Janssen-Ortho Inc. and Daiichi Pharmaceutical Co., Ltd..v. Novopharm Limited

 

Federal Court (Hughes J.)

 

T-2175-04 October 17, 2006

 

2006 FC 1234 online

 

Anticipation and Obviousness

 

 [98]          Section 2 of the Patent Act, supra, defines an invention in terms of that which is “new and useful”. The Supreme Court of Canada has reminded us that “inventive ingenuity” has also been an essential requirement for a valid patent. (Commissioner of Patents v. Farbwerke Hoechst A/G, [1964] S.C.R. 49 at 51).

 

[99]           The Supreme Court of Canada has recently said that to be valid, a claimed invention must be new, that is, not previously disclosed, whether or not it was inventive; it must be useful; and it must possess inventive ingenuity. (Biolyse Pharma Corp. v. Bristol-Myers Squibb Co., [2005] 1 S.C.R. 533 at para. 1, 2005 SCC 26). The patent monopoly should be purchased with the hard coinage of new, ingenious, useful and unobvious disclosure (Apotex Inc. v. Wellcome Foundation Ltd., [2002] 4 S.C.R. 153 at para. 37, 2002 SCC 77).  The requirement that a patent claim which is “novel” has sometimes been considered by the courts in terms of its antithesis was the claimed invention “anticipated”. Similarly, the requirement of inventive ingenuity has sometimes been considered by the courts as being of its antithesis “obviousness”.

 

[100]       As the Federal Court of Appeal stated in Imperial Tobacco Ltd. v. Rothmans Benson & Hedges Inc. (1993), 47 C.P.R. (3d) 188 at 198, [1993] F.C.J. No. 135 (QL), anticipation and obviousness are both questions of fact but each must be approached differently.  Anticipation means that your claimed invention, whether or not it was inventive, was already known to the public, thus cannot be the subject of a monopoly subsequently given to any one person.  Obviousness means that while the claimed invention may not have been presumably known, it is nonetheless not something that a person can monopolize since it is something that a person skilled in the art would have been expected to come up with in any event.

 

[106]       The House of Lords in Synthon v. SmithKline Beecham PLC’s Patent, [2005] UKHL 59 para. 19 (Lexis), [2006] 1 All. E.R. 685, [2006] RPC 10 has put the matter succinctly:  there are two requirements for anticipation, enablement and disclosure.

 

[107]       The Defendant argues that the phrases “purely by mechanical skill” and “produce the claimed invention without the exercise of any inventive skill” mean that if an ordinary person skilled in the art could bring to bear on the publication the understanding of the day and routine techniques of the day, from which the invention as claimed would result, there is anticipation. This is not the correct interpretation of the test for anticipation as set out by the Supreme Court of Canada.

 

[108]       The Supreme Court test requires that the “flag” be planted at the point of the claimed invention and that the direction as to how to arrive at that point must be so clear such that an ordinary person skilled in the art would in every case, without possibility of error, be led to that point. No such flag is planted and no such direction is given in either the ’840 patent or the Daiichi publication. There is no anticipation of what is claimed in claim 4 of the Patent.

 

Obviousness

 

[109]       Inventive ingenuity is not defined in the Patent Act. Obviousness has only been defined recently in the post-October 1, 1996 version of the Patent Act, section 28.3 (1993, c. 15, s.33) as being “subject matter that would not have been obvious [at the relevant date] to a person skilled in the art… having regard to information disclosed … in such a manner that [it] became available to the public.”  This definition is not different from the law as it was generally understood previously.

 

  [110]       Obviousness is a measure of whether the invention, as claimed, possesses sufficient inventive ingenuity so as to merit the grant of a monopoly. It is to be determined by the Court on the evidence before it, on an objective and principled basis. As Hoffman L.J. said in Société Technique de Pulverisation Step v. Emson Europe Ltd., [1993] RPC 513 at 519 (Eng. C.A.)(Lexis), the question is that of fact and degree which must be answered in accordance with the general policy of the Patent Act to reward and encourage inventors without inhibiting improvements of existing technology by others.

 

[111]       The classic test for obviousness as established by the Federal Court of Appeal is that of Beloit Canada Ltd. v. Valmet OY (1986), 8 C.P.R. (3d) 289 at 294 [Beloit]:

 

The classical touchstone for obviousness is the technician skilled in the art but having no scintilla of inventiveness or imagination; a paragon of deduction and dexterity, wholly devoid of intuition; a triumph of the left hemisphere over the right. The question to be asked is whether this mythical creature (the man in the Clapham omnibus of patent law) would, in the light of the state of the art and of common general knowledge as at the claimed date of invention, have come directly and without difficulty to the solution taught by the patent. It is a very difficult test to satisfy.

 

[112]       This definition comes perilously close to that for anticipation as set out by the Supreme Court of Canada if it is to be interpreted that the person skilled in the art has “no scintilla of inventiveness or imagination” and that being led “directly and without difficulty” to “the solution taught by the patent” means that there must be only one way so as to inevitably arrive at the invention and that the “invention taught’ is different from the claim as properly construed. There would be no point in considering obviousness if it is, in effect, little different than a consideration of anticipation.

 

[113]       A determination of obviousness on a principled and objective basis requires that the Court take into consideration a number of factors. These factors may vary in number and importance dependant upon the circumstances of the case. The Court is not a scientific body, thus it must take the facts of the case, the opinions of the experts and the circumstances as presented into consideration and come up with a weighed decision (Molnlycke AB v. Procter & Gamble Ltd., [1992] FSR 549 (Ch.) (Lexis), [1994] RPC 49 (Ch.) at 442 ff). The factors to be considered as of the date of the invention which can be considered as December 1985, include:

 

1.         What is the invention as claimed? The claim or claims at issue, as construed by the Court is what are at issue. The “invention” as generally expressed in the patent or by the inventors is not the issue, it is the claim as properly construed.

 

2.         Who is the person skilled in the art to whom the patent is addressed? To that extent the uninventive and unimaginative person postulated in the Beloit quotation has been supplanted by the Supreme Court of Canada in Whirlpool at para.74. The Court said that while such a person is deemed to be uninventive as part of his future personality he or she is thought to be reasonably diligent in keeping up with advances in the field to which the patent relates. The common knowledge of skilled workers undergoes continuous evolution and growth.    

 

3.         What body of knowledge and information would the ordinary person skilled in the art be expected to have, or to be reasonably able to obtain, as of the date of the alleged invention? Not all knowledge is found in print form, much is simply commonly known and passed from person to person. Just as one might learn to cook at mother’s elbow, it is not all in the recipe book.  Similarly, not all knowledge that has been written down, perhaps fleetingly, becomes part of the knowledge that an ordinary person skilled in the art is expected to know or find.

 

4.         What is the climate in the relevant field at the time the alleged invention was made? The general state of the art includes not only knowledge and information but also attitudes, trends, prejudices and expectations.

 

5.         What motivation existed at the time the alleged invention was made to solve a recognized problem? There may have been a general motivation such that everybody in the particular area was looking for a solution. The more unique and personal the motivation was, apart from any general motivation, the more one might be expected to be inventive. If motivation came from an outside source, and common place thought and techniques can come up with a solution, the less one is expected to have exercised inventive ingenuity. The United States Supreme Court is expected to consider the issue of motivation shortly in KSR International Co. v. Teleflex Inc., U.S. No. 04-1350 review granted 6/26/06, scheduled to be heard November 28, 2006.

 

6.         What effort and time was involved? Were the efforts randomized or focused? In this regard phrases such as “worth a try” and “directly and without difficulty” and “routine testing” have been used by the courts. It is not useful to use such phrases as they tend to work their way into expressions of law or statements of expert witnesses. Sachs L.J. deprecated the coining of such phrases in General Tire & Rubber Company v. Firestone Tyre & Rubber Company Limited, [1972] R.P.C. 195 at pages 211-12. The length of time and expense involved in the efforts are not, in themselves, useful considerations as an invention may be the result of a lucky hit, or be simply the uninventive application of routine, of time consuming and expensive techniques.

 

Of secondary importance are factors arising after the time that the alleged invention is made since, after all, the Court is to be concerned with “inventive ingenuity” exercised at the time of making the invention. These secondary factors include:

 

7.         Commercial success. Was the subject of the invention quickly and anxiously received by relevant consumers? This may reflect a fact that many persons were motivated to fill the commercial market. This may also reflect things other than inventive ingenuity such as marketing skills, market power and features other than the invention.

 

8.         Subsequently recognized advantages. The inventors may have perceived only certain advantages, yet later those inventors or others may determine that other, previously unrecognized advantages lay in the alleged invention. This factor is of limited usefulness in considering inventive ingenuity as of the date of the invention. The recognition of later advantages, if unexpected, may themselves be the subject of a patent. To the extent that the United States Courts in cases such as Re Zenitz 33 F. 2d 924 have placed weight upon subsequently discovered advantages that is not the law here. Little, if any, weight should be put on this factor.

 

9.         Meritorious awards, if in fact directed to the alleged invention may be recognition that the appropriate community of persons skilled in the art believed that activity to be something of merit.

 

The most dangerous of all the factors and one to be avoided or applied only with the greatest of care is:

 

10.           Hindsight. It is far too easy to see how the alleged invention could have been arrived at, even easily, once it has been done. As some cases say, simplicity does not negate invention. However, if the number of decisions to be made in arriving at the solution were few, and commonplace, hindsight may merely confirm that no inventive ingenuity was required so as to arrive at the solution.  If the points for decision were many and choices abundant, there may be inventiveness in making the proper decisions and choices.

 

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[115]       Therefore, taking all these factors into consideration, the claimed invention is one of the enantiomers of Ofloxacin, a known compound, the S(-) enantiomer in a reasonably pure form.  The separation of racemic compounds into their enantiomers was known, but was a matter of lesser significance in the medicinal chemical world of the early to mid 1980’s.  Known techniques and devices for separation of racemic compounds into their enantiomers could only produce minute quantities of impure material, scarcely enough to interest anyone in activity.  Only Daiichi was motivated to pursue the matter.  Once pressed, it found ways, including a Gerster modification, to produce enough (-) enantiomer to identify it as the S configuration and to determine that it exceeded Ofloxacin as an antibiotic and was at least as good in respect of toxicity; solubility was greater.  With some marketing effort, levofloxacin found a respectable place in the marketplace.  Not the greatest invention, not “eureka”, but of sufficient “inventive ingenuity” to merit valid patent protection as set out in claim 4.

 

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[122]       There is no provision, in section 34(1) for sanctions if a patent fails to describe the invention correctly, fully and, clearly.  However, the Courts have said, for instance, the Supreme Court of Canada in Pioneer Hi-Bred Ltd. v. Canada (Commissioner of Patents), [1989] 1 S.C.R. 1623 at 1637-38, [1989] S.C.J. No. 72 at para. 27 (QL)  [Pioneer Hi-Bred], that a patent must disclose everything that is essential for the invention to function properly.  To be complete a patent must meet two conditions, first it must describe the invention and define the way that it is produced or built, failing which it is ambiguous.  Secondly, the patent must define the nature of the invention and how to put it into operation failing which the patent is invalid for insufficiency. 

 

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[131]       The “old” Patent Act, section 55(1) provides that the patentee, Daiichi, and persons claiming under the patentee, Janssen-Ortho, are entitled to all damages sustained by them by reason of the infringement.  Section 57 given the Court the power, in its discretion to order an injunction and an account of profits.  Normally an order for delivery up or destruction of offending goods would follow an award of an injunction.  As part of the normal function of a superior court of record, this Court may order pre and post judgment interest at rates and on terms as it may determine, and costs.

 

[132]       I have reviewed the consideration of remedies recently in Merck & Co. v. Apotex Inc., 2006 FC 524 at paras. 224-41 [Merck] and the Federal Court of Appeal has given its judgment in respect of that decision on October 10, 2006, 2006 FCA 324 revising to some extent the remedies given in that case.  The award of profits is an equitable remedy, in Merck I disentitled successful plaintiffs from such an award because of certain conduct of that plaintiff.  It is, however, necessary for a party seeking an equitable remedy, such as profits, to show some basis for the exercise of equity.  Here the Plaintiffs have made no showing whatsoever.  I have no reason, other than the Plaintiffs’ success, for making such an award.  Accordingly, I will not award the election of profits.

 

 

[133]       As to an injunction that remedy normally follows a finding that a valid patent has been infringed.  While this action has gone on for a much lesser time than the Merck, supra, action, here only about two years, it must be considered that this Court has in other proceedings refused to prohibit the granting of an NOC to the Defendant so that the Defendant had entered the market and commenced to sell its levofloxacin products.  The English Court of Appeal in Minnesota Mining & Manufacturing Co. v. Johnson & Johnson Ltd., [1976] RPC 671 at 676 et seq reviewed the importance of the exercise of discretion in awarding a permanent injunction.  Accordingly, an injunction will be granted, but to take effect only after thirty days from the date of issuing of these Reasons that is the period of time allowed for filing an appeal.  In that time the Defendant’s may continue to sell or otherwise dispose of its levofloxacin products already in its possession, custody or control, but only in the normal course of business and provided that all monies received in respect thereof are accounted for and held in a separate trust fund to be paid to the Plaintiffs or as they may direct by December 31, 2006.  These monies are to be taken into consideration, by way of set off or otherwise, when a final calculation as to damages is made.

 

[134]       With respect to delivery up or destruction of levofloxacin products, the Defendant may elect to destroy the product that it has on hand at the end of the thirty day period referred to above, or to deliver up that remaining product to the Plaintiffs, as they may direct.  Delivery up should be made within the Greater Toronto area where the Defendant carries on business.  If delivery up is to be made outside that area, the Plaintiffs should bear the cost.

 

[135]       Pre-judgment interest is allowed in respect of any monetary award of damages.  It should not be compounded.  The rate of such interest should be calculated separately for each year since the infringing activity began at the average annual bank rate established by the Bank of Canada as the minimum rate at which it makes short term advances to the banks listed in Schedule I of the Bank Act, R.S.C. 1985, c. B-1.

 

[136]       Post-judgment interest, not compounded, follows the establishment of the quantum of damages at the rate of five percent (5%) established by the Interest Act, R.S.C 1985, c. I-15, s.4.