Following the Federal Court’s decision that Bayer’s patent relating to YAZ and YASMIN (both containing drospirenone and ethinyl estradiol) was valid and infringed by Apotex and Cobalt, Apotex argued that it, rather than Bayer, should be entitled to elect between damages and an accounting of profits. As we reported, the court disagreed, and ordered that Bayer has the right to elect.
Apotex appealed and asked that the court choose an accounting of profits. The Federal Court of Appeal (FCA) dismissed Apotex’s appeal, finding that the Federal Court did not err in its interpretation of the Patent Act.
Only the patentee can elect an accounting of profits
Apotex argued the Patent Act allows both a plaintiff and a defendant to request that the court grant the remedy of accounting of profits, and that an infringer is not prevented from electing the way in which damages are calculated. Additionally, Apotex argued the trial judge failed to consider and address circumstances that would have led to the exercise of discretion to award an accounting of profits.
The FCA rejected Apotex’s assertion as an “astounding proposition.” In reviewing the case law and legislative history, the FCA held that the election of an accounting of profits belongs to the patentee only, subject to the court’s discretion. The FCA also held that the patentee always has a right to damages under the Patent Act, and the court cannot force a patentee to choose an accounting of profits over its damages, unless it is willing to seek such a remedy. Justice Nadon noted Apotex was unable to point to a single case where the infringer was able to select the remedy and he agreed with the trial judge that allowing Apotex to elect an accounting of profits “would turn the doctrines of equity and parliamentary sovereignty on their heads.”
Liability decision: Bayer Inc v Apotex Inc, 2016 FC 1013
Order allowing the election between damages and an accounting of profits: Bayer Inc v Cobalt Pharmaceuticals Company, 2016 FC 1192