer v. Apotex and Canada (Minister of Health), January 21, 2004 FCTD (Snider J.) Application for Prohibition/Allegation of Non-Infringement/Burden of Proof/Request for Generic Samples/Sufficiency of Notice of Allegation/Patented Medicines (Notice of Compliance) Regulations
Application by Pfizer to prohibit the Minister from issuing an NOC to Apotex for the medicine azithromycin. In its NOA, Apotex stated that it would not infringe Pfizer's patent for the dihydrate form because its tablets would be in the monohydrate form. Since December 2001, Pfizer has requested samples of the bulk and tableted material produced by Apotex in its clinical trials. Apotex, in spite of repeated requests and an unsuccessful motion, has refused to provide the requested samples. Pfizer submits that since the requested samples are necessary to its case, the burden of proof should shift to Apotex and failure to provide the samples should give rise to a common law presumption that it would infringe the patent. Pfizer argues that Apotex will produce the dihydrate either as a byproduct or as its final product and that, even if its final product is free of dihydrate, it will nevertheless convert into the dihydrate upon storage and scaling up of production.
Held: Application dismissed. Apotex has an evidential burden to 'put into play' the issue of non-infringement by issuing a NOA and a detailed statement. Apotex has the opportunity, but not the obligation, of filing further evidence in support of its detailed statement. If it is determined that the NOA and detailed statement are not deficient, Apotex would have met its evidential burden without requiring production of samples. In order for a common law presumption to be applied, Pfizer must show that the information is within the exclusive knowledge and peculiarly within the knowledge of Apotex. Since Apotex disclosed portions of its ANDS, the information sought by Pfizer was not peculiarly within the knowledge of Apotex. The evidence suggested that the ANDS disclosed sufficiently the procedure to obtain azithromycin and Pfizer could follow these steps to test the samples. The mere fact that the sample materials are relevant is insufficient to order their production or to form the basis of a successful application. The NOA will be adequate if further disclosure elaborates on the basis for which the allegation of non-infringement was made such that there is sufficient evidence upon which to evaluate the allegation. Pfizer's expert had taken liberties that someone skilled in the art would not have and deviated significantly from the ANDS process. As such, Pfizer failed to show that, on a balance of probabilities, Apotex would infringe its patent by producing the dihydrate either as a byproduct, a final product, upon storage or scaling up of production. The possibility of conversion to dihydrate does not establish on a balance of probabilities that Apotex's allegation of non-infringement is not justified. In the event that Apotex's monohydrate tablets do convert to dihydrate, it will face grave consequences at that time.
5. James W. Halford and Vale Farms v. Seed Hawk, Simplot Canada et al., January 23, 2004 FCTD (Pelletier J.) Patents /Infringement/Validity/Personal Liability
Action for patent infringement. The patent related to a device for placing seed and fertilizer in the ground comprising a frame having a knife means with a first tube means for depositing fertilizer mounted to the rear edge of the knife and a second tube means spaced therefrom for depositing the seed. The second tube could be adjusted horizontally and vertically and particularly to a position scraping the side of the furrow formed by the knife means to deposit the seed at the side. A packer wheel mounted on the same support as the second tube followed the second tube and ran in the furrow to press down soil over the seed and fertilizer. The accused device used a similar arrangement, having a first "fertilizer" knife with a fertilizer tube mounted to its rear edge, and a "seed" knife mounted rearwardly of the fertilizer knife and having a seed tube mounted to its rear edge, and a packer wheel following the seed knife/seed tube. Personal liability was asserted against the principals of the corporate defendant Seed Hawk, who had been warned of potential infringement by their own counsel. Inducing infringement was alleged against Simplot, which had provided financing to Seed Hawk for the development of the accused device.
Held: Infringement - The patent was not infringed. The patented device allowed placement of the seed relative to the fertilizer by pivotal attachment of a single mounting member to the knife means, with the knife means being mounted to the frame. This allowed the single mounting member (carrying the packer wheel and second tube means) to move independently of the knife means, so that seed and fertilizer might not always be deposited in the desired relationship. In contrast, the possibility of differential movement between the fertilizer knife, the seed knife and the packer wheel in the accused device was severely constrained because they were all mounted on a common member. This meant that the accused device would succeed in maintaining consistent relative placement of seed and fertilizer when the position of the ground varied with respect to the frame. This amounted to a material difference in the manner of operation, so there was no infringement. In addition, the patent specified that engagement of the second tube with the ground or soil was to be provided "solely" by the outer edge of the second tube means. The accused device used a seed knife to which the seed tube was secured. The use of the word “solely” indicated an intention to exclude additions or modifications to the seed tube, so there was again no infringement.
Validity - The patent is valid. The failure of one of the claims to recite the packer wheel and the single mounting member was not a failure to claim essential elements because these elements were not essential. The patent is not invalid for obviousness. A skilled but unimaginative technician would not have been led directly and without difficulty to the invention by the elements of the mosaic of prior art. It would take an inventive step to conceive of a seed tool which is adjustable from side to side as that term was used in the patent. The patent is not anticipated. The devices cited for anticipation mount the fertilizer tool, the seed tool and the packer wheel on a single member, whereas the patent teaches mounting of the fertilizer tool to the frame and the seed tool and packer wheel to a single mounting member which is pivotally mounted relative to the fertilizer knife assembly. Furthermore, the cited devices use a furrow opening knife and a delivery tube for each material planted, while the patent teaches the use of one furrow opening device with a second material being deposited in the same furrow solely by a second tube means. In addition, the cited devices contemplate passage of the packer wheel over the furrow and not within the furrow. The patent was not invalid for insufficient disclosure with respect to the element of steering since, as that term was used in the patent, “steering” refers to a tendency to keep the seed tube within the furrow by resisting lateral forces. The Court did intimate that, if pleaded, an assertion that the claims were invalid for inutility and overclaiming for failing to specify (and in some claims even to recite) the space between the second tube means and the knife means could have succeeded.
Personal Liability - (The Court considered the issue of personal liability, notwithstanding its finding on the issue of infringement.) Corporate directors and officers are personally liable for conduct undertaken in the course of their corporate duties if that conduct is itself tortious or if it serves an interest other than the corporation’s. Thus, a director can be held personally liable for tortious acts if the director’s own behaviour is tortious, or when the corporation is used simply as a cloak for the personal activities of the director. The mere fact of exercising control is not sufficient to establish personal liability. Infringement is a matter about which reasonable persons can disagree. At its highest, the case against the individual defendants was that they decided to take a chance that they were right about infringement and the plaintiff was wrong. This is a long way from embarking on a deliberate scheme of appropriating the plaintiff’s invention. Had infringement been found, the individual defendants would not have been personally liable.
Inducing Infringement - (The Court considered the issue of inducing infringement, notwithstanding its finding on the issue of infringement itself.) The pleadings failed to allege that Simplot had induced infringement by end users. As to activity by Seed Hawk, the claim failed because the plaintiffs failed to show that without the assistance of Simplot, the [alleged] infringement would not have occurred. The individual defendants would have persisted in their development efforts even if they had not received funding and marketing assistance.
Editorial Note: The Court appears to have applied a test for infringement different from that outlined in Free World Trust v. Electro Santé Inc., [2000] 2 S.C.R. 1024. After apparently having identified the essential elements, the Court said (para. 139):
…Consequently, simply asking if any essential element is lacking is not a useful way of determining whether infringement has occurred. It may be that one element has been substituted for another, the substituted member doing exactly what the original member did, doing it in the same way, and leading to the same result. Such a substitution would clearly amount to infringement even if on a literal reading of the claim one of the essential elements was missing. …
[Emphasis added.]
The Court conducted an element-by-element comparison of the claims to the accused device, and then, for the differences identified, proceeded to embark on an assessment of whether the variants would make a difference in the way the invention works. Thus, the Court appears to have embarked on a pure Improver analysis. [see Improver Corp. v. Remington Consumer Products Ltd., [1990] F.S.R. 181]
The Court also suggested that a dependent claim could be infringed even when the independent claim from which it depends is not infringed, if it adds to the independent claim those elements whose absence resulted in a finding of non-infringement.
6. Bayer v. Apotex and Canada (Minister of National Health and Welfare), February 2, 2004 FCTD (Campbell J.) Application for Prohibition/Allegation of Non-Infringement/Obvious Chemical Equivalent /Validity of NOA/Patented Medicines (Notice of Compliance) Regulations
Application by Bayer to prohibit the Minister from issuing an NOC to Apotex for the medicine ciprofloxacin. The NOA at issue is Apotex' eighth NOA with respect to ciprofloxacin and its second non-infringement allegation regarding the '067 patent. Bayer argues as a preliminary matter that Apotex failed to comply with requirements in s.5(3)(c)(i) of the Regulations. Bayer contends that a "notifiable change" is a "submission for a NOC" and therefore, Apotex was obliged to file its notifiable change prior to serving its NOA. Bayer also argues that Apotex' ANDS contains a previously prohibited process and therefore Apotex' current NOA does not "relate to" its ANDS. With regard to the allegation of non-infringement, Bayer argues that the Apotex process for producing ciprofloxacin is an obvious chemical equivalent of the Bayer process.
Held: Application dismissed. A "submission for a NOC" within the meaning of s.5 of the Regulations does not include a "notifiable change" as evidenced by a line of authority, which concludes that the expression means only a new drug submission, an abbreviated new drug submission, a supplement to a new drug submission or to an abbreviated new drug submission. Citing AB Hassle v. RhoxalPharma Inc. (2002), 21 C.P.R. (4th) 298, the Court held that there is no onus on a second person to file its new drug submission with the Court and the authority of the Court to order production of relevant portions of a new drug submission is discretionary. Therefore, Apotex has not failed to comply with s.5(3)(c)(i) of the Regulations because its ANDS contains a previously prohibited process and does not contain the Apotex process which is the subject of Apotex' current NOA. Using a purposive construction, the Court found five essentials expressed in the '067 patent but also added the wording "or an obvious chemical equivalent" to each. In Free World Trust v. Électro Santé, [2000] 2 S.C.R. 1024, Binnie J. stated that obvious chemical equivalents must "work in the same way" which should be taken "as meaning that the variant (or component) would perform substantially the same function in substantially the same way to obtain substantially the same result." Bayer was unable to show that the nucleophilic aliphatic substitution in Apotex' process performs substantially the same function in substantially the same way to obtain substantially the same result as the nucleophilic aromatic substitution reaction present in the '067 patent claims.
7. Lilly and Novopharm v. Apotex, February 11, 2004 FCTD (Aronovitch P.) Misleading NOA/"Grave Consequences" /Separate, New Relief/Stay of Section 8 Proceeding/Patented Medicines (Notice of Compliance) Regulations
Lilly brought a motion to amend the Statement of Claim to seek various relief on account of "grave consequences", on the basis that the Federal Court had indicated in previous proceedings that there would be such consequences to a generic drug manufacturer who sends a misleading NOA to an innovator in order to obtain approval to market a generic drug. Apotex sent two NOA's in respect of Lilly's medicine nizatidine. In the first NOA, Apotex represented that it would rely upon the compulsory license to acquire only licensed nizatidine, however contrary to its undertaking Apotex did not in fact sell licensed nizatidine. In the second NOA, Apotex alleged that a version of the process being used by Apotex was different from the process originally claimed. The information supplied by Apotex regarding the process was found "to say the least misleading" by Teitelbaum J. in a motion brought by Lilly to quash Apotex' NOC. In another proceeding, Apotex instituted a s.8 claim for damages arising as a result of losses suffered by Apotex during the period it was left off the market due to Lilly's prohibition application. On the basis that Apotex' two NOAs were inaccurate and misleading, Lilly claimed in respect of "grave consequences" a stay of the Apotex s.8 action, any such other unspecified relief as the Court may grant for "grave consequences" and patent infringement.
Held: Although the list of remedies cited by the Court in previous decisions as constituting "grave consequences" is not exhaustive, grave consequences may not amount to a separate, new or unspecified form of relief. "Grave consequences" available for a misleading NOA can be adequately addressed by the existing forms of relief available in a patent infringement action. Despite the allegations of misleading NOA's in the action for patent infringement, a stay of another proceeding, Apotex' s.8 action, is not available as a remedy. No judicial decision was cited as authority and s.50 of the Federal Courts Act did not provide authority. The current proceeding and the s.8 proceeding were not duplicative nor would the determination of issues in one proceeding be determinative of the issues in the other.
8. Pfizer Ireland Pharmaceuticals and Pfizer Canada v. Lilly Icos and Eli Lilly Canada, February 11, 2004 FCTD (Blais J.) Interlocutory Injunction /Admissibility of Evidence/ Res Judicata
Motion for interlocutory injunction to restrain defendants from offering, selling or distributing or inducing others to use the CIALIS pharmaceutical composition for treatment of ED. Pfizer argued there was a serious issue to be tried, because Lilly led no evidence to dispute infringement and a patent is presumed valid. Pfizer also argued that there would be irreparable harm because if they succeeded at trial, attempting to enforce an injunction to reassert exclusivity could provoke a consumer or physician backlash and damage Pfizer brand equity generally. Pfizer further asserted that damages could not be quantified when a patent holder's exclusivity is lost too soon, because a continued monopoly allows brand equity to build, thereby consolidating the patent holder's market share. Pfizer argued that the balance of convenience favoured granting the injunction, because it could compensate Lilly for losses based on comparable foreign competitive markets, while there were no comparable monopoly markets from which Pfizer's losses could be calculated. On the question of whether there was a serious issue, Lilly argued that Pfizer's patent was of questionable validity, given the finding of invalidity of the corresponding patent by the English Court of Appeal, the revocation of the corresponding patent by the European Patent Office, and the re-examination of the corresponding patent by the USPTO. Lilly also argued that Pfizer had adduced no evidence as to the meaning of the relevant claims or whether they were infringed. As to the issue of irreparable harm, Lilly argued that the harm asserted by Pfizer would occur after trial when a permanent injunction would be imposed, and that Pfizer had presented no evidence of harm during the period preceding trial if the injunction were not granted. Lilly also argued that the assertion of a consumer backlash was unsupported by survey evidence, and that Pfizer had failed to seek preliminary injunctions in other countries (which Pfizer disputed). Lilly argued that the balance of convenience favoured refusing to grant the injunction, given its expenditures in developing and marketing CIALIS, and asserted that Pfizer's losses if the injunction were not granted would be simpler to calculate than its own, where no figure exists on what the competitive market would yield for each of the players. Lilly undertook to keep an accounting and satisfy any damage award given at trial. Lilly also objected to some of Pfizer's affidavit evidence, and asserted that the matter was res judicata by reason of the interim injunction decision in its favour.
Held: Motion denied. Lilly waived its right to object to the relevant paragraphs of the affidavit by cross-examining on them. The doctrine of res judicata did not apply because the interim injunction decision was clearly not meant to be final. The finding of invalidity by the English Court of Appeal, revocation by the European Patent Office, and re-examination by the USPTO did not negate the fact that there was a serious issue to be tried, as a Canadian patent is presumed valid until proven otherwise. On the issue of irreparable harm, the Court was satisfied that Pfizer's losses could be determined. No evidence was presented to support Pfizer's argument that there would be a backlash by physicians and consumers. The VIAGRA brand was well established in Canadian society, and its position as pioneer would remain despite competition. The Court distinguished American Cyanamid, argued in support of the contention that it would be impractical to enforce an injunction because of damage to goodwill, because the patent in that case related to surgical sutures, by definition used only by specialists. There was no evidence that consumers would give up other Pfizer products or renounce ED medication because one brand ceased to be available, and if anything, some customers might be enticed by Lilly's marketing to try CIALIS, and be susceptible to try another ED medication if CIALIS became unavailable. The losses claimed by Pfizer were calculable, and the other harm alleged was speculative. On the issue of balance of convenience, if the injunction were granted, Lilly would lose all of its potential revenue, as well as the opportunity to develop its market; its strategic placement as second competitor might well be lost to another and the development of a relationship with physicians and pharmacists would be made more difficult, given the lag time between its considerable marketing efforts and finally entering the market. If ultimately no infringement were found, damages would have to be calculated without the benefit of a baseline or relevant experience. By contrast, if the injunction were not granted but infringement ultimately found, Pfizer would lose some of its potential revenue, its market would be temporarily modified but monopoly would be reestablished, and establishing damages would be somewhat facilitated by having at least a baseline stemming from four years of sales in the same market.
9. Canamould Extrusions and 888804 Ontario v. Driangle, February 12, 2004 FCTD (Stone J.) Patents/Infringement/Standard of Appellate Review
Appeal to determine whether the Trial Judge erred at law in construing the claims of a patent, and if so, whether she erred in finding that the patent was not infringed.
Held: Appeal dismissed, with costs. Construction of patent claims is a matter of law and the standard of review is correctness. Infringement of a patent is a mixed question of law and fact and therefore it calls for the standard of palpable and overriding error. The appropriate approach to patent construction is the single-step purposive approach, and excessive literalism is to be avoided. The task of the judge pursuant to the purposive approach is to determine which of the elements of the claimed invention were "essential" and which ones were not. In construing the claims of a patent, regard may be had to the whole of the specification including the drawings and the disclosure. The onus is on the patentee to show that, to a skilled reader, a claimed feature of the invention was obviously substitutable. The test for infringement was set out in Free World Trust v. Electro Santé Inc., [2000] 2 S.C.R. 1024: If a method or device comprises all of the essential elements of a patented invention there is infringement, but there is no infringement if an essential element is different or omitted. The Trial Judge purposively construed the claims to mean that an essential element of the invention is a table that is "continuous" or uninterrupted. The respondent's allegedly infringing device consisted of a top surface that was interrupted. Consequently, the Trial Judge did not err in finding that there was no infringement.
10. Procter & Gamble v. Genpharm and Canada (Minister of Health), February 12, 2004 FCTD (Snider J.) Application for Prohibition Order/Kit for Treating Osteoporosis /Obviousness/Definition of "medicine"/Patented Medicines (Notice of Compliance) Regulations
Application for prohibition order preventing the Minister from issuing an NOC to Genpharm for its product GEN-ETI-CAL CAREPAC until the expiry of P&G's '376 patent. P&G make and sell the only approved etidronate disodium drug product for the treatment of osteoporosis in Canada – the Didrocal kit. The Didrocal kit consists of an intermittent cyclical therapy for treating osteoporosis. The therapy consists of more than one cycle of a low effective dose of etridronate followed by a period with no etidronate. At issue were the "use" claims and the "kit" claims of the '376 patent. The "use" claims are directed to the use of biophosphonates, such as etidronate, that inhibit bone resorption, and the "kit" claims cover a kit for the treatment and prevention of osteoporosis. Genpharm asserts that the limited effective amount (the "LED") of etidonate claimed by P&G was obvious and the intermittent administration of etidronate, rather than prolonged therapy, was also obvious. Genpharm also asserts that the "kit" claims fall outside of the definition of "medicine" under s.2 of the Regulations and that its kit of only one cycle did not infringe the P&G "kit" claims that included the essential element of "two or more cycles".
Held: Application allowed. The claims of the '376 patent were not obvious. Although treatment of osteoporosis by administration of an LED of a biophosphonate may have been obvious, it was not obvious that an LED of etidronate specifically could be used. An LED of etidronate could not be inferred from studies with clodronate, another biophosphonate, as prior art treated clodronate and etidronte as possessing distinct properties. Prior art teaching a specified dosage of etidronate and a bone cell activator did not render the claims obvious as a skilled technician would not think that a specified dosage of etidronate used without a bone cell activator would work equally well. Similarly, the prior art references taken together did not connect a reduction in the side-effects of etidronate and intermittent administration and therefore the prior art would not lead a skilled technician to conclude that the intermittent administration of etidronate was obvious. Snider J. concluded that the combination of the elements together to produce a kit was not obvious. Although the validity of the patent determined the issue in P&G's favour, as Genpharm had not argued non-infringement of the "use" claims, Snider J. considered the other two issues. The "kit" claims are not a "medicine" within the meaning of the Regulations. The P&G kit is not administered to patients, rather it is a system for administering substances to patients. Snider J. went on to find that Genpharm's kit did infringe the "kit" claims of the '376 patent, should the "kit" claims fall under the Regulations. The fact that Genpharm's kit only contained enough medication for one cycle, whereas P&G's kit contained enough for more than one cycle was not relevant to infringement. This distinction was an attack on the regimen itself and not on whether the kit in question facilitates compliance with the regimen. Further, the labeling of the two kits is practically identical. The instructions describe the cyclical regimen, not just the components of the kit, thereby ensuring compliance by the user with the claimed therapy.
11. Eiba v. Canada (Attorney General), February 19, 2004 FCTD (Mosley J.) Reinstatement of Patent Application after Expiry of Reinstatement Period
Application for judicial review of a purported decision by the Commissioner of Patents refusing to accept late reinstatement of a patent application. Applicant had paid maintenance fees for previous years, but failed to pay the 2002 maintenance fees or to request examination. Applicant's agents were notified that the application was abandoned on both grounds. The agents prepared two submissions, one relating to the maintenance fee and one requesting examination; these were sent through the file room but there was no evidence they entered the postal system. Both submissions requested the applicable fees be debited to the firm's Visa account. CIPO received the request for examination, and sent a notice stating that the request had been received and that examination would take place "in due course"; however the maintenance fee submission was not received by CIPO. When the agents attempted to pay the next year's maintenance fee, they were told that the application was abandoned and incapable of being reinstated. The applicant submitted that the Commissioner breached the duty of fairness, because the "usual practice" of CIPO was not to accept requests for examination where an application was not otherwise in good standing, and to notify agents when there was a discrepancy, leading to "legitimate expectations" on the applicant's part that the application had been fully reinstated.
Held: Application dismissed. Judicial review is available in respect of a Commissioner's notice to the applicant that the application had lapsed for failure to pay the maintenance fee. The "usual practices" of the office did not create a duty of the Commissioner to inform the applicant that the request for reinstatement and payment of the required fee had not been received. The Court was not persuaded that the doctrine of legitimate expectations applied to the situation where an administrative body has allegedly, in past situations, brought administrative deficiencies in the filing process to an applicant's attention, so as to create an expectation that the Commissioner will catch each slip, even inadvertent ones, of an applicant in the reinstatement process. The Commissioner has no duty to provide notice to an applicant that an application has not been properly reinstated when the obligation to reinstate an abandoned application is clearly placed on the applicant by the legislative scheme. The maintenance fee provisions of the Act and Rules must be interpreted strictly to ensure compliance by applicants through the timely and diligent filing of fees. The Commissioner has no authority pursuant to the Act and Rules to extend the deadline for payment of maintenance fees.
12. AstraZeneca v. Apotex and Canada (Minister of Health), March 2, 2004 FCTD (O'Keefe J.) Prohibition Order/Sufficiency of NOA/Improper Construction of Claims/Product Monograph Statements Infringing Claims /Patented Medicines (Notice of Compliance) Regulations
Application for an order to prohibit the Minister from issuing an NOC to Apotex in respect of Apo-Omeprazole capsules containing omeprazole in 20 mg strength until after the expiry of Astra's '762 patent. The patent claims a pharmaceutical composition for the treatment of gastritis and peptic ulcer comprising a certain receptor or proton pump in combination with an acid degradable antibacterial compound. Astra asserts that Apotex' NOA is fatally flawed because it fails to assert that its products will not be used by patients for the claimed uses and fails to address the uses referred to in several of the '762 patent claims. Further Astra asserts that Apotex is attempting to expand the legal and factual basis for the NOA by leading certain evidence provided by witnesses for Apotex and Apotex relies on an improper construction of the '762 patent claims. It is further submitted by Astra that Apotex' product monograph makes reference to antibiotics and uses falling clearly within the claim language of the '762 patent.
Held: Application dismissed. Apotex' NOA was sufficient to enable Astra to decide whether to oppose the issuance of an NOC by the Minister. The NOA was therefore sufficient. Apotex did not expand the legal and factual basis of the NOA as alleged by Astra, witnesses for Apotex were responding to the evidence of Astra's witness. Astra's assertion that the product monograph contains statements that will lead patients to use the product for claimed uses, such that omeprazole be used in combination with an antibiotic, also failed. O'Keefe J. accepted expert evidence that the approved uses of a product are contained in the "Indications and Clinical Uses" section of the product monograph and that the uses contained therein are the only uses that can lawfully be promoted by Apotex. References to concomitant use and increases in bioavailability in the "Actions and Clinical Pharmacology", the "Pharmacology (Pharmacokinetics)" or the "Information for the Patient", sections did not indicate that Apotex was seeking approval for these uses. None of the statements impugned by Astra were contained in the "Indications and Clinical Use" section. Therefore, Apotex is not relying on a patent construction which is at odds with the clear language of the patent. If indeed the '762 patent refers to the use of omeprazole and an antibiotic in combination, approval by Apotex was not being sought for this use.
13. Apotex and Canada (AG General) v. Merck, March 2, 2004 FCTD (Snider J.) Motion for Summary Judgment/Question of Law /Unjust Enrichment/Applicability and Interpretation of Old and New Section 8 /Patented Medicines (Notice of Compliance) Regulations
Motion for summary judgment brought by Merck, alternatively that the issues be determined as preliminary questions of law. Merck's motion arises from an action commenced by Apotex to obtain damages from Merck pursuant to s.8 of the Regulations and for unjust enrichment in respect of Apotex' drug Apo-Norfloxacin. The issues to be decided were the applicability and interpretation of old and new s.8 and whether unjust enrichment is available to Apotex.
Held: Motion dismissed. The interpretation and application of s.8 of the Regulations are complex matters that must be determined following a trial of all of the issues. Both parties had "strong, but diametrically opposed arguments." The determinative issue was the adequacy of the record. There was a significant gap in the evidence required to determine the proper interpretation of the provisions. The missing evidence related to the intent and object of both the regulations at issue and the underlying statutory framework. As much of the evidence would be contested, it is properly dealt with at trial. The incomplete record also precluded determination of questions of law. Further, a full trial is required to determine the availability of a claim for unjust enrichment as it is interwoven with the interpretation of s.8 of the Regulations.
14. Pfizer v. Canada (AG Canada and Minister of Health), March 11, 2004 FCTD (Mosley J.) Judicial Review/Refusal to List on Patent Register/Tablet not a "medicine" /Patented Medicines (Notice of Compliance) Regulations
Pfizer sought judicial review of a decision of the Minister that refused to add Pfizer's '376 patent to the Patent Register on the grounds that it does not contain a claim to the medicine verapamil hydrochloride, or its use, as required by s.4(2)(b) of the Regulations. The '376 patent claims a tablet that reacts with gastrointestinal fluids after being ingested such that the gradual expansion of the tablet wall allows the drug to be forced out slowly through an opening in the wall. The medicine is released after a measured delay and at a measured rate. This timing is beneficial as it allows for patients to take the tablets before going to bed, so that the drug substance will be released in the pre-dawn hours, when heart patients are at the greatest risk of suffering heart attacks. Pfizer argued that the '376 patent claims formulations of active and inactive ingredients administered to patients in a particular dosage form. Further, Pfizer argues that the '376 patent claims a compressed tablet dosage form, or in other words, a pharmaceutical composition. The Minister submitted that the '376 patent contains claims for a system or method for the administration of a number of medicines.
Held: Application dismissed. The standard or review of the Minister's decision is correctness. The active ingredient, verapamil hydrochloride, is only mentioned twice in the patent, in claim 2 as one of several drugs that could be used in the dosage form described in claim 1 and in examples 1 and 2 of the specification. Verapamil hydrochloride is not mixed together with various inactive ingredients but rather the design of the tablet structure allows for "discrete and separate components" of drug-free layers and the dose of the drug itself. The sustained release and time-varied nature of the invention described in the patent are ways of building the invention, that is the tablet, using different medicines. Therefore the claims are not for the medicine itself. The '376 patent is not eligible for listing on the Patent Register.
15. AstraZeneca Canada v. Apotex and Canada (Attorney General and Minister of Health) (Ct. File No. T-260-04), AB Hassle and Astra Pharma v. Canada (Minister of Health and Welfare) (Ct. File No. T-1446-93), March 12, 2004 FCTD (Russell J.) Variance of Protective Order/Patented Medicines (Notice of Compliance) Regulations
Court File No. T-260-04 is a motion by AstraZeneca for an order varying the Protective Order made on Court File No. T-1446-93. T-1446-93 was a prohibition proceeding relating to the drug Omeprazole that was dismissed in respect of four and allowed with respect to two of AstraZeneca's patents. In T-1446-93, the Protective Order was granted on the consent of the parties. Under that order, Apotex produced confidential information which AstraZeneca now seeks to introduce into T-260-04. Earlier this year, the Minister issued an NOC to Apotex for its Apo-Omeprazole. Subsequently, AstraZeneca initiated the T-260-04 application for judicial review of the Minister's decision to issue the NOC. The Minister was alleged to have decided that Apotex could rely on different formulations in addressing various formulation patents listed by AstraZeneca on the Patent Register.
Held: Motion allowed. Citing Smith, Kline and French Laboratories v. Canada (Attorney General), [1989] F.C.J. No. 223 (T.D.), aff'd [1997] F.C.J. No. 689 (C.A.), the Court laid out a guide as to when protective orders should be varied: "…the reason for varying the orders should be truly compelling, especially where the purpose for access is unrelated in any way and is in that sense collateral or ulterior to the action in which the documents are filed and sealed." This was not a completely new circumstance involving different parties, and the nature and history of the dispute over the relevant patents made it difficult to sever and isolate different actions. AstraZeneca made it clear in its Notice of Application that it would seek appropriate variation of the Protective Order to ensure the complete record was before the Court. The issue of different formulations is also raised in the Notice of Application and in a letter of Apotex that mentions different formulations. If the Minister was wrong in issuing an NOC that relied on different formulations, it would be highly relevant for the Court to know whether or not different formulations had been used by Apotex in relation to the relevant patents.
(b) Trade Marks
1. Felix Dennis and Dennis Publishing v. Genex Communications et al., August 12, 2003 FCTD (Pinard J.) Trade Mark Infringement /Interlocutory Injunction /Irreparable Harm
Motion for an interlocutory injunction to prohibit the defendants from infringing the plaintiff’s registration for MAXIM for magazines. The defendants have announced that they will publish a magazine called MAXIMUM. The plaintiffs have already obtained an interim injunction.
Held: Motion dismissed. Although the plaintiffs have shown a serious issue to be tried, they have not shown irreparable harm. The defendants have undertaken to keep detailed accounts and there “is no good evidence that casts any reflection on the defendants’ integrity, nor on their ability to pay such damages.” There is no evidence to support the plaintiff’s speculation that the defendants’ magazine may be vulgar and obscene. The lack of a real product to be examined makes the task of someone who must prove irreparable harm much more difficult.
2. Tall Ships Art Productions v. Bluenose II Preservation Trust Society and Reg. TMS; AG of Nova Scotia v. Bluenose II Preservation Trust Society and Reg. TMS, December 10, 2003 FCTD (MacKay J.) Official Marks/Judicial Review/Extension of Time
Motions by the applicants for extensions of time to file applications for judicial review of the Registrar’s decision to publish public notice of the adoption and use by Bluenose Trust of three official marks, each of which contain the word BLUENOSE. The Trust first complained that Tall Ships was infringing its copyright in images of the Bluenose ship in 1996. The Trust’s official marks were published on November 7, 2001 but it did not assert its official marks against Tall Ships until June 2003. The Trust consented to the province being granted an extension of time but contested Tall Ships’ motion. Tall Ships’ position is that the Trust is not a public authority.
Held: Motions granted. Tall Ships did not delay in applying for an extension of time once it learned of the official marks.
3. Sim & McBurney v. Anchor Brewing, January 26, 2004 FCTD (Campbell J.) Section 45 Appeal
Appeal from a s. 45 decision that maintained the registration for STEAM for beer.
Held: Appeal dismissed. The Registrar’s decision is not unreasonable. The Registrar accepted the registrant’s evidence as being unequivocal and based on personal knowledge – the evidence proved use on a balance of probabilities.
4. Clark O’Neill v. Pharmacommunications Group and Reg. TMS, January 28, 2004 FCTD (Harrington J.) Section 45 Appeal /Special Circumstances /Fiduciary Duty
Appeal from a s. 45 decision that expunged the registration for SINGLE SOURCE SAMPLING & Design for the distribution of pharmaceutical samples. The registrant uses the mark for these services in the U.S. and the requesting party approached it with a view to establishing a joint venture to offer the services in Canada. However, the parties encountered regulatory difficulties that prevented the service from being offered to Canadians. The contemplated joint venture came to an end due to a corporate reorganization of the registrant. The requesting party ultimately started its own sampling service in Canada using the name DIRECT SOURCE SAMPLING. When the registrant sued the requesting party for trade mark infringement, it commenced s. 45 proceedings.
Held: Appeal dismissed. Advertisement without performance is not use. Although the registrant pleaded that the regulatory framework that exists between Canada and the U.S. constituted special circumstances excusing its non-use, this was not accepted since there have not been any significant changes in the laws. The registrant’s corporate reorganization did not excuse the non-use; there was no evidence use would have occurred but for the reorganization. The registrant also argued that the Registrar should not have expunged the registration because the s. 45 notice was requested in bad faith by a party that owed the registrant a fiduciary duty. However, the s. 45 case law concerning fiduciary duties is all distinguishable. The requesting party was never under any obligation to use the registered mark and has done nothing to prevent the registrant from using the mark.
5. Best Canadian Motor Inns v. Best Western International, January 29, 2004 FCTD (Gibson J.) Opposition Appeal /Descriptive When Sounded/Design Marks /Material New Evidence
Appeal from an opposition decision that held that the mark BEST CANADIAN MOTOR INNS & Design was unregistrable because it is clearly descriptive of the applied-for services (hotel, restaurant and accommodation services; promotional services relating to hotel, restaurant and accommodation services).
Held: Appeal dismissed. It was open to Parliament to provide an exception to s.12(1)(b) in respect of design marks that include words that are a dominant feature of the marks. As Parliament did not do so, such marks have to meet the “sounded” test on the basis of their word elements. Mr. Justice Gibson respectfully found that Mr. Justice Russell’s comments on this issue in Fiesta Barbeques Ltd. v. General Housewares Corp. [2003] F.C.J. No. 1296 (QL) ignored generally applicable principles of statutory interpretation. New evidence filed on appeal by a branding consultant was not material as the Board did consider the mark as a whole and did not disregard the design features which were the focus of this new evidence.
6. Bluedot Jeanswear v. 9013-0501 Québec, February 6, 2004 FCTD (Beaudry J.) Opposition Appeal /Confusion /Linguistic Experts
Appeal from an opposition decision that held that the mark RAGE JEANS was not registrable because it was confusing with ORAGE.
Held: Appeal dismissed. The Court concurred with the Board’s finding that there is a likelihood of confusion at least for Francophone and bilingual consumers. New evidence filed by the appellant from linguistic experts was disregarded because these experts’ work never involved trade-marks nor the behaviour of consumers in the retail market and their analysis focused on a non-legal linguistic concept of confusion rather than confusion as contemplated by the Trade-marks Act. The respondent’s linguistic experts reinforced the Board’s decision.
7. Cushman & Wakefield v. Wakefield Realty, February 9, 2004 FCTD (Harrington J.) Opposition Appeal/Confusion/Effect of Disclaimer/Use of Related Mark/Section 50
Appeal from an opposition decision that held that the marks CUSHMAN & WAKEFIELD and CUSHMAN & WAKEFIELD Design were not registrable because they are confusing with the previously used and registered trade-mark WAKEFIELD Design. Material new evidence was filed on appeal that showed that the appellant’s name CUSHMAN & WAKEFIELD WORLDWIDE was widely known in Canada.
Held: Appeal allowed. The words in the marks are weak because they have family name or geographical connotations. The first word in a trade-mark is the most important and the Registrar erred in relying too much on the applicant’s disclaimer of CUSHMAN to discount the differences between the marks. The appellant’s use of CUSHMAN & WAKEFIELD WORLDWIDE is relevant because “a purchaser would likely infer that services offered by Cushman & Wakefield and services offered by Cushman & Wakefield Worldwide emanated from the same source.” The Court considered “it significant that CUSHMAN & WAKEFIELD WORLDWIDE was registered as a trade-mark in Canada and has only led to the anecdotal confusion referred to…” The use of the appellant’s marks by Royal Lepage satisfied the requirements of s. 50(1); there need not be authority to use the marks in writing.
8. Alticor and Quixtar Canada v. Nutravite Pharmaceuticals, February 16, 2004 FCTD (Snider J.) Infringement/Passing Off/Invalidity/Confusion/Nature of the Trade /Descriptiveness/Survey Evidence
Infringement and passing off action. The plaintiff, the owner of a registration for NUTRILITE for vitamin, mineral and herbal supplements, seeks to prevent the defendant’s use of NUTRAVITE for similar products. It also seeks to prevent the use by the defendant of the slogan A PERFECT BLEND OF SCIENCE AND NATURE based on its prior use of BEST OF NATURE – BEST OF SCIENCE. The defendant counterclaims that the plaintiff’s registration is invalid because it was, contrary to s. 26(c) or (e) of the Unfair Competition Act, descriptive of the character or quality of the wares. The plaintiff’s predecessor was previously successful in preventing the registration of the defendant’s mark. The defendant ceased use of its slogan after the commencement of this action.
Held: Both parties’ claims dismissed.
Validity: Although NUTRILITE was a word used in certain science journals when the plaintiff’s trade-mark application was filed in 1952, most of those publications were foreign in origin and there is no evidence of their Canadian distribution. Therefore the Court could not conclude that the Canadian scientific community, let alone the average Canadian consumer, knew what NUTRILITE meant.
Infringement: The material date for assessing confusion is the date of this proceeding. The Court rejected the plaintiff’s argument that its mark was well-known. The defendant’s wares are sold through drug stores. The plaintiff’s wares are sold through a multi-level marketing program where purchasers must be members and where sales through retail stores are prohibited. Although both parties’ products are available on the Internet, the plaintiff’s products cannot be purchased through the web site by a person who is not connected to the multi-level marketing program. Thus, the Court found that the channels of trade are distinct. In response to the plaintiff’s argument that the lack of a restriction to the channels of trade in its registered statement of wares means that the Court must consider if confusion would be likely if the wares were ever sold in the same channels of trade, Mr. Justice Snider stated that he thought that this was an incorrect view. Regarding s. 6(5)(e), both parties presented linguistic experts. The Court stated that it was difficult to choose between the experts but concluded that the pronunciation, while very close, is not going to be a factor causing confusion in most cases because the differences between “v” and “l” in the context of the whole word are significant. The Court also concluded that there was a slight difference in appearance and that both words would be construed similarly. Evidence of at least 81 products with the prefix NUTR associated with the general class of supplements and other health-related products shows that consumers are accustomed to looking for minor differences among marks of this nature. Despite 10 years of coexistence, there is no evidence of confusion between the marks. A survey conducted of the people who sell the plaintiff’s wares showed that the majority of them thought that NUTRAVITE was a product of the plaintiff. However, the survey results did not include those interviewees whose first response was that they had no knowledge of NUTRAVITE – if these are included then 5% or less were “confused”. Snider J. said that such a small but statistically significant portion of the pertinent population might, in some circumstances, be sufficient to support a finding of confusion, but not here because 1) the exclusion of individuals in Québec makes it unclear if the results would be different in a second language connotation and 2) the telephone surveys meant that the individuals did not see the marks, which does not replicate the real life situation. Thus the survey does not support a conclusion that confusion is likely. In concluding that there is not a likelihood of confusion, the Court noted that the s. 6(5) factor warranting the greatest emphasis in this case is the nature of the trade.
Passing Off: Regarding the slogan, the Court focused on minor differences in the ways that the plaintiff uses its slogan (BEST OF NATURE, BEST OF SCIENCE vs. NUTRILITE: THE BEST OF NATURE, THE BEST OF SCIENCE.) and stated, “Admittedly, these are minor differences but, in the context of trade-mark, it appears to me that using different configurations is a significant departure. If the owner of the rights cannot bother to reproduce the trade-mark consistently and prominently, why should this Court intervene?” In any event, the Court held that the plaintiff had not established the elements of a passing off action.
9. Sarasin Consultadoria v. Roox’s, March 4, 2004 FCTD (Russell J.) Opposition Appeal/Section 30(b)/Section 50
Appeal from opposition decision that refused an application because the applicant failed to meet the onus on it to establish use that accrued to it as of its claimed date of first use. The applicant filed an invoice that referred to “a party whose identity or role has not been explained”. The applicant appeals the decision under s. 30(b) while the opponent appeals the Registrar’s decision that confusion was not likely with the opponent’s mark. The applicant filed new evidence on appeal concerning a license agreement with the party referred to on the invoice.
Held: Applicant’s appeal is successful. The new evidence would have materially affected the Registrar’s decision and the Court is satisfied that the applicant has now met its onus under s. 30(b). The opponent’s appeal is dismissed – the opponent did not file any new evidence and the Court was not satisfied that the Registrar’s decision regarding confusion was wrong.
10. Mattel v. 3894207 Canada and Reg. TMs, March 11, 2004 FCTD (Rouleau J.) Opposition Appeal/Confusion/Survey Evidence /Application for Judicial Review to Correct Non-existent Opponent
Appeal from opposition decision that rejected an opposition to the registration of BARBIE’S & Design for restaurant services. The opponent argued that the mark was confusing with its famous BARBIE mark which is used with dolls and related products. It submits that the Registrar erred in finding that there was no connection between the opponent’s wares and the applicant’s services. On appeal, the opponent filed survey evidence.
Held: Appeal dismissed. The nature of the wares, as well as the nature of the parties’ businesses, could not be more different. The survey evidence was flawed – “the fact that the restaurants are restaurants for adults… is essential information which absolutely should have been revealed to those who participated in the survey in order for the results of this survey to have any merit of any kind.” In addition, it was illogical to exclude from the survey individuals who were familiar with the applicant’s restaurants. The application of the “first impression” test does not require that the consumer be unfamiliar with the nature of the applicant’s restaurants. “Quite the contrary, it is precisely the participants who were familiar with the services of the [applicant’s] restaurant and business who would have been in the best position to enlighten us about the likelihood of confusion.”
Upon appeal, the applicant became aware that the opposition had been filed in the name of a company that has never existed. It therefore applied for judicial review to have the actual company recognized retroactively as the true opponent. Although the original opponent, having no legal existence, could not have had the requisite interest to oppose, the Court allowed the application because “it would be unfair to dismiss the application for judicial review on such a technical ground, as the situation was brought about by the inadvertence of all of the parties involved, including the employees working at the Opposition Board who proceeded to register the statement of opposition without noticing the problem.”
11. Anchor Brewing v. Sleeman Brewing & Malting, March 16, 2004 FCTD (Hugessen J.) Validity of Trade Mark Registration/Section 18 Expungement/Summary Judgment/Use in the Normal Course of Trade
Anchor sued Sleeman for infringement of its registered trade mark STEAM for beer. Sleeman counterclaimed, alleging invalidity, and now moves for summary judgment.
Held: Motion for summary judgment dismissed. Sleeman has failed to demonstrate that there is no genuine issue for trial. Sleeman alleged that ANCHOR had not used STEAM but recent s. 45 proceedings held otherwise. Sleeman also alleged that the mark was not used in the normal course of trade because Anchor’s sales are small. Sleeman presented an expert who gave the opinion that such sales are merely token but this evidence was contradicted by Anchor’s evidence. A trade mark owner is not required to achieve a certain volume of sales in order to maintain his rights and there is no evidence that the sales were fictitious or were not genuine commercial sales.
(c) Copyright
1. Oakley v. Shoppers Drug Mart, March 2, 2004 FCTD (O’Keefe J.) Copyright Infringement/Summary Judgment
Motion for summary judgment in an action for copyright infringement. Oakley claims that Shoppers copied the Oakley Ellipse in creating its Shoppers OPTIMUM Design. Shoppers’ design was created by an ad agency that had previously worked for Oakley.
Held: Motion dismissed because there is a serious issue for trial. Shoppers submitted that it is a conventional and common design idea to use an ellipse and that the Court could only find in favour of Oakley by concluding that the evidence of the creator of Shoppers’ design was not credible, something that cannot be done in a summary judgment motion. The creator of Shoppers’ design swears that he was not aware of the Oakley Ellipse when he created Shoppers’ design. This matter should go to trial because the creator’s evidence is central to the issue of infringement and he should be cross-examined before a judge.
2. Pyrrha Design et al. v. 623735 Saskatchewan, March 23, 2004 FCTD (Rouleau J.) Copyright Infringement/Summary Judgment/Section 64 Copyright Act/Industrial Design
Motion for summary judgment by defendant seeking dismissal of an action for copyright infringement with respect to a jewellery design.
Held: Action dismissed because the plaintiff only claims copyright infringement, not industrial design infringement. The plaintiff’s jewellery design is a design as defined in both the Copyright Act and Industrial Design Act. Copyright could subsist and more than 50 items have been produced. The item in question is a useful article. Therefore the subject matter properly belongs for registration under the Industrial Design Act. The defendant has clearly demonstrated the applicability of s.64(2) of the Copyright Act and none of the exceptions in s. 64(3) apply.
(d) Practice
1. S & M Brands et al. v. Alain Paul et al., September 5, 2003 FCTD (Blais J.) Motion To Allow Third Parties At Discovery
Motion by the defendants to allow non-parties to represent them and assist their counsel at an out-of-court discovery because they could not follow the discovery in English. The non-parties were the former owners of the defendants' business.
Held: Motion granted. The general principles applicable to the presence of non-parties at discovery were set out in Ormiston v. Matrix Financial Corp., [2002] S.J. No. 383. In particular, Ormiston held that an adjudicator may exercise his or her discretion in allowing a non-party to attend discovery in the following circumstances: (a) where a non-party has expert knowledge relevant to the issues and the expert knowledge is beyond the ability of the legal counsel; (b) where a non-party, who is not a professional expert, has knowledge or abilities that will make the discovery process run smoothly and expeditiously; or, (c) where a party requires the assistance of a non-party in special circumstances. In this case, language assistance met the above criteria. The evidence showed that the inability of the defendants to understand English during the discovery of the plaintiff’s representative would be a serious handicap which could cause the defendants some injury. While the initial onus of establishing that a non-party be allowed to attend rests with the party seeking the assistance, once this initial onus has been met, the burden of proving prejudice (or proving other grounds for excluding the non-party) rests with the opposing party. The plaintiffs were not able to demonstrate prejudice, or any other ground for excluding the non-parties.
2. Universal Foods v. Hermes Food Importers et al., January 14, 2004 FCA (Sexton J.A.) Post Security For Costs/Federal Court Rule 416(1)(g)
The plaintiff in an action, Universal Foods, appealed an order in which, inter alia, it had to post security with the Court in the amount of $100,000.00 for costs and damages.
Held: Appeal allowed. The Court of Appeal held that r. 416(1)(g) of the Federal Court Rules has two criteria necessary for a Court to consider ordering a plaintiff to post security for costs: (1) the action initiated by the plaintiff must be frivolous and vexatious; and, (2) the plaintiff must have insufficient assets in Canada to pay the costs. In this case, neither of the elements was met. Furthermore, r.416(1)(g) only gives the Court authority to grant security for costs, not damages.
3. Interbox Promotion v. 9073-0433 Québec, January 29, 2004 FCTD (Harrington J.) Delay
Appeal by Interbox from an order of the Prothonotary dismissing three copyright infringement actions for delay. Interbox had filed replies to statements of defence in the three actions, but then had done nothing until it received notices of status review. Interbox argued that the actions were not pursued further because an almost identical case in which it was involved had just gone to trial and would decide the legal issues in dispute. However, Interbox did not propose a stay of proceedings and never sought directions from the Court
Held: Appeal allowed. Although the prime burden is upon the plaintiff to advance the case, the role of the defendant cannot be completely ignored. The obligation upon a defendant to file an affidavit of documents is not contingent upon the plaintiff having first filed its affidavit. Both parties are under the same obligation. None of the defendants could bring on a motion for dismissal because of undue delay, because none had served an affidavit of documents as required by the Federal Court Rules. Additionally, the delay was in the order of months as opposed to years, and was therefore not sufficiently lengthy to warrant dismissal.
4. AB Hassle et al. v. Apotex and The Minister of Health, January 30, 2004 FCTD (Tabib P.) Motion to Strike Hearsay Evidence
Apotex brought a motion to strike two affidavits because they contained hearsay evidence.
Held: Motion dismissed. The Prothonotary held that the party bringing a motion to strike evidence on the basis of hearsay, prior to it being heard by the trier of fact, must meet three criteria: (1) the evidence is clearly hearsay; (2) the hearsay goes to a controversial issue; and, (3) the other party would be prejudiced by leaving the matter to be decided by the trial judge. The Prothonotary did not consider that the hearsay evidence was either controversial or that the other party would be prejudiced by leaving the matter to the trial judge.
5. Almecon Industries v. Anchortek et al., February 2, 2004 FCTD (Lafrenière P.) Order to Pay into Court/Patent Infringement /Bankruptcy and Insolvency/Equitable Doctrine of Tracing
In an earlier proceeding, Anchortek (as well as three other parties) were found liable for the infringement of Almecon's patent. A reference was ordered to determine the quantum of damages or profits. However, before the quantum could be determined, Anchortek made an assignment in bankruptcy. Moreover, before Anchortek went bankrupt, its principals transferred its assets to a number of entities (the "respondents"), essentially leaving Anchortek a shell company. Upon notification of the bankruptcy proceeding, Almecon brought a motion for an order requiring the respondents to pay into the Court the profits made from the infringing patent (which the Prothonotary estimated to be $350,000). In support of this motion, Almecon argued that the respondents had fraudulently acquired Almecon's "property" (i.e. the illegal profits made by infringing its patent) and equity (vis-à-vis the doctrine of tracing) demanded that the respondents disgorge this property to Almecon.
Held: Motion dismissed. The Prothonotary relied on three principal grounds in dismissing the motion. First, the Prothonotary held that, as a result of Anchortek's assignment in bankruptcy, there was an automatic and wide ranging stay with respect to any proceedings brought or commenced against a bankrupt party. As such, the plaintiff could not circumvent the mandatory provisions of the Bankruptcy and Insolvency Act ("BIA") through the Federal Court. Instead, Almecon must pursue its rights through the Bankruptcy Court in Alberta. Second, the Prothonotary held that even if it had jurisdiction over the parties, Almecon had not established that any property was being held in trust for it by or on behalf of Anchortek. Specifically, the Prothonotary found that there was no evidence that the illegal profits from the patent infringement (i.e. Almecon's "property") could be separated from the general property of Anchortek. Accordingly, given that the illegal profits did not exist as a distinct and identifiable fund, there was no "property" held in trust. Finally, since the plaintiff could not identify the "specific property" that it sought to preserve, it could not rely on r. 377 and 378 of the Federal Court Rules, and therefore the Federal Court did not have authority to grant security for damages or profits.
6. Universal Food v. Hermes Food Importers et al., February 3, 2004 FCA (Rothstein J.A.) Standard for Contempt of Court Finding
Universal Foods contended that it should not be held in contempt of Court because it did not intentionally disobey the trial judge's order.
