Absent de facto prejudice, pleading amendments will ‘almost always’ be in the interests of justice

On January 29, 2016, Justice Barnes of the Federal Court released the Order and Reasons in Canplas Industries Ltd. v. Airturn Products Inc., 2016 FC 109 where the Defendants moved to amend their Second Statement of Defence and Counterclaim to add a product made by Vent Air as prior art.

The Vent Air product was disclosed to the Plaintiff in late 2014 and was made available for inspection to the Plaintiff and its expert witness in March 2015. The Plaintiff’s expert then dealt with the Vent Air product in his expert report assuming the Vent Air product was prior art.

The Plaintiff opposed the amendment on the ground that the Defendants had not and cannot establish that the Vent Air product was disclosed to the public before the relevant claim date. The Plaintiff further claimed that the Defendants failed to produce particulars of the public disclosure of the Vent Air product before the claim date; that the sample of the product the Defendants produced for inspection was manufactured years after the claim date; and that although the sample did reference 3 US design patents dating back to the 1980s, none of those patents disclosed the innovative product claimed by the Plaintiff in this proceeding. Accordingly, the Plaintiff alleged that this evidence is insufficient to provide the temporal provenance of the Vent Air product and that the amendments should be refused on the basis that: (i) it was “plain and obvious” the assertion would not succeed; and (ii) that the pleading was based only on assumptions and speculation (not evidence).

In considering the motion, Justice Barnes acknowledged that it may be appropriate to refuse a pleading amendment where it is “manifestly incapable of being proven” or where a party admits “it has no evidence to support the impugned allegation or where the allegation is otherwise certain to fail”. However, Justice Barnes held that this was not the case on this motion, pointing to the fact that the Defendants were continuing to search for evidence to establish that the Vent Air product is, in fact, prior art. Justice Barnes held that to refuse the proposed amendments would foreclose that possibility and potentially result in relevant evidence being excluded from the record. Justice Barnes was confident that should the Defendants prove incapable of establishing that the Vent Air product is prior art, the allegation and any evidence it supports would be excluded.

Justice Barnes concluded his analysis by citing the Federal Court of Appeal decision in Janssen Inc. v. Abbvie Corp, 2014 FCA 242 which suggests that a holistic approach is required when considering motions to amend. Justice Barnes held that so long as the proposed amendment creates no de facto prejudice (as was the case here), it will almost always be in the interests of justice to err on the side of allowing it because it is far better to let the amendment in and later exclude it from consideration than to face the possibility of requiring a new trial.

Based on the foregoing, Justice Barnes allowed the Defendants’ motion to amend.

A copy of the decision can be found here.