Friday, November 25, 2011

Test for a Stay Depends on Whether the Court is Enjoining Another Body, or Delaying Its Own Proceedings

Mylan Pharmaceuticals ULC v. AstraZeneca Canada, Inc. 2011 FCA 312, Stratas JA

In 2011 FC 1023 (blogged here and here), Rennie J granted an order of prohibition in respect of Mylan’s application for an NOC for anastrozole. Mylan is appealing this decision. In this motion, AstraZeneca sought to have the hearing of the appeal stayed until the decision of the SCC in Teva v Pfizer / sildenafil (SCC 33951). The legal issue raised was whether the applicable legal test was the tripartite test set out in RJR-MacDonald Inc. v. Canada (Attorney General), [1994] 1 SCR 311 (the same test as for an interlocutory injunction). Stratas JA held that the RJR-MacDonald test applies only when the Court is enjoining another body from exercising its jurisdiction [5]. In the case where the Court is deciding whether to delay exercising its own jurisdiction, “the demanding tests prescribed in RJR-MacDonald do not apply,” [5] and the question is “whether, in all the circumstances, the interests of justice support the appeal being delayed” [14].

Stratas JA’s decision was supported by some prior FCA authority, in particular Epicept Corporation v Minister of Health, 2011 FCA 209 [14], which is directly on point and to the same effect. Mylan relied on D & B Companies of Canada Ltd. v. Canada (Director of Investigation and Research) (1994), 58 CPR (3d) 342 (FCA) to the contrary. In that case the Competition Tribunal had applied the RJR-MacDonald test in deciding whether to stay its own proceeding, and the FCA affirmed. Stratas JA distinguished D & B Companies on the basis that the FCA decision was staying the proceeding of another tribunal, so RJR-MacDonald properly applied, and the Competition Tribunal, for its part, was entitled to consider whatever factors it considered relevant [10].

These grounds for distinguishing D & B Companies are persuasive in their own terms, but they do not address the point made by Rothstein J, sitting as a judicial member of the Tribunal, in deciding to use the RJR-MacDonald factors. (The decision of the Tribunal is appended to the FCA decision.) Rothstein J recognized that if the respondent sought a stay from the FCA, the FCA would apply the RJR-MacDonald test, and he stated that “I do not understand why the Tribunal, in considering this adjournment application, would apply different principles than the Federal Court of Appeal on the stay application, both relating to the same proceedings.” My own view is that Stratas JA has the better of this debate. As Stratas JA pointed out, “forbidding [a] body from doing what Parliament says it can do. . . .is unusual relief that requires satisfaction of a demanding test,” while a body delaying its own proceedings “is not unlike scheduling or adjourning a matter” [5]. Functionally, the difference is that a body delaying its own proceeding has a better grasp of the practical and policy considerations peculiar to itself, and therefore is in a better position to exercise discretion. I suggest that contrary to Rothstein J’s observation, there is no inconsistency, because the RJR-MacDonald test applied by the reviewing tribunal is more stringent than the considerations applied by the tribunal itself. Consequently, the effect of applying the RJR-MacDonald test when enjoining another tribunal, but not when the tribunal decides whether to stay its own process, is simply to give deference to the tribunal in the control of its own process.

With that said, Stratas JA emphasized that “This is not to say that this Court will lightly delay a matter” [5], and on the facts, the motion for a stay was denied. (A motion brought by Mylan seeking to have the appeal expedited was also decided fo ra variety of reasons specific to the case.)

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