Canada: Claims Under The Statutes Of Monopolies And The "Basket Clause" Struck In Section 8 Proceeding (Intellectual Property Weekly Abstracts - Week Of November 28, 2016)

PATENT DECISIONS

Claims under the Statutes of Monopolies and the "basket clause" struck in section 8 proceeding

Actavis Pharma Company v Alcon Canada Inc. et al., 2016 ONSC 7151

This was a motion to strike portions of the Plaintiff's statement of claim or, alternatively, for particulars in the Ontario Superior Court. In the underlying proceeding, the Plaintiff seeks relief pursuant to section 8 of the PMNOC Regulations for losses suffered due to the delay in taking its generic version of Patanol to market. The impugned claims in this motion to strike included, inter alia, claims under the Statutes of Monopolies and the "basket clause" claims. The Court agreed that these claims must be struck.

The Court pointed out that there has yet to be a determination on the merits of claims under the Statutes of Monopolies. Further, the Court noted that motions to strike these claims have been unsuccessful, with courts taking the view that the claims are novel ones and should be allowed to proceed to trial. The Court concluded, however, that this case was different because an essential element of the claim was not present, namely: an in rem declaration of invalidity of the Patent.

In this case, no in rem declaration of invalidity of the patent has been obtained, or even yet sought, by the Plaintiff in the Federal Court, which has exclusive jurisdiction to make such a declaration. While there was a risk that there could be two proceedings in the Ontario court dealing with the same factual matters (if the Statutes of Monopolies claims were brought again if a declaration of invalidity was granted by the Federal Court), the Court concluded that this was preferable to the risks of attempting to prosecute a novel action for damages when all the elements of the claim were not present.

In respect of the "basket clause" claims, the Plaintiff sought relief including "such further and other relief as this Honourable Court deems just" and "other losses, including those to which Actavis is entitled as a matter of equity, arising during the Relevant Period and which will be particularized as this matter proceeds to trial". In striking these claims, the Court noted that the Plaintiff's claim did not make out a claim for equitable relief and there were no facts that supported the claims as pleaded.

The Court also ordered particulars in respect of certain paragraphs. The Plaintiff had alleged that it suffered losses from lost sales of other products that would have been bundled with the generic version of Patanol that Actavis would have brought to market. The Court noted that particulars with respect to the other products with respect to which losses were claimed should be provided since this information was not within the Defendants' knowledge. Particulars were also ordered for claims in respect of lost business opportunities as the Defendants were entitled to know what opportunities the Plaintiff claims to have lost.

COPYRIGHT DECISIONS

Federal Court dismisses infringement action where acknowledged use covered by fair dealing

1395804 Ontario Ltd. (Blacklock's Reporter) v. Canada (Attorney General), 2016 FC 1255

In this action, the Plaintiff ("Blacklock's") alleged that officials in the Department of Finance violated its copyright by obtaining, reading and distributing two of its news articles without authorization. The Defendant ("Attorney General") argued that Blacklock's conduct was a misuse of copyright and that the conduct Blacklock's complains about constituted fair dealing. For the purposes of this matter, the Federal Court found that it need only decide whether the impugned conduct was protected under the fair dealing provisions of the Copyright Act and, in particular, section 29.

The Court accepted that Blacklock's had established that its copyrighted material was used by the Department without payment or consent; these facts were also admitted by the Defendant. Therefore, the Attorney General had the burden to establish, on a balance of probabilities, that this acknowledged use was protected by section 29 of the Act.

The Court noted that fair dealing by a user of copyrighted material is a well-recognized right under the Act. In reviewing the jurisprudence, the Court discussed relevant considerations in applying the fair dealing provisions. The Court was satisfied that the Department's acknowledged use of the two Blacklock's articles constituted fair dealing: the circulation of this news copy within the Department was done for a proper research purpose and the admitted scope of use was, in the circumstances, fair.

In applying the fair dealing provisions, the Court agreed that the deliberate breach of the accepted terms of access to and use of copyrighted material, whether protected by a paywall or not, was a relevant consideration. The Court noted however, that the owner of copyright must establish that the terms of use actually prohibit the access or distribution in question and that the person involved was aware of the limitations. In this case, the Court found that Blacklock's failed to ensure that its subscribers were aware of the Terms and Conditions it sought to impose.

The Court dismissed Blacklock's infringement action.

Interplay between Broadcasting Act and Copyright Act Considered in Respect of Retransmission

2251723 Ontario Inc. v Bell Canada, 2016 ONSC 7273

The Ontario Superior Court of Justice was considering a request by VMedia for an order declaring that its new internet retransmitting service does not infringe Bell's copyright in CTV television broadcasts. VMedia asserted that it was entitled to simultaneously retransmit without Bell's consent, while Bell argued that as the owner or licensee of the copyright, retransmission was not permitted without its consent. Bell sought a declaration of infringement in a counter-application. The Court dismissed VMedia's application and granted Bell's application.

The Court set out the various necessary approvals and licences at play under the Broadcasting Act and the Copyright Act. After considering the facts of the case, the Court concluded that VMedia is a new media transmitter under section 31(1) of the Copyright Act. As a result, VMedia's service does not qualify for a compulsory licence, available only to retransmitters who are not new media retransmitters, under section 31(2) of the Copyright Act.

The Court awarded the requested declaration that VMedia infringed Bell's rights under the Copyright Act, and enjoined VMedia. The Court refused to address the relief sought in respect of a possible breach of an agreement between the parties. The Court reviewed Bell's Costs Outline that sought $194,365 on a partial indemnity basis, and awarded $150,000, which included disbursements and taxes.

TRADEMARK DECISIONS

Appeal granted where, inter alia, findings were contentious matters unsuited to resolution under the summary process of section 45

Mcdowell v. Laverana GmbH & Co. KG, 2016 FC 1276

The Federal Court granted an appeal of a decision of the Trademarks Opposition Board (TMOB). In the decision below, the TMOB was satisfied that the Appellant demonstrated use of the trademarks in relation to the registered "services", but not to the goods described in the registrations. The Respondent chose not to respond to the appeal.

The Court held that the new evidence offered in support of the appeal fully addressed the gaps identified by the TMOB. Apart from the new evidence, the Court also found that the TMOB's conclusion that the Appellant could not demonstrate use of her trademarks in association with the goods was not reasonable. The TMOB had made several contested findings regarding the evidence presented including, inter alia that the branded hang tags were essentially price tags, and therefore did not distinguish the goods but only the retailer's services. The Court noted that these determinations were contentious matters that were unsuited to resolution under the summary process envisaged by section 45 of the Trade-marks Act. Furthermore, the Court pointed out that hang tags and labels attached to the goods would ordinarily be sufficient to demonstrate that a trademark was displayed in association with the goods during the relevant period.

Lastly, the Court found that TMOB's conclusion that the ambiguity in the evidence should be resolved against the interests of the trademark owner was clearly wrong; any ambiguity in the evidence should have been resolved in favour of the Appellant, the registered owner.

INDUSTRY UPDATES

Health Canada has published a 2016 Master File Cost Recovery Consultation Document. The website indicates that interested parties are encouraged to provide comments and suggestions by January 9, 2017.

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