The State of the Art on State of the Art?

Ciba Specialty Chemicals Water Treatments Ltd v SNF Inc 2017 FCA 225 Pelletier JA: Rennie JA, concurring reasons by Woods JA aff’g 2015 FC 997 Phelan J
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Under the “old” Patent Act the body of prior art that may be set up against the patent in an obviousness attack did not include all publicly available information that could be set up in a novelty attack, but only that which was generally known to a person skilled in the art or which would be discovered in a reasonably diligent search. As Hughes J noted in Merck v Pharmascience 2010 FC 510, [37], there is a “quaere” as to whether codification of the obviousness requirement in s 28.3 of the new Act, which requires a person skilled in the art to have regard to information “available to the public” as of the claim date, has changed the law in this respect, so that all publicly available prior art may be used in an obviousness attack, regardless of whether it would have been discovered by a reasonably diligent search. In my article, What is the State of the Art for the Purpose of an Obviousness Attack? (2012) 27 CIPR 385, I reviewed the debate. While the text of 28.3 does imply that all publicly available prior art may be set up against the patent in an obviousness attack under the new Act, I concluded, based on contextual and purposive considerations, that on balance the better view is that s. 28.3 was not intended to change the law.

In Ciba Specialty Chemicals Water Treatments Ltd v SNF Pelletier JA, with Rennie JA agreeing, held that all prior art that is available in a novelty attack is also part of the state of the art for the purposes of an obviousness attack [51]-[63]. This implies that the codification did indeed change the law, though Pelletier JA did not say so expressly. Woods JA concurred in the result, but declined to express an opinion on this point [99], saying “The issue is better addressed in an appeal where it is relevant to the outcome and in which the Court has the benefit of full submissions from counsel, which was not the case here” [100]. I must say that I agree entirely with Woods JA. While the position taken by Pelletier JA is a reasonable one which is supported by the text of s 28.3, some important interpretive arguments were not addressed, presumably because the Court did not have the benefit of full submissions on this point.

Pelletier JA relied primarily on the text of 28.3 [51], [57], which does indeed clearly support his position. The remainder of the points made by Pelletier JA are, in my view, more questionable.

Pelletier JA stated that “In Anglo-Canadian jurisprudence, the comparison at step 3 is to the prior art” [51]. Pelletier JA cited no cases on point, and it may be that Pelletier JA did not intend this as a description of what the courts had previously done, but rather a statement of his conclusion. To the extent that he intended it as describing the actual practice of the courts, I am not sure it is right. As discussed in my article, it was not true in English law prior to the Act of 1977 and it was not true in Canadian law prior to 1993. Since then, the question has remained unsettled in Canadian law. In 2006 FC 1234, [109] Hughes J expressed the view, albeit in passing, that codification was not intended to change the law. In Novartis v Teva / deferasirox 2015 FC 770 blogged here, O’Reilly J held that indeed the law had not changed, while in Pollard v BABN 2016 FC 883 [192-95], Locke J suggested the opposite. The question was noted, but not addressed, in 2015 FCA 163 [21]: see here for a discussion. None of these cases were discussed by Pelletier JA. And indeed, as Pelletier JA acknowledged [59], he himself had expressed the opposite view in BMS v Teva 2017 FCA 76, [48]. This is not to say that BMS v Teva settled the question, as it was not directly at issue, and also referred to “prior art” in other paragraph, as Pelletier JA pointed out. But it does indicate that the point was open.

Pelletier JA also relied on Windsurfing [1985] RPC 59 (CA) for the proposition that the state of the art encompasses all prior art. Windsurfing does indeed take that position, but, as discussed in my article, it was in obiter and in conflict with the well known decision in General Tire [1972] RPC 457, 497 (CA).

He also relied at [56] on the SCC’s use of the phrase “prior art” in Sanofi / Plavix 2008 SCC 61, [70]-[71]. However, the issue there was not the precise definition of the prior art, but rather the significance of the actual course of conduct of the inventor.

Finally, Pelletier JA relied on the parallel between s 28.3 and the legislation under the UK Patent Act, 1977 [58]. In my article, at 389, I argued that the better parallel is the UK Act of 1949, both because the structure of the 1977 Act is different, and because it was widely recognized as effecting a change in the law, whereas 28.3 was thought to be to be merely a codification.

None of this is to say that Pelletier JA's conclusion was wrong, but only that it is not clearly right. (Note that the above is not an exhaustive review of the relevant considerations which are discussed in my article, but only touches on those raised by Pelletier JA.)

Despite the clear holding by Pelletier JA, I am not sure where the law stands on this point. The authority of the holding is undermined by the fact that it was a decision of only two members of the panel, the point was not fully argued, it did not review the relevant Canadian cases, and it was strictly obiter. In Lilly v Apotex / cefaclor, 2009 FC 991 [349]-[370], Gauthier J declined, quite rightly in my view, to follow the SCC holding as to “standard of review” of a granted patent set out in Wellcome / AZT 2002 SCC 77 [44], in part because the issue was not argued before the SCC [356, fn126] and the point was obiter [357]. (With that said, the situations are not entirely parallel because the SCC in Wellcome / AZT was clearly wrong, for the reasons given by Gauthier J, while the position taken by Pelletier JA is entirely reasonable, even though the counter-arguments were not fully considered.) Apart from any question of the authority of this decision, it does seem to me undesirable for a court to make a holding in obiter on a point of law which has not been argued, because, as Wellcome / AZT illustrates, such holdings may not be as well considered as when the issue is fully argued.