16 | LEXPERT • December 2017 | www.lexpert.ca/usguide-litigation/
be obvious if you have no idea what the result would be?"
So while Bristol-Myers managed to stave off Teva's entry to
market with its generic drug, its success was limited. "It's true that
the court cut the baby in half by finding that the patent on the
compound was valid but that the patent on the salt was not," says
Donald Cameron, who heads Bereskin & Parr LLP's litigation
group in Toronto. "But Teva still got to market about 20 months
earlier than it could have had the salt patent not been ruled
invalid. It's just another example of generics coming at innovators
and trying to get in on the market for a remunerative drug as early
as possible." — J.M.
8.
R. v. Aitkens
e proposed Financial CHOICE Act in the US would do many
things — from defanging the Dodd-Frank Wall Street Reform
and Consumer Protection Act to sending fewer securities cases to
US Securities and Exchange Commission administrative tribu-
nals and instead sending them into federal court, which oen
means a jury trial. In Canada, jury trials are all but unheard of for
securities fraud, a decision recently tested and reinforced by the
country's highest court.
In R. v. Aitkens, 2017 SCC 14, the Alberta Securities Commis-
sion charged Ronald Aitkens with trading in securities without
registration; distributing securities without a prospectus; making
false or misleading statements in an offering memorandum; and
perpetrating a fraud on investors. Under Alberta's Securities Act
(and the Canadian provinces and territories have largely coordi-
nated statutes), the maximum penalty for securities violations is
five years less a day, plus fines of up to C$5 million.
What difference does that day make? A world of difference, if
you're the defendant. Canada's Charter of Rights and Freedoms
stipulates that an accused only has the right to a jury trial in cases
where the penalty is five years or more. Aitkens brought a Charter
challenge, arguing that he faced a more severe punishment than
five years of imprisonment because of the potential for a fine as
well; therefore he was entitled to a jury trial.
His lawyers argued that Alberta's Provincial Court lacks the
jurisdiction to conduct a jury trial, and the question of whether
the Court of Queen's Bench has jurisdiction to conduct a jury
trial over a provincial offense is a question of law to be determined
only by the Court of Queen's Bench, so they applied for an order
that his case be transferred to the superior court.
e Provincial Court of Alberta denied the application. Jury
trials for securities cases in Canada are "almost non-existent," says
Jeffrey Leon, a partner and co-head of litigation in the Toronto
office of Bennett Jones LLP.
Aitkens appealed, and his appeal was lumped in with R. v.
Peers, 2015 ABCA 407, another securities case using the same
legal argument. e difference is, Peers had another Alberta
Provincial Court judge who had permitted the transfer to the
Court of Queen's Bench, which promptly punted the case back.
nonetheless agreed with Teva that the Salt Patent claims were
obvious. e inventive concept in the patent, she concluded, was
the anhydrous crystalline solid form of the drug, whose stabil-
ity improved its bioavailability compared to the free-base version.
But Justice Mactavish found that the improved bioavailability
was obvious and that the other characteristics of the salt were
inherent to it and not an invention.
Bristol-Myers appealed. e company argued that, since
Mactavish had decided that each of the elements of the inven-
tive concept could not be predicted, she was bound to decide the
"obvious to try" test in its favor. e Federal Court of Appeal
agreed that the Salt Patent was obvious. But the court also found
that Justice Mactavish erred in focusing on the salt's properties in
articulating the inventive concept. Instead, the inventive concept
was the solution taught by the patent, which was the creation of
a product that was pharmaceutically acceptable because of its
enhanced bioavailability.
Still, the Salt Patent was obvious because its inventive concept
was indistinguishable from the prior art. If there were any differ-
ences, "the common general knowledge of the person skilled in
the art" could discern them. Although it was unnecessary in
this case to apply the "obvious to try" test, the inventive concept
articulated by the appellate court would also have been obvious
to try, as evidenced by the nature and extent of the meager effort
required to formulate the salt.
Steven Mason, a partner in McCarthy Tétrault LLP's Toronto
office, who was part of the firm's team representing Bristol-Myers,
says that the result was "disturbing" to his client. "is was an
invention that was unknown and unpredictable, involving a
particular salt with important pharmacological properties that
could not have been foreseen, and that resulted in a drug that
was very useful and very important for the treatment of a deadly
condition," he says. "But the court said that the fact that the
outcome couldn't be predicted and that the result was a surprise
was not enough to establish patentability. But how can something
Donald Cameron
Bereskin & Parr LLP
"It's true that the court
cut the baby in half
by finding [in Bristol-
Myers Squibb v. Teva]
that the patent on the
compound was valid
but that the patent on
the salt was not. But
Teva still got to market
about 20 months earlier
than it could have …"
CROSS-BORDER SIGNIFICANCE
