Wednesday, December 11, 2013

How High a Bar for Overruling Prior FCA Decisions?

Eli Lilly Canada Inc. v. Apotex Inc. / olanzapine (NOC) No.2 2013 FCA 282 Evans JA: Stratas, Webb JJA aff’g 2010 FC 952 Gauthier J

 Under the “no reach back” rule established in Apotex v Syntex / naproxen (NOC) 2010 FCA 155 aff’g 2009 FC 494 and re-affirmed in Pfizer Canada Inc. v Ratiopharm / amlodipine besylate (NOC) 2011 FCA 215 (blogged here) the Court will not reach back and retroactively set aside an order of prohibition obtained in an NOC proceeding solely because the patent has been held invalid in a subsequent action. The consequence is that the generic will not be entitled to damages under s 8 of the NOC Regulations, which is triggered by success in the NOC proceeding itself, even though it will have been held off the market by an invalid patent. (See here for my posts on related cases).

In this proceeding, Apotex asked the FCA to reconsider this rule. The FCA declined, on the basis of stare decisis:

[8] Because this Court is normally bound by its own decisions, Apotex can only succeed in this appeal if it satisfies us that Syntex and Ratiopharm should not be followed because they are "manifestly wrong" within the narrow meaning of Miller v. Canada (Attorney General), 2002 FCA 370 at paras. 8, 10, and 22 (Miller). They were not per incuriam, nor subsequently overruled or seriously attenuated by decisions of the Supreme Court of Canada.

It is interesting to contrast the “manifestly wrong” standard applied by the FCA in overruling its own decisions, with the standard set out by the SCC in Canada v. Craig, 2012 SCC 43 [24]-[28] for overruling the SCC’s own decisions. The SCC does not provide a rule, but rather (unsurprisingly, from the SCC) engages in “a balancing exercise between the two important values of correctness and certainty,” [27], giving “careful and respectful consideration” [26] to the earlier decision. This appears to be a significantly lower standard than “manifestly wrong.” That impression is confirmed by the result in Craig, which the SCC overruled a prior decision on the basis that it was wrong (though there was no suggestion that it was manifestly wrong), and there had been significant judicial and academic criticism of the prior decision.

Of course, there is an important difference between the FCA and the SCC, that would justify a higher threshold for the FCA to overrule its own decisions; as the FCA stated in Miller, “The Supreme Court of Canada will normally be the appropriate forum for correcting the errors of intermediate courts of appeal” [8]. Because there is no higher court to correct the SCC, it must be more willing to correct its own errors.

While there is certainly merit to this argument, a difficulty is that the SCC according to Sopinka J is "not a court of error and the fact that the court of appeal reached the wrong result is in itself insufficient" for the SCC to grant leave. The statutory criteria for granting leave is whether the question involved is of such “by reason of its public importance. . . one that out to be decided by the Supreme Court” (Supreme Court Act s 41), and, as Sopinka J has written:

On a fundamental level, whether or not the Court of Appeal was “wrong” had little if anything to do with whether the case is one of public importance.

See this article by a former SCC law clerk (one of my co-clerks, as it happens), quoting Sopkina J (at 90 and 91) and describing the reasons for granting leave.

So, as a practical matter, the FCA is perhaps not so different from the SCC. If the SCC wrong, the legislature can correct the error, and if the FCA is wrong, the SCC can correct it, but in either case, the mechanism for correction is difficult to invoke and likely to be used only in a minority of cases. That does not mean the FCA is wrong in setting a high threshold; arguably the SCC is wrong in being too ready to overrule itself.

While the question of the test the FCA should apply before reversing itself is interesting, I doubt a lower standard would have helped Apotex in this case. According to the FCA, “[t]he principal argument advanced by Apotex in the present appeal for our revisiting the issue decided in Syntex and Ratiopharm is that the Court relied on a decision of the English Court of Appeal, Unilin Beheer BV v. Berry Floor N V, [2007] EWCA Civ. 364 (Unilin), which was subsequently overruled by the Supreme Court of the United Kingdom in Virgin Airways Limited v. Zodiac Seats UK Limited, [2013] UKSC 46" [10]. But so far as I can tell, the FCA did not rely on Unilin; it was relied on by Hughes J at first instance in Syntex. As the FCA pointed out [11], its own decisions turned primarily on the interpretation of s 8 of the NOC regulations in the context of that particular statutory scheme. This appears to be a case in which the same point was simply being re-argued. Certainty is a very important consideration, and in such a situation, perhaps “manifestly wrong” is the best standard to apply before reversing a settled point.

No comments:

Post a Comment