On April 14, 2016, the Supreme Court of Canada denied Apotex’s final attempt at obtaining leave to appeal in the storied patent battle between Merck and Apotex over Merck’s lovastatin patent.
The case began in 1997 when Apotex launched its generic lovastatin product. At the liability trial in 2010, Justice Judith Snider of the Federal Court found Merck’s lovastatin patent to be valid and infringed (2010 FC 1265). The judgment included reference to DNA evidence establishing that Apotex had infringed through its operations in Winnipeg. The Judge also found that Apotex’s joint venture partner fabricated batch records and testimony regarding how the lovastatin was made. The Federal Court of Appeal affirmed the Trial Judge’s ruling (2011 FCA 363), and Apotex’s application for leave to appeal to the Supreme Court was dismissed.
In the subsequent damages trial, Justice Judith Snider ordered Apotex to pay over $180 million in compensatory damages and interest (2013 FC 751); the largest reported Canadian damages award for patent infringement.
Apotex’s appeal was later dismissed, in 2015, by a unanimous panel of the Federal Court of Appeal (2015 FCA 171). This decision is important for a number of reasons. For example, the so-called “non-infringing alternative” defence was recognized in Canada for the first time; however, Apotex was unable to support it on the facts. For more information on this appellate ruling see our previous blog.
On April 14, 2016, the Supreme Court of Canada dismissed Apotex’s applications for leave to appeal. This ruling represents the final chapter in an almost 20 year-old patent case.
McCarthy Tétrault was counsel to Merck throughout, at all trials and appeals
In Sadhu Singh Hamdard Trust v. Navsun Holdings Ltd. (2016 FCA 69), the Court of Appeal set aside the Federal Court’s (2014 FC 1139) decision dismissing Hamdard Trust’s claim of copyright infringement and passing off against Navsun Holdings and remitted the matter to the Federal Court for redetermination, with some guidance.
This case involves a dispute over an unregistered trademark used by a Punjabi subscription daily newspaper, Ajit Daily, published in India, and by a free weekly newspaper, Ajit Weekly, published in Canada. Hamdard Trust, which operates Ajit Daily, sued Navsun Holdings, which operates Ajit Weekly, for use of a similarly stylized “Ajit” logo in its masthead.
On March 31, 2016, the Competition Bureau (Bureau) released revised Intellectual Property Enforcement Guidelines (IPEGs). These IPEGs reflect incremental changes to the draft version released for consultation last year. Most notably the new IPEGs provide further guidance on (i) pharmaceutical patent litigation settlements, (ii) product switching (also known as “product hopping”), (iii) collaborative standard setting and standard essential patents, and (iv) patent assertion entities.
Have you been wronged, but are unsure by whom? There’s an app for that! An application, that is…for a Norwich Order.
In the age of the internet, it is increasingly easy to commit wrongs anonymously. Violations of legal rights via the internet can take many forms. From defamation to copyright infringement to breach of confidence and contract, when a wrong has been committed against you or your company but the wrongdoer’s identity is unclear, the first step is to obtain that information. If an innocent third party such as a website has enabled the perpetrator to commit the wrong, a Norwich Order can be sought.
A Norwich Order is an order for pre-action discovery—it is a way to compel information before you commence a claim. Continue Reading
On March 24, 2016, the Canadian Radio-television and Telecommunications Commission (“CRTC”) signed a memorandum of understanding (“MOU”) with the United States Federal Trade Commission. This MOU is an effort by Canada and the United States to work together on anti-spam enforcement measures, and expressly refers to unsolicited telecommunications, unsolicited commercial electronic messages (spam), and other unlawful electronic threats (e.g., malware and botnets). Continue Reading
In reasons dated March 21, 2016, the Federal Court of Canada upheld a decision that allowed a patent infringement action involving tenofovir (an anti-HIV drug) to continue on the basis of allegations of a likely future (quia timet) infringement. The Court was satisfied that there was a “strong possibility of infringement” in circumstances where regulatory approval, and future market presence, of the generic copycat was “sufficiently likely” even though not inevitable that the generic would receive marketing authorization.
NPEs, otherwise known as non-practicing entities, or pejoratively referred to by some as “patent trolls”, have seen a significant negative impact on their business model south of the border. NPEs are analogous to private equity businesses–their business model is to acquire undervalued patent assets and turn around and sell or license them to others, which often leads to expensive patent litigation. If their assets are depreciating in value, the model becomes significantly less attractive. This is exactly what is happening in the US.
Recent US Supreme Court decisions including Alice, which restricted the scope of patent-eligible subject matter, and eBay, which limited the ability of NPEs to obtain injunctions, along with the post-grant review processes introduced under the America Invents Act, have significantly depreciated the value of some US patent portfolios held by trolls. On average, there have been about eleven Section 101 decisions per month in the US federal courts post-Alice, with the overall rate of patent invalidation in the low 70% range.
Not many people will feel sympathy for the potential demise of the NPE business model in the US. However, they should be concerned about the broader implications of a weakened patent system for American innovation and entrepreneurship. In addition, innovative Canadian companies should be worried about the implications of NPEs shifting their focus north of the border, where litigations costs are a fraction of those in the US, where there is no analogous post-grant review process and where we have yet to see a judicial impediment against trolls obtaining permanent injunctions.
Canada can best avoid the problems experienced in the US from the assertion of patents of questionable inventive value, not by weakening the patent system, but rather by strengthening it. A better pre-grant review process, with highly-trained legal experts in the patent office, will increase the quality of issued patents in Canada. A stronger patent system will attract significantly greater innovation investment in the country and reward innovative businesses. Continue Reading
In June 2015, the previous Conservative government tabled legislation to implement the Marrakesh Treaty to Facilitate Access to Published Works for Persons Who Are Blind, Visually Impaired, or Otherwise Print Disabled. However the bill was introduced shortly before the summer break and, as it turned out, Parliament was dissolved before the legislature returned.
On March 24, 2016, the new Liberal government tabled a substantially identical bill, now known as C-11.
As was the case for its predecessor, the bill broadens the existing exception in section 32, including by removing the exclusion of large print books and by expressly addressing distribution of, or providing access to, the accessible works. It also includes changes to section 32.01 dealing with export of accessible works and section 41.16, to permit the circumvention of technological protection measures in order to exercise the exceptions set out in sections 32 and 32.01.
The online sale of a software licence constitutes a “use” in relation to a good for the purposes of Canadian trademarks. This was the recent holding of the Federal Court of Canada in Specialty Software v Bewatec, 2016 FC 223. This decision strengthens trademark protection for software in Canada and demonstrates that courts will adapt legal concepts to modern technology. Here, the traditional model of purchasing software on tangible media, such as a CD-ROM, is simply outdated. Software as a service (SaaS) offerings have greatly increased in recent years with the explosion of cloud computing, which essentially provides users with access to a software program over the Internet, usually though a subscription or licence fee. The Specialty Software decision is important because it confirms that the sale of a software licence – whether by diskette or via online subscription access – can constitute a transfer of property for the purposes of a “use” in association with goods under section 4(1) of the Trade-marks Act.
Canada’s PM(NOC) Regulations allow innovative drug manufacturers to list patents on the public Patent Register pertaining to their drug products. This provides a public notice function to potential copycat generic manufacturers of all listed patents that must be addressed or, else the patent expired, before obtaining marketing authorization from the Canadian Minster of Health to market and sell a generic version of the drug in Canada.
When engaging these regulations, innovative drug manufacturers have faced significant opposition to listing patents pertaining to combination drug products (i.e., drug products containing two or more active medicinal ingredients). For example, it has been held that a patent claiming one medicinal ingredient of a combination drug is not eligible for listing for that drug, even though the ingredient is present in the final product.
Canada’s PM(NOC) Regulations have been recently amended to address this problem. Industry Canada deemed the amendments necessary to “restore the intent” of the PM(NOC) Regulations. Nevertheless, the application of the previous version of the PM(NOC) Regulations continues to impede innovator patent protections for combination drug products.