Federal Court of Appeal refuses Appeal of Motion to Strike Decision due to “Uncertainty” in the Case Law

On December 8, 2015, Justice Stratas of the Federal Court of Appeal released his Reasons for Judgment of the Court in Teva Canada Limited v. Pfizer Canada Inc., 2015 FCA 280. The case was an appeal from the Federal Court (Justice Strickland) who dismissed an appeal from the Order of Prothonotary Aronovitch who dismissed Teva Canada Limited’s motion to strike certain paragraphs in Pfizer’s Statement of Defence and Counterclaim.

The motion to strike stemmed from Teva’s action under s. 8 of the NOC regulations seeking compensation for losses suffered as a result of being prohibited from selling its generic version of VIAGRA. In its Defence and Counterclaim, Pfizer claimed that Teva’s manufacture and sale of the its generic tablets would infringe (i) Pfizer’s underlying patent (the 748 Patent, that was litigated previously in a section 6 proceeding), (ii) Pfizer’s industrial design rights, and (iii) would constitute passing off. Teva brought a motion to strike/sever these elements of Pfizer’s Defence and Counterclaim.

On Appeal Teva argued that in raising an allegation of patent infringement, Pfizer was attempting to re-litigate issues that were decided against it within the context of the NOC Regulations. Teva also argued that section 8(5) of the NOC Regulations (which allows the court to take into account “all matters it considers relevant” in assessing the amount of compensation owed pursuant to a section 8 action) is not so broad as to encompass any factor that a party or a judge chooses to raise.

In support of its submissions Teva claimed that the Courts below failed to properly apply AstraZeneca Canada Inc. v. Apotex Inc., 2013 FCA 77 (“Omeprazole”). In Omeprazole, the Federal Court of Appeal endorsed Justice Hughes’ conclusions that (i) AstraZeneca’s (then) pending action for infringement of the patent in issue was not relevant to Apotex’s section 8 claim; (ii) a pending infringement action is not relevant to the discretion that flows from s.8 (5) and (iii) that in such circumstances the appropriate remedy (if any) is found in an action for patent infringement.

The Federal Court of Appeal dismissed Teva’s appeal, holding that there is uncertainty regarding the state of the law as expressed in Omeprazole and other cases, and uncertainty regarding the interpretation of section 8 of the PM (NOC) Regulations. In brief reasons issued from the bench, Justice Stratas explained that the Federal Court of Appeal declined to interfere with the findings of the Prothonotary and the Federal Court, who held that the issues before them were not plainly and obviously devoid of merit. .

A copy of the decision can be found here.

Aitken Klee represented Teva in this proceeding.