GOOD FAITH IN CANADIAN PATENT PRACTICE: LUNDBECK V RATIOPHARM RAISES THE BAR

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1 GOOD FAITH IN CANADIAN PATENT PRACTICE: LUNDBECK V RATIOPHARM RAISES THE BAR LOUIS-PIERRE GRAVELLE AND DANIEL C. SMITH * ROBIC, LLP LAWYERS, PATENT AND TRADE-MARK AGENTS In Lundbeck Canada Inc. et al. v ratiopharm inc. et al. i, the Canadian Federal Court Trial division - found that misleading statements made by an applicant showed a lack of good faith which invalidated the subsequent patent. Background Paragraph 73(1)(a) of the Canadian Patent Act ( Act ) states that a patent application shall be deemed to be abandoned if the applicant does not reply in good faith to any requisition made by an examiner. Until Lundbeck, the only decision which seriously considered the scope of paragraph 73(1)(a) was G.D. Searle & Co. v. Novopharm ii wherein Justice Hughes likened the process of applying for a patent to an ex parte proceeding: only the applicant and the Patent Office examiner are involved in dialogue (at 72) and that [i]t is not harsh or unreasonable, if after a patent issues, the disclosure is found to lack good faith, that the Court may deems the application and thus the patent to have been abandoned (at 73). However, between G.D. Searle and Lundbeck, the Courts pronouncements regarding candour and good faith have been inconsistent at best. Justice Shore seemingly contradicted Justice Hughes in Janssen-Ortho Inc. v Apotex Inc. iii in remarking that [w]hile a duty of candour and good faith exists during the prosecution of patent applications in the United States Patent Office, a similar duty does not exist in Canada (at 201). This contrast was remarked upon by Justice Hughes himself, prior to Lundbeck, in Mycogen Plant Science Inc. v Bayer et al. iv, where he contrasted the stances taken in G.D. Searle and Janssen-Ortho and CIPS, * Of ROBIC, LLP a multidisciplinary firm of lawyers, patent agents and trade-mark agents. The author wishes to thank Simon Picard, articling student at ROBIC, LLP, for his valuable research and contribution to this article. Published in the May 2010 issue of Intellectual Property Magazine. Publication

2 2 concluded that [g]iven the uncertainty of the state of the law as to the duty of candour, I cannot find that it is plain and obvious that a plea of lack of candour cannot succeed if appropriate relief as a result can be claimed (at 19). Prosecution of CA 2,426,492 In response to a request from the Canadian examiner, Lundbeck identified two references cited during the application s international phase. In doing so, Lundbeck neither commented on nor provided copies of these references. Later, and in response to the examiner s rejection of the claims for being directed to a mere aggregation of two known types of compounds, Lundbeck stated that there were numerous articles in the prior art which warned against [the claimed combination] and brought forward four references to back up this assertion. Lundbeck further stated that the claimed combination would thus have been counter-intuitive and definitely improbable in view of the prior art available at the time of filing (emphasis added) and that the teachings of the prior art as a whole would not have prompted the skilled person to elaborate the instant composition (emphasis added). Unfortunately for Lundbeck, one of the two previously identified references, Wenk, not only contradicted these assertions but was in fact far more pertinent to the claimed subject matter than any of the four references discussed in Lundbeck s response. This did not come to the examiner s attention and the application was subsequently allowed. Federal Court decision In her conclusions, Justice Mactavish echoed the parallels Justice Hughes drew to ex parte proceedings and noted that a party seeking ex parte relief must do more than simply present its own case in the best possible light, as would be the case if the other side were present. Rather, the applicant must state his or her own case fairly and must inform the Court of any points of fact or law known to it which favour the other side (at 331). In ignoring Wenk, Lundbeck did not fairly or accurately represent the state of the prior art (at 341) and had failed to fulfill its duty of good faith imposed by paragraph 73(1)(a) of the Act. The application was therefore retroactively abandoned and Lundbeck s patent invalid.

3 3 Comparison with US law 37 CFR 1.56 of the U.S. Patent Rules sets out that [e]ach individual associated with the filing and prosecution of a patent application has a duty of candor and good faith in dealing with the Office, which includes a duty to disclose to the Office all information known to that individual to be material to patentability no patent will be granted on an application in connection with which fraud on the Office was practiced or attempted or the duty of disclosure was violated through bad faith or intentional misconduct (emphasis added). Two distinctions arise: first, in finding the patent invalid Justice Mactavish did not comment on whether Lundbeck s transgression was either intentional or material. Although not at issue in this case, section 53(1) of the Act states that a patent is void if the specification or drawings contain more or less than is necessary for obtaining the end for which they purport to be made, and the omission or addition is wilfully made for the purpose of misleading (emphasis added). Crucially, paragraph 73(1)(a) contains no such qualification. Moreover, ratiopharm insisted that it was not alleging Lundbeck acted in bad faith, but rather showed simply a lack of good faith. Indeed, regarding materiality, Justice Mactavish found that Wenk neither anticipated nor rendered obvious Lundbeck s claims. Murkier, however, is the second distinction: the duty of candour in the U.S. includes an ongoing duty to disclose all known references to the examiner. The Canadian Patent Rules establish a mechanism whereby an examiner may request that an applicant identify all prior art references cited in corresponding applications, but this request is neither automatic nor ongoing. Whether or not Justice Mactavish s comments that an applicant must inform the Court of any points of fact or law known to it which favour the other side extends now to a positive, ongoing duty of disclosure remains to be seen. Practical considerations First and foremost, Canadian patent agents must be careful not to overstate their case when characterising the prior art. When possible, discussion should be limited to the cited prior art and broad statements regarding the prior art as a whole should be avoided in particular. Secondly, a Canadian patent s file wrapper has gone from being largely irrelevant to validity to now being extremely relevant. Any mischaracterisation or misleading statement, however unintentional or immaterial, could seemingly now be considered a lack of good faith and grounds for invalidity under section 73(1)(a) of the Act.

4 4 ROBIC, un groupe d'avocats et d'agents de brevets et de marques de commerce voué depuis 1892 à la protection et à la valorisation de la propriété intellectuelle dans tous les domaines: brevets, dessins industriels et modèles utilitaires; marques de commerce, marques de certification et appellations d'origine; droits d'auteur, propriété littéraire et artistique, droits voisins et de l'artiste interprète; informatique, logiciels et circuits intégrés; biotechnologies, pharmaceutiques et obtentions végétales; secrets de commerce, know-howet concurrence; licences, franchises et transferts de technologies; commerce électronique, distribution et droit des affaires; marquage, publicité et étiquetage; poursuite, litige et arbitrage; vérification diligente et audit. ROBIC, a group of lawyers and of patent and trademark agents dedicated since 1892 to the protection and the valorization of all fields of intellectual property: patents, industrial designs and utility patents; trademarks, certification marks and indications of origin; copyright and entertainment law, artists and performers, neighbouring rights; computer, software and integrated circuits; biotechnologies, pharmaceuticals and plant breeders; trade secrets, know-how, competition and antitrust; licensing, franchising and technology transfers; e-commerce, distribution and business law; marketing, publicity and labelling; prosecution litigation and arbitration; due diligence. COPYRIGHTER IDEAS LIVE HERE IL A TOUT DE MÊME FALLU L'INVENTER! LA MAÎTRISE DES INTANGIBLES LEGER ROBIC RICHARD NOS FENÊTRES GRANDES OUVERTES SUR LE MONDE DES AFFAIRES PATENTER R ROBIC ROBIC + DROIT +AFFAIRES +SCIENCES +ARTS ROBIC ++++ ROBIC +LAW +BUSINESS +SCIENCE +ART THE TRADEMARKER GROUP TRADEMARKER VOS IDÉES À LA PORTÉE DU MONDE, DES AFFAIRES À LA GRANDEUR DE LA PLANÈTE YOUR BUSINESS IS THE WORLD OF IDEAS; OUR BUSINESS BRINGS YOUR IDEAS TO THE WORLD Trade-marks of ROBIC, LLP ("ROBIC")

5 i (2009) FC 1102 ii (2007) FC 81; iii (2008) FC 744 iv (2009) FC