Irides: Weekly patent litigation update

The Irides Weekly Update is our round-up of patent litigation news highlights from around the world. Taking its name from the plural of “iris” - a nod to the ability of Irides to see what’s happening around the world.

Our latest edition - 17 November 2023 - is below:

UK 

Court considers claim construction in finding patent valid but not infringed

On 18 October 2023, in the ongoing patent dispute between Abbott and Dexcom, Mr Justice Richards handed down his judgment finding Abbott’s patent valid but not infringed. 

This was the third in a series of trials between the parties concerning continuous glucose monitoring (CGM) systems. These are wearable units with a tiny sensor inserted beneath the skin which measures glucose levels in the surrounding tissue and transmits this information to a receiver (such as a smartphone). Abbott’s patent EP (UK) 2 549 918 (the Patent) relates to designs for an inserter device which positions the CGM components into or onto the user, including the insertion of a sensor beneath the skin. Abbott alleged that Dexcom’s G7 Applicator device infringes its Patent, and Dexcom counterclaimed for invalidity on the grounds of added matter, obviousness, lack of novelty and insufficiency.

The Patent discloses an inserter designed to insert a sensor into the skin. The handle is initially kept axially distant from the top of the sheath, then when the user presses the handle, it faces resistance until a threshold minimum force has been applied to overcome the sheath snap mechanism (being a “biased retention feature”), allowing the sensor to be inserted into the skin.

Infringement

There was no significant dispute as to how the G7 applicator worked, and so the central issue for infringement was the construction of claims 1 and 7. The court adopted Dexcom’s interpretation of most of the claim issues in dispute and overall, based on the claim construction adopted by the court, it held there was no infringement of claims 1 or 7 by Dexcom’s G7 Applicator.

Validity challenges

Dexcom ran an added matter challenge centred on the addition of the elements involving the “biased retention feature of the sheath” into the claims of the Patent as granted, which it argued constituted an intermediate generalisation, because it introduced for the first time the idea that a mechanism could have (and distal movement of the handle could overcome) a “biased retention feature of the sheath” which has no corresponding detent in the handle. In its judgment the court drew a distinction between permitted generalisations and intermediate generalisations. As to the former, a patentee is allowed to disclose any invention by reference to a number of embodiments, and the claims may use phrases that generalise beyond the description of the invention set out in the particular embodiments, provided that the generalised wording does not teach anything new about the invention. As to the latter, where “a feature is taken from a specific embodiment, stripped of its context and reintroduced into the claim in circumstances where it would not be apparent to the skilled person that it has any general applicability to the invention” (per Kitchin LJ in Nokia v IPCom) the claim is invalid for added matter. On the present facts the court held the addition of these elements constituted a permitted generalisation and did not introduce any new teachings. 

Dexcom’s insufficiency arguments (ran as a squeeze with infringement) were rendered unnecessary due to the court’s acceptance of Dexcom’s points on claim construction. In considering the novelty and inventive step attacks, the Judge considered both parties’ proposed claim construction on whether the sheath “has” the biased retention feature in case his earlier conclusions on construction were wrong. On the adopted claim construction, Dexcom’s prior art attacks failed. (Had it been otherwise, the court considered claim 1 would be anticipated and claim 7 would be obvious). 

The UK dispute is part of a wider European battle, in which Dexcom has brought actions before the UPC in the Munich Local Division and the Paris Local Division regarding four of its patents. Two further UK trials are also scheduled for November 2024 and January 2025. 

UPC

Recent decisions on security for costs and penalties for violation of orders

In orders that have only recently become available, on 18 October 2023, the Dusseldorf Local Division was required to address the issue of enforcing injunctions. The court emphasised its authority to enforce penalty payments when a party fails to comply with a court-ordered injunction.

Readers will be aware that in June 2023, myStromer applied for a preliminary injunction against Revolt, alleging infringement of its patent relating to a bicycle frame and motor hub combination structure that was being displayed at a trade show. The court approved the injunction requiring that Revolt stop sales of its Opium e-bikes in countries including the Netherlands, Germany, France, and Italy. Once it was made aware of the injunction, Revolt did not comply; it continued to showcase the bikes at the Eurobike fair with the contentious component removed; it delayed the removal of promotional posts on Instagram until the following day, and it permitted a German dealer to display an infringing bike during a special sales event on 24 September 2023, sometime after the injunction had been granted. Revolt also advised its Belgian dealers that sales of the bikes could continue in Belgium, even to customers from the countries where the injunction was in effect.

myStromer applied to the court for a penalty order. The court considered art. 25 of the UPCA which states that a patent shall confer on its proprietor the right to prevent any third party not having the proprietor's consent from the following:

(a) making, offering, placing on the market or using a product which is the subject matter of the patent, or importing or storing the product for those purposes;

(b) using a process which is the subject matter of the patent or, where the third party knows, or should have known, that the use of the process is prohibited without the consent of the patent proprietor, offering the process for use within the territory of the Contracting Member States in which that patent has effect;

(c) offering, placing on the market, using, or importing or storing for those purposes a product obtained directly by a process which is the subject matter of the patent.

The court clarified that in patent law, "offer" includes any act that makes a product available for acquisition, like displaying goods at a trade fair. Displaying goods at a trade fair, even without all features of the patent claim being evident, could constitute an offer if the other features completing the claim can be inferred (here the product on offer – the e-bike – was modified to remove the “thru axle” and torque sensor, thereby taking it outside the claim).

The court then went on to consider various factors while assessing the penalty, including the nature, extent, and duration of the infringement, and the debtor's level of culpability. The court also took into account the debtor's past behaviour in determining the penalty amount. Repeated violations led to a higher penalty, while genuine efforts to comply could lead to a reduction.

Based on these principles, the court ordered a penalty payment of €26,500, of which €1,000 was for the continued operation of the trade fair stand, €500 for the delayed deletion of the Instagram account and €25,000 for the German sales event. The court highlighted that penalty payments serve both as a deterrent against future violations and as punitive measures for the violation of court prohibitions.

On 30 October 2023, the Central Division in Munich granted an order in the case of President and Fellows of Harvard College v NanoString. In this action,  Nanostring brought an action in the Munich Central Division seeking revocation of President and Fellows of Harvard College’s (PFHC) patent. PFHC raised a Preliminary Objection, challenging the court's jurisdiction over the German part of the patent and simultaneously requested security for legal costs, citing concerns about enforceability against the UK-registered Nanostring and Nanostring’s financial stability.

The Munich Central Division considered the submissions of the parties and the legal framework under Rule 158.1 of the Rules of Procedure (RoP) and art. 69(4) of the Unified Patent Court Agreement (UPCA) which states that at the request of the defendant, the court may order the applicant to provide adequate security for the legal costs and other expenses incurred. The court may order this at any time during the proceedings following a reasoned request in relation to the costs of the first instance proceedings.

The court noted that the UK's exit from the EU added procedural burdens and uncertainties to enforcing UPC judgments in the UK. Furthermore, concerns were raised about the claimant's financial stability, given its parent company's situation and the group's significant long-term debts, despite substantial cash reserves. On this basis the court found that, in line with the Helsinki and Munich local divisions, it had the discretion to order a security for legal costs and other expenses.

The defendant deferred to the court as to the quantum of the security. The court considered that based on the table of ceilings for reimbursable costs, the corresponding security for a value in dispute of €7.5 million would be €600,000. However the court ordered the claimant to provide security of €300,000 for the defendant's legal costs and expenses, having assessed that figure to be reasonable and proportionate, payable within six weeks, either as a deposit on the UPC account or as a bank guarantee from a significant EU bank. Both parties were granted leave to appeal.

CANADA

The Patented Medicine Prices Review Board (PMPRB) has released a scoping paper on themes and questions to develop new price review guidelines

The Patented Medicine Prices Review Board (PMPRB) has initiated a consultative process aimed at developing comprehensive price review Guidelines. This consultation process and the Guidelines are expected to significantly impact the pricing and regulation of patented medicines in Canada. A full set of guidelines has been awaited since July 2022 as a result of amendments to the Patented Medicines Regulations, which included the adoption of a new list of foreign reference price countries (PMPRB11). The PMPRB is currently operating under an amended Interim Guidance, pending the introduction of the new Guidelines. The scoping paper released forms the basis of the first phase of this consultative process, with a second phase anticipated in 2024 focusing on the development of the new Guidelines.

The consultative process covers six themes:

1. Efficient Monitoring of Prices without Price Setting – to set the procedures used by the PMPRB when monitoring the prices of patented medicines;
2. Transition to PMPRB11 in relation to New versus Existing Medicines;
3. Price Reviews during Product Life Cycle – specific questions are posed relating to how often price reviews should be conducted and what criteria besides time should be used to trigger price reviews amongst other themes on therapeutic comparator identification;
4. Investigations and Referral to Hearings;
5. Relation to pan-Canadian Health Partners, Insurers (Private and Public); and Alignment with Broader Government Initiatives;
6. Engaging with Patients, Health Practitioners, Pharmacy, and other Stakeholders.

PMPRB announced policy roundtable discussions scheduled for 5 December (English) and 6 December (French), with a registration deadline of 24 November 2023. Additionally, stakeholders are invited to submit written responses to the scoping paper by 20 December 2023. More information can be found here.

GEORGIA

Georgia becomes the fifth validating state of the EPO

A significant milestone has been reached as Georgia becomes the fifth validating state of the European Patent Office (EPO). Once the Validation Agreement enters into force, this will offer a more efficient and cost-effective method of achieving patent protection via the EPO.