In a recent decision of the Federal Court (Janssen Inc. v.
Teva Canada Limited, 2016 FC 593), Justice Hughes awarded
approximately $18 million in damages (inclusive of prejudgment
interest) to two Janssen entities in compensation for Teva Canada
Limited's ("Teva's") (then Novopharm Limited)
infringement of Canadian Patent No. 1,304,080 ("080
Patent"). The 080 Patent relates to the compound levofloxacin,
marketed in Canada under the brand name LEVAQUIN®.
While the findings of Justice Hughes were generally
fact-specific, this decision is noteworthy for both its comments on
the ability of a party to "claim under" a patentee and
for the ability of a plaintiff to claim damages during the period
post-expiry of a patent.
Teva commenced selling Novo-levofloxacin in Canada in December
2004, following a dismissal of Janssen's application for a
prohibition order under the Patented Medicines (Notice of
Compliance) Regulations. Shortly thereafter, an infringement
action was commenced against Teva by Janssen Inc. ("Janssen
Canada") and the owner of the 080 Patent (Daiichi Sankyo
In a decision dated October 17, 2006, Justice Hughes held that
the 080 Patent was valid and infringed, and awarded Janssen Canada
and Daiichi their damages to be determined at a later
In 2011, the plaintiffs brought a motion seeking to add three
more Janssen entities as plaintiffs for the purpose of claiming
damages under the patentee. That motion was dismissed by Justice
Hughes.2 As a result, a separate action was commenced
wherein other Janssen entities, including Janssen Pharmaceuticals
Inc. ("Janssen US"), sought damages for Teva's
infringement of the 080 Patent.
The trial for damages in both the 2004 and 2011 actions were
heard together by Justice Hughes in April 2016, which gave rise to
the decision discussed herein.
Janssen US's standing to "claim under" the
The first issue addressed by Justice Hughes was whether Janssen
US had standing to "claim under" the patentee pursuant to
section 55(1) of the Patent Act. After an extensive review
of prior jurisprudence, Justice Hughes found that for the Court to
conclude that a party is a person "claiming under" the
patentee pursuant to section 55(1):
The person must be one who, as a user, an assignee, a licensee
or lessee, has a title or a right that can be traced back to the
It does not matter whether a licensee is exclusive or
The license must be proved but it need not exist in
The claim must be one in respect of a use in Canada and not
elsewhere in the corporate chain.
In this case, the 080 Patent was licensed by Daiichi to Johnson
& Johnson. Janssen US alleged it was a sub-licensee under that
licence, although no written sub-licence existed. On the evidence
presented at trial, Justice Hughes found Janssen US to indeed
have a sub-licence to which Daiichi had consented or
Teva also argued that Janssen US could not claim damages under
the patentee as it did not sell the patented invention in Canada.
Justice Hughes concluded that it was immaterial whether Janssen US
had title to the tablets in Canada. Further, he noted that the
Patent Act permits recovery of damages in respect of
activity outside Canada. As Janssen US was part of the chain of
supply of LEVAQUIN® tablets in Canada, Janssen US was therefore
awarded damages for Teva's infringement of the 080 patent.
The second issue addressed by Justice Hughes was the actual
quantification of damages, which is generally a fact-specific
inquiry. However, it is worth noting that Justice Hughes reaffirmed
that a claimant is entitled to claim damages sustained after a
patent has expired in respect of losses incurred as a result of an
infringer's activity while the patent was in force.
The Court further held that damages can be awarded for price
suppression where the patentee or person claiming under the
patentee was forced to reduce its price because of the infringer
offering the product at a lower price.
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