Rhoxalpharma Inc. v. Novartis Pharmaceuticals Canada Inc.

Rhoxalpharma Inc. v. Novartis Pharmaceuticals Canada Inc. Court (s) Database Federal Court of Appeal Decisions Date 2005-05-16 Neutral citation 2005 FCA 188 File numbers A-213-04 Decision Content Date: 20050516 Docket: A-213-04 Citation: 2005 FCA 188 CORAM: DESJARDINS J.A. NADON J.A. PELLETIER J.A. BETWEEN: RHOXALPHARMA INC. Appellant (Respondent) and NOVARTIS PHARMACEUTICALS CANADA INC. and NOVARTIS AG Respondents (Applicants) and THE MINISTER OF HEALTH Respondent (Respondent) "Dealt with in writing without appearance of parties" Order delivered at Ottawa, Ontario, on May 16, 2005. REASONS FOR ORDER BY: PELLETIER J.A. CONCURRED IN BY: DESJARDINS J.A. NADON J.A. Date: 20050516 Docket: A-213-04 Citation: 2005 FCA 188 CORAM: DESJARDINS J.A. NADON J.A. PELLETIER J.A. BETWEEN: RHOXALPHARMA INC. Appellant (Respondent) and NOVARTIS PHARMACEUTICALS CANADA INC. and NOVARTIS AG Respondents (Applicants) and THE MINISTER OF HEALTH Respondent (Respondent) REASONS FOR ORDER PELLETIER J.A. [1] This is a motion under Rule 403 for directions to be given to the Assessment Officer with respect to the assessment of costs following a successful appeal. Following the decision of this Court in Consorzio del Prosciutto di Parma v. Maple Leaf Meats Inc., [2003] 2 F.C. 451, 2002 FCA 417, such a motion should be heard and disposed of by the panel of the Court which heard the original appeal. [2] The litigation arose under the Patented Medicines (Notice of Compliance) Regulations, SOR 93/133, as amended (the Regulations), and has a long and rich history. For these purposes it can be summarized as follows. The respondents Novartis Pharmaceutical Canada Inc. and Novartis AG (collectively Novartis) own a patent with respect to a hydrosol of cyclosporine. The applicant Rhoxalpharma Inc. (Rhoxalpharma) sought a Notice of Compliance with respect to a drug it had developed which, while not containing a hydrosol of cyclosporine, resulted in the formation of a hydrosol of cyclosporine in the stomach when ingested. Rhoxalpharma served Novartis with a Notice of Allegation with respect to the 100 mg capsule of its drug. In response, Novartis initiated proceedings under section 6 of the Regulations for an order prohibiting the Minister from issuing a Notice of Compliance. [3] That application was heard by Tremblay-Lamer J. of the Federal Court who dismissed it. By the time Novartis' appeal came on for hearing, the Notice of Compliance had been issued. Rhoxalpharma argued that Novartis' appeal was therefore moot, a submission which was accepted by this Court. [4] Rhoxalpharma then served Novartis with a second Notice of Allegation with respect to the 25 mg and 50 mg capsules of the drug. Once again, Novartis initiated prohibition proceedings, in which the same technical issues were raised, as was the question of issue estoppel, given the decision with respect to the 100 mg capsule. Lemieux J. of the Federal Court declined to apply issue estoppel on the basis of equitable considerations. He considered the evidence put before him, which differed in material respects from the evidence before Tremblay-Lamer J., and came to the conclusion that Rhoxalpharma's drug did infringe Novartis' patent. [5] Rhoxalpharma appealed to this Court where, Pelletier J.A. dissenting, it was successful. The order allowing the appeal says "The appeal is allowed with costs, the decision of the motions judge is set aside, and Novartis' application is dismissed." [6] In its submissions in response to this motion, Novartis pointed out that the Court's order made no mention of costs in the Court below and that, following Canada v. Canadian Pacific Ltd., (2002) 289 N.R. 159, 2002 FCA 98, the Court's order as to costs cannot be amended by way of a motion for directions under Rule 403. [7] In response, Rhoxalpharma filed a reply in which it requested, in the alternative, that the Court's order as to costs be reconsidered and that it be awarded its costs in the Federal Court as well as in the Court of Appeal. Since there is no provision in the Rules for a Reply to a Reply, Novartis wrote to the Court to say that it was being deprived of its right to respond to the request for reconsideration and that, in any case, the case was clearly not one which fell within the terms of Rule 397(1). There is no suggestion that the order does not comply with the reasons given for it, nor that a matter which ought to have been dealt with was overlooked. [8] The issue of reconsideration is not one which should be dealt with incidentally to the motion for directions as it will have a significant impact upon the outcome. But I agree with Novartis that reconsideration cannot be raised for the first time in a Reply to the Respondent's submission. The matter should be addressed squarely by a motion seeking the relief with the appropriate affidavits and arguments in support. And since the time for bringing a motion for reconsideration has long since passed, a motion for an extension of time will also be required. [9] As a result, the Court's consideration of the motion for directions will be suspended to allow Rhoxalpharma to raise the issue of reconsideration in the appropriate form. "J.D. Denis Pelletier" J.A. " I concur Alice Desjardins J.A." "I concur M. Nadon J.A." FEDERAL COURT OF APPEAL NAMES OF COUNSEL AND SOLICITORS OF RECORD DOCKET: A-213-04 APPEAL FROM A JUDGMENT OR AN ORDER OF FEDERAL COURT, FEDERAL COURT FILE NO. T-462-02 STYLE OF CAUSE: Rhoxalpharma Inc. and Novartis Pharmaceuticals Canada Inc. and Novartis AG and The Minister of Health MOTION DEALT WITH IN WRITING WITHOUT APPEARANCE OF PARTIES REASONS FOR ORDER BY: PELLETIER J.A. CONCURRED IN BY: DESJARDINS J.A. NADON J.A. DATED: May 16, 2005 WRITTEN REPRESENTATIONS BY: Mr. Hilal El Ayoubi FOR THE APPELLANT (RESPONDENT) Ms. Jennifer Wilkie FOR THE RESPONDENTS Mr. Marc Richard (APPLICANTS) SOLICITORS OF RECORD: Fasken Martineau DuMoulin LLP FOR THE APPELLANT Montréal, Québec (RESPONDENT) Gowling Lafleur Henderson LLP FOR THE RESPONDENTS Ottawa, Ontario (APPLICANTS) John H. Sims, Q.C. Deputy Attorney General of Canada FOR THE RESPONDENT Ottawa, Ontario (RESPONDENT)