Federal Court Decisions

 

 

 

Date: 20070305

Docket: T-2047-06

Citation: 2007 FC 232

Ottawa, Ontario, March 5, 2007

PRESENT:     The Honourable Mr. Justice Shore

 

 

BETWEEN:

APOTEX INC.

Applicant

and

 

THE GOVERNOR IN COUNCIL,

THE MINISTER OF HEALTH and

THE ATTORNEY GENERAL OF CANADA

Respondents

 

REASONS FOR ORDER AND ORDER

 

OVERVIEW

 

[1]               This is a motion brought by the Respondents primarily for an order striking out the Notice of Application and dismissing the proceeding, on the basis that the Applicant has no standing to make this judicial review application.

 

[2]               In a second motion heard before the Court, Eli Lilly Canada Inc. sought to be added as a Party Respondent to this Application, or in the alternative, an intervenor. The decision in response to the first motion, in effect, takes into account the second motion, in that Eli Lilly acknowledged that its motion would be moot or premature if the Court decided that the Applicant had no standing to make the Judicial Review Application at this time.

 

[3]               Apotex is a company that manufactures and distributes generic drugs. It challenges legislation that was enacted very recently, the Regulations Amending the Food and Drug Regulations (Data Protection), SOR/2006-241 (Data Protection Regulations) (published October 18, 2006). Apotex claims that the Data Protection Regulations are ultra vires the enabling legislation (subsection 30(3) of the Food and Drugs Act, R.S. 1985, c. F-27). It also claims that to the extent the enabling legislation may confer the authority to make the Data Protection Regulations, it too is ultra vires.

 

[4]               The Data Protection Regulations impose particular limitations on certain manufacturers that seek, pursuant to Part C, Division 8 of the Food and Drug Regulations, C.R.C. c. 870, a notice of compliance for a new drug; however, at this time, Apotex has no genuine interest in any issue raised, and is not a party directly affected within the meaning of section 18.1 of the Federal Courts Act, R.S.C. 1985, c. F-7, as amended.

 

[5]               Accordingly, without further evidence before the Court at this time, this Application is bereft of success. The Notice of Application is struck out and the Application is dismissed.

 

[6]               An Application for Judicial Review can be made only by a person directly affected, and that person must name as a Respondent every other person directly affected. To the extent that the Order sought in this Application will affect Apotex, it will affect a large number of other parties; however, those parties have not been named as Respondents, and the identity of certain parties is confidential.

 

BACKGROUND

            The Data Protection Regulations

[7]               On October 18, 2006, the new Data Protection Regulations were published in the Canada Gazette Part II, having been registered October 5, 2006 (As noted in the Regulatory Impact Analysis Statement, the proposed amendment was pre-published June 17, 2006, after which the government consulted extensively with stakeholders, including generic and innovator drug manufacturers and their trade associations). (Data Protection Regulations, Moving Parties’ Motion Record, pp. 26-35).

 

[8]               The operative portion of the Data Protection Regulations is subsection C.08.004.1(3), which provides as follows:

 

[9]               Apotex is a manufacturer and distributor of pharmaceutical products. Most of the products are “generic”. As the largest Canadian generic drug manufacturer, it describes, in general terms, the process by which the Minister of Health ordinarily reviews and approves submissions made by generic manufacturers for “notices of compliance”, which signify the Minister’s permission for these manufacturers to market their drugs.

 

[10]           Nowhere in its Notice of Application does Apotex state that it has made any submission for a notice of compliance that the Minister, pursuant to the Data Protection Regulations, has refused to consider, has refused to approve, or in respect of which has refused to issue a notice of compliance. Indeed, Apotex does not refer to any action of any kind taken pursuant to the Regulations. It describes no situation in which the Regulations have actually been applied or put into operation.

 

[11]           Notwithstanding these omissions, Apotex, cites as grounds for its Application:

(a)     that the operation and application of the Data Protection Regulations show no rational connection to the enabling provision;

(b)     that the implementation of the measures represented by the enabling provision and the Regulations is beyond federal competence;

(c)     that the enabling provision permits the exercise of sweeping, indeterminate, and uncertain powers; and

(d)     that it does not know precisely how restrictively, or expansively, the Regulations will actually be applied.

(Notice of Application, Moving Parties’ Motion Record, pp. 18-22).

 

            Procedural History

[12]           About a month after the publication of the Data Protection Regulations, on November 22, 2006, Apotex filed the Notice of Application in this proceeding.

 

[13]           On December 19, 2006, counsel for the Respondents wrote to the Court and to counsel for the Applicant in response to a request under Rule 317, indicating that Rule 317 does not apply in this case, because there is no “decision” being challenged.

 

[14]           On January 8, 2007, the Applicant filed its affidavits in support of its Application. On consent of the parties, the Respondents’ affidavits were served and filed February 22, 2007.

 

[15]           On January 18, 2007, Apotex filed a Notice of Motion for an Order requiring the Respondents to comply with Rule 317.

 

[16]           On February 5, 2007, Eli Lilly Canada Inc. filed a Notice of Motion for an Order adding it as a party Respondent to this proceeding or, alternatively, granting it leave to intervene. As the primary ground for its motion, Eli Lilly refers to two new drug submissions it has recently made that contain data intended to be protected by the Data Protection Regulations. (Notice of Motion by Eli Lilly Canada Inc., Feb. 5, 2007, Moving Parties’ Motion Record, pp. 36-48). Eli Lilly’s motion was also heard February 27, 2007 by the undersigned.

 

A Related Proceeding

[17]           On November 14, 2006, the Canadian Generic Pharmaceutical Association initiated an application very similar to this one (Court File No. T-1976-06) and amended its Notice of Application January 19, 2007. On January 30, 2007, a motion to strike the Application on the ground that the Applicant had no standing was heard. It was dismissed in a decision issued February 9, 2007. (Reasons for Orders in T-1976-06, Moving Parties’ Motion Record, pp. 49-61). A Notice of Appeal respecting that decision was issued February 19, 2007. (Moving Parties’ Motion Record, pp. 62-66).

 

ISSUES

[18]           (1)        Does Apotex have the standing required to bring this Application?

(2)        Should the Application be struck out?

 

ANALYSIS

            Does Apotex have the standing required to bring this Application?

[19]           No person may seek judicial review in this Court unless that person is “directly affected by the matter in respect of which relief is sought”. (s.18.(1), Federal Courts Act, above. The only exception occurs where an Applicant has public interest standing, discussed below). Plainly, the rationale for this requirement has at least two elements: to ensure that appropriate parties are brought before the Court, and to ensure that no matter is brought before the Court until it actually has an effect to be examined.

 

[20]           For an Applicant to be considered “directly affected”, the matter at issue must be one which adversely affects its legal rights, impose legal obligations on it, or prejudicially affect it directly. (Reference is made to: Rothmans of Pall Mall Canada Ltd. v. Canada (Ministry of National Revenue – M.N.R.), [1976] 2 F.C. 500 (C.A.); Kwicksutaineuk/Ah-kwa-mish Tribes v. Canada (Minister of Fisheries and Oceans), 2003 FCT 30 (T.D.), [2003] F.C.J. No. 98 (QL), at para. 8, aff’d on other grounds 2003 FCA 484, [2003] F.C.J. No. 1893 (C.A.) (QL), leave to appeal to S.C.C. refused [2004] S.C.C.A. No. 55).

 

[21]           The Data Protection Regulations specify particular limitations on certain manufacturers that seek a notice of compliance for a new drug. Until the situation arises in which a manufacturer has sought a notice of compliance and the Minister has acted on it, or refused to act on it, pursuant to the Data Protection Regulations, the “matter” will have no direct effect, and no party will be directly affected. Until then, neither the issue nor the Applicant is properly before the Court.

 

[22]           Such were findings in two previous applications dismissed by this Court, both also brought by Apotex (and another drug manufacturer) in respect of other regulations. (Apotex Inc. v. Canada (Minister of National Health and Welfare), [1998] F.C.J. No. 1092; Apotex Inc. v. Canada (Minister of National Health and Welfare), [1998] F.C.J. No. 1096; aff’d on other grounds, [1999] F.C.J. No. 1978 (F.C.A.). There, as here, the regulations at issue affected the rights of drug manufacturers that made particular new drug submissions. There, as here, the Applicants had not made such new drug submissions.

 

[23]           The Court ruled that the Applicants had no standing to bring the application. In one case, the Court stated:

[5]        …I am not satisfied that the applicants have standing to bring this application for judicial review. Neither has filed for a notice of compliance by comparison or reference to a drug to which the Patent relates and neither has sent to the holder of the Patent a notice of allegation of non-infringement...

[6]        If and when a notice of compliance submission is made, if then Glaxo Biochem Inc. brings an application for judicial review to determine whether the allegation of non-infringement is justified, the issue of whether the Patent is properly on the Register will be before this Court and the applicant or applicants in connection with the new drug submission will also be properly before this Court.

(Apotex Inc. v. Canada (Minister of National Health and Welfare), [1998] F.C.J. No. 1092).

 

[24]           In the other case, the Court sated:

[14]      The applicants are generic drug manufacturers and, as such, are each regularly engaged in the process of making new drug submissions in accordance with the Regulations. Each is also regularly engaged in the litigation contemplated by those Regulations, litigation brought against them by "brand name manufacturers" or "first persons". However, there is no specific patent or patents on the Register that is or are identified in this proceeding and in relation to which either of the applicants has filed a new drug submission.

…

[16]      On the evidence before me, I find no basis to conclude that the applicants are "anyone directly affected" by the Minister's course of conduct in maintaining the Register, within the meaning of subsection 18.1(1) of the Federal Court Act. The applicants are not "second persons" with identifiable direct interests at stake under the Regulations under which the Minister maintains the Register. I conclude that while they are, or may some day become so, in respect of a specific entry or entries on the Register, that is insufficient to constitute a direct interest to support this application.

…

[18]      I conclude that, even if the subject matter of this application is a proper subject of judicial review, the applicants nonetheless lack standing to bring this application. (Emphasis of the Court.)

 

(Apotex Inc. v. Canada (Minister of National Health and Welfare), [1998] F.C.J. No. 1096).

 

[25]           In this proceeding, Apotex has the same lack of standing. There is no evidence that the Data Protection Regulations have been applied to impose any actual limitation on Apotex – or on any other drug manufacturer seeking a notice of compliance. As in the cases described above, the possibility that Apotex may at some time in the future be affected by the Regulations does not give it standing now.

[26]           This consideration demonstrates that Apotex has no standing and should not be permitted to proceed; however, the same analysis may be taken further, in case it be feared that the matter might otherwise be beyond challenge.

 

[27]           At some future time, particularly given the known litigiousness of this industry, the appropriate case will arise in one of two situations. A generic drug manufacturer will make a submission for a notice of compliance for its version of a particular drug made by an innovator manufacturer, and the Minister will make a decision that implements the Data Protection Regulations. In one situation, the Minister may refuse to accept the submission, or to approve it, or to issue a notice of compliance. The generic drug manufacturer can then initiate a Judicial Review Application on appropriate grounds (including, if so advised, those raised here). In that Application, the Applicant would name as a Respondent the innovator manufacturer of the drug to which the generic drug is compared. In the second situation, the Minister may accept the submission, approve it, and issue a notice of compliance. The innovative drug’s manufacturer can then, on appropriate grounds, initiate a Judicial Review Application. In that Application, the Applicant would name as a Respondent the generic manufacturer of the drug to which the notice of compliance is issued.

 

[28]           In either of those ways, both a situation in which a direct effect has arisen, and its directly affected parties, will be properly before the Court. To attempt to determine the current application, in which no such situation exists, is contrary to a well-recognized judicial principle – a Court should not be asked to intervene in an abstract debate without the benefit of a live dispute on a particular set of facts. (Reference is made to: The Professional Institute of the Public Service of Canada v. Canada (Customs and Revenue Agency), 2004 FC 507, [2004] F.C.J. No. 649 (QL), in which the application was dismissed as premature and speculative, esp. at paras. 77-78; Corp. of Canadian civil Liberties Assn. v. Canada (Attorney General), [1998] O.J. No. 2856 (C.A.), esp. at paras. 91-92). Justice John C. Major noted (though in a Charter case involving public interest standing), the principle “…mirrors the Court's vigilance in ensuring that it hears the arguments of the parties most directly affected by a matter. In the absence of facts specific to the appellants, both the Court's ability to ensure that it hears from those most directly affected and that Charter issues are decided in a proper factual context are compromised.” (Hy and Zel’s Inc. v. Ontario (Attorney General), [1993] S.C.R. 675, at para. 20).

 

[29]           Further, it cannot be suggested that Apotex may have public interest standing. A party seeking public interest standing must satisfy the Court that, among other things, there is no other reasonable and effective way to bring the issue before the Court. This criterion has been described by the Supreme Court of Canada as being “at the heart of the discretion to grant public interest standing” (Hy and Zel’s, above, at para. 16), because “a court should have the benefit of the contending views of the persons most directly affected by the issue”. (Finlay v. Canada (Minister of Finance), [1986] 2 S.C.R. 607 infra, at para. 35). There is clearly a more reasonable and effective means to bring this issue before the Court – either of the means described above.

 

[30]           Thus, Apotex is not a person directly affected by the matter in respect of which relief is sought, and may not make this Application for Judicial Review at this time.

 

Should the application be struck out?

[31]           While it is said that a motion to strike an Application for Judicial Review should be used in very exceptional cases, the Court will and should dismiss an Application for Judicial Review in this manner if it is so clearly improper at to be bereft of any chance of success at this time. (Pharmacia Inc. v. Canada (Minister of National Health and Welfare) (F.C.A.), [1995} 1 F.C. 588 (C.A.); [1994] F.C.J. No. 1629 (QL)).

 

[32]           On that basis, Notices of Applications have been struck out in a number of cases. Examples include the following:

(a)        where the Court had no jurisdiction because the Applicant:

i.          could have utilized a statutory grievance (Bouchard) or appeal procedure (Ontario Hydro and Fast);

ii.          brought the Application in the wrong division of the Court (Rocky Mountain);

iii.         challenged a decision not made by a federal board, commission, or tribunal (Mennes, Spatling, Scheuneman and Brazeau);

iv.         challenged a letter or a decision that did not create a legal effect that was subject to judicial review (Kourtchenko and Moses);

v.         failed to seek any substantive relief that was within the jurisdiction of the Court (Nourhaghighi, Lavoie and Al-Mhamad).

(b)        where it was clear that the Applicant could not satisfy the pre-conditions for the issuance of the remedy in a mandamus application (Rocky Mountain);

(c)        where other legislation provided a remedy in a complete code (Syntex);

(d)        where the Applicant sought a declaration requiring the Respondent to comply with the law in the future (Syntex);

(e)        where the relief sought is moot or can otherwise have no practical effect (Canada (Attorney General) v. Canada (Information Commissioner));

(f)         where allowing the Application to proceed would amount to an abuse of process because precisely the same issue had been litigated in previous applications (even though with different Respondents) (Hoffman-LaRoche and Syntex).

(Bouchard v. Canada (1999) 255 N.R. 183 (F.C.A.), [1999] F.C.J. No. 1807 (QL);

Ontario Hydro v. UMG Telecommunications Inc., [1998] F.C.J. 746 (C.A.) (QL);

Fast v. Canada (Minister of Citizenship and Immigration), [2001] 1 F.C. 257, [2000] F.C.J. 1116 (T.D.) (QL);

Rocky Mountain Ecosystem Coalition v. Canada (National Energy Board), (1999) 174 F.T.R. 17, [1999] F.C.J. No. 1223 (QL);

Mennes v. Canada (Attorney General), (1998) 149 F.T.R. 317 (T.D.); [1998] F.C.J. No. 800; aff’d (1999), 247 N.R. 295 (C.A.);

Spatling v. Canada (Solicitor General), 2003 FCT 621, [2003] F.C.J. No. 621 (QL), at para. 5;

Scheuneman v. Canada (Attorney General), 2003 FCA 194, [2003] F.C.J. No. 686 (C.A.) (QL);

Brazeau v. Canada (Attorney General), 2003 FCT 621, [2003] F.C.J. No. 687 (C.A.) (QL);

Kourtchenko v. Canada (Minister of Citizenship and Immigration), (1998) 146 F.T.R. 23 (T.D.), [1998] F.C.J. No. 159 (QL);

Moses v. Canada, 2002 FCT 1088, [2002] F.C.J. No. 1444 (QL);

Nourhaghighi v. Canada (Human Rights Commission), [2001] F.C.J. No. 75 (T.D.) (QL), at para. 6;

Lavoie v. Canada, [2000] F.C.J. 360 (T.D.) (QL);

Al-Mhamad v. Canada (Canadian Radio-Television and Telecommunications Commission), 2003 FCA 45, [2003] F.C.J. No. 145 (C.A.) (QL);

Rocky Mountain, above;

Syntex (U.S.A.) L.L.C. v. Canada (Minister of Health), 2002 FCA 289, [2002] F.C.J. No. 2020 (QL);

Syntex (U.S.A.) L.L.C. v. Canada (Minister of Health, 2001 FCT 1185, [2001] F.C.J. No. 1647 (QL);

Canada (Attorney General) v. Canada (Information Commissioner), [1998] 1 F.C. 337 (T.D.), [1997] F.C.J. No. 1160, aff’d [2000] F.C.J. No. 17 (C.A.);

Hoffmann-LaRoche Ltd. v. Canada (Minister of National Health and Welfare), (1998) 158 F.T.R. 135 (T.D.), [1998] F.C.J. No. 1706;

Syntex (U.S.A.) L.L.C. v. Canada (Minister of Health), 2001 FCT 1185, above, at paras. 18-22).

[33]           Similarly, a Judicial Review Application should be struck out where the applicant has no standing to initiate it. The Court may determine the issue of standing as a preliminary matter on a motion to strike an Application for Judicial Review, and may strike the application in a very clear case.

(Reference is made to: Sierra Club of Canada v. Canada (Minister of Finance), [1999] 2 F.C. 211 (T.D.), [1998] F.C.J. No. 1761 (QL), at paras. 24-26; Alberta v. Canada (Wheat Board), [1998] 2 F.C. 156 (T.D.), [1997] F.C.J. 1484 (QL), aff’d on other grounds [1998] F.C.J. No. 1747 (C.A.) (QL)).

 

[34]           As noted by the Supreme Court of Canada, in Finlay above, the matter is one for judicial discretion:

[16]      … it is a matter of judicial discretion, having regard to the particular circumstances of a case, whether to determine the question of standing with final effect as a preliminary matter or to reserve it for consideration on the merits… It depends on the nature of the issues raised and whether the court has sufficient material before it, in the way of allegations of fact, considerations of law, and argument, for a proper understanding at a preliminary stage of the nature of the interest asserted… (Emphasis of the Court.)

 

 

[35]           Apotex is not a party directly affected within the meaning of section 18.1 of the Federal Courts Act; nor can it be said to have public interest standing at this time. As Justice John Evans has noted in Sierra Club, above:

[26]      Of course, when the Court has sufficient material to enable it to make a determination, then it may properly deny standing on a preliminary motion…

 

CONCLUSION

[36]           Accordingly, it can and should be concluded at this time that the Application is bereft of any possibility of success. As an Application for Judicial Review may only be made by a person directly affected by the matter in respect of which relief is sought, and Apotex is not such a person, it is plain and obvious that the Application for Judicial Review cannot succeed. The Notice of Application is struck out and the application is dismissed without costs.

 

ORDER

 

THIS COURT ORDERS that the Notice of Application be struck and that the Application be dismissed without costs.

 

 

“Michel M.J. Shore”

FEDERAL COURT

 

SOLICITORS OF RECORD

 

 

DOCKET:                                          T-2047-06

 

STYLE OF CAUSE:                          APOTEX INC. v.

THE GOVERNOR IN COUNCIL,

THE MINISTER OF HEALTH and

THE ATTORNEY GENERAL OF CANADA

 

PLACE OF HEARING:                    Ottawa, Ontario

 

DATE OF HEARING:                      February 27, 2007

 

REASONS FOR ORDER

AND ORDER:                                   SHORE J.

 

DATED:                                             March 5, 2007

 

 

APPEARANCES:

 

Mr. John Simpson Mr. Miles Hastie	FOR THE APPLICANT
Mr. F.B. Woyiwada Mr. Richard Casanova   Mr. Richard R. Dearden Ms. Wendy Wagner	FOR THE RESPONDENTS     FOR PROPOSED INTERVENOR

 

SOLICITORS OF RECORD:

 

GOODMANS LLP Toronto, Ontario	FOR THE APPLICANT
JOHN H. SIMS, Q.C. Deputy Attorney General of Canada   GOWLING LAFLEUR HENDERSON LLP Ottawa, Ontario	FOR THE RESPONDENTS     FOR PROPOSED INTERVENOR