Wednesday, November 8, 2023

Nova v Dow: Miscellaneous Policy Issues

Nova Chemicals Corp v Dow Chemical Co 2022 SCC 43 Rowe J: Wagner CJ, Moldaver, Karakatsanis, Brown, Martin, Kasirer and Jamal JJ concurring; Côté J dissenting affg Nova Chemicals Corporation v Dow Chemical Company 2020 FCA 141 Stratas JA: Near, Woods JJA affg Dow Chemical Co v Nova Chemicals Corp 2017 FC 350, 2017 FC 637 Fothergill J

2,160,705 / film-grade polymers / ELITE SURPASS

The Intuition / The Legal Background / Causation as a Matter of Fact / The Concession / What Role for “But For” Causation in Identifying the NIO? / Summary of the Summary / Causation Concept in the Absence of an NIO / What is the NIO? / The Value of the Invention / Rivett on the Facts / Three Policy Arguments / The Source of the Chilling Effect

In a previous post I discussed the three main policy arguments raised by Rowe J in support of his approach to an accounting of profits, arguing that they in fact support an accounting based on “but for” causation. My last post then addressed the crucial policy issue of the chilling effect. There are two more policy arguments raised by Rowe J. While I address them at more length in Part II of my forthcoming article for completeness in canvassing the policy issues, I will mention them only briefly here as they did not seem to play a major role in Rowe J’s reasoning.

First, Rowe J said that an accounting “discourages efficient infringement: when an infringer’s profits exceed the damages suffered by the patentee” [47]. This is probably a reference to the “catch-me-if-you-can” problem, described by Zinn J at first instance in Rivett 2009 FC 317 [23]. As I explain in more detail in the article, this argument does not support Rowe J’s approach to an accounting because a “but for” accounting is entirely adequate to address the problem and does so without risking a chilling effect.

Second, Rowe J also asserted that “smaller businesses would be disproportionately disadvantaged by [“but for” causation]” [64]. With due respect, this argument is simply not serious, for reasons I discuss in detail in Part II of my the article. The only explanation for it is that Rowe J was casting about for additional arguments to bolster a decision he had already made for other reasons.

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