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27 April 2017Patents

Canada’s Supreme Court dismisses patent appeal against Dow Chemical

US-based Dow Chemical has won a patent case against Nova Chemicals at the Supreme Court of Canada.

The Supreme Court rejected an appeal from Nova Chemicals on April 20, just one day after the Federal Court of Canada issued a judgment on the damages to be paid in the dispute.

Dow is on track to receive one of the largest ever award of damages for patent infringements in Canada, according to its lawyers at Smart & Biggar/Fetherstonhaugh.

Dow’s Canadian patent number 2,160,705, called “Fabricated products made from ethylene polymer blends”, is at the core of the dispute.

Both companies are manufacturers of polymer composition products such as rubbish bags and food wrap, and are competitors in the market.

Dow sells polyethylene film-grade copolymers under the name ‘Elite’ in Canada, while Nova manufactures and sells polyethylene film-grade copolymers under the name ‘Surpass’.

In 2010, Dow sued Nova accusing it of infringement and seeking damages or an accounting of profits.

Four years later, Justice O’Keefe found that the patent was valid and infringed by Nova.

O’Keefe heard only the liability phase of the action, and according to his judgment, Dow was entitled choose between damages or an accounting of Nova’s profits.

Dow elected for an accounting of Nova’s profits.

Then, in September last year, the Federal Court of Appeal upheld the Federal Court decision by O’Keefe.

Nova had appealed to the Supreme Court over the Court of Appeal decision, asking whether the Court of Appeal was permitted to defer to the trial judge’s conclusions on patent construction or whether is it required to reconsider the issue.

The Supreme Court rejected the appeal

Justice Fothergill, at the Federal Court, issued his judgment on damages on April 19.

“If Nova had not infringed the ‘705 patent, then it would have taken Nova some time follo wing the patent’s expiry to attain the same level of sales of the infringing products that Nova enjoyed in April 2014,” said Fothergill.

According to Dow, Nova’s infringement of the patent provided it with a “springboard” into the market.

As a result of this, Dow argued, Nova continued to profit from its infringing activity after the expiry of the patent.

“Of particular note, Justice Fothergill’s judgment represents the first time that springboard profits have been awarded in Canada, and is potentially the first reported instance of such an award anywhere in the world,” said a press release from Smart & Biggar.

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