Canada’s Patent Regime Forecloses Civil Actions by Consumers in British Columbia

Canada’s patent laws are a complete code giving consumers no right to independent civil actions. This was the conclusion of the British Columbia Court of Appeal in Low v Pfizer Canada Inc, a decision which may impede indirect purchaser class actions for patent law breaches that might have resulted from several recent Supreme Court of Canada decisions addressing indirect purchaser class actions, discussed previously on this blog.

The Fight Against Pfizer

In Low v Pfizer, the British Columbia Court of Appeal overturned the certification of a class action relating to Viagra. In 2012, the Supreme Court of Canada determined that Pfizer’s patent for Viagra was invalid based on the failure of the company to comply with patent disclosure requirements. Low, who was a consumer of Viagra, alleged that Pfizer had unlawfully abused the patent system and had thus prevented cheaper generic versions of the drug from entering the market. Low argued that, as a result, Pfizer had overcharged the purchasers of Viagra. He sued Pfizer in a proposed class action on behalf of all purchasers of Viagra in British Columbia between 2006 and 2012.

The chambers judge certified the class, finding that Low’s claims of unjust enrichment and unlawful interference with economic relations were not bound to fail. However, the Court of Appeal disagreed.

The Canadian patent regime is made up of a number of statutes and regulations. The Court of Appeal found that it is a complete code in that it governs the marketing of patented drugs, including all rights and remedies. The regime confers no direct rights or protections on consumers. That does not leave the door open for enterprising consumers to search out civil causes of action under which to sue patent holders. The Court stated that in circumstances such as these, where the government has comprehensively legislated a particular area of the law, the reasonable conclusion is that it did not intend to extend rights of recovery beyond those expressly included in the regime.

One of the effects of this conclusion was that the claim of unlawful interference with economic relations could not succeed. That cause of action requires, in order to fulfill the “unlawful” requirement, that a breach of statute be actionable outside of the context of the statute itself. Having concluded that the completeness of the patent regime forecloses all civil actions of consumers rooted in the Patent Act, this cause of action had no likelihood of success.

The Court further distinguished its earlier decision in Wakelam v. Wyeth Consumer Healthcare on the grounds that the British Columbia consumer protection regime at issue in Wakelam is not a complete statutory code that excludes equitable claims in unjust enrichment. Even if the patent regime was not a complete code, Low’s claim of unjust enrichment was bound to fail, as contracts between Pfizer and direct purchasers constituted a juristic reason for Pfizer’s gains.

Impact Going Forward

It remains to be seen whether this decision will be applied to other heavily regulated industries. For now, it is clear that consumers attempting to bring patent-related class actions may find it difficult to find a cause of action that will lead to certification.

Subscribe to this blog
Via RSS Feed

Deborah Glendinning

Partner, Litigation

Sonia Bjorkquist

Partner, National Chair, Litigation

Éric Préfontaine

Partner, Litigation

Christopher Naudie

Partner, Litigation

Craig Lockwood

Partner, Litigation

Tristram Mallett

Partner, Litigation

Karin Sachar

Associate, Litigation