Company alleges it lost its foreign patent applications due to the fault of its lawyer
The Ontario Court of Appeal has dismissed a lawsuit filed by an Ontario corporation against its Spanish lawyer over alleged misrepresentation concerning foreign patent applications.
GlycoBioSciences Inc. is an Ontario-based corporation. It engaged Herrero and Associates, a law firm in Madrid, Spain, to undertake specific work on the corporation’s behalf over its patent applications in Panama, Costa Rica, and Ecuador. However, GlycoBioSciences later alleged that the law firm negligently and fraudulently misrepresented the status of its patent applications in Panama and Costa Rica, resulting in the loss of its Panamanian and Costa Rican applications. GlycoBioSciences sued Herrero and Associates in Ontario.
Herrero brought a motion to dismiss the action because the subject matter is outside the Ontario court’s jurisdiction. GlycoBioSciences argued that the Ontario Superior Court has jurisdiction because the factors that would connect the tort to the province of Ontario were made to the corporation in Ontario.
The motion judge dismissed GlycoBioSciences’ action, which the Superior Court upheld on appeal. The appeal court found that the corporation has not identified any error in the motion judge’s reasons. The appellant GlycoBioSciences bore the burden of establishing a presumptive connecting factor that established, on a prima facie basis, a real and substantial connection between Ontario and the subject matter of the litigation.
The court clarified that the appellant was required to establish a “good arguable case” for the factual allegations that underpin the legal argument that would establish jurisdiction. The appeal court upheld the motion judge’s finding that the appellant had not established a good arguable case that the respondent law firm made false claims knowingly or negligently.
The court found that the appellant’s Panamanian application was terminated because of failure to pay a “substantive examination fee.” The appellant argued that its lawyer, Herrero and Associates, could have corrected the situation. However, the court accepted the law firm’s assertion that the appellant never granted it the power of attorney that would have been a necessary precondition to taking such steps.
The court likewise found that the appellant had frustrated the respondent’s attempts to act on its behalf for the Costa Rican application by not providing the necessary power of attorney until it was too late. The appeal court concluded that the motion judge did not make any error in finding no good arguable case concerning the Panamanian and Costa Rican applications.
The court ultimately dismissed GlycoBioSciences’ appeal and awarded the costs of the appeal to the respondent for $26,000 all-inclusive on a substantial indemnity basis. The court emphasized that a substantial indemnity award is warranted on the appeal because of the appellant’s reckless allegations that impugned the integrity of opposing counsel and the motion judge, the imposition of an improperly voluminous record, and the respondent’s offer to settle.
