Micro Chemicals Limited et al. v. Smith Kline & French Inter-American Corporation

he erred in fixing a royalty that is too low.

he erred in principle in clause 2(b) of the licence in not providing one rule for the case where the non-arms length purchaser resells to an arms length purchaser in bulk and another rule for the case where the non-arms length pur-

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chaser resells to an arms length purchaser in dosage or some other processed form.

Meanwhile on May 17, 1968, the respondent had brought an action in the Exchequer Court of Canada against Micro, Paul Maney Laboratories Canada Ltd. and Gryphon Laboratories Limited (hereinafter referred to respectively as “Maney” and “Gryphon”) for infringement of its patent No. 612204 from and after January 10, 1961, and claiming damages or an accounting of profits. This is the infringement action referred to in Jackett P.’s Order of December 21, 1970.

The infringement action was tried by Walsh J. on an agreed statement of facts. On July 31, 1969, he directed that judgment should be entered as follows:

1. Declaring and adjudging that Canadian Letters Patent 612204 referred to in the Statement of Claim is valid as between the parties;

2. Declaring and adjudging that the said Patent has been infringed by all three of the defendants;

Declaring and adjudging that the plaintiff is entitled to be paid by the defendants an amount equal to either

(a) the amount of the damages sustained by the plaintiff as a result of the infringement by the defendants of the said patent, or

(b) the amount of the profits derived by the defendants from infringing the said patent.

For the purpose of determining the amount that the plaintiff is so entitled to be paid by the defendants (if the parties cannot agree on it), referring to the Registrar (or a Deputy Registrar nominated by the Registrar or, if none such be available, an officer of the Court agreed upon by the parties or appointed by the Court) for inquiry and report, the following questions, viz:

(a) What acts of infringement by the defendants of the aforesaid patent have occurred as alleged by the Statement of Claim; and

(b) According to the election of the plaintiff, (which election must be made in writing and filed in the Court and served upon the defendants before the plaintiff may take any steps in

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connection with the reference) what is the amount of the aforesaid damages sustained by the plaintiff or the amount of the aforesaid profits derived by the defendants; and

Ordering and adjudging that the plaintiff recover from the defendants such costs herein to be taxed, except the cost of the reference, which will be left open to be dealt with upon the motion for judgment upon the report of the referee under Rule 186 of the General Rules and Orders of this Court.