Micro Chemicals Ltd. v. Rhone-Poulenc, S.A.

Micro Chemicals Ltd. v. Rhone-Poulenc, S.A.

Where a compulsory licence expressly limits sales to products 'to be used in Canada', a licensee (or related domestic entities acting with knowledge and coordination) that sells product resulting in export acts outside the scope of the licence and infringes the patentee's rights; the licence defines the legal justification for manufacture and sale and cannot be circumvented by inter-company arrangements.

Citation
[1965] SCR 284
Parties
Defendant/appellant: Micro Chemicals Limited; Defendant/appellant: Gryphon Laboratories Limited; Defendant/appellant: Paul Maney Laboratories Canada Limited; Plaintiff/respondent: Rhone-Poulenc, S.A.
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
21 December 1964
Procedural Posture
Patent Infringement (compulsory Licence) / Appeal to Supreme Court of Canada From the Exchequer Court; Judgment Delivered 1964 12 21
Outcome
Appeal dismissed; judgment of Noël J. of the Exchequer Court sustained; costs awarded to respondent; directions as to assessment of damages upheld.
Legal Topics
Compulsory Licence, Licence Limited to Domestic Use, Patent Infringement, Statutory Interpretation
Source Language
English
Intellectual Property Patent Law Compulsory Licence Licence Limited to Domestic Use Patent Infringement Statutory Interpretation

Case Brief

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Parties

Micro Chemicals Limited

Defendant/appellant

Gryphon Laboratories Limited

Defendant/appellant

Paul Maney Laboratories Canada Limited

Defendant/appellant

Rhone-Poulenc, S.A.

Plaintiff/respondent

Procedural Posture

Patent Infringement (compulsory Licence) / Appeal to Supreme Court of Canada From the Exchequer Court; Judgment Delivered 1964 12 21

Legal Issues

  1. 1 Whether a compulsory licence limited to sale 'to be used in Canada' permits sales by the licensee (or related domestic companies) that result in export
  2. 2 Whether transactions among related companies with common officers constitute an evasion of licence restrictions
  3. 3 Whether purchasers' downstream actions can absolve a licensee of breach when licence restricts export

Ratio Decidendi

Where a compulsory licence expressly limits sales to products 'to be used in Canada', a licensee (or related domestic entities acting with knowledge and coordination) that sells product resulting in export acts outside the scope of the licence and infringes the patentee's rights; the licence defines the legal justification for manufacture and sale and cannot be circumvented by inter-company arrangements.

Court Disposition

Appeal dismissed; judgment of Noël J. of the Exchequer Court sustained; costs awarded to respondent; directions as to assessment of damages upheld.

Orders

  • Appeal dismissed with costs
  • Judgment of Noël J. sustained including directions as to the assessment of damages