Toronto, Ontario, May 10, 2007
PRESENT: The Honourable Mr. Justice Mosley
BETWEEN:
PFIZER CANADA INC. and WARNER-LAMBERT COMPANY, LLC
and
THE MINISTER OF HEALTH and RANBAXY LABORATORIES LIMITED
REASONS FOR ORDER AND ORDER
[1] This is an appeal from the order of a prothonotary dated April 12, 2007 declining to grant leave to Pfizer under Rule 312 to file the additional affidavit of Dr. Allan S. Myerson, sworn on April 5, 2007, in proceedings under the Patented Medicines (Notice of Compliance) Regulations, SOR/93-133. The underlying application brought by the applicants arises from allegations set out in a letter to them dated January 31, 2005 from counsel for Ranbaxy Laboratories Limited (the “Ranbaxy letter”).
[2] In December 2006 Pfizer was granted leave by Prothonotary Milczynski, case management prothonotary for the application, to amend its notice of application to add responses to Ranbaxy’s allegations relating to two patents, Canadian Patent Nos. 2,220,018 (018 Patent) and 2,220,455 (455 Patent). These responses had originally been included in the notice but were deleted on the basis of Pfizer’s analysis of information voluntarily produced by Ranbaxy which indicated that the form of atorvastatin calcium for which Ranbaxy sought a notice of compliance would not infringe the 018 or 455 patents. In another proceeding, Ranbaxy made further production of information which, upon analysis, led Pfizer to conclude that infringement would in fact result leading to the motion to amend.
[3] In addition to granting leave to amend, Prothonotary Milczynski also set aside the scheduled hearing dates in January, extended the 24 month stay provided under s.7(1) (e) of the Regulations to October 26, 2007 and established a new schedule for completing the remaining procedural steps. Under the new schedule, evidence was to be served and filed by March 23rd and cross-examinations were to be completed by April 30th. The hearing on the merits was set to begin June 25, 2007 for a duration of three days.
[4] In accordance with the new schedule, on February 5, 2007 Pfizer delivered five affidavits including one by Dr. Allan S. Myerson of Chicago, Illinois. Ranbaxy delivered affidavits on March 23, 2007 from three witnesses including Dr. Ian M. Cunningham and Dr. Mark D. Hollingsworth. Dates for cross-examination were agreed to by March 30th; all within the April 30th timeline fixed by the prothonotary. Dr. Myerson’s cross examination was scheduled for April 13th in Chicago.
[5] Dr. Hollingsworth’s affidavit presents the results of calculations he performed using some of the results reported by Dr. Myerson in his February affidavit. Dr. Cunningham’s affidavit includes a discussion of his views on the interpretation of a phrase which appears in the claims of the 455 Patent.
[6] On April 5th, late in the day on the Thursday before the Easter holiday weekend, Pfizer served and filed a motion returnable in Ottawa on April 12th, seeking leave pursuant to Rule 312 to file additional evidence from Dr. Myerson responding to the Hollingsworth and Cunningham affidavits.
[7] Due to the length of the motions list in Ottawa on April 12th and the fact that Dr. Myerson’s cross-examination on his first affidavit was to take place the following day in Chicago, Prothonotary Milczynski heard the motion by teleconference from Toronto. She delivered her decision and reasons the same day. In determining whether leave to file additional evidence under Rule 312 should be granted, Prothonotary Milczynski held that a four part test must be considered:
- whether the further evidence serves the interests of justice;
- whether the further evidence will assist the court;
- whether granting the motion will cause substantial or serious prejudice to the other side; and
- whether the evidence was not available and/or could not be anticipated as being relevant at an earlier date. [emphasis mine]
[8] Applying these factors and having reviewed the Myerson reply affidavit, Prothonotary Milczynski reached several conclusions. First, with respect to the proposed response to Dr. Hollingsworth’s evidence, she found that the reply affidavit contains comments that are largely discussion relating to or criticism of the methodology employed by Dr. Hollingsworth. While these could be of assistance to the Court which would hear the application, they could also be explored in the cross-examination of Dr. Hollingsworth. Secondly, regarding the proposed response to Dr. Cunningham, the learned prothonotary concluded that the reply affidavit raised nothing new or anything that could not have been anticipated. Further, the issue of claims construction with respect to the 455 Patent was raised and contained in the Notice of Allegation.
Issues
[9] The central issue before me is whether the Prothonotary erred in dismissing Pfizer’s motion for leave such that this Court should exercise its discretion on a de novo basis pursuant to the test set out in Canada v. Aqua-Gem Investments Ltd., [1993] 2 F.C. 425 (C.A.) and restated in Merck & Co. v. Apotex Inc., 2003 FCA 488 at para. 19 as follows:
Discretionary orders of prothonotaries ought not to be disturbed on appeal to a judge unless:
a) the questions in the motion are vital to the final issue of the case, or
b) the orders are clearly wrong, in the sense that the exercise of discretion by the prothonotary was based upon a wrong principle or upon a misapprehension of facts.
[10] There is no suggestion that the questions in the motion are vital to the final issue of the case. Pfizer submits that the exercise of discretion was based on wrong principles or a misapprehension of facts in that the learned prothonotary:
1) erred in law by imposing a requirement of “forseeability” that had been previously absent in the test for reply evidence;
2) erred in holding that Dr. Myerson could have foreseen the evidence of Drs. Hollingsworth and Cunningham given his uncontested evidence in support of the motion to the contrary; and
3) erred in law by holding that the issue of “claims construction” addressed in the Cunningham affidavit was raised and contained in the Ranbaxy letter.
Analysis
The test for reply evidence
[11] Pfizer submits that long-standing authority in this Court supports a “permissive” three part test for the filing of reply evidence based on the following three factors as originally set out in Eli Lilly and Co. v. Apotex Inc. (1997), 76 C.P.R. (3d) 15 (F.C.T.D.): interests of justice, assistance to the court, and prejudice to the respondent. Pfizer does not dispute that it could have tendered the evidence of Dr. Myerson on the points addressed in the Hollingsworth and Cunningham affidavits in his affidavit in chief but argues that there was no reason to do so until the issues raised by their evidence was presented.
[12] Pfizer contends further that the additional requirement applied by the prothonotary, “whether the evidence was not available and/or could not be anticipated as being relevant at an earlier date”, was specifically rejected by this court in Abbott Laboratories v. Canada (Minister of Health) (2003), 29 C.P.R. (4th) 450 at para. 20 [Abbott Laboratories].
[13] The court in Abbott Laboratories was dealing with an argument that the restrictive test for allowing reply evidence at trial, as set out in Halford v. Seed Hawk Inc., 2003 FCT 141 at para. 15 , should be applied to PM(NOC) proceedings. Justice Elizabeth Heneghan rejected that approach noting that these applications are intended to be summary in nature and the prothonotary is vested with considerable discretionary authority to manage the proceedings. Justice Heneghan noted that the prothonotary had considered the three factors identified in Eli Lilly in arriving at her decision to allow the reply evidence: Abbott Laboratories, above at para. 20.
[14] There is clear authority for the addition of a fourth element to the test in the decision of the Federal Court of Appeal in Atlantic Engraving Ltd. v. LaPointe Rosenstein, 2002 FCA 503 [Atlantic Engraving]. The Court of Appeal cited the Eli Lilly formula at paragraph 8 but went on to say the following at paragraph 9:
Further, an applicant, in seeking leave to file additional material, must show that the evidence sought to be adduced was not available prior to the cross-examination of the opponent's affidavits. Rule 312 is not there to allow a party to split its case and a party must put its best case forward at the first opportunity. [Citations omitted] [Emphasis mine]
[15] All “four” parts of the test were also set out and utilized by the Federal Court of Appeal in Mazhero v. Canada (Industrial Relations Board), 2002 FCA 295 at paragraph 5. The Court of Appeal cited a decision in which Prothonotary Hargrave, interpreting the then recently adopted Rule 312, stated:
The new Federal Court Rules allow the filing of a supplementary affidavit and of a supplementary record, however such should only be allowed in limited instances and special circumstances, for to do otherwise would not be in the spirit of judicial review proceedings, which are designed to obtain quick relief through a summary procedure. While the general test for such supplementary material is whether the additional material will serve the interests of justice, will assist the Court and will not seriously prejudice the other side, it is also important that any supplementary affidavit and supplementary record neither deal with material which could have been made available at an earlier date, nor unduly delay the proceedings. [emphasis mine]
(Deigan v. Canada (Industry), [1999] F.C.J. No. 304 (Proth.)(QL), aff'd. [1999] F.C.J. No. 645 (T.D.)(QL))
[16] In challenging the notion of a fourth element to the additional evidence test under Rule 312, Pfizer advances the same arguments upon which they were unsuccessful last year in a case heard and decided by my colleague Justice Max Teitelbaum: Pfizer Canada Inc. v. Canada (Minister of Health), 2006 FC 984. The respondent submits that as Pfizer did not appeal that decision, this motion represents a “collateral attack” on Justice Teitelbaum’s decision. That in my view is a mischaracterization of the matter as the proceedings are distinct. Nonetheless, unless I am persuaded that my colleague’s reasons were clearly wrong, the principle of judicial comity suggests that I should not depart from Justice Teitelbaum’s reasoning: Glaxo Group Ltd. v. Canada (Minister of National Health and Welfare), [1995] F.C.J. No. 1430 (T.D.) (QL); Aventis Pharma Inc. v. Apotex Inc., 2005 FC 1283.
[17] As in the case before Justice Teitelbaum, Pfizer argues that Atlantic Engraving should be distinguished on two grounds: first that the Court should only apply what it calls the “available in chief” requirement when a party has sought leave to file reply evidence after cross-examinations have already occurred; and second, the requirement was established in a trade marks case in the context of Atlantic Engraving and PM(NOC) proceedings are unique.
[18] Justice Teitelbaum held, at paragraphs 19-21 of the 2006 decision, that there is nothing on the face of the Federal Court of Appeal’s decision in Atlantic Engraving to indicate that it would not apply to Rule 312 motions in PM(NOC) proceedings. Moreover, Justice Teitelbaum made it clear that the principle that a party must put its best case forward at the first opportunity and not split its case was not limited to situations in which cross-examinations had already taken place. This was in keeping, he concluded, with the legislative intent that these proceedings should be summary in nature and proceed expeditiously.
[19] I agree with Justice Teitelbaum and adopt his reasons as my own.
Whether the respondent’s evidence could have been anticipated
[20] Pfizer submits that the prothonotary proceeded on a misapprehension of the facts as the uncontradicted evidence before her as stated by Dr. Myerson in his April 5, 2007 affidavit was that he could not have anticipated the evidence put forward in the Hollingsworth and Cunningham affidavits for several reasons. I will address the Cunningham affidavit under the next issue.
[21] Dr. Myerson deposes that he could not have anticipated Dr. Hollingsworth’s “extensive calculations using one of the unit cells obtained from [his] indexing results…because my analysis was and remains sufficient to conclude that Ranbaxy’s samples contain crystalline Form 1 atorvastatin.” Dr. Myerson proceeds to set out several other reasons why he disagrees with Dr. Hollingsworth’s evidence, but this statement is really the crux of the matter. While Prothonotary Milczynski agreed that Dr. Myerson’s evidence could be of assistance to the Court, she considered that these points could also be explored in the cross-examination of Dr. Hollingsworth.
[22] Pfizer relies on the aphorism that “cross-examination is no substitute for evidence”. While that may be true in many cases, it doesn’t provide a satisfactory answer for why Dr. Hollingsworth’s evidence could not have been foreseen. The fact that Dr. Myerson did not think it necessary to perform the same analysis is not, in my view, proper reply evidence but evidence to supplement his prior affidavit.
[23] Prothonotary Milczynski’s Order states that she reviewed the affidavit for which leave was being sought. In doing so, she had the benefit of the knowledge gained from having case managed this file for several months. The conclusions she reached with respect to the proposed evidence in reply to the Hollingsworth affidavit were, in my view, reasonably open to her on the evidence submitted as well as that previously filed. The applicant has not established that she proceeded on a misapprehension of the facts and was clearly wrong in this respect.
Was claims construction a live issue?
[24] With respect to Dr. Cunningham’s views on the construction of the phrase “removing the solvent to afford… amorphous atorvastatin” which appears in the claims of the 455 Patent, Dr. Myerson deposes that he did not discuss this phrase in his first affidavit because the Ranbaxy letter did not raise the issue. Dr. Cunningham states that based on his reading of the claims, the 455 Patent is limited to evaporative techniques. Dr. Myerson disputes this as he says that solvents may be removed by other means such as precipitation and filtration or drying.
[25] Prothonotary Milczynski concluded that the issue of claims construction with respect to the 455 Patent was raised and contained in the Notice of Allegation. Pfizer submits that she erred in law in so finding as there is no discussion of the phrase in the Ranbaxy letter or indication that Ranbaxy would be relying upon the fact that its process allegedly does not involve evaporation.
[26] Ranbaxy argues that it is axiomatic that an allegation of non-infringement involves claim construction: Whirlpool Corp. Camco Inc., [2000] 2 S.C.R.1067, 2000 SCC 67 at paragraph 43. Accordingly, the respondent submits that it was incumbent upon Dr. Myerson in his first affidavit to properly construe the claims of the 455 Patent. Further, Ranbaxy contends that the issue is clearly identified in the portions of the Notice of Allegation that describe the process claims of the 455 Patent.
[27] It is trite law that the first task of an applications judge in a patent case, including proceedings under the PM (NOC) Regulations, is to construe the claims. I do not understand that to mean however that claims construction is put in issue by a bald assertion of non-infringement. Adequacy of the Notice of Allegation and the accompanying detailed statement is a matter of law. The test for adequacy is whether the detailed statement is sufficient to make the patentee fully aware of the grounds on which the other party claimed that the relevant patent would not be infringed if a NOC was issued by the Minister: Novopharm Ltd. v. Pfizer Canada Inc. et al., 2005 FCA 270 at para. 4. This must include an adequate description of any claim construction grounds.
[28] I have read the portions of the Notice of Allegation to which Ranbaxy drew my attention several times and I am unable to see how they identify the issue that Dr. Cunningham raised in his construction of the disputed phrase. Accordingly, I am satisfied that the learned prothonotary erred in law in holding that the issue of “claims construction” addressed in the Cunningham affidavit was raised and contained in the Ranbaxy letter.
[29] Considering the matter de novo, I am satisfied that those paragraphs of the Myerson April 5th affidavit that address the Cunningham claim construction evidence meet the test for the filing of additional evidence under Rule 312 described above. Reception of the evidence will serve the interests of justice and will assist the Court in making its final determination, as Prothonotary Milczynski found. There is no evidence or submissions before me that it will cause substantial or serious prejudice to the respondent, and with respect to the fourth requirement, in light of my conclusions in the preceding paragraphs, the evidence could not have been anticipated as being relevant at an earlier date.
[30] I will therefore grant leave to file paragraphs 18 to 25 inclusive of the Myerson affidavit as they relate to the Cunningham evidence. Paragraphs 2 to 17 inclusive of the affidavit will be struck as they pertain to the Hollingsworth evidence. While the results were somewhat mixed, in light of the background to this matter and that Ranbaxy had the greater success on the appeal, costs of the motion here and below in any event of the cause are payable to the respondent.
ORDER
THIS COURT ORDERS that:
1. The applicant’s appeal from the Order of Prothonotary Milczynski dated April 12, 2007 is granted in part.
2. Paragraphs 18 to 25 inclusive of the affidavit of Dr. Allan S. Myerson dated April 5, 2007 may be filed as additional evidence under Rule 312.
3. Paragraphs 2 to 17 inclusive of Dr. Myerson’s April 5, 2007 affidavit shall be struck before it is filed.
4. The costs of this motion here and below are payable to the respondent in any event of the cause.
“Richard G. Mosley”
FEDERAL COURT
NAME OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: T-507-05
STYLE OF CAUSE: PFIZER CANADA INC. ET AL.
v. THE MINISTER OF HEALTH ET AL.
PLACE OF HEARING: Toronto, Ontario
APPEARANCES:
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Peter R.Wilcox Vincent M. De Grandpre |
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David M. Reive |
RANBAXY LABORATORIES LIMITED
|
SOLICITORS OF RECORD:
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Torys LLP Toronto, Ontario
|
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Dimock Stratton LLP Toronto, Ontario |
RANBAXY LABORATORIES LIMITED
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