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08 January 2018
Seedlings Life Science Ventures is the plaintiff in a patent infringement action against Pfizer relating to Patent 2,486,935, which covers auto-injectors. Seedlings brought a motion seeking approval of a litigation funding agreement (LFA) with a third party (Bentham IMF Capital Limited, the Canadian subsidiary of IMF Bentham Ltd, an Australian professional litigation funding enterprise), as required by the terms of the agreement.(1)
The LFA, to which Seedlings' counsel are also parties, provides that:
Seedlings remains in control of the litigation, but Bentham has the right to be consulted on settlement. Bentham will also have access to all documents in the litigation, but will be subject to the same confidentiality or implied undertaking obligations as Seedlings.
The prothonotary dismissed the motion on the basis that such approval is not required beyond class proceedings. Further, the Federal Court had no jurisdiction to determine the validity of the LFA. Seedlings is asserting its own rights in the within action; thus, the question of whether the LFA constitutes champerty or maintenance does not affect the validity of Seedlings' rights. Therefore, champerty or maintenance is not a basis to bring the issue within the court's jurisdiction.
The prothonotary also found that it was unnecessary to determine this issue:
No confidentiality order was in place at the time and, in any event, previous examples had addressed disclosure to third parties. The implied undertaking will allow the sharing of information for the purpose of conducting the litigation and can be enforced by the court without any determination on this motion.
For further information on this topic please contact Brandon Heard at Smart & Biggar/Fetherstonhaugh by telephone (+1 416 593 5514) or email (firstname.lastname@example.org). The Smart & Biggar/Fetherstonhaugh website can be accessed at www.smart-biggar.ca.
(1) Seedling Life Science Ventures LLC v Pfizer Canada Inc, 2017 FC 826.
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