Canada: Whose Liability Is It Anyway? The Court Clarifies The Burden In Summary Trials And Infers Inducement

In Janssen Inc. v. Pharmascience Inc., 2022 FC 62, the Federal Court highlighted two important issues: the burden in summary trial proceedings and the evidentiary burden for proving inducement of patent infringement. The Court's findings with respect to these issues in Pharmascience differ from its findings in two other recent decisions.¹

The Court held that, once an issue is found to be suitable for summary trial, the burden to prove that issue falls on the same party who bears the onus in the underlying action. In other words, the onus on summary trial is the same as at a full trial. On the question of inducement, the Court inferred that Pharmascience would induce infringement of the claimed dosing regimen through recommendations in the product monograph, even though the monograph did not explicitly identify the infringing step and the prescribing physician would have a final say in the exact regime.

Background

Janssen commenced an action against Pharmascience under the PM(NOC) Regulations in relation to Canadian Patent No. 2,655,335 ("335 Patent") and paliperidone palmitate (INVEGA SUSTENNA®), which is used to treat schizophrenia.

The 335 Patent pertains to dosing regimens for injections of paliperidone palmitate that employ a specific dose on Day 1 (a "loading dose") that is followed by different doses on later days ("maintenance doses"). In general, the 335 Patent contains claims for prefilled syringes for the dosing regimens and claims for use of the dosing regimens.

Janssen previously successfully asserted the 335 Patent against another generic manufacturer, Teva. In Teva, the Court found that the proposed paliperidone palmitate product would directly infringe the 335 Patent's prefilled syringe claims, but that there would be no direct or induced infringement of other claims.² The Teva decision is currently under appeal.

Pharmascience is not seeking approval for prefilled syringes of its proposed paliperidone palmitate product.³ Relying on the Teva decision, Pharmascience brought a motion seeking summary trial on the question of infringement.

The Burden in Summary Trial

As we have previously reported, there is an ongoing trend in the Federal Court to allow more matters to be determined in whole or in part by summary judgment or summary trial, including complex pharmaceutical litigation.⁴

However, there has been conflicting case law as to which party bears the burden of proof on the merits on summary trial. Some jurisprudence (e.g. Viiv⁵) suggested the onus lies on the party seeking summary trial (e.g. Pharmascience would need to establish non-infringement since it brought the motion), and some jurisprudence (e.g. Louis Vuitton⁶) found that it is the same onus as would be applied in the underlying action (e.g. Janssen would need to establish infringement since it brought the patent infringement action).

The Court in Pharmascience clarified that while the party seeking summary trial has the burden to demonstrate that the procedure is appropriate (i.e. Pharmascience has to establish that the matter is suitable for summary trial), the burden on the merits in the summary trial itself is the same as the burden in the underlying action (i.e. Janssen has to establish infringement).⁷ In other words, the party alleging infringement in the action has the onus of proving infringement on summary trial, and the party alleging invalidity in the action has the onus of proving invalidity on summary trial. The presiding judge explicitly overturned his earlier ViiV decision on this issue.⁸

The Court's approach to summary procedure reinforces the jurisprudence that parties are expected to litigate as they play bridge: "lead trump or risk losing".⁹ If parties do not lead evidence or arguments on the merits—often to support that the matter is not appropriate for summary judgment—they risk fighting empty-handed if the Court proceeds with the summary trial.

Inducement

A party may be found liable for infringement if they themselves perform all elements of a claim ("direct" infringement), or if they knowingly induce a third party to commit an infringing act. The test for inducement requires (i) a third party to directly infringe the claim, (ii) the inducer to influence the party such that the infringing act would not occur without the influence, and (iii) the influencer to know its influence would bring about the infringing act.

The Court held that Pharmascience was liable for induced infringement by influencing prescribing physicians to select an infringing maintenance dose for their patients. Pharmascience's product monograph provided guidance to physicians in selecting the dosing regimen. Relying on the product monograph, the Court found that prescribing physicians would likely be lead to the patented dosage regimen, notwithstanding that Pharmascience did not supply or market all of the elements of the claimed regimen.¹⁰

The Court's findings differ from its earlier decision in Teva, where it found that psychiatric medical professionals were unlikely to be lead by a general recommendation in a product monograph, particularly when such physicians had prior experience with Janssen's INVEGA SUSTENNA® product (which had been marketed for a decade).¹¹ As a result, the Court found that Teva would not have influenced physicians to use the claimed dosage regimen with Teva's generic paliperidone palmitate product. Due to the redactions in the public decisions, it is difficult to discern whether the Court's departure from the findings in Teva is attributable to differences between the product monographs and other evidence, or if the Court adopted a new approach to drawing inferences of inducement.

The appeal in Teva and any appeal (if filed) in Pharmascience may help further clarify this issue.

In a subsequent decision, Janssen Inc. v. Apotex Inc., 2022 FC 107, the Court held that Apotex's generic paliperidone palmitate product also infringed the 335 Patent by inducement. The Court found that Apotex's product monograph recommended prescribers use the claimed dosage regimen. While much of the analysis is redacted, the Court noted that each case was based on the specific product monograph at issue and involved different factual circumstances,¹² highlighting the fact-intensive nature of the inquiry.

Footnotes

1. ViiV Healthcare Company v. Gilead Sciences Canada, Inc., 2020 FC 486 [Viiv], aff'd 2021 FCA 122; Janssen Inc. v. Teva Canada Ltd., 2020 FC 593 [Teva], under appeal.

2. Teva at paras 35, 282, 290.

3. Pharmascience at para 88. Parts of the decision are redacted. Consequently, Pharmascience's non-infringement argument may involve other non-public elements.

4. ViiV at para 18.

5. Viiv at para 20.

6. Louis Vuitton Malletier S.A. v. Singga Enterprises (Canada) Inc., 2011 FC 776 at paras 95, 97 [Louis Vuitton].

7. Pharmascience at para 57.

8. Pharmascience at para 55; Viiv at para 20.

9. Byfield v. Toronto-Dominion Bank, 2012 ONCA 49 at para 10.

10. Pharmascience at para 144.

11. Teva at para 286.

12. Janssen Inc. v. Apotex Inc., 2022 FC 107 at para 131.

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