Time for En Banc Review at the FCA?

Cobalt Pharmaceuticals Co v Bayer Inc / drospirenone (NOC) 2015 FCA 116 Stratas JA: Pelletier, Webb JJA aff’g 2013 FC 1061 Hughes J (blogged here and here)
            2,179,728 / 2,382,426 / drospirenone / YAZ

No new law was applied by the FCA in Cobalt / Drospirenone and the result itself is not surprising, but the decision is nonetheless very interesting. Stratas JA explicitly called for the SCC to provide advice in two different areas, namely the standard of review for claim construction [16] and whether methods of medical treatment should be considered patentable subject matter [101]. Stratas JA also provided an in-depth discussion, albeit in obiter, of whether construction of the claims should be considered a matter of law or fact [16]-[24].

That the FCA called for SCC clarification in two contentious areas of law raises the broader question of what institutional mechanisms should be used to clarify and advance the law. I suggest it is time to seriously consider instituting an en banc mechanism similar to that which is used in both the US appellate system, including the Federal Circuit, and in the EPO with the Enlarged Board of Appeal. In this mechanism, a court which normally sits in panels, will sit with a large number of judges (though not necessarily the full court) to review its own decision in appeals raising important points of law. As the EPO explains, the Enlarged Board of Appeal “clarifies and interprets important points of law . . . and ensures uniform application of the law.” The issues raised in this case illustrate the usefulness of a mechanism for clarification and interpretation of important points of law. An en banc procedure could also usefully address apparent divergences between different panels of the FCA. En banc review would have advantages over the options which are currently institutionally available, namely legislative amendment, review by the SCC, or allowing panels to overrule prior decisions of other panels.

The problem with legislative amendment is obvious: the legislature has a lot on its plate and even very important issues of patent law may not be important enough to warrant legislative action. This is so obvious that in his call for reform Stratas JA addressed himself only to the SCC: he did not bother to say “in the interests of the sound development of the law, I would like to offer certain observations for the legislature to consider.” But much the same can be said about the SCC. The SCC has a limited caseload and it grants leave only in cases which it considers to be “of public importance” (Supreme Court Act s 40; and see here for a general discussion of the factors considered in leave decisions.) As I noted in an earlier post, “The SCC only hears about 60 cases a year, including many as of right criminal appeals, and it has an understandable focus on constitutional and criminal law cases. With what remains it has to deal with every other area of private law. The SCC simply does not have the ability to deal with every confused technical area of law, no matter how important that area might be to some parties.” It is true that the SCC is more accessible than the legislature and it is certainly more likely to act on technical matters of law such as the nature of appellate review, but the fact remains that the SCC cannot deal with every area of patent law that requires clarification or reform.

The problem of accessibility does not arise if we look to individual panels of the FCA, but individual panels simply lack the requisite institutional authority. This is quite apart from any argument that a panel should not be permitted to change or depart from settled law in order to preserve the expectations of the parties. Even if we were to say that it is permissible for an individual panel to depart from settled law, doing so would be more likely to further confuse difficult areas of law. The views of any panel, even the most recent to opine on a particular issue, carry no more weight than the panels that went before it. If one panel purported to change or clarify the law, the next panel to hear the same issue would be perfectly justified in saying that the opinion of the panel that had changed the law deserved no more weight than any of the panels that went before it, and so the supposed change was ineffective. Certainly, a well reasoned opinion of one panel may be so persuasive that subsequent panels will follow it for that reason; and more broadly, mechanisms of comity can cause the law to evolve and become clearer through the decisions of multiple panels. Such a process often does work effectively to resolve difficult new issues of law. But sometimes even new issues prove intractable; and the mechanism of incremental change through the decisions of individual panels is much less effective to address the problem which arises when law which is taken to be settled in principle proves to be problematic in practice.

So, en banc review is more accessible than the legislature or the SCC and it is more authoritative and potentially quicker than the decisions of individual panels. With that said, I can think of a couple of objections to en banc review, though none which strike me as compelling. One is that the law once settled, should not be changed. But that is not an argument against en banc review; it is an argument against changing the law through any mechanism, including SCC review and legislative change. And if the issue is one of clarification or interpretation rather than change, then by definition there are no settled expectations to be disturbed.

The other objection is that en banc review will not be useful when the problematic law is SCC precedent. While it is true that not even an en banc panel of the FCA could overrule the SCC, that only limits the scope of en banc review in some cases. So, one of the areas addressed by the FCA was methods of medical treatment. As Stratas JA noted “The current law in this Court is that methods of medical treatment are not patentable. . . . The provenance of this is Tennessee Eastman Co. et al. v. Commissioner of Patents, [1974] S.C.R. 111, 33 D.L.R. (3d) 459, a decision based on former subsection 41(1) of the Patent Act, now repealed.” As Stratas JA points out, and as the SCC has affirmed, Tennessee Eastman itself was based on s 41. As discussed here, the notion that methods of medical treatment remain unpatentable despite the repeal of s 41 stems from the interpretation of Tennessee Eastman by the FCA itself in ICI (1986) 9 CPR(3d) 289, subsequently affirmed in other FCA decisions. While the law is settled, changing it would not require the FCA to overrule the SCC, but only to overrule its own prior decisions.

The question of the correct standard of appellate review of claim construction is different, because of the authority of the SCC in Whirlpool 2000 SCC 67 [61] holding that “claims construction is a matter of law for the judge.” I will discuss this in more detail in Monday’s post. For now I will just saw that I think the law could be considerably clarified and improved in this area without overruling Whirlpool. And even if I am wrong about that, if en banc review can authoritatively tackle even half the contentious patent issues that come to the FCA, that would be very helpful.