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Patents - Infringment Remedies. Nova Chemicals Corp. v. Dow Chemical Co.
In Nova Chemicals Corp. v. Dow Chemical Co. (SCC, 2022) the Supreme Court of Canada generally considered patent infringment remedies:A. Remedies in Patent Law
[7] Below I define three patent law remedies and explain how they relate to each other. The three statutory remedies I define are (1) reasonable compensation, (2) damages, and (3) an accounting of profits.
Reasonable Compensation
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Reasonable compensation can be granted for any loss caused by the infringer’s use of the invention between the patent’s publication and the grant of the patent.
This remedy is authorized by s. 55(2) of the Patent Act, R.S.C. 1985, c. P-4.
This remedy typically entitles a patentee to a “reasonable royalty” (S. J. Perry and T. A. Currier, Canadian Patent Law (4th ed. 2021), at §§17.93-17.94).
A reasonable royalty is “that which the infringer would have had to pay if, instead of infringing the Patent, [the infringer] had come to be licensed under the Patent” (AlliedSignal Inc. v. Du Pont Canada Inc. (1998), 1998 CanLII 7464 (FC), 78 C.P.R. (3d) 129 (F.C. (T.D.)), at para. 199, quoting Unilever PLC v. Procter & Gamble Inc. (1993), 47 C.P.R. (3d) 479 (F.C. (T.D.)), at p. 571 (text in brackets in original)). “The test is what rate would result from negotiations between a willing licensor and a willing licensee” (para. 199).
Damages
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Damages compensate the patentee for all pecuniary losses causally attributable to infringement after the grant of the patent.
This remedy is authorized by s. 55(1) of the Patent Act.
Damages can include lost profits on sales or due to depression of prices, and lost income from licensing opportunities, among others (Perry and Currier, at §17.9).
Accounting of Profits
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An accounting of profits requires that the infringer disgorge all profits causally attributable to infringement of the invention after the grant of the patent.
This remedy is authorized by s. 57(1)(b) of the Patent Act.
This remedy is an alternative to an award of damages (Apotex Inc. v. ADIR, 2020 FCA 60, 172 C.P.R. (4th) 1, at para. 35). It is an equitable, discretionary remedy (AlliedSignal Inc. v. Du Pont Canada Inc. (1995), 61 C.P.R. (3d) 417 (F.C.A.), at pp. 444-46). Judges may consider practical consequences, including expediency, misbehaviour by litigants, and whether the patentee practices the invention itself when exercising this discretion (K. Andrews and J. de Beer, “Accounting of Profits to Remedy Biotechnology Patent Infringement” (2009), 47 Osgoode Hall L.J. 619, at p. 641; Bayer Inc. v. Cobalt Pharmaceuticals Co., 2016 FC 1192, 142 C.P.R. (4th) 374, at paras. 6 and 10; Seedlings Life Science Ventures, LLC v. Pfizer Canada ULC, 2021 FCA 154, at paras. 76 and 79-81 (CanLII)). At para 42-67 to court considers the purpose of an 'accounting of profits' and 'non-infringing options'.
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