Federal Court introduces new measures to streamline IP litigation

On June 24 2015 the Federal Court issued a practice notice providing new measures that seek to improve case management of complex litigation, including IP litigation. The new measures – designed to achieve increased proportionality in court proceedings – streamline certain aspects of IP litigation and should result in both time and cost savings for litigants.

While many of the recommendations in the notice are necessarily general, they are intended to make it easier for an action to be tried within at most two years, an objective that the Federal Court communicated in an earlier practice notice in May 2009. The recommendations will also make litigation more cost effective for litigants, due – at least in part – to a cap on the duration of oral examinations for discovery and new limitations for motions to compel answers refused during examinations for discovery. Historically, such refusal motions have frequently been time consuming and costly, and have resulted in delays in proceedings. 

Practice notice
The Notice to the Parties and the Profession – Case Management, Increased Proportionality in Complex Litigation before the Federal Court provides as follows:

• Earlier trial judge management – the trial judge will get involved in a matter earlier to ensure that the parties and the court are ready to proceed on the scheduled trial date. For example, the trial judge may be involved in ensuring timely resolution of interlocutory motions and appeals and implementing procedures relating to discovery and litigation timetables.
• Short notice waiting list for earlier trial dates – parties which are ready for trial will be able to request an earlier trial date, subject to the court’s availability, notwithstanding that they may already have a trial date fixed for a later date in the future.
• No new demonstrative evidence at trial – parties will have to exchange demonstrative evidence at least 60 days before trial, with any objections to be dealt with shortly thereafter.
• Limits on documentary discovery – proportionality applies to documentary discovery. The costs involved, the time required, and the nature and complexity of a dispute are all factors to be accounted for in this regard. In addition, the parties will be required to discuss early on the representative(s) to be examined, their knowledge and expertise, the scope of inquiry and the documents anticipated to be reviewed.
• Limits on oral discovery – proportionality also applies to oral examinations for discovery. In the absence of special circumstances, the court will limit the duration of oral discoveries based on the estimated duration of trial to the following (based on actual or estimated durations for trial):
  • one-week trial or less – one day of oral discovery per party;
  • one to two-week trial – two days per party;
  • three to four-week trial – three days per party; and
  • five or more weeks – four days per party.

In addition, any follow-up discovery will be limited to one day per party. It remains to be seen how these new limitations will be implemented and enforced in practice. For example, where a single plaintiff brings an action against multiple defendants, variations from the durations set out above may be necessary depending on the circumstances of each case.

• Limits on refusal motions – refusal motions will be much briefer (limited to one hour per day of discovery) and will be heard after only discoveries are complete. In addition, the practice of taking questions "under advisement” (ie, refusing a question during an examination, but committing to further consider its propriety after the examination) will no longer be permitted. This, combined with the new requirement to answer all questions unless “clearly improper or prejudicial” or privileged, should result in significantly fewer discovery refusals and therefore less voluminous refusals motions. Potentially significant cost penalties may also be imposed against unsuccessful or unreasonable parties.
• Limits on appeals of interlocutory orders of prothonotaries – in view of the current system, which allows for multiple levels of appeal as of right, the court is considering recommending amendments to legislation to limit appeals of interlocutory orders (eg, refusal motions).
• Stricter enforcement of the limit on number of experts – in the absence of extraordinary reasons, each party will be entitled to call five expert witnesses only.
• Science and technology primers before trial – parties may be required to jointly or separately provide science and technology primers to the court before trial, particularly in cases involving complex science and technology issues.
• Early consideration of mediation in all actions – the court will proactively raise alternative dispute resolution as an option throughout a proceeding, including as early as the close of pleadings. Such alternative dispute resolution may include mediation, which is a service that the Federal Court offers parties involved in litigation.

Comment
In sum, the new measures provided in the Federal Court’s practice notice streamline certain aspects of IP litigation matters and should result in both time and cost savings for litigants. In particular, the new requirements relating to document and oral discovery, as well as motions for resolving discovery-related refusals, are significant and should result in a noticeably shorter and more focused discovery phase of an action. Given that document and oral discovery and resulting refusals motions represent a substantial amount of the time and costs associated with an IP court action, this practice notice will be a welcome development for litigants interested in timely and cost-effective resolution of IP disputes in Canada.