The Federal Court of Appeal (FCA) has decided that the Federal Court's Notice to the Profession regarding experimental testing (the Notice) does not apply to testing conducted in advance of litigation. As a result, parties wishing to lead evidence of pre-litigation testing at trial are not required to obtain leave of the Court.
Background
This decision was rendered in the context of actions for patent infringement under the Patented Medicines (Notice of Compliance) Regulations. Bayer Inc. and Bayer Intellectual Property GMBH (Bayer) initiated actions against Apotex Inc. (Apotex) and Teva Canada Limited (Teva) after receiving their respective notices of allegation in relation to Bayer's product, XARELTO (rivaroxaban). More than a year before Bayer commenced its litigation against the defendants, Bayer had conducted experimental tests in contemplation of future litigation. After the actions were started, Bayer informed the defendants of its intention to rely on the testing at trial. Apotex and Teva objected, taking the position that the Notice required Bayer to obtain leave of the Court in order to lead its testing evidence.
The Notice states that in an action for infringement or validity of a patent, where a party intends to establish any fact by experimental testing conducted for the purpose of the litigation, it must provide reasonable notice to the other parties two months before the scheduled service of the expert report to which the testing relates. If the party intending to rely upon the experiments has not properly advised the other parties, it is unable to lead the testing evidence at trial without leave of the Court.
The Decisions
Bayer brought a motion for the Court to determine the admissibility of its pre-litigation testing evidence. The Federal Court (FC) held that the Notice did not require Bayer to obtain leave to lead this evidence. Apotex and Teva appealed. The FCA dismissed the appeal for substantially the same reasons as the motion judge.
Both the FC and the FCA noted that the Notice contained indications that it was only intended to apply in the context of ongoing litigation. For example, the Notice refers to "other parties", "adverse parties", "facts in issue", and the "case management judge". Further, the Notice contains a deadline that is connected to the service of expert reports and refers to testing conducted "for the purpose of the litigation". The FCA found that these statements in the Notice contemplate that litigation has already commenced.
The FCA went on to comment that the Notice reflects a long-standing general practice of the Court set out in the case law. To date, the requirement to advise that experiments will be conducted has only been applied in the context of ongoing litigation. The FCA noted that if the Chief Justice of the FC intended the Notice to extend to experimental tests commenced prior to litigation, the Notice likely would have expressly said so.
Originally published 23 April, 2020
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