Date: 19990211
Docket: T-2520-93
BETWEEN:
RICHTER GEDEON VEGYÉSZETI GYAR RT
Plaintiff
- and -
APOTEX INC.
Defendant
REASONS FOR ORDER
ROTHSTEIN J.
[1] This is an appeal by Apotex Inc. from an order of Giles A.S.P. dated November 9, 1998 made under Rule 382 of the Federal Court Rules, 1998 and pursuant to a Notice of Status Review issued by the Administrator of the Court under Rule 381. Giles A.S.P. ordered that the proceedings should continue as a specially managed case.
[2] Canada v. Aqua-Gem Investments Ltd., [1993] 2 F.C. 425 stands for the proposition that, on an appeal from a prothonotary, where what is involved is a question vital to the final issue of a case, a judge ought to exercise his or her discretion de novo (see page 463). The parties agreed that a decision to dismiss or continue under Rule 382 is such a decision, and therefore a judge on appeal should exercise discretion de novo in these circumstances.
[3] This is a patent infringement action. It was commenced on October 26, 1993. On February 25, 1994, the Defendant filed a Statement of Defence and Counterclaim. The Plaintiff filed a Reply and Defence to Counterclaim on March 11, 1994. Thereafter no steps were taken by either the Plaintiff or the Defendant until April 1998.
[4] On April 29, 1998, Plaintiff's counsel wrote to Defendant's counsel advising that the Plaintiff intended to proceed to a 1999 trial date and proposed a schedule for the conduct of the case.
[5] On May 11, 1998, Plaintiff's counsel again wrote to Defendant's counsel in which he referred to the provision of an affidavit of documents and dates for discovery. The letter also indicated the Plaintiff's intention to proceed with a motion to Court for case management and requested Defendant's counsel reply to the April 29, 1998 letter with respect to the Plaintiff's proposed schedule. Plaintiff's counsel indicated he intended "to file the motion by the end of the week".
[6] On May 13, 1998, Defendant's counsel wrote to Plaintiff's counsel indicating that he expected to be able "to provide [him] with a proposed schedule next week".
[7] On May 20, 1998, Plaintiff's counsel forwarded documents requested by Defendant's counsel.
[8] On May 25, 1998, Defendant's counsel again wrote to Plaintiff's counsel. The tenor of this letter indicates that Plaintiff's counsel was trying to convince Defendant's counsel that the matter need not proceed as quickly as Plaintiff's counsel had originally intended. Because of its significance, I quote the letter in its entirety:
| Thank you for your letter of May 20, 1998 and the enclosed copies of correspondence. |
| You will appreciate that my optimism in conducting discoveries in this matter during the summer, as expressed to you in our telephone conversation, was premised upon a belief that the file had advanced to a point where discoveries were in order. Apart from the fact that Mr. Johnston's file was lost in the transition of Mr. Johnston's retirement from the file, upon my reviewing the matter, it became plain that the proceeding was not ready for discovery. Neither side has delivered an affidavit of documents, despite the fact that the action is over four years old. |
| I am not attempting to delay your client from proceeding with this action. I am simply attempting to ensure that the action proceed in a reasonable fashion taking into account the fact that the action stood idle while your client chose to litigate with Merck and taking into account the fact that, given Mr. Johnston's retirement from the file, my involvement now is equivalent to the action having been newly commenced by your client against Apotex. |
| I am still working diligently with my client and with my colleagues to familiarize myself with the matter and to be in a position to proceed with the action as is reasonably appropriate in all the circumstances. |
| I trust that, in view of all of the foregoing, you and your client will approach the matter reasonably and will afford such reasonable time as is warranted in the circumstances. |
| As a final observation, I note that you and your client have had some four years of involvement with the matter through the Merck litigation. It would, in my view, be entirely inappropriate and unfair to use as a guide by which to assess the pace of the present litigation that which you and your client feel is reasonable given your experience as opposed to that which is reasonable given our lack of experience. |
| I will contact you further so soon as I am in a position to offer you a proposed schedule. |
| [emphasis added] |
[9] It is apparent that Defendant's counsel's position was that in view of the long time the matter had been outstanding and the relative inexperience of Defendant's counsel as compared to Plaintiff's counsel with the file, there was no warrant for proceeding as quickly as Plaintiff's counsel proposed and that when he was ready, Defendant's counsel would provide Plaintiff's counsel with a proposed schedule.
[10] Nothing further was done by either side. On August 13, 1998, the Administrator issued a Notice of Status Review. Submissions were made by the Plaintiff and Defendant culminating in the Order of Giles A.S.P. on November 9, 1998 that the proceeding should continue as a specially managed case.
[11] The basis of the Defendant's position on the Appeal is:
| 1. There is no reasonable explanation by the Plaintiff for its delay; |
| 2. The Defendant will be prejudiced if the matter proceeds. |
[12] I agree with the Defendant that there is no reasonable explanation for the delay between March 1994 and April 1998. However, in April 1998, Plaintiff's counsel, possibly stirred to action by the coming into force of the Federal Court Rules, 1998, began to take steps to move the matter forward. Thereafter, it was Defendant's counsel that retarded the matter. While a defendant may have no obligation to move a matter forward, in this case Defendant's counsel sought, and apparently obtained, agreement from Plaintiff's counsel to proceed at a pace convenient to Defendant's counsel. If Defendant's counsel had not so communicated in this manner to Plaintiff's counsel, it appears that Plaintiff's counsel would have made a motion to have the Court fix the schedule and have the case specially managed. Had this occurred, the Notice of Status Review would likely have been preempted, no question of delay would have arisen and the matter would have continued in accordance with a schedule proposed by the Plaintiff or fixed by the Court.
[13] In these circumstances, after asking for and obtaining tacit agreement from Plaintiff's counsel to proceed at a pace convenient to Defendant's counsel, I think it is inconsistent and inappropriate for Defendant's counsel to try to take advantage of the Notice of Status Review to have the action dismissed.
[14] In the cases cited by Defendant's counsel relative to delay, there were long unexplained delays before the issuance of the Notice of Status Review. In the case at bar, there had been a long delay, but the Plaintiff began to take action before the Notice of Status Review issued and held off on a motion for a schedule and case management because of representations made by Defendant's counsel. This is not the case of a party being out of time and seeking an extension, being required to account for the entire period of delay. There is a reasonable explanation for the delay between April 1998 and the issuance of the Notice of Status Review and it is sufficient in the cirucumstances of this case.
[15] As to the matter of prejudice, it ill lies in the mouth of the Defendant to claim prejudice for delay when the last correspondence was from Defendant's counsel telling Plaintiff's counsel that he would "advise you further so soon as I am in the position to offer you a proposed schedule". Defendant's counsel says the Defendant has been denied the counsel of its choice because counsel originally retained had retired. I have no evidence from the Defendant as to why present counsel, who is well known to the Court as acting for this Defendant, is in any way unsatisfactory. Vague allegations of failed memories of witnesses is not persuasive. More specific evidence is required such as for example, whether recollections will be the sole basis of the evidence or whether indeed, evidence of past factual events will be required. Such evidence has not been provided here. See Birkett v. James (C.A.), 1978 Appeal Cases 297, 304 (C.A.) not disagreed with by the House of Lords on appeal. If the Defendant has been prejudiced in its ability to cap damages, to formulate a different process in a more timely matter or to calculate profits attributable to infringing sales, these are issues that may be addressed if and when damages are to be assessed.
[16] The appeal is dismissed. The order of Giles A.S.P. dated November 9, 1998 is confirmed except that the time limits specified in the order shall run from the date of this order. The parties shall communicate with the registrar forthwith to arrange a conference call to argue the matter of costs.
"Marshall Rothstein"
Judge
Toronto, Ontario
February 11, 1999
FEDERAL COURT OF CANADA
Names of Counsel and Solicitors of Record
COURT NO: T-2520-93
| STYLE OF CAUSE: RICHTER GEDEON VEGYÉSZETI GYAR RT |
- and -
| APOTEX INC. |
DATE OF HEARING: MONDAY, FEBRUARY 1, 1999
PLACE OF HEARING: TORONTO, ONTARIO
REASONS FOR ORDER BY: ROTHSTEIN J.
DATED: THURSDAY, FEBRUARY 11,1999
APPEARANCES: Mr. Ronald Dimock
For the Plaintiff
Mr. Andrew Brodkin
For the Defendant
SOLICITORS OF RECORD: Dimock Stratton Clarizio
| Barristers & Solicitors |
Box 102,
3202-20 Queen Street West
| Toronto, Ontario |
| M5H 3R3 |
For the Plaintiff
Goodman Phillips & Vineberg
Barristers & Solicitors
250 Yonge Street, Suite 2400
| Toronto, Ontario |
| M5B 2M6 |
For the Defendant
FEDERAL COURT OF CANADA
Date: 19990211
Docket: T-2520-93
Between:
| RICHTER GEDEON VEGYESZETI GYAR RT |
Plaintiff
- and -
| APOTEX INC. |
Defendant
REASONS FOR ORDER