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 - 12 January 2024 - is below:

EU - STOP PRESS

CJEU rules contrary to the Advocate General in Mylan v Gilead C-473/22 relating to compensation where a preliminary injunction has subsequently been held to have been wrongly granted

On 11 January 2024, the Court of Justice of the European Union (CJEU) handed down its decision in case C-473/22 (judgment available here). The case was a reference from the Finnish Court relating to Finland’s strict liability regime for damages payable following a preliminary injunction which has been granted in relation to an IP right and which is later held to have been wrongly granted. The CJEU ruled that national legislation which provides a strict liability mechanism for compensation for damage caused by a provisional measure is not in principle precluded by art. 9(7) of Directive 2004/48/EC on the enforcement of intellectual property rights (the Directive).

The case relates to a preliminary injunction obtained by Gilead against Mylan in Finland for infringement of a Supplementary Protection Certificate (SPC) held by Gilead. The SPC in question was later invalidated and Mylan sought damages from Gilead as compensation for the injury caused by the wrongly granted preliminary injunction.

A full background to the case can be found here, which reported the opinion of the Advocate General (AG). As set out in that update, the AG opined that art. 9(7) of the Directive does not support a strict liability regime for the loss caused by provisional measures. The CJEU, however, found in the alternative. 

The CJEU flagged that, given the context of art. 9(7) of the Directive, including the fact that it replicates the broad wording of the TRIPS Agreement, the provision should be interpreted as laying down a minimum standard concerning the enforcement of intellectual property rights while leaving the Member States leeway to opt for a strict liability regime or a fault-based liability regime. 

In addition, it was highlighted that art. 9(7) does not mention among the conditions for compensation the need for existence of fault on the part of the applicant for provisional measures. Citing the Bayer Pharma reference (C-688/17), which the AG referred to in his opinion, the CJEU did not find support from this case for the assertion that art. 9(7) provides for compensation to be paid to the defendant only in the event of fault on the part of the applicant for the provisional measures. Instead, Bayer provides authority for the provision that, when Member States transpose art. 9(7), they must allow the relevant court to be able to take into account all the circumstances of the case, including the conduct of the parties, irrespective of the liability regime adopted.

The CJEU went on to refer to the balance which must be struck in the legislation between offering prompt and effective provisional measures and mitigating the risk that the defendant will suffer loss as a result of such provisional measures. 

Finland’s strict liability regime allows for the amount of compensation payable to be reduced where the defendant enabled the injury to occur or failed to take reasonable measures to avoid or mitigate the injury and thereby contributed to its occurrence. Such a strict liability mechanism in which the relevant court may take into account all the circumstances of the case, including any participation by the defendant in the occurrence of the injury, makes it possible to adjust the amount of damages and thereby mitigate any deterrent effect for the holder of the intellectual property right.

Therefore, art. 9(7) of the Directive was deemed to not preclude national legislation which provides for a mechanism for compensation for injury caused by a provisional measure based on a system of strict liability of the applicant for those measures, in the context of which the court is entitled to adjust the amount of damages by taking into account the circumstances of the case, including whether the defendant played a part in the occurrence of the injury.

If followed, the Attorney General’s opinion would have led to a significant change in approach to the systems of many EU countries for granting compensation for wrongfully imposed PIs. The CJEU’s ruling adopts an orthodox approach.

CHINA

Beijing IP Court gives findings on technical effect and the use of post-filed data in assessing obviousness

On 6 November 2023, the Beijing IP Court handed down its judgment revoking the first instance decision of the China National Intellectual Property Administration (CNIPA) which found Novo Nordisk’s patent ZL 200680006674.6, which relates to semaglutide (the Patent), to be invalid. 

Post-filed data 

At first instance, CNIPA rejected the admittance of post-filed data in support of a technical effect for semaglutide on the grounds that the Patent, which disclosed the technical effects of the genus compounds (including the specific compound semaglutide), the preparation of 22 specific compounds including semaglutide, and the standards and objectives for screening those compound, failed to disclose the technical effect of semaglutide specifically. As the technical effect was not obtainable from the Patent specification, post-filed data demonstrating this technical effect could not be relied upon and the Patent was held invalid. 

On appeal, the Beijing IP Court held that the Patent did in fact disclose a technical effect for semaglutide of “duration of action of at least 24 hours”. It was enough that the Patent disclosed that the genus compounds all have a technical effect of duration of action of at least 24 hours, and that semaglutide was one of the 22 specific compounds prepared, to presume that semaglutide possesses this same technical effect. Therefore, Novo could rely on the post-filed data demonstrating duration of action of at least 24 hours for semaglutide. The court considered this data demonstrated inventiveness over the prior art compounds which had a shorter duration of action.

Novo also sought to rely on post-filed data to substantiate the technical effect of compounds having an initial terminal half-life of 60-70 hours or more, as the Patent discloses that secondary screening would be required for these compounds. The Beijing IP Court rejected that this technical effect could be obtained from the Patent, because the specification did not specify which compounds meet this criteria, nor point to any correlation between this criterion and the specific compounds of the invention. There was therefore no indication that semaglutide met this criterion for secondary screening, and as such the Patentee could not rely on post-filed data to support the technical effect of having an initial terminal half-life of 60-70 hours or more. 

Structural obviousness 

The Beijing IP Court also overturned the CNIPA’s finding that the structural modifications made to the closest prior art compound liraglutide to obtain semaglutide were obvious. The modification involved the replacement of the 8-position amino acid, and substitution of the hydrophobic substituent and linking group on the 26-position amino acid. The court agreed with the CNIPA that the replacement of the 8-position amino acid was obvious, as it was well known to those skilled in the art that replacing this amino acid would extend the duration of action of liraglutide. However, the court overturned the finding that the substitutions on the 26-position amino acid were obvious to increase duration of action. As a principle, the court held that in the absence of reasonable grounds that specific modifications were obvious, it should not be found that such modifications are obvious even if they have been disclosed in the prior art. 

This decision suggests the Beijing IP Court may be adopting a more patentee-friendly approach to its assessment of inventive step.

BRAZIL

BRPTO violates due process and publishes rules impacting appeals and patent examination

On 12 December 2023, the President of the Brazilian Patent and Trademark Office (BRPTO) enacted substantial procedural changes based on four opinions issued by the Federal Attorney’s Office. This Directive, effective from 2 April 2024, alters the appellate process in patent appeals, drawing parallels to certain precedents set by the European Patent Office Board of Appeals in cases T 473/91, T 830/03, and T 555/08. The BRPTO also announced that as of 1 January 2024, applications will be examined in the order in which they are requested for examination, rather than by the date of filing. Directive here. 

In September 2023, the BRPTO sought legal advice from the Specialized Federal Attorney’s Office regarding the application and limits of the "full devolutive effect" in administrative appeals and an opinion was provided in November targeting the concept of the "full devolutive effect" which allows for a comprehensive re-evaluation of first-instance decisions during the appeal. However, the new interpretation significantly narrows this scope. Under the revised framework, certain actions by applicants, previously permissible at the appellate stage, are now precluded. This includes the inability to correct formal deficiencies such as the absence of a power of attorney, limitations on claim amendments, and the barring of new data to bolster claimed inventions during the appeal phase. However, the Directive does allow applicants to reduce the scope of patent claims that are permissible even after the technical examination request, as this would serve the public interest.

In response to feedback from PTO users, the BRPTO has extended the deadline for compliance to 2 April 2024. This extension includes the provision for office actions to be issued for non-compliant appeals, allowing a 60-day period for applicants to submit their considerations.

UK

UKIPO publishes updates to the Manual of Patent Practice (MPP)

On 2 January 2024, the UK Intellectual Property Officer (UKIPO) issued an update to the MPP which contains three key developments for patent practitioners.

First, paragraph 1.39.4 has been included to highlight that examiners should not use the program for a computer exclusion to object to inventions involving artificial neural network (ANN). This is addressed the ruling from the High Court in the case of Emotional Perception AI Ltd v Comptroller-General of Patents, Designs and Trade Marks [2023] EWHC 2948 (Ch) which established that an ANN, irrespective of being hardware or software-based, does not constitute a computer program.

Second, paragraph 3.87.3 has been introduced, focusing on the concept of inventive step. The court determined that the presence of prior art suggesting clinical trials might indicate a compound as an effective treatment does not inherently make it an obvious choice for experimentation as a treatment.

Third, paragraph 76.20.1 has also been introduced to emphasise that care must be taken when considering amendments to the description which impact the construction of the claims. In Ensygnia v Shell [2023] EWHC 1495 (Pat), a statement that embodiments comprising an electronic display were “outside the scope of the claims” was added to the description by amendment. However, the judge held that “without hindsight, I do not think it would even occur to the skilled reader reading this passage in the context of the application as a whole that the invention could be implemented using a sign that is not electronic or which cannot be changed.” The patent was therefore found to be invalid due to both added matter and for having extended the scope of protection.

Several other changes were made to reflect the changes in terminology arising from the Retained EU Law Act 2023.