Canada: Patents Year In Review 2013

Last Updated: March 6 2014
Article by Michael Crichton and Christopher C. Van Barr

Most Read Contributor in Canada, October 2018

This article summarizes noteworthy Canadian patent law decisions and developments from 2013.

1. Plavix: Court of Appeal Addresses "Promise of the Patent" Doctrine

For several years, Canada's Federal Court and Federal Court of Appeal have wrestled with the "promise of the patent" doctrine.  In some cases, the Courts have ventured beyond explicit promises to dissect the specification and elevate statements of benefit or advantage to become promises of utility.  Where those benefits or advantages were neither demonstrated nor soundly predicted, patents have been invalidated.

In sanofi-aventis v. Apotex Inc., 2013 FCA 186, the Court of Appeal addressed the validity of the Plavix® patent.  Previously, the trial judge in an impeachment action brought by Apotex had found the patent invalid on the bases of inutility and obviousness.  The trial judge invalided the patent notwithstanding an earlier decision of the Supreme Court of Canada in 2008 (Apotex Inc. v. Sanofi-Synthelabo Canada Inc., 2008 SCC 61), made in the context of a Patented Medicines (Notice of Compliance) Regulations proceeding, which endorsed the patent's validity.  

At trial, the judge found that the patent promised that the claimed compound could be used in humans; however, he also found that such use was not soundly predicted on the basis that there was insufficient disclosure in the patent's description in to support the prediction. 

On appeal, the Federal Court of Appeal disagreed with the trial judge's finding of lack of utility.  In particular, the Court of Appeal clarified that the "promise of the patent" doctrine does not necessarily apply in all cases.  In this regard, where there is no explicit promise in a patent description, no promise should be "read in" to a patent.  In the case of Plavix, there was no explicit promise of use in humans, but rather only identification of certain advantages over the prior art.  As such, because those advantages were demonstrated by the patentee, the patent was declared valid.  In addition, the Court of Appeal overturned the trial judge's finding of obviousness.

The Court of Appeal's decision is not the end of the road for the Plavix patent.  Recently, Apotex was granted leave to appeal the Court of Appeal's decision to the Supreme Court of Canada.  A hearing is scheduled for November 3, 2014.

2. Eurocopter: Court of Appeal Addresses the Disclosure Requirement for Sound Prediction and Confirms an Award of Punitive Damages for Patent Infringement

In Bell Helicopter Textron Canada Limitée v. Eurocopter, société par actions simplifée, 2013 FCA 219, the Court of Appeal addressed, among other things, the issues of sound prediction in the context of a mechanical invention and punitive damages for patent infringement.

With respect to the doctrine of sound prediction, the patentee, Eurocopter, had argued that the doctrine only applied to inventions in the fields of chemistry and biology because results in those fields are difficult to predict.  In contrast to those fields, Eurocopter argued that the utility of mechanical inventions can be demonstrated through mathematical calculations and known rules of physics, therefore the doctrine should not apply to those types of inventions. 

The Court of Appeal disagreed with Eurocopter's arguments, and held that prior cases support the proposition that sound prediction may be relevant in mechanical or other non-pharmaceutical inventions.  Thus, in order for utility to be demonstrated in the case of a mechanical invention, the requirement set by the Court of Appeal was for "evidence that establishes that the embodiment at issue does in fact work in a manner that gives rise to the advantages stated in the patent".  If the evidence merely consists of "calculations to the effect that the embodiment should work in the manner claimed in the patent, or should give rise to the advantages," in some situations utility will not be demonstrated, but rather must be predicted.  In this case, the Court of Appeal upheld the trial judge's finding that the utility of severalpatent claims was neither demonstrated based on the evidence nor soundly predicted based on what was disclosed in the patent.

In coming to this conclusion, the Court of Appeal made noteworthy comments regarding the degree of disclosure required in the context of a sound prediction analysis.  In particular, the Court of Appeal held that:

where the sound prediction is based on knowledge forming part of the common general knowledge and on a line of reasoning which would be apparent to the skilled person (which is often the case in mechanical inventions), the requirements of disclosure may readily be met by simply describing the invention in sufficient detail such that it can be practiced. A contextual approach is thus appropriate in each case.

With respect to punitive damages, the Court of Appeal upheld the trial judge's finding that such damages were warranted in this case based on a number of factors, including Bell Helicopter's "slavish" copying of Eurocopter's patented product, and that Bell Helicopter, as a "sophisticated" company, ought to have known of Eurocopter's patent.  The Court of Appeal cautioned that punitive damages are only available in patent cases where "the evidence shows that there has been high-handed, malicious, arbitrary or highly reprehensible conduct that departs to a marked degree from the ordinary standards of decent behaviour".  Nevertheless, it appears that the only remarkable behaviour at issue in the case involved the defendant's copying with imputed knowledge of the patent.   

3. Noteworthy Decisions Regarding Remedies in Patent Cases

In 2013, there were several noteworthy decisions dealing with remedies in patent cases:

  1. Merck & Co., Inc. v. Apotex Inc., 2013 FC 751: the Federal Court in this case awarded Merck over $119 million in damages, plus interest, for Apotex's infringement of Merck's patent for the anti-cholesterol drug lovastatin.  In awarding damages, the Court rejected Apotex's argument that the existence of a "non-infringing alternative" should be considered in determining a plaintiff's lost profits "but for" the infringer's activities.
  2. Apotex Inc. v. Takeda Pharmaceuticals and Abbott Laboratories, 2013 ONCA 555: the Ontario Court of Appeal in this case upheld the Superior Court's dismissal of Apotex's claim for disgorgement of Takeda's and Abbott's profits in the context of the Patented Medicines (Notice of Compliance) Regulations.  Section 8 of the Regulations provides a generic drug manufacturer with the ability to be compensated for any losses suffered as a result of a delayed market entry caused by a patentee's application under the Regulations to prohibit such generic's market entry.  A key finding of the Court of Appeal was that, according to section 8, the recoverable loss may be no more than the generic's damages and does not extend to an innovator's profits.  In addition, the Court of Appeal rejected Apotex's allegation of unjust enrichment on the basis that the Regulations provide a valid juristic reason for an innovator's exclusive presence in the market.
  3. Apotex Inc v. Takeda Canada Inc., 2013 FC 1237: the Federal Court in this case departed from previous jurisprudence and found that it was within the Court's discretion to disregard market entry ramp-up experienced by a generic in the context of determining the hypothetical world for assessing a generic's damages under section 8 of the Regulations.  In addition, the Court held that, in this hypothetical world, the successful generic challenger is not subject to the Regulations while potential competitors are, conversely, subject thereto. 
  4. Apotex Inc. v. H. Lundbeck A/S, 2013 FC 192: the Federal Court in this case ordered a generic to pay a patentee $1.7 million as an accounting of the generic's profits for patent infringement.  In order for a patentee to succeed with a claim for an accounting of profits, it must show that at least some of the infringer's profits were attributable to the patented invention.  Where an infringer's profits would have been no different had a non-infringing alternative been used, a patentee will not be able to recover any of the infringer's profits.  In the present case, the patentee succeeded with its recovery of significant profits of the generic because all of those profits were realized as a direct result of infringing the patent in suit, which covered a specific active ingredient that was the only active ingredient included in the generic's product. 

4. The Canada-European Union Comprehensive Economic and Trade Agreement (CETA) and Canada's Patent Regime

CETA contemplates several noteworthy changes to patent landscape in Canada, particularly in the context of pharmaceutical patents:

  1. Patent term restoration: where innovative pharmaceutical companies' drug approvals are delayed, CETA provides that an additional two years of market exclusivity following patent expiry may be granted.
  2. Appeal rights for innovators: currently, innovators are unable to appeal the dismissal of an application to prohibit the regulatory approval of a generic entering the market with a particular drug.  In contrast, generics are able to appeal court orders that prohibit the regulatory approval of their product.  CETA changes this situation by providing that an innovator will have the right of appeal, just like a generic.
  3. Duplicative litigation: under the current regime, if either an innovator or a generic loses at the initial stage, i.e., the stage where an order prohibiting market entry of a generic is sought, the losing party may still bring a traditional patent action (either for infringement if the plaintiff is the patentee, or for declarations of invalidity and/or non-infringement).  In contrast, CETA provides that there shall not be such duplicative litigation, though the details as to how this will be implemented are currently unknown.

5. Application of New Canadian Patent Office Guidelines for Computer-Implemented Inventions

In 2013, the Canadian Patent Office released two Practice Notices that are relevant to computer-implemented inventions.  The first Notice addresses claim construction; the second notice addresses subject matter eligibility for computer-implemented inventions.

Recent application of the new Practice Notices by the Patent Appeal Board confirms that the correct approach for construing claims is to follow a purposive construction that determines which elements of a claim are essential vs. non-essential.  In the context of computer-implemented inventions, applicants must carefully draft their patent applications such that, for example, something more than a mere algorithm is claimed.  In this regard, there should preferably be physical or tangible elements or equipment that are claimed in the patent claim.  In particular, it may not be sufficient to simply recite a "computer-implemented" system or method in a claim preamble and then fail to claim any physical or tangible components in the body of the claim.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions