SUPERIOR COURT OF JUSTICE - ONTARIO

2015 ONSC 7772

COURT FILE NO.: CV-14-514915

MOTION HEARD: OCTOBER 16, 2015

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Apotex Inc. v. Pfizer Ireland Pharmaceuticals and Pfizer Canada Inc.

BEFORE: MASTER R.A. MUIR

COUNSEL: Julie Rosenthal for the plaintiff Rahool Agarwal and Stephen Taylor for defendants

REASONS FOR DECISION

[1] There are two motions before the court but only one issue. Has the defendant Pfizer Ireland Pharmaceuticals (“Pfizer Ireland”) been properly served with the plaintiff’s statement of claim?

[2] Pfizer Ireland seeks a declaration that the purported service of the plaintiff’s statement of claim on Pfizer Ireland is invalid. The plaintiff seeks a declaration that Pfizer Ireland has been properly served with the statement of claim. For the reasons that follow, it is my view that Pfizer Ireland has been properly served.

[3] The plaintiff alleges that Pfizer Ireland is the owner of a Canadian patent relating to the use of a series compounds for the medical treatment of impotence. One of these compounds is known as sildenafil (the “Sildenafil Patent”).

[4] In 2005, Pfizer Ireland commenced an application against the plaintiff in the Federal Court. Pfizer Ireland’s application sought an order prohibiting the Minister of Health from issuing a notice of compliance to the plaintiff for its generic version of sildenafil. Ultimately, Pfizer Ireland’s Sildenafil Patent was declared invalid by order of Justice Zinn of November 20, 2012.

[5] The plaintiff then commenced this action on October 27, 2014. It seeks damages for losses it alleges it suffered as a result of Pfizer Ireland’s Federal Court application. Part of the plaintiff’s claim in this action is made pursuant to section 8 of the Patent Regulations, which was enacted pursuant to section 55.2 of the Patent Act.[^1] The plaintiff’s statement of claim also contains other causes of action based on common law or statutes other than the Patent Act.

[6] When it applied for its Sildenafil Patent in Canada, Pfizer Ireland was required by sections 29(1) and (2) of the Patent Act to appoint a representative in Canada “for all purposes of [the] Act, including the service of any proceedings taken under it”. On November 8, 2002, Pfizer Ireland appointed the law firm Bereskin & Parr as its representative in Canada in relation to the Sildenafil Patent. The appointment document provided Bereskin & Parr with “full powers of agent and representative for service” in respect of the Sildenafil Patent.

[7] On December 18, 2014, the plaintiff purported to serve Pfizer Ireland with the statement of claim in this action by delivering a copy to Bereskin & Parr’s offices in their capacity as Pfizer Ireland’s representative for service in Canada. Pfizer Ireland takes the position that the statement of claim was not properly served. It argues that the statement of claim must be served on Pfizer Ireland at its offices in the Republic of Ireland in accordance with the provisions of the Hague Convention.[^2]

[8] Pfizer Ireland makes a number of arguments in support of its position that section 29(2) of the Patent Act does not apply to the service of the statement of claim in this action. First, it argues that an action based on regulations under the Patent Act is not a proceeding taken under the Patent Act itself. Second, Pfizer Ireland argues that in any event, this action is not a “proceeding” taken under the Patent Act. Third, Pfizer Ireland takes the position that the inclusion of other causes of action based on common law or other statutory causes of action renders section 29(2) inapplicable to this action. Finally, Pfizer Ireland submits that absent any right of service pursuant to section 29(2) of the Patent Act, service of the statement of claim in this action must be made pursuant to the provisions of the Hague Convention in accordance with Canada’s international obligations.

[9] I agree with the plaintiff that the starting point must be the Supreme Court’s approval of the central rule of statutory interpretation in Rizzo & Rizzo Shoes Ltd. (Re)[^3]:

Today there is only one principle or approach, namely, the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament.

[10] Of course, the Interpretation Act[^4] mandates a very similar approach. It provides that every enactment is deemed remedial and shall be given such fair, large and liberal construction and interpretation as best ensures the attainment of its objects.

[11] In my view, the interpretation of section 29(2) of the Patent Act suggested by Pfizer Ireland is simply not consistent with such an approach to statutory interpretation. Pfizer Ireland’s interpretation results in a narrow and unduly restrictive reading of what is a very broad statutory provision. A non-resident owner of a patent must appoint a representative in Canada “for all purposes of [the] Act including the service of any proceedings taken under it”. [Emphasis added]. The plain and ordinary sense of these words requires an expansive interpretation. It makes no logical sense to limit the application of this provision to proceedings authorized by the Patent Act itself and not to include claims authorized by the regulations. I note that section 12(2) of the Patent Act provides that the regulations under the Patent Act have the same force and effect as if they had been enacted as part of the statute. The French version of section 29(2) also supports a broad application of the section with its use of the words “procedures prises sous son régime”. This language would favour a wide interpretation of the English word “Act”.

[12] The legislative history of sections 29(1) and (2) included with the plaintiff’s materials provides some insight into the intention of Parliament when it first enacted the requirement that a non-resident patent owner appoint a representative in Canada. It appears that difficulties were experienced in locating these patent owners for the service of papers and other purposes. The appointment of an agent would address this difficulty. This requirement also makes sense from a policy perspective. Parliament did not create this regime to allow for service on persons who have no connection to Canada. Sections 29(1) and (2) of the Patent Act only apply to non-resident owners of Canadian patents. These persons have chosen to avail themselves of the benefits of Canadian patent law and protection. When they do so, they must appoint a representative for all purposes of the Patent Act, including the service of legal documents. It makes no sense from a policy or logical perspective to allow for service of a proceeding authorized by a section of the Patent Act on the patentee’s representative but require service abroad in accordance with the Hague Convention when the proceeding is pursuant to the regulations under the Patent Act.

[13] Similarly, Pfizer Ireland’s suggestion that this action is not a “proceeding” within the meaning of section 29(2) of the Patent Act also represents an unduly narrow interpretation of the provision. The ordinary grammatical meaning of the word would appear to include an action such as this. The definition of “proceeding” in the Canadian Oxford Dictionary includes an action at law or a lawsuit.[^5] The Rules of Civil Procedure[^6] and the Federal Courts Rules[^7] refer to actions governed by those rules as being proceedings. Elsewhere in the Patent Act, the word “proceeding” is used to refer to actions in the Federal Court and in the provincial superior courts. Parliament was at all times aware that certain Patent Act related proceedings can be taken in the provincial superior courts, including a proceeding taken pursuant to section 8 of the Patent Regulations. In my view, it makes no interpretive sense to limit the scope of section 29(2) in this fashion as suggested by Pfizer Ireland.

[14] I am also unable to accept Pfizer Ireland’s argument that the joinder of other claims with the Patent Act proceeding removes this action from the ambit of section 29(2). The plaintiff’s joinder of its other claims against Pfizer Ireland is presumptively permissible under Rule 5.01(1) of the Rules of Civil Procedure. The joinder of several claims in a single action is commonplace. Parliament is deemed to be aware of this practice and procedure. It enacted and re-enacted section 29(2) of the Patent Act nevertheless. The broad unqualified language of the enactment must be given expansive meaning in the circumstances. Although the plaintiff’s other claims against Pfizer Ireland are not under or pursuant to the Patent Act, they clearly arise from the same set of facts and arise from the dispute surrounding the Sildenafil Patent. The joinder of those additional claims does not conflict with or do harm to the policy objectives of the enactment.

[15] Finally, I agree with the plaintiff that the Hague Convention does not apply in the circumstances of this action. The Hague Convention applies when it is necessary to serve judicial documents outside of Canada. It applies when service on a party must take place in another country. It does not apply if service can be made in Canada. As was stated by this court in Khan Resources Inc. v. Atomredmetzoloto JSC[^8]:

As explained above, however, the court in Schlunk did not mean that the Service Convention always has primacy over state law. State law must be applied first to determine whether service abroad is necessary. If service abroad is necessary, then the application of the Service Convention is mandatory. In other words, the convention is mandatory when domestic law determines that it applies.

[16] In the circumstances of this action, it is my view that the domestic law of Canada, specifically section 29(2) of the Patent Act, allows for the service of this statement of claim on Pfizer Ireland in Canada by service on its registered representative Bereskin & Parr. Service abroad is not required. The Hague Convention does not apply.

[17] The relief requested by the plaintiff is hereby granted. Pfizer Ireland has been properly served with the statement of claim in this action. Service is validated as of December 18, 2014. Pfizer Ireland shall deliver its statement of defence by February 1, 2016 or on such later date as may be agreed to by the parties. Pfizer Ireland’s motion is dismissed.

[18] If the parties are unable to agree on the issue of the costs of these motions they shall provide the court with brief submissions in writing by no later than January 15, 2016.

Master R.A. Muir

DATE: December 10, 2015

[^1]: RSC 1985, c. P-4.

[^2]: Rules and the Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters signed at The Hague on November 15, 1965.

[^3]: 1998 837 (SCC), [1998] SCJ No. 2 at paragraph 21.

[^4]: RSC 1985, c. I-21, section 12.

[^5]: Katherine Barber, The Canadian Oxford Dictionary (Toronto: Oxford University Press, 1998) at 1153.

[^6]: R.R.O. 1990, Reg. 194, Rule 1.03.

[^7]: SOR/98-106, section 2.

[^8]: 2012 ONSC 1522 at paragraph 66; affirmed 2013 ONCA 189.