Date: 19991214
Docket: A-36-98
CORAM: STONE, J.A.
LINDEN, J.A.
ROTHSTEIN, J.A.
BETWEEN:
APOTEX INC.
Appellant
(Defendant)
- and -
MERCK & CO. INC., and
MERCK FROSST CANADA INC.
Respondents
(Plaintiffs)
Heard at Toronto, Ontario, Monday, December 13, 1999
and Tuesday, December 14, 1999
Judgment delivered from the Bench at Toronto, Ontario
on Tuesday, December 14, 1999
REASONS FOR JUDGMENT OF THE COURT BY: STONE J.A.
Date: 19991214
Docket: A-36-98
CORAM: STONE, J.A.
LINDEN, J.A.
ROTHSTEIN, J.A.
BETWEEN:
APOTEX INC.
Appellant
(Defendant)
- and -
MERCK & CO. INC., and
MERCK FROSST CANADA INC.
Respondents
(Plaintiffs)
REASONS FOR JUDGMENT OF THE COURT
(Delivered from the Bench at Toronto, Ontario
on Tuesday, December 14, 1999)
STONE J.A.
This is an appeal from a judgment of MacKay J. dated January 23, 19981 dismissing the appellant"s motion in the action for relief against the operation of paragraph 3 of the judgment at trial2. By that judgment a permanent injunction was granted to the respondents from infringing patent rights contained in Canadian Patent No. 1,275,349 of October 16, 1990 (the "patent"). The judgment was varied on appeal3 which left paragraph 3 intact. Applications by both sides for leave to appeal to the Supreme Court of Canada were dismissed.4
The relief sought by the appellant"s motion reads as follows:
| 1. Amending or varying paragraph 3 of the Trial Judgment dated December 22, 1994 as varied by the Court of Appeal Judgment dated April 19, 1995 amended May 16, 1995 ("Trial Judgment") to provide that Apotex is restrained and enjoined from infringing Canadian Letters Patent No. 1,275,349 (""349 Patent") by manufacturing, using, offering for sale and selling, in Canada or elsewhere, dosage forms containing enalapril maleate as an active ingredient and directing a trial of the issues set out in Schedule "A" hereto (the "Issues") [[i.e., Schedule "A" to Apotex" motion]; |
| 2. In the alternative to paragraph [1], staying the operation [of] paragraph 3 of the Trial Judgment except as to the activity described in paragraph 1 hereof pending trial of the Issues, or in the alternative, pending further order of the Court in an action to be commenced by Apotex and Signa S.A. de C.V. in the form attached hereto as Schedule "B" ("Signa Action") [i.e., Schedule "B" to Apotex" motion]; |
| 3. In the alternative to paragraphs 1 and 2, amending or varying paragraph 3 of the Trial Judgment to provide that Apotex is restrained and enjoined from infringing "349 Patent by manufacturing, using, offering for sale and selling, in Canada or elsewhere, dosage forms containing compounds falling within the scope of claims 2 to 5 of the "349 Patent and directing a trial of the Issues; |
| 4. In the alternative to paragraphs 1 to 3 staying the operation of paragraph 3 of the Trial Judgment except as to the activity described in paragraph 3 hereof pending trial of the Issues, or in the alternative, pending further order of the court in the Signa Action. |
The underlying purpose of the motion is apparent from the "issues" which the appellant seeks to have tried. If the motion is successful, the way would then be open for the appellant to contest in this or another action the validity of Claim 1 of the patent as well as the composition and use Claims 8 and 11 by limiting the scope and operation of paragraph 3 of the trial judgment to that of restraining and enjoining the manufacture, use, offering for sale and selling by the appellant in dosage forms containing the compound enalapril maleate and no other compound.
The appellant argues that this relief should be available in the circumstances because the broad scope of Claim 1 prevents the appellant from using and selling compounds that were developed subsequent to the trial judgment, which arguably fall within the scope of that claim but not within the scope of Claims 2 to 5 which are said to relate specifically to the compound enalapril and its salts including enalapril maleate. Therefore, unless paragraph 3 of the trial judgment is varied or stayed, the appellant would be prevented from litigating the validity of Claim 1 and the other claims it now seeks to impeach. This, argues the appellant, would result in keeping the appellant out of the market in using and selling the newly developed compounds that are available from Signa S.A. de C.V. and would cause the appellant irreparable harm.
The appellant draws attention to the Statement of Claim in the action, and argues that it is focussed essentially on the alleged infringement of the patent by the use and sale in dosage form of enalapril maleate which the appellant had acquired either before October 16, 1990, when the patent was issued, or from a licensed supplier after that date. The appellant thus asserts that it was sufficient that it raised a defence that was specific to that particular allegation of infringement and that it did so by relying successfully on section 56 of the Patent Act. The appellant concedes that having done so, it would not now be permissible to question the validity of Claim 1 as a defence to use and sale of additional quantities of any subsequently acquired enalapril maleate, but that paragraph 3 of the trial judgment ought to be varied or stayed so that the validity of Claim 1 may be litigated and a judicial determination made of whether the appellant would infringe the patent by using and selling the newly developed compounds.
As MacKay J. noted, the allegations of infringement contained in the Statement of Claim were not confined to that of the manufacture and sale of enalapril maleate. In his words5:
| [18] Whatever Apotex" intent may have been at the time, its view now, on reflecting back, ignores several relevant factors in the context of the pre-trial preparations and the trial itself. First, while the Statement of Claim alleges infringement by manufacture and sale of enalapril maleate, it also sets out, inter alia , |
| 21. By reason of the acts of the Defendant set out herein, the Defendant has infringed claims 1 to 5 and 8 to 15 of the Patent. |
| 22. The Plaintiffs are not aware of the full extent of the Defendant"s infringements but claim relief in respect of all acts of infringement by the Defendant. |
| 23. The Defendant will continue to infringe the rights of the Plaintiffs unless restrained by this Honourable Court. |
| ... |
| 26. THE PLAINTIFFS THEREFORE CLAIM: |
| (a) a declaration that claims 1 to 5 and 8 to 15 of the Canadian Letters Patent No. 1,275,349 have been infringed by the Defendant; |
| (b) an injunction, both interlocutory and permanent, restraining the Defendant by its officers, directors, servants, agents, employees, or otherwise, from infringing claims 1 to 5 and 8 to 15 of the Canadian Letters patent No. 1,275,349. |
| By its terms, Merck"s Statement of Claim sought relief that is broader in its application than concern exclusively with Apotex" enalapril maleate tablets. It sought protection of the full scope of its patent, as defined by the claims specified in that statement. |
In dismissing the motion, MacKay J. expressed the following view having regard to the manner in which the pleadings were framed and to other factors examined by him6:
| Implicitly, the validity of [claim 1], supported by the Act and not questioned by Apotex, underlies the finding of infringement and the injunction order so far as those relate to claim 1. |
To his mind, whatever authority the Court might possess to vary the trial judgment, it was without jurisdiction in the circumstances to vary the terms of the injunction and direct the trial of issues. Otherwise, there would be "no end of litigation" when there ought to be aside from "exceptional circumstances".7 This principle precluded the exercise of any discretion that the Court might otherwise have to reopen the trial and direct the trial of issues or to vary the terms of the injunction for that purpose. He was of the further view that the Court lack jurisdiction to stay the operation of the permanent injunction. While the appellant argued that the doctrine of res judicata had no application in the circumstances, MacKay J. accepted the respondents" contention that it was not a relevant consideration with respect to the sought-after reopening of the trial judgment, although it might be a relevant consideration in a separate action by the appellant to impeach the validity of Claim 1.
In view of the manner in which the cause of action was framed in the pleadings, we are unable to accept that the issue of infringement at trial was fundamentally confined to that involving only the use and sale of enalapril maleate. Paragraph 22 of the Statement of Claim claimed "relief in respect of all acts of infringement by the Defendant", and not only those acts that involved the use and sale of the enalapril maleate. That plea was not attacked as improper before the action was tried, and, indeed, the case proceeded to trial on the basis of the whole of the pleadings.
Moreover, paragraph 2 of the appellant"s Amended Defence appears to have conceded that "for the purpose of the within action only" the registered owner of the patent would be entitled to the exclusivity granted under the Patent Act in respect of the claims in the patent. That paragraph reads:
| 2. With respect to paragraphs 6, 7 and 8 of the Statement of Claim, subject to section 56 of the Patent Act and the availability of licenced enalapril and enelapril maleate, and for the purpose of the within action only, the Defendant admits that the Plaintiff, Merck & co. Inc, as registered owner of Canadian Letters Patent No., 1,275,349 (the "Patent") would be entitled to the exclusivity granted under the Patent Act in respect of the claims in the Patent, save and except as to the claims relating to the dosage form of the compounds and their use as more particularly claimed in claims 8 to 17 inclusive of the Patent, the validity of which claims is not admitted but denied, as more particularly set out below. |
It seems to us that, having regard to that plea, an issue with respect to the validity of Claim 1 may not now be raised in the action seeing that the action has been finally disposed of at trial and on appeal. The trial judgment was based to an extent on this concession of exclusivity in respect of claims in the patent in determining that Claim 1, among other claims, had been infringed. It seems to us, as well, that invalidity of Claims 8 and 11 as a defence were squarely raised by the appellant at trial and was determined against it.
If the concession in paragraph 2 of the Amended Defence is not to be viewed in the manner we have just indicated, it seems to us that the issue of validity of Claim 1 ought to have been raised at the trial itself. While section 56 of the Patent Act turned out to be a sufficient defence to the claimed infringement by use and sale of enalapril maleate prior to the issuance of the patent, it did not extend to the use and sale of other compounds covered by Claim 1 which, in our view, are encompassed in the plea contained in paragraph 22 of the Statement of Claim.
The policy of the law strongly favours the finality of court orders, not only so as to ensure the certainty of transactions but also the integrity of the judicial process8. In a passage from a decision of the Supreme Court of Nova Scotia en banc that was quoted with apparent approval by the Supreme Court of Canada9, it was stated10:
| The doctrine of res judicata is founded on public policy so that there may be an end of litigation, and also to prevent the hardship to the individual of being twice vexed for the same cause. The rule which I deduce from the authorities is that a judgement between the same parties is final and conclusive, not only as to the matters dealt with, but also as to questions which the parties had an opportunity of raising. It is clear that the plaintiff must go forward in the first suit with his evidence; he will not be permitted in the event of failure to proceed with a second suit on the ground that he has addition evidence. In order to be at liberty to proceed with a second suit he must be prepared to say: "I will shew you this is a fact which entirely changes the aspect of the case, and I will shew you further that it was not, and could not by reasonable diligence have been ascertained by me before." |
This policy is of long-standing and has been consistently upheld and applied by the highest authorities both in England11 and in Canada12 for at least a century and a half. It was first enunciated in 1843 by Vice-Chancellor Wigram, as follows13:
| In trying this question I believe I state the rule of the Court correctly when I say that, where a given matter becomes the subject of litigation in, and of adjudication by, a Court of competent jurisdiction, the Court requires the parties to that litigation to bring forward their whole case, and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matter which might have been brought forward as part of the subject in contest, but which was not brought forward, only because they have, from negligence, inadvertence, or even accident, omitted part of their case. The plea of res judicata applies, except in special cases, not only to points upon which the Court was actually required by the parties to form an opinion and pronounce a judgment, but to every point which properly belonged to the subject of litigation, and which the parties, exercising reasonable diligence, might have brought forward at the time. |
More recently, in a passage that was also quoted with apparent approval by the Supreme Court of Canada, Lord Denning M.R. stated14:
| The law, as I understand it, is this: if one party brings an action against another for a particular cause and judgment is given on it, there is a strict rule of law that he cannot bring another action against the same party for the same cause. Transit in rem judicatam . . . But within one cause of action, there may be several issues raised which are necessary for the determination of the whole case. The rule then is that, once an issue has been raised and distinctly determined between the parties, then, as a general rule, neither party can be allowed to fight that issue all over again. The same issue cannot be raised by either of them again in the same or subsequent proceeding except in special circumstances. ... And within one issue, there may be several points available which go to aid one party or the other in his efforts to secure a determination of the issue in his favour. The rule then is that each party must use reasonable diligence to bring forward every point which he thinks would help him. If he omits to raise any particular point, from negligence, inadvertence, or even accident (which would or might have decided the issue in his favour), he may find himself shut out from raising that point again, at any rate in any case where the self- same issue arises in the same or subsequent proceedings. But this again is not an inflexible rule. It can be departed from in special circumstances... |
In view of the manner in which the cause of action was framed in the pleadings, we are of the opinion, as Vice-Chancellor Wigram put it, that the validity of Claim 1 was a "point which properly belonged to the subject of litigation" and therefore ought to have been raised at trial. If it had been raised and accepted it could well have afforded the appellant a defence to the whole of the Statement of Claim quite apart from the defence that was based on section 56 of the Patent Act .
The appellant contends, nevertheless, that "special circumstances" exists in the present matter that takes it outside of the rule enunciated by Vice-Chancellor Wigram. This is, basically, that the compounds that the appellant now wish to use and sell were not developed before the judgment at trial, combined with the submission that the essential focus of the action at trial was different. In our view, this does not furnish a sufficient answer. Before the matter proceeded to trial the appellant was faced with all of the allegations asserted and with the relief claimed in the Statement of Claim. Section 56 of the Patent Act as a defence might have provided a partial answer to the allegations and it proved to do so. It did not, however, provide an answer to the broad plea contained in paragraph 22 of the Statement of Claim and the related relief claimed in paragraph 26. In our view, therefore, the appellant is foreclosed from raising that issue in the action at this stage well after trial judgment and appeal.
The appeal will be dismissed with costs.
"A. J. Stone"
J.A.
FEDERAL COURT OF CANADA
Names of Counsel and Solicitors of Record
DOCKETS: A-36-98
| STYLE OF CAUSE: APOTEX INC. |
Appellant
(Defendant)
| - and - |
| MERCK & CO. INC., and |
| MERCK FROSST CANADA INC. |
Respondents
(Plaintiffs)
DATE OF HEARING: MONDAY, DECEMBER 13, 1999 and
| TUESDAY, DECEMBER 14, 1999 |
PLACE OF HEARING: TORONTO, ONTARIO
REASONS FOR JUDGMENT
| OF THE COURT BY: STONE J.A. |
Delivered at Toronto, Ontario on Tuesday, December 14, 1999
APPEARANCES: Mr. Harry Radomski and
| Ms. Daniela Bassan |
| For the Appellant (Defendant) |
Mr. G.A. Macklin
| For the Respondents (Plaintiffs) |
| SOLICITORS OF RECORD: Goodman, Phillips and Vineberg |
Barristers & Solicitors
| 2400-250 Yonge Street |
Toronto, Ontario
| M5B 2M6 |
| For the Appellant (Defendant) |
| Gowling Strathy & Henderson |
Barristers & Solicitors
| 2600-160 Elgin Street |
Ottawa, Ontario
| K1P 1C3 |
| For the Respondents (Plaintiffs) |
FEDERAL COURT OF APPEAL
Date: 19991214
Docket: A-36-99
BETWEEN:
| APOTEX INC. |
Appellant
(Defendant)
| - and - |
| MERCK & CO. INC., and |
| MERCK FROSST CANADA INC. |
Respondents
(Plaintiffs)
| REASONS FOR JUDGMENT |
| OF THE COURT |
__________________
1 The judgment is reported as Merck & Co. et al. v. Apotex Inc. (1998), 143 F.T.R. 161.
2 Paragraph 3 reads as follows:
3. The Defendant, by its officers, directors, servants, agents, employees, or otherwise, is hereby restrained and enjoined from infringing claims 1 to 5 and 8 to 15 inclusive of Canadian Letters Patent No. 1,275,349, and in particular from manufacturing, using, offering for sale and selling, in Canada or elsewhere, APO-ENALAPRIL tablets or any tablets or other dosage forms containing enalapril maleate as an active ingredient, manufactured from bulk enalapril maleate contained in lots P-65478, P-65479 and P-65480 as well as from the 44.9 kilograms of enalapril maleate, referred to in paragraph 1 hereof.
The trial judgment is reported as Merck & Co. Inc. et al. v. Apotex Inc. (1994), 59 C.P.R. (3d) 133 (F.C.T.D.).
3 The judgment is reported as Apotex Inc. v. Merck & Co. et al. (1993), 60 C.P.R. (3d) 356 (F.C.A.).
5 Reasons for Judgment, at p.p. 12-13.
8 Hogue v. Montreal Trust Co. et al. (1997), 162 N.S.R. (2d) 321 (N.S.C.A.), per Cromwell J.A. at p. 340.
9 Town of Grandview v. Doering, [1976] 2 S.C.R. 621, at p.p. 636-37.
10 Fenerty v. The City of Halifax (1920), 50 D.L.R. 425, per Drysdale J. at p.p. 437-38.
11 See e.g. Hoystead v. Federal Commissioner of Taxation , [1925] A.C. 155 (P.C.); New Brunswick Railway Company v. British and French Trust Corporation, Limited, [1939] A.C. 1 (H.L.); Yat Tong Investments Co. Ltd. v. Dao Heng Bank Ltd., [1975] A.C. 581 (P.C.); Brisbane City Council v. Attorney-General for Queensland, [1978] A.C. 411 (P.C.); Arnold v. National Westminister Bank PLC, [1991] 2 A.C. 93 (H.L.), per Lord Keith, at p.p. 104-05.
12 Town of Grandview, supra, note 9, at p. 637.
13 Henderson v. Henderson (1843), 3 Hare 100, at p.p. 114-5.
14 Fidelitas Shipping Co., Ltd. v. V/O Exportchleb, [1966] 1 Q.B. 630 (C.A.), at page 640, as quoted by Ritchie J. in Town of Grandview, supra, note 9, at p. 637.