Federal Court Finds a Second NOA not to be an Abuse of Process

In Eli Lilly Canada Inc v Novopharm Limited et al (2007 FC 596), Justice Hughes of the Federal Court held that it was not an abuse of process for Novopharm Limited (Novopharm) to serve a second Notice of Allegation (NOA) on Eli Lilly Canada Inc (Lilly) after Novopharm withdrew its first NOA days before Novopharm's evidence was due. Novopharm did not provide any explanation why it withdrew the first NOA. Novopharm's second NOA differed from its first in that Novopharm did not include allegations of indefiniteness and overbreadth, which had been in the first NOA, and Novopharm included additional allegations directed to double patenting, section 53 of the Patent Act and inoperability, which had not been included in the first NOA. (Section 53 of the Patent Act provides that if a patentee has wilfully misled the Patent Office by providing in the specification more or less information than is needed to describe the invention, the patent may be invalid). The Court held that Novopharm's second NOA was not an abuse of process because the Patented Medicine (Notice of Compliance) Regulations did not offer a practical way of amending an NOA other than by withdrawing the NOA. If a generic manufacturer was willing to suffer cost penalties and a new 24-month stay by withdrawing an NOA, the Court would not find that it was an abuse of process. The Court qualified this holding by stating that a generic manufacturer would not be able to serve a new NOA directed to the issue of validity (unless a new matter not previously discoverable arose) if the court were seized of the matter at a hearing on the merits or if a decision had been made by the court. Justice Hughes also considered the effect on the current proceedings of a recent decision of the Federal Court which involved the validity of the same patent but was between Lilly and another generic manufacturer, Apotex Inc (Eli Lilly Canada Inc v Apotex Inc, 2007 FC 455). The Court held that the proper approach would be to compare the reasons for judgment given by the Court in the first proceeding involving Apotex and determine if there is better evidence or a more appropriate legal argument made by the generic manufacturer in the second proceeding. If the Court did not find that there was better evidence or a more appropriate argument, it would be an abuse to permit the matter to be considered again. Justice Hughes also cautioned both parties on the number of expert witnesses put forward. Section 7 of the Canada Evidence Act permits a party to submit no more than five expert witnesses per issue. In a subsequent decision of the Federal Court, Altana Inc v Novopharm Limited (2007 FC 637), Madame Prothonotary Tabib limited Altana Inc. to five expert witnesses for the issue of infringement and held that infringement was one issue, despite the fact that the Notice of Allegation related to two patents with use and formulation claims. For the full reasons for judgment, see: http://decisions.fct-cf.gc.ca/en/2007/2007fc596/2007fc596.html Summary by: Katharine McGinnis