Sanofi-Aventis Canada Inc. et al. v. Apotex Inc., 2008 FCA 175

• Judge: Linden, Noël and Ryer, JJ.A.
• Court: Federal Court of Appeal (Canada)
• Case Date: May 07, 2008
• Jurisdiction: Canada (Federal)
• Citations: 2008 FCA 175;(2008), 379 N.R. 383 (FCA)

Sanofi-Aventis Can. v. Apotex Inc. (2008), 379 N.R. 383 (FCA)

MLB headnote and full text

Temp. Cite: [2008] N.R. TBEd. AU.016

Apotex Inc. (appellant) v. Sanofi-Aventis Canada Inc. and Schering Corporation (respondents)

Apotex Inc. (appellant) v. Sanofi-Aventis Canada Inc., Schering Corporation, Sanofi-Aventis Deutschland GmbH and ratiopharm inc. (respondents)

(A-419-07; 2008 FCA 175)

Indexed As: Sanofi-Aventis Canada Inc. et al. v. Apotex Inc.

Federal Court of Appeal

Linden, Noël and Ryer, JJ.A.

May 13, 2008.

Summary:

The plaintiffs, Schering Canada Inc. and Sanofi-Aventis Canada Inc. (Sanofi Canada), were the owner and a licensee of Canadian Patent No. 1,341,206. The plaintiffs sued Apotex Inc. for infringement of the patent, seeking injunctive relief, damages, and an accounting of profits. In its statement of defence, Apotex denied the plaintiffs' entitlement to an accounting of profits on the basis of inequitable and unlawful conduct by the plaintiffs in entering into agreements with ratiopharm inc. and others for the purpose of causing harm to Apotex by way of unlawful anti-competitive activity (the "Improper Conduct Pleadings"). Apotex also counterclaimed for damages and other relief against the plaintiffs as well as against Sanofi-Aventis Deutschland GmbH (Sanofi-Germany) and ratiopharm inc. who were added to the action as defendants by counterclaim. The "Second Conspiracy Pleadings" in the counterclaim spelled out the inequitable and unlawful conduct that underpinned the Improper Conduct Pleadings. The subject matter of the counterclaim was also part of an action commenced by Apotex in the Ontario Supreme Court against a number of parties, including the predecessors of Sanofi Canada and ratiopharm, but not including Schering and Sanofi-Germany. Sanofi Canada and Sanofi-Germany moved to strike out paragraphs of Apotex's defence and counterclaim or, in the alternative, to stay proceedings pursuant to those paragraphs.

The Federal Court, in a decision reported at [2007] F.T.R. Uned. 596, struck out the portion of Apotex's statement of defence containing the Improper Conduct Pleadings as against Sanofi Canada and granted a stay of the portion of the counterclaim containing the Second Conspiracy Pleadings as against Sanofi Canada and Sanofi Germany. Apotex appealed.

The Federal Court of Appeal dismissed the appeal.

Equity - Topic 1482

Equitable principles respecting relief - Clean hands doctrine - Application of - The plaintiffs, Schering Canada Inc. and Sanofi-Aventis Canada Inc. (Sanofi Canada), were the owner and a licensee respectively of Canadian Patent No. 1,341,206 - The plaintiffs sued Apotex Inc. for infringement of the patent, seeking injunctive relief, damages, and an accounting of profits - In its statement of defence, Apotex denied the plaintiffs' entitlement to an accounting of profits on the basis of inequitable and unlawful conduct by the plaintiffs in entering into agreements with ratiopharm inc. and others for the purpose of causing harm to Apotex (the "Improper Conduct Pleadings") - A motions judge struck out the portion of the statement of defence containing the Improper Conduct Pleadings as against Sanofi Canada - Apotex appealed - The Federal Court of Appeal dismissed the appeal - A party would not be disentitled to equitable relief by virtue of inappropriate conduct on its part unless that conduct related directly to the subject matter of that party's claim and the equitable relief sought - There was no relationship between the alleged improper conduct on the part of Sanofi Canada and the equitable relief it sought - The court also commented that the motion judge's determination, that the status of Sanofi Canada as a licensee disqualified it from claiming equitable relief in the infringement action, was unsupportable - The equitable relief sought by Sanofi Canada (injunction and an accounting of profits) had been granted to licensees - See paragraphs 9 to 19.

Patents of Invention - Topic 3102

Infringement of patent - Remedies - Damages or accounting of profits - [See Equity - Topic 1482 ].

Patents of Invention - Topic 3103

Infringement of patent - Remedies - Injunctive relief - [See Equity - Topic 1482 ].

Cases Noticed:

RBM Equipment Ltd. v. Philips Electronics Industries Ltd. (1973), 9 C.P.R.(2d) 46 (F.C.A.), refd to. [para. 10].

Eli Lilly and Co. and Eli Lilly & Co. Canada Ltd. v. Marzone Chemicals Ltd. and the Gardeners Sales Ltd. (1976), 14 N.R. 311; 29 C.P.R(2d) 255 (F.C.A.), refd to. [para. 10].

Procter & Gamble Co. v. Kimberly-Clark of Canada Ltd. (1990), 29 C.P.R.(3d) 545 (F.C.A.), refd to. [para. 10].

Visx Inc. v. Nidek Co. et al. (1994), 87 F.T.R. 96; 58 C.P.R.(3d) 51 (T.D.), refd to. [para. 10].

Volkswagen Canada Inc. v. Access International Automotive Ltd., [2001] 3 F.C. 311; 271 N.R. 363 (F.C.A.), refd to. [para. 10].

Fiberglass Canada Ltd. et al. v. Spun Rock Wools Ltd. et al. (1974), 6 C.P.R. 57 (P.C.), refd to. [para. 13].

Armstrong Cork Canada Ltd. v. Domco Industries Ltd. (1980), 47 C.P.R.(2d) 1 (F.C.T.D), affd. (1980), 54 C.P.R.(2d) 155 (F.C.A.), affd. [1982] 1 S.C.R. 907; 42 N.R. 254; 66 C.P.R.(2d) 46, refd to. [para. 13].

Windsurfing International Inc. v. Bic Sports Inc. (1985), 63 N.R. 218; 8 C.P.R.(3d) 241 (F.C.A.), refd to. [para. 13].

Monsanto Canada Inc. et al. v. Schmeiser et al. (2001), 202 F.T.R. 78; 12 C.P.R.(4th) 204 (F.C.), affd. (2002), 293 N.R. 340; 21 C.P.R.(4th) 1 (F.C.A.), affd. [2004] 1 S.C.R. 902; 320 N.R. 201; 31 C.P.R.(4th) 161, refd to. [para. 13].

Wellcome Foundation Ltd. et al. v. Apotex Inc. (1998), 151 F.T.R. 250; 82 C.P.R.(3d) 466 (T.D.), affd. (2001), 267 N.R. 109; 11 C.P.R.(4th) 218 (F.C.A.), refd to. [para. 13].

Lubrizol Corp. et al. v. Imperial Oil Ltd. et al. (1992), 150 N.R. 207; 45 C.P.R.(3d) 449 (F.C.A.), refd to. [para. 13].

Voith (J.M.) GmbH v. Beloit Corp. (1997), 214 N.R. 85; 73 C.P.R.(3d) 321 (F.C.A.), refd to. [para. 13].

Statutes Noticed:

Federal Courts Act, R.S.C. 1985, c. F-7, sect. 50(1) [para. 21].

Counsel:

David Lederman, for the appellant;

A. David Morrow and J. Sheldon Hamilton, for the respondent, Sanofi-Aventis;

Marc Richard, for the respondent, Schering Corporation.

Solicitors of Record:

Goodmans LLP, Toronto, Ontario, for the appellant;

Smart & Biggar, Toronto, Ontario, for the respondent, Sanofi-Aventis;

Gowling Lafleur Henderson LLP, Ottawa, Ontario, for the respondent, Schering Corporation.

This appeal was heard on May 7, 2008, at Toronto, Ontario, before Linden, Noël and Ryer, JJ.A., of the Federal Court of Appeal. The following judgment of the Court of Appeal was delivered by Ryer, J.A., on May 13, 2008.