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21 November 2018
The Ontario Superior Court of Justice recently dismissed Apotex's motion to plead promise-based invalidity grounds in a Section 8 lansoprazole action. The motion had arisen in the context of a Section 8 action in which Apotex claimed damages for delay in the issuance of its notice of compliance for its generic lansoprazole product (Takeda's Prevacid) due to prohibition applications commenced by Abbott and Takeda. Abbott and Takeda had pleaded patent infringement as a defence to the Section 8 claim and brought a counterclaim for patent infringement. Apotex in turn challenged the validity of Takeda's patents. The Ontario Superior Court of Justice (2017 ONSC 2348) dismissed a motion for summary judgment brought by Abbott and Takeda and ordered the matter to proceed to a damages trial, scheduled to commence in January 2019 (for further details please see "Ontario Superior Court dismisses summary judgment motion in Lansoprazole Section 8 claim").
In the present motion, Justice Quigley dismissed Apotex's motion for leave to amend its statement of reply and defence to counterclaim (Apotex Inc v Abbott and Takeda, 2018 ONSC 5199). Apotex brought the motion following the striking down of the "promise doctrine" by the Supreme Court in AstraZeneca Canada Inc v Apotex Inc (2017 SCC 36) (for further details please see "Promise doctrine struck down and AstraZeneca's NEXIUM patent upheld as useful"). Apotex sought to raise new grounds of patent invalidity, premised on "overpromising" under overbreadth and insufficiency (Section 27 of the Patent Act) and wilful misrepresentation and fraud (Section 53 of the Patent Act).
In dismissing Apotex's motion, Quigley relied on recent decisions of the Federal Court that have rejected the repackaging of promise-based pleadings as other grounds of patent invalidity, deferring to the Federal Court as a specialist bench in patent law. In his view
[h]aving specifically overruled the Promise Doctrine as bad law, it is not evident and indeed it is counterintuitive that the Supreme Court [in AstraZeneca] intended that promise based arguments would simply be imported into claims of overbreadth or misrepresentation under those sections.
Regarding the allegation of wilful misrepresentation raised against Takeda, Quigley accepted that a pleading could survive if the misrepresentation was a "promise", but found that Apotex's amendments did not satisfy the necessary elements of the cause of action under Section 53. Quigley went on to find that Apotex had merely recycled its promise-based allegations, failing to particularise any additional facts to support its claim of misrepresentation. Acknowledging the gravity of claims under Section 53 and fraud allegations generally, Quigley awarded Takeda elevated costs to compensate it for Apotex's improper and deficient Section 53 fraud allegations.
For further information on this topic please contact Tierney GB Deluzio at Smart & Biggar/Fetherstonhaugh by telephone (+1 416 593 5514) or email (email@example.com). The Smart & Biggar/Fetherstonhaugh website can be accessed at www.smart-biggar.ca.
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