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 - 22 March 2024 - is below:

IN

Two decisions of the Madras High Court explore the terms “mere” and “occurring in nature” in the context of exclusions from patentability

In two recent court decisions handed down on 6 March 2024, Imclone v Assistant Controller and Genmab v Assistant Controller, the Madras High Court has considered the extent of the exclusions to patentability contained within s. 3 of the Indian Patents Act 1970 (the Act).

The central question for the court in both cases was whether the production of a synthesized non-living substance, in particular, a monoclonal antibody, qualifies for patent protection or if it is excluded by the Act.

The specific exclusion within s. 3 of the Act which was considered by the Court in each decision was s. 3(c): “the mere discovery of a scientific principle or the formulation of an abstract theory or discovery of any living thing or non-living substance occurring in nature”.

The word “mere”

The court first considered the original pre-amended text of s. 3(c): “the mere discovery of a scientific principle or the formulation of an abstract theory”. The court considered that the qualifier “mere” here was not intended to capture the “formulation” exclusion. The Court then went to conclude that it would be a “strained construction” for the word “mere” to then qualify the later added third limb of the section relating to “discovery of any living thing or non-living substance occurring in nature”, but not the second limb. The Court considered that construction would be different had s. 3(c) been drafted to merge the first and third limbs together.

The Court also considered the Statement of Objects and Reasons which led to the later third limb amendment, and noted no reference to the qualifier “mere”, which it would have expected Parliament to include had it intended it to apply.

The Court therefore deviated from the previous interpretation of s. 3(c) found by the Delhi High Court in Diamond Star Global Sdn. Bhd. v Joint Controller of Patents and Designs [2023:DHC:2316].

The phrase “occurring in nature”

The court considered that the phrase "occurring in nature” applied to a “non-living substance” only, and therefore did not qualify the first part of the limb “any living thing”. The court considered that to qualify a living thing as occurring in nature created a redundancy, and the sentence would be structured differently had it been Parliament’s intention to capture both parts of the limb with the qualifier.

The Court’s view was therefore that the exclusionary third limb of s. 3(c) is intended to capture the finding of a previously undiscovered non-living substance by identifying and isolating it from nature.

Application to the facts

The Court considered that the real issues posed for synthesized non-living substances were in relation to novelty and technical advancement, not patent eligibility. Furthermore, the patent must not fall down at the other s. 3 exclusions and must meet the other requirements of the Act.

Imclone

Here, the antibody was generated in mice in which murine genetic material had been deleted and replaced with human genetic material. Said mice were then injected with an engineered antigen and monoclonal antibodies were generated using a hybridoma process. The Court did not find that this was excluded from patentability under s. 3(c), the process not being a finding of a previously undiscovered non-living substance by identifying and isolating it from nature.

The Court also held that the fact the organism specified in the sequence listing was homo sapien did not mean it concerned the discovery of an antibody or non-living substance occurring in nature.

Genmab

Again, the assertions of the respondent that the patent concerns the discovery of an antibody/non-living substance occurring in nature were not supported merely because the organism specified was homo sapiens. The Court did not describe the process by which the antibody was produced in this case, but indicated it did not fall within the s. 3(c) exclusion. The Court went on to consider and conclude that the patent was inventive and contained technical advancement.

Both patents therefore proceeded to grant.

UPC

Recent decision of the Hague local division in Plant-e v Arkyne which opens the possibility of US style entirely EEO confidentiality clubs

On 4 March 2024, the Hague Local Division of the UPC issued an order relating to Plant-e’s application under UPC Rules of Procedure r. 262A for a confidentiality order covering financial information provided with their reply to an application by Arkyne Technologies (Bioo) under r. 158 for security for costs in the main proceedings.

In their reply to Bioo’s r. 158 application, Plant-e had provided redacted and unredacted versions of documents that contained commercial information to support their arguments contradicting Bioo’s contention that Plant-e’s financial position would not allow it to cover Bioo’s legal costs in the event that they were ordered to do so. The r. 262A application for confidentiality was filed alongside this.

The redacted information concerned the investments made in Plant-e by investors and the relevant amount of said investments, information on the sales funnel of Plant-e and projected sales in the near future and more information concerning the financial situation of Plant-e than is publicly available.

In their r. 262A application, Plant-e also requested:

a) that Bioo be ordered to pay recurring penalty payments for each breach of the confidentiality order;

b) a confidentiality regime in which the redacted information is only to be used by Bioo for the r. 158 application and no other purposes; and

c) that only one natural person in Bioo may be granted access to the redacted information and that said person may not be involved in sales, procurement of grants and discussions with existing or potential investors, or hold a financial position within Bioo.

Bioo’s r. 158 application was rejected prior to this order (without the Court considering the redacted information) and, on 26 January 2024, the Judge-Rapporteur issued a Preliminary Order giving the parties the opportunity to provide further comments and giving Plant-e the opportunity to withdraw its r. 262A application.

Plant-e maintained its r. 262A application, stating that the redacted information had already been submitted and shared with Bioo’s representatives and might become relevant if an appeal was filed against the rejection of the r. 158 application. Bioo maintained the primary position that the r. 262A application should be dismissed.

In relation to requests a) and c) above, the parties agreed that if the r. 262A application is granted no penalty for breach should be imposed, and to establish an “attorneys’ eyes only’’ confidentiality club such that only Bioo’s legal representatives would be allowed access to the redacted information. Plant-e amended its r. 262A application accordingly.

The parties did not agree on b), the use of the redacted information. Plant-e argued that the use of the redacted information should be limited to the context of the r. 158 application only. Bioo argued that the use of the redacted information should be permitted for the entirety of the proceedings pending between the parties, including both the main proceedings and the counterclaim.

Legal Framework

In the UPC, the protection of trade secrets, personal data or other confidential information is governed by Article 58 of the UPC Agreement (UPCA) which has been implemented in r. 262A. These state the following:

Art. 58 UPCA:

“Protection of confidential information

To protect the trade secrets, personal data or other confidential information of a party to the proceedings or of a third party, or to prevent an abuse of evidence, the Court may order that the collection and use of evidence in proceedings before it be restricted or prohibited or that access to such evidence be restricted to specific persons.”

r. 262A:

“1. Without prejudice to Article 60(1) of the Agreement and Rules 190.1, 194.5, 196.1, 197.4, 199.1, 207.7, 209.4, 315.2 and 365.2 a party may make an Application to the Court for an order that certain information contained in its pleadings or the collection and use of evidence in proceedings may be restricted or prohibited or that access to such information or evidence be restricted to specific persons.

[…]

6. The number of persons referred to in paragraph 1 shall be no greater than necessary in order to ensure compliance with the right of the parties to the legal proceedings to an effective remedy and to a fair trial, and shall include, at least, one natural person from each party and the respective lawyers or other representatives of those parties to the legal proceedings.”

Court Decision

The Court considered that the redacted information, being financial information that is not in the public domain, qualified as “confidential information” according to Art. 58 UPCA and r. 262A and Bioo’s response failed to provide convincing arguments to counter this assertion.

The Court considered that unprotected disclosure of this information to employees of Bioo would likely have a negative impact on Plant-e, as the proceedings involved competing small companies with limited staff. Taking into account the interests of both parties, The Court found that giving a natural person of Bioo access to the redacted information would be likely to distort competition, which should be prevented under Art. 42.2 UPCA. Withholding the redacted information from a natural person of Bioo would not affect Bioo’s position in the main proceedings (as it was not relevant) or in the r. 158 application, as sufficient information was available for the Court to take a decision on this without considering the redacted information.

The Court noted that it is not entirely clear whether denying access to at least one natural person of Bioo is in line with the legal framework of the UPC outlined above. The wording of r. 262A.6 is identical to the wording used in Art. 9(3) of Directive (EU) 2016/943, which has been implemented in different ways in member states.

For example, in Germany and Belgium, the provisions of the Directive have been extended to apply to all types of cases in which confidential information is concerned (even as just a side issue), including a strict rule that at least one natural person from each party should be granted access to the confidential information. However, in the Netherlands, the application of the Directive is limited to proceedings concerning the enforcement of trade secrets, and a different regime applies where confidential information is at issue in other proceedings (such as in patent cases), where access to such information can be limited to attorneys only where it is considered to be appropriate and in line with a fair trial.

The Court considered that the differing approaches of contracting member states gave room for flexibility to base access to confidential information in the UPC on both the circumstances of the case and type of confidential information concerned. They found justification for this approach in “the logic that the principle of fair trial is more likely to be impaired when the essence of the case is the trade secret and no natural person of a party would get access to the confidential information, as compared to a case wherein this information is a side issue (like in the case at hand)”.

In interpreting the legal framework of the UPC outlined above, the Court found that the wording of r. 262A.1 and Art. 58 UPCA allowed for a reading that, in addition to limiting access to specific persons, it is also possible in proceedings before the UPC to rule that access to confidential information be prohibited completely, as an alternative. This was specifically due to the use of the wording “restricted or prohibited or (…) restricted to specific persons”.

The Court also went further, and stated that even if a strict rule that at least one natural person from each party must be granted access to the confidential information was read to apply in the situation of this case (following a different interpretation of r. 262A.6) it would still be possible for the parties to exclude access by natural persons through mutual agreement, or by the party concerned forfeiting its right to access by a natural person, provided that this does not impact the prospect of a fair trial.

The Court therefore ordered that only Bioo’s legal representatives shall have access to the redacted information and that the redacted information may be used by Bioo for the r. 158 application and no other purposes.

A copy of the order can be found here. [First published in EPLAW Patent Blog, 21 March 2024]

IN

2024 Amendments to the Patent Rules

On 15 March 2024, amendments to the Patent Rules in India came into effect. Key aspects of the amendments include a streamlined procedure for pre-grant opposition, provisions for extensions and filing statements of working, and changes in several prescribed deadlines and fee structures.

The amendments aim to streamline patent procedures, align with international standards, and address issues relating to pre-grant opposition proceedings. These changes are being introduced just five days after India entered into a Trade and Economic Partnership Agreement with the European Free Trade Association, from which some of the changes appear to stem. The key changes are outlined below, but the full notice can be found here:

• Streamlining of Pre-Grant Opposition Process (Rule 55) - An additional stage has been added in pre-grant opposition proceedings where the Controller will now first decide on whether the opposition should proceed. In doing so the Controller will analyse whether the pre-grant opponent has made a prima facie case for the opposition before issuing a notice to the Applicant. These amendments are likely intended to reduce vexatious pre-grant oppositions against patent applications which are filed for the sole purpose of delaying grant. Further, the introduction of official fees for filing pre-grant oppositions creates an additional deterrence against the filing of such vexatious oppositions.
• Reduction in time to file statement and undertaking regarding foreign applications - The time limit for filing statements regarding foreign family members has been reduced from six months to three months. However, the requirement of filing office actions and granted claims, etc. of those family members under Section 8(2) of the Patents Act has been removed and the Controller must instead use accessible and available patent databases for considering the information relating to applications filed in a country outside India.
• Reduction in renewal fee if paid in advance for at least 4 years - Patentees can obtain a 10% reduction in renewal fees if paid in advance for a minimum of four years.
• Provision for extension of prescribed timelines (Rule 138) - The Controller now has the power to extend deadlines by up to six months (previously this was only one month).

Relaxation in filing statement of working - In India, patented inventions must be worked (i.e. practised.) The statement of working form must now be filed only once every three years, rather than annually.