This is the latest chapter in the story involving Canada's
judge-made "promise of the patent" doctrine, which is
sometimes referred to as the "promise doctrine" or
"promise of the patent". The promise doctrine essentially
states that in order to constitute a useful (and therefore
patentable) invention, an invention must not only be useful for
some purpose, but it must also make good on any promise of utility
found in the disclosure of the patent.
On September 12, 2013, Eli Lilly filed a $500 million claim
against the Government of Canada over "invalidated
patents", alleging that Canada has "violated its
obligations under NAFTA by allowing its courts to invalidate
patents for its drugs."
Lilly asserts that the judicial application of the promise
doctrine to invalidate its patents covering drugs STRATERRA and
ZYPREXA, amounts to Canada's contravention of its treaty
obligations to protect patent rights, resulting in the unlawful
expropriation of Lilly's intellectual property. To view
Lilly's full Notice of Arbitration click here. It makes for an interesting
Some say the promise doctrine has been improperly grafted onto
the utility requirement enshrined in the Canadian Patent Act. Lilly has been consistent in
challenging the rule.
In May 2013, Lilly was denied leave to the Supreme Court of
Canada – after a rare oral leave hearing – in its case
against Novopharm (now Teva), who succeeded in having Lilly's
ZYPREXA patent invalidated through application of the promise
doctrine. Thus, Lilly's hopes for judicial clarity about the
promise doctrine from the Supreme Court of Canada were dashed
– and shattered – against the rocks of national
The full ZYPREXA trial decision can be found here. Lilly's appeal to the Federal Court
of Appeal was summarily dismissed from the bench. That decision can
be found here. The Supreme Court leave application
dismissal can be found here.
With Canada being on the U.S. IP watch list and concern over the
proper forum in which Canada's domestic law should be shaped,
Lilly's potential arbitration will undoubtedly raise
In the meantime, some good news exists for patent holders
concerned with the promise doctrine. The Federal Court of Appeal
provided clarification in its recent Plavix decision. I wrote a
blog about that, which can be found
There can be no doubt, however, that more is yet to come.
A recent Saskatchewan Court of Queen's Bench decision allowed a court-appointed receiver to sell and transfer intellectual property rights free and clear of encumbrances, finding that a license to use improvements of an invention was a contractual interest and not a property interest.
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