“Your client’s samples also appear to have originated in Canada, and the chemistry described by Section D of your client’s Confidential Process Description dated26 April 2006 (the ‘Process Description’) is stated to be carried out at Apotex Pharmachem Inc. As your client will be aware, our client has a product patent on perindopril erbumine in Canada that does not expire until 2018. For this reason also we doubt that the sample you have provided is a product of your client’s industrial manufacturing line. Please would you clarify the situation.”
“We do not see the relevance of the points raised in relation to where the product is manufactured or our client’s regulatory position. As stated above, we can confirm that the samples are a product of our client's industrial manufacturing line.”
“… the Defendants must not, dispose of, offer to dispose of, or import into the United Kingdom it’s [sic] generic perindopril erbumine product …”
“… the Defendants must not dispose of, offer to dispose of, or import in the United Kingdom their generic perindopril erbumine product …”
“If the Court later finds that this Order has caused loss to the Defendants, which shall include Apotex UK Limited, and decides that the Defendants should be compensated for that loss, the Claimants will comply with any Order the Court may make.”
“9. The upshot of all of this is that were the patent valid, Servier’s monopoly in practice would last until 2020, But, as the Judge held and we confirm, [the European Patent] is invalid. And very plainly so. It is the sort of patent which can give the patent system a bad name.I am not sure that much could have been done about this at the examination stage. There are other sorts of case where the Patent Office examination is seen to be too lenient. But this is not one of them. For simply comparing the cited prior art ('341) with the patent would not reveal lack of novelty and probably not obviousness. You need the technical input of experts both in the kind of chemistry involved and in powder X-ray diffraction and some experimental evidence in order to see just how specious the application for the patent was. The only solution to this type of undesirable patent is a rapid and efficient method for obtaining its revocation. Then it can be got rid of before it does too much harm to the public interest. 10. It is right to observe that nothing Servier did was unlawful. It is the court’s job to see that try-ons such as the present patent get nowhere…”
“It has come to our clients’ attention from sources including its distributors in the UK, that Apotex has, through its UK subsidiary, recently begun offering for sale and selling a generic version of perindopril in the UK. As a result, our client Les Laboratories Servier and its UK subsidiary Servier Laboratories Limited moved for and obtained an interim injunction on August 3, 2006 and an interlocutory injunction on August 8, 2006 against, inter alia, Apotex Inc and Apotex Pharmachem Inc. Said injunction orders Apotex Inc and Apotex Pharmachem Inc to not ‘dispose of, offer to dispose of, or import in the United Kingdom’ generic perindopril, save for the fulfilment of existing contractual orders. During the hearing of the UK injunctions, it has come to light that the source of the generic perindopril sold in the UK was Apotex Inc and/or Apotex Pharmachem Inc’s Canadian manufacturing facilities, and not a Dutch company as indicated on the product. Further, our clients have now become aware that Apotex Inc, through its various local subsidiaries, is planning on launching generic perindopril in other European countries. It is our clients’ understanding that the source of that generic perindopril will also be either Apotex Inc and/or Apotex Pharmachem Inc’s Canadian manufacturing facilities. As you are well aware, the manufacture, use, formulation, offer for sale, sale and export from Canada of perindopril constitutes an infringement and/or inducement to infringe of the claims of the ‘196 patent. No doubt Apotex Inc and Apotex Pharmachem Inc are aware of the existence of the ‘196 patent. Your actions therefore constitute a blatant and unacceptable infringement of our client’s rights.”
“… Apotex, fully aware of the [Canadian] Patent, chose Canada as the manufacturing site for perindopril products. Apotex could have avoided all of the manufacturing infringement by making perindopril-containing products outside of Canada. This is not just speculation. As acknowledged by a number of witnesses for Apotex, Apotex also has manufacturing facilities in India and is in the process of obtaining authorization to produce perindopril from that site. Indeed, as stated by Dr. Sherman, during his testimony, Apotex had ‘determined that it would make sense to have the facilities outside of Canada qualified in case it turned out we would lose at trial’. I have no problem with Apotex and other related companies arranging their business affairs in any way they see fit. However, they must also bear the consequences of their choices where they are perfectly aware that a patent will be infringed. In this case, Apotex chose to make perindopril in Canada fully knowing that making perindopril would constitute infringement and that it might be required to disgorge its profits.”
“The objection, that a contract is immoral or illegal as between plaintiff and defendant, sounds at all times very ill in the mouth of the defendant. It is not for his sake, however, that the objection is ever allowed; but it is founded in general principles of policy, which the defendant has advantage of, contrary to the real justice, as between him and the plaintiff, by accident, if I may so say. The principle of public policy is this; ex dolo malo non oritur actio. No court will lend its aid to a man who founds his cause of action upon an immoral or an illegal act. If, from the plaintiff's own stating or otherwise, the cause of action appears to arise ex turpi causâ, or the transgression of a positive law of this country, there the court says he has no right to be assisted. It is upon that ground the court goes; not for the sake of the defendant, but because they will not lend their aid to such a plaintiff. So if the plaintiff and defendant were to change sides, and the defendant was to bring his action against the plaintiff, the latter would then have the advantage of it; for where both are equally in fault, potior est conditio defendentis.”
“The narrow principle illustrated by the foregoing examples of accepted application of the maxim of ex turpi causa non oritur actio in tort, is that a plaintiff will not be allowed to profit from his or her wrongdoing. This explanation, while accurate as far as it goes, may not, however, explain fully why courts have rejected claims in these cases. Indeed, it may have the undesirable effect of tempting judges to focus on the issue of whether the plaintiff is ‘getting something’ out of the tort, thus carrying the maxim into the area of compensatory damages where its use has proved so controversial, and has defeated just claims for compensation. A more satisfactory explanation for these cases, I would venture, is that to allow recovery in these cases would be to allow recovery for what is illegal. It would put the courts in the position of saying that the same conduct is both legal, in the sense of being capable of rectification by the court, and illegal. It would, in short, introduce an inconsistency in the law. It is particularly important in this context that we bear in mind that the law must aspire to be a unified institution, the parts of which—contract, tort, the criminal law—must be in essential harmony. For the courts to punish conduct with the one hand while rewarding it with the other, would be to ‘create an intolerable fissure in the law's conceptually seamless web’: Weinrib, ‘Illegality as a Tort Defence’ (1976) 26 UTLJ 28, 42. We thus see that the concern, put at its most fundamental, is with the integrity of the legal system.”
“The Latin maxim ex turpi causa non oritur actio (no action can arise from an illegal or immoral act) encapsulates a public policy which English law gives effect to in different ways in different situations. Since there is no over-arching principle of universal validity in all contexts, it is necessary to identify the principle or principles applicable to the situation at hand.”
“The maxim ex turpi causa expresses not so much a principle as a policy. Furthermore, that policy is not based upon a single justification but on a group of reasons, which vary in different situations.”
“… the court will not award compensation under a cross-undertaking for the loss sustained by an unlawful business or where the beneficiary of the cross-undertaking has to rely to a substantial extent upon his own illegality in order to establish the loss. As a matter of international comity, it does not matter for this purpose whether the acts in question are unlawful under English law or under foreign law.”
“… I am glad to be able to say that our law has been purged from the suggestion that fraud and false representation injurious to an innocent person can be committed with impunity if the injured person has by such fraud and false representation been unwittingly and innocently made to commit what the law has said shall be called a crime.”
“It has, I think, long been settled law that if an act is manifestly unlawful, or the doer of it knows it to be unlawful, as constituting either a civil wrong or a criminal offence, he cannot maintain an action for contribution or for indemnity against the liability which results to him therefrom. … Nor, in my judgment, can there be any valid claim to indemnity where the doer of the act which constitutes the offence has done it with knowledge of all the circumstances necessary to constitute the act an offence, but in ignorance that the act done under those circumstances constituted an offence. A man is presumed to know the law. … But I am unable to accept the defendants’ proposition, where the act, though a criminal offence - malum prohibitum - is, upon the state of facts which the doer by the fraudulent misrepresentation of the person against whom he claims indemnity has been induced to believe to be the true state of facts, neither criminal nor immoral.”
“It is, of course, a settled principle that a man cannot recover for the consequences of his own unlawful act, but this has always been confined to cases where the doer of the act knows it to be unlawful or is himself in some way morally culpable. It does not apply when he is an entirely innocent party.”
“On these authorities, I think the law is that, although a man may have been guilty of an offence which is absolutely prohibited so that he is answerable in a criminal court, nevertheless if he has been led to commit that offence by the representation or by the promise of another, then in those circumstances he can recover damages for fraud if there is fraud, or for breach of promise or warranty if he prove such to have been given, provided always that he himself has not been guilty of culpable negligence on his part disabling him from that remedy.”
“On the facts as found, and indeed on the facts which are not in dispute, the position was therefore that, at the request of the defendants, the plaintiffs made a representation which they knew to be false and which they intended should be relied upon by persons who received the bill of lading, including any banker who might be concerned. In these circumstances, all the elements of the tort of deceit were present. Someone who could prove that he suffered damage by relying on the representation could sue for damages. I feel impelled to the conclusion that a promise to indemnify the plaintiffs against any loss resulting to them from making the representation is unenforceable. The claim cannot be put forward without basing it upon an unlawful transaction. The promise upon which the plaintiffs rely is in effect this: if you will make a false representation, which will deceive indorsees or bankers, we will indemnify you against any loss that may result to you. I cannot think that a court should lend its aid to enforce such a bargain.”
“The general principle is not in doubt. In Alexander v. Rayson[1914] 1 KB 169 , 182 this court said: ‘It is settled law that an agreement to do an act that is illegal or immoral or contrary to public policy, or to do any act for a consideration that is illegal or immoral or contrary to public policy, is unlawful and therefore void. But it often happens that an agreement which in itself is not unlawful is made with the intention of one or both parties to make use of the subject-matter for an unlawful purpose, that is to say, a purpose that is illegal, immoral or contrary to public policy. ... In such a case any party to the agreement who had the unlawful intention is precluded from suing upon it. Ex turpi causa non oritur actio. The action does not lie because the court will not lend its help to such a plaintiff.’ I do not propose to consider the cases to which Morris L.J. has already referred. In none of the cases cited before us has a plaintiff failed where he was not fraudulently minded, but was merely reckless and unthinking in committing a tort of deceit instigated by the defendant. Nor, per contra, has any case been cited where a plaintiff has succeeded in such circumstances. But recklessness is sufficient to make a man liable in damages for fraud. Here the plaintiffs intended their misrepresentation to deceive, although they did not intend that the party deceived should ultimately go without any just compensation. In an action based on deceit that state of mind would render them liable, no less than if they had been fraudulent, and I cannot avoid the conclusion that the purpose for which the clean bill of lading was given in this case was unlawful within the general principle set out above. The plaintiffs' rather haphazard belief that no one would be ultimately defrauded, though it affects their merits, does not in my view improve their legal position in this case.”
“… even if we should conclude that the representation was made with such recklessness as to amount, in law, to the same thing as a representation made with the deliberate intention of deceiving, still I am not satisfied that it would be right to hold, or that any authority compels us to hold, that the proved circumstances were such that it would be contrary to public policy, contra bonos mores, to allow the plaintiffs to recover upon the contract of indemnity from the defendants. I have, I hope, sufficiently perused all the authorities, including those cited by my brother Morris. I have failed to find any case (apart from those involving immorality or public illegality) in which, upon the principle ex turpi causa non oritur actio, a plaintiff has been cast from the seat of judgment who has not been found personally dishonest. If there was a false statement deliberately made, it was made in accordance with a practice that was common and well known in the trade and with an intention that any consequences should be covered by their or their principals' liability to make compensation - in other words, in circumstances in which the plaintiffs, by reason of the current laxity in that respect, honestly believed would not damage anybody.”
“The stock of video tapes at the Mill Street shop was, as I have concluded from the evidence in this case, composed largely of pirate tapes. It is true that a substantial number of the tapes were not copies of films in which any of the plaintiffs is entitled to copyright or an exclusive licence. Nonetheless, to the extent that the tapes were pirate tapes, they belonged, undersection 18 of the Copyright Act 1956 , to the owners of the copyright. Further, every sale of every video tape from the Mill Street shop of which evidence has been given in this case seems to have been the sale of a pirate tape. The prospect of an inquiry as to the damage caused by the Anton Piller order to such a business brings to my mind the application by the highwayman against his partner for an account. The court would not countenance that application and I do not think I should countenance an inquiry into the damage caused by the order to the business of the Mill Street shop. Mr. Robinson will not of course suffer the fate of the highwayman, nor will Mr. Beveridge suffer the fate of his counsel.”
“285. In my judgment counsel for the defendants is correct that Scott J was exercising his discretion not to enforce the cross-undertaking by ordering an inquiry as to damages, but instead by making a summary award essentially to compensate the defendants for the wrongful obtaining and execution of the Anton Piller order. This can be seen particularly clearly from his reasons in relation to the 8 Frederick Street business, which included the false evidence given by Mr Robinson. 286. Nevertheless, it remains necessary to analyse the basis on which Scott J exercised his discretion, particularly so far as the Mill Street business was concerned. In my view, the basis of the decision was that virtually the entire business at Mill Street was unlawful in that it consisted of the sale or rental of video tapes which were pirate tapes, that is, infringing copies of films the copyrights in which were owned either by the plaintiffs or by other copyright owners. As counsel for the defendants pointed out, Scott J clearly regarded it as significant that, by virtue of section 18 of the 1956 Act, the pirate tapes belonged to the copyright owner and hence the defendants were guilty of conversion. It is difficult to believe that Scott J would have taken a different view of this had the Anton Piller order been set aside for material non-disclosure prior to trial and he had been hearing an inquiry under the cross-undertaking. This reading is supported by Scott J’s reference to the notorious case of Everet v Williams ….”
“… it is to be borne in mind that counterfeiting of video films is a serious offence. In effect to make and distribute pirate copies of films is to steal from the true owner of the copyright, the property for which he has to expend money in order to possess it. It is an offence really of dishonesty.”
“What appears from the above discourse is that the illegality defence is commonly invoked where there is some form of culpability on the part of the plaintiff. In instances where the act of the plaintiff had been criminal, the illegality defence was readily invoked. The same was done where the conduct of the plaintiff was, at the time, considered morally reprehensible.”
“The conduct of the appellant, in committing a statutory offence, was not criminal in nature. Nor was it an act that could be classified as reprehensible or grossly immoral. In short, we were of the view that the appellant had not engaged in an act that was so culpable as to attract the application of the illegality defence.”
“179. Checking for fraud is part of an auditor's task, but it is not his sole or primary task (for a reputable auditor to discover that the client company's business is wholly fraudulent and criminal must be quite unusual). But suppose for the sake of argument that a trader engages an accountant for the primary and express purpose of preparing financial statements that comply with all the requirements of company law and tax law, so that the lawfulness of the financial statements is the very thing that the accountant undertakes to do; and suppose that the accountant negligently fails to perform this task, and the trader is in consequence liable to some penalty or criminal sanction. Could the accountant meet a claim for professional negligence by pleading the ex turpi causa defence? It is obviously impossible to answer that question without knowing more about the facts. If the trader had honestly supplied information which he believed to be correct and complete, and the accountant had negligently failed to notice that the information could not be correct and complete, it seems unlikely that such a regulatory breach, not involving dishonesty, would bring the ex turpi causa principle into play. 180. That seems to have been the principle of the decision of the Court of Appeal of Singapore in United Project Consultants Pte Ltd v Leong Kwok Onn[2005] 4 SLR 214 , paras 55–57, where the claimant trading company had been fined for incorrect tax returns prepared by the defendant. … ”
“... Mr Sumption accepts that whether there is iniquity sufficient to trigger the maxim may sometimes require careful examination of the facts (see eg Burrows v Rhodes[1899] 1 QB 816 and United Project Consultants Pte Ltd v Leong Kwok Onn[2005] 4 SLR 214 ), but Mr Stojevic's iniquity is not here in doubt. ... ”
“91. An issue of potential importance in the present case is whether an attempted civil law bribe is sufficient to engage the principle of ex turpi causa, or whether it is necessary to prove an actual bribe. 92. In principle it would seem that an attempt should be sufficient to do so, and the contrary was not strongly argued. It involves an act which is more than preparatory which is done with the intent to bribe. As appears from Lord Mansfield’s statement of policy in Holman v Johnson, the principle of ex turpi causacan extend to immoral as well as illegal acts and may apply to improper conduct evincing serious moral turpitude. Bribery involves serious moral turpitude. The moral turpitude involved on the part of the briber is much the same in the case of an attempted bribe as it is in the case of an actual bribe. That that involves sufficient turpitude to bring in to play the principle of ex turpi causa is borne out by the approach of the criminal law. … 118. … for reasons set out above I consider that proof of a payment which is intended to be a civil law bribe is sufficient to engage the ex turpi causa principle. It is not necessary to establish that the intended illegal purpose has been effectively carried out. 119. In the above circumstances it is not necessary to decide whether, on my findings, there has been a breach of the criminal law. …”
“16. Although the maxim goes back at least as far as the judgment of Lord Mansfield CJ in Holman v Johnson (1775) 1 Cowp. 341, its modern application dates from Tinsley v Milligan[1994] AC 340 , which held, overruling Euro-Diam v Bathurst[1990] 1 QB1 , that the courts had no discretion in relation to the maxim. The modern law has now culminated in Gray v Thames Trains Ltd[2009] 1 AC 1339 when Lord Hoffmann said (para 30) that it expressed not so much a principle as a policy and that it was a rule which may be stated in a narrower form and a wider form (para 32). In its narrower form it is that a claimant cannot recover for damage which is the consequence of a sentence imposed upon him for a criminal act; in its wider version it is that a claimant may not recover for damage which is the consequence of his own criminal act. Both versions of the rule are often in play as they are in the present case because it is said that recovery of the penalty likely to be imposed by the OFT is recovery for the consequence of a sentence for the criminal (or quasi – criminal) act of entering into an illegal agreement, whereas recovery of the costs of the OFT investigation is recovery for the consequences of making the illegal agreement. The main difference between the application of the two forms of the rule appears to be that there is no question of any causation problem in the application of the narrower version whereas difficult problems of causation may (in theory) arise if it is only the broader version of the rule on which reliance can be placed (para 51). The rationale of the maxim is the need for the criminal courts and the civil courts to speak with a consistent voice. It would be inconsistent for a claimant to be criminally and personally liable (or liable to pay penalties to a regulator such as the OFT) but for the same claimant to say to a civil court that he is not personally answerable for that conduct. 17. Most of the cases, in which the maxim has been applied to criminal or illegal acts and their consequences, have been cases in which the crime or other illegal act has involved a mental element. … 18. It has not been expressly decided whether the maxim (in either its narrower or wider version) applies where the criminal act is one of strict liability and the claimant may not have been at fault at all. The closest case is Askey v Golden Wine Co Ltd[1948] 2 All ER 35 in which Mr Askey had been convicted of offences under the then applicable Food and Drugs legislation and was held to be unable to recover an indemnity for the consequences of his punishment but it was clear that Mr Askey had in fact acted intentionally or in a criminally negligent way. The problem of strict liability offences need not, however, concern the court in this case because section 31(3) of the Act makes it clear that the OFT may only impose a penalty if is satisfied that the infringement ‘has been committed intentionally or negligently by the undertaking.’ We must therefore proceed on the basis that Safeway is attempting to recover damages for the consequences of an infringement committed intentionally or negligently.” ‘has been committed intentionally or negligently by the undertaking.’ We must therefore proceed on the basis that Safeway is attempting to recover damages for the consequences of an infringement committed intentionally or negligently.”
“289. First, I do not regard the defendants’ business as an unlawful one. It is beyond dispute that it was lawful so far as English law is concerned. As to US law, as already stated the claimants do not now contend that US law has extra-territorial effect so as to make the defendants’ acts in this country illegal. In my view, the fact that the defendants’ business resulted in illegal acts being committed by others in the USA is not sufficient to make that business itself unlawful. 290. Secondly, in my judgment the defendants do not have to rely upon their own illegality in order to establish their loss, and certainly not in a substantial way. They simply rely upon (i) the purchase of pharmaceuticals in Turkey, (ii) importation of those products into the United Kingdom, transhipment and export under IPR and (iii) sale of the drugs to CanadaDrugs upon terms that title and risk passed at the point where Royal Mail collected the goods from 8PM. None of these acts were illegal. It is the claimants who seek to rely upon the illegal acts of importation into the USA by others as an answer to the claim. 291. Thirdly, even if the defendants’ business is regarded as having depended upon the commission of illegal acts by others in the USA, by the date of the injunction it was an established business with a valuable goodwill. That business, and in particular the goodwill, was property which could have been sold to a third party. (Indeed, as already noted, Ms Gutteridge’s approach to valuing the lost business was essentially to consider what would be paid for it by a purchaser.) The defendants’ claim is for the loss of that business, and thus may be viewed as a claim for the loss of that property. It is difficult to see why, following Tinsley v Milligan, that loss should be irrecoverable.”