Apotex Inc. v. Shire LLC, 2016 FC 1267

Apotex Inc. v. Shire LLC, 2016 FC 1267

In the context of a patent impeachment action, the Defendants, Shire LLC and Shire Pharma Canada ULC (“Shire”), brought a motion to strike portions of the Reply of the Plaintiff, Apotex Inc.

Shire first sought to strike an allegation that was found by the Court to be solely a statement of legal conclusions to be drawn from the facts already pleaded in the Statement of Claim. While Parties are not required to raise points of law in their pleadings, if they do, such pleadings do not bind either the Court or the Parties. Hence, the Court concluded that striking a legal conclusion is a waste of its time, and this portion of the motion was dismissed.

Shire next took issue with portions of the Reply purporting to raise Section 53 of the Patent Act as a new ground of invalidity. Allegations of fraud under s. 53 require full particulars, however, Apotex failed to plead sufficient material facts to disclose a reasonable cause of action. Instead, Apotex made only vague allegations about “assertions” as to the utility of the invention made by Shire to the Patent Office. The Court struck these portions of the Reply, noting that implicit allegations of fraud are not proper pleadings. Apotex was instructed that if it wished to raise a new ground of invalidity pursuant to s.53, it would have to move to amend its Statement of Claim, not add them to its Reply.

Although Shire was only partially successful on the motion, they were granted elevated costs, as the Court disapproved of the casual and thoughtless allegations of fraud made by Apotex under s.53. The Court issued a stern warning against “procedural gamesmanship” and stated that it will not hesitate to sanction such behavior through cost awards.

Summary prepared by Aleksandra (Sasha) Gracia.  The case is available HERE.