Procedural issues

This article is part of the latest edition of our Patents: Review of the Year publication.

Territorial scope of the Act

We reported last year on the judgment of Bacon J in Anan Kasei v Neo⁸¹, where the Judge found that Anan Kasei could not recover damages from Neo for its supply of catalytic converter materials outside of the UK. Neo had supplied a small amount of test product in the UK and the parties agreed an £85,000 damages payment for this. This test product allowed Neo to secure further orders, for which Rhodia sought over €24 million. Rhodia’s problem was that these materials were manufactured in China, where the patent had been invalidated, and supplied in territories without patent protection. Bacon J held that although damages are not in principle barred by virtue of the acts taking place abroad, on the facts there were multiple intervening contingencies and Rhodia had failed to prove that the foreign sales were caused by the English acts. Just nine months later, Arnold LJ delivered the leading judgment in the Court of Appeal⁸². Drawing upon the verdict of the US Supreme Court in WesternGeco v Ion Geophysical⁸³ he agreed with Bacon J that extra-territorial damages are, in principle, available but that on the facts of this case there was no causation due to the multiple intervening contingencies. Permission to appeal to the Supreme Court has been refused.

Preliminary issues

Readers will remember the pemetrexed litigation which ran throughout much of the 2010s. The settlement agreement with Eli Lilly required Teva to respect the patent in Europe and was governed by English law. Therefore, when there was an alleged breach of this agreement in Germany, the case came before His Honour Judge David Hodge KC for a case management hearing to determine Lilly’s application for the court to make a determination on two preliminary issues⁸⁴: whether the losses to be assessed were those of the claimant group as a whole or only the German subsidiary and whether damages could be claimed under German law only. The Judge refused the application on the basis these issues were not suitable for disposal on a preliminary basis: further disclosure and evidence would be needed and a preliminary issue hearing would delay the main trial. The Judge was also uneasy about dealing with the applicability of German law on the basis of assumed facts.

Arrow relief

In the years following its rise to prominence, Arrow⁸⁵ relief was pleaded widely. The idea of getting freedom to operate against an entire patent family via a declaration that an accused product was old or obvious is highly attractive. However, in recent years it has become clear that such declarations will not be given unless they serve a useful purpose (a requirement for any declaration granted by the English Courts). In fact, to this day, only two Arrow declarations have ever been granted in the UK⁸⁶. A further refusal was added to the tally by HHJ Hacon in Philip Morris v Nicoventures⁸⁷. PMI sought Arrow declarations in respect of two families of patent applications pending before the EPO. BAT’s arguments against the grant of Arrow relief were that: (1) the declaration sought was unclear; (2) PMI had sought to expand the scope of the declaration relating to lack of novelty such that it stretched beyond the bounds of the disclosure in the prior art; and (3) the declaration lacked a useful purpose. Again, the Judge having disagreed on the first two points, the case turned on “useful purpose”.

Having reviewed the case law on useful purpose, the Judge identified fourteen principles, the latter two of which were his own additions:

An Arrow declaration is likely to serve a useful purpose if the applicant can show that (a) the respondent’s portfolio of patent applications and/or patents creates real doubt, likely to continue for a significant⁸⁸ period, as to whether technical subject-matter which the applicant wishes to exploit can lawfully be used, (b) the applicant’s reasonable intention to exploit that subject-matter would be of significant commercial advantage to it and (c) the declaration sought would, if granted, eliminate or significantly reduce the delay.

The court will more readily find that there is a useful purpose where the respondent’s behaviour has been consistent with an intent to prolong the doubt.

However, the Judge was also clear that he would be reluctant to discourage parties from consenting to revocation of patents where to do so will save costs and avoid unnecessary use of court time. On the facts of this case, BAT’s conduct in the prosecution of the relevant patent families was not found to weigh in favour of granting Arrow relief. PMI also had not made out sufficiently in its evidence that the relief would have a material impact on its commercial plans. The Arrow declaration was therefore refused.

Licensing

The interpretation of royalty provisions in a sub-licence granted to Tesaro of patents held by the University of Sheffield and the Institute of Cancer Research was the focus of a dispute which came before Richards J in AstraZeneca v Tesaro⁸⁹. AstraZeneca was the head licensee of the patents and the sub-licence granted to Tesaro contained obligations to pay royalties to AstraZeneca for sales of Tesaro’s anti-cancer drug Zejula (niraparib).

The licensed patents were second medical use patents and the issue in dispute was whether Tesaro was required by the agreement to pay royalties on all sales of Zejula (i.e. a total sales royalty) or only on sales found to be infringing. Although the sub-licence was governed by English law, the United States doctrine of patent misuse was of some relevance to its interpretation because the United States was a major market for both AstraZeneca and Tesaro. The doctrine of patent misuse is intended to prevent patentees using agreements to extend the scope of a patent beyond that which the law allows. One of the practices that may be prevented by the doctrine is the charge of royalties on products which do not infringe the licensed patents. Tesaro argued that there was at least a significant risk that the total sales royalty would fall foul of this doctrine and therefore the court should not impute to the parties an intention to agree a total sales royalty.

The Judge concluded that the risk of patent misuse was relatively low in this case and that the parties’ intentions should be taken from the language of the agreement, which pointed towards a total sales royalty structure. Although the agreement referred to use which “may be claimed or covered” by the licensed patents, this was found to relate to the fact that there were, or might be, patents relating to niraparib that AstraZeneca did not have the power to license. Royalties were therefore payable on all sales of Zejula, regardless of whether they related to an infringing use.

Inventorship

In 2023, the appeal of the UK IPO’s refusal to grant two patents to an AI machine called DABUS reached the Supreme Court, and in one of the final judgments of the year, that Court, led by Lord Kitchin, unanimously dismissed the appeal of Dr Thaler (the owner of DABUS)⁹⁰. The Supreme Court agreed with the findings of the UK IPO and all the lower courts on three issues.

First, the Supreme Court held that DABUS could not be considered an inventor within the meaning of the Act. It was clear that an inventor must be a natural person. Secondly, Dr Thaler was not the owner of any invention made by DABUS and so was not entitled the apply for a patent. The Court again was clear that there is no invention because DABUS cannot be an inventor. Even if there were some invention, it could not be considered transferred by the doctrine of accession in the same way the owner of a tree owns the fruit of that tree – this only applies to tangible property. Finally, the Hearing Officer was correct to hold that the applications would be taken to be withdrawn at the expiry of the sixteen-month period specified by r. 10(3) of the Patent Rules 2007 by reason of Dr Thaler failing to satisfy either of the requirements in s. 13(2) of the Act: he did not identify any person(s) whom he believed to be the inventor or inventors of the inventions described in the applications and his ownership of DABUS did not provide a proper basis for entitlement. This is the end of the road for Dr Thaler in the UK but cases have been heard relating to DABUS and equivalent patents in many other jurisdictions around the world, several of which have reached the same conclusion as the UK but certain jurisdictions (South Africa and Saudi Arabia) currently have patents in force listing DABUS as the inventor. The Supreme Court made it clear that it was deciding this case on the basis of interpreting the legislation as it is and not as it should be, bearing in mind the rapid development of AI technology. That would be a policy position requiring a change in legislation.

Inventor compensation

The attention commanded by a Supreme Court case can be influential. And so it may not be surprising that after Professor Shanks’ successful inventor compensation claim in the Supreme Court in 2019 comes another case for inventor compensation in Parsons v Convatec⁹¹. Dr David Parsons, an analytical chemist, worked for Convatec from 1991 to 2022 during which time various inventions, mostly concerned with silver in antimicrobial products, were patented, primarily in Convatec's name. In September 2022, Dr Parsons brought an action against Convatec seeking compensation under s. 40 of the Act on the basis that he was the inventor and the inventions were of ” to the company and therefore eligible for compensation. Convatec sought to strike out parts of Dr Parsons' claim in respect of five patent families, arguing that some patents weren't initially granted to Convatec, Dr Parsons wasn’t named as an inventor in others, and that his claims under certain patents were time barred.

Zacaroli J heard Convatec's strike out application. Only the time bar point gained any traction, and on this, having considered the prescribed period for making the compensation claim under s. 40(1) of the Act (beginning on the date of the grant of the patent and ending 1 year after the patent has ceased to have effect) he agreed with Convatec that Dr Parsons was too late in respect of two patents. Although the Court has a discretion to extend the period, the Judge declined to do so, mainly because the extensions required would be many years in length, the patents were on a public register and Dr Parsons was still working in the field at the time their term ended. It did not matter that the term ended prematurely by revocation and Dr Parsons said he wanted to wait in order to bring all his claims at once. Hence, Convatec succeeded in striking out parts of Dr Parsons’s claim. The rest of the case will proceed to trial.

Listing

Recorder Douglas Campbell KC’s case management decision in February 2023 to hear the FRAND trial before the technical trials (i.e. trials on the issues of infringement and validity) in Kigen v Thales⁹² is significant. This approach aims to resolve the broader commercial issues first which could influence the outcome of the technical trials.

In July 2023, in a passage of his judgment in Nokia v Oppo⁹³ entitled “Reflections”, Meade J endorsed this approach: “There have now been multiple FRAND/SEP litigations in the UK where the FRAND trial has been scheduled to take place only after a number of technical trials, up to 2 years or longer after the litigation has been initiated. … It is becoming ever clearer that technical trials are not about what is really in issue in these disputes. What is really in issue is FRAND terms. … I do not see why it should not be possible to prioritise the FRAND issues more than has been the case to date, and, for example, to schedule at the start of a case such as this a single trial, or two trials which are simultaneous or very close in time, covering technical issues and FRAND. If the patentee failed to show that there was a SEP that was valid and essential then the FRAND terms could not be imposed on the implementer by putting it to its election. There would be consequences in terms of costs and use of resources if no patent was found valid and essential but that can happen in any action where the establishment of a cause of action and the consequences of its breach are tried together.”

Putting this into practice, in November 2023, Meade J decided in Panasonic v Xiaomi⁹⁴ that he would expedite the listing of a FRAND trial as well as placing it ahead of the technical trials in the same matter. Xiaomi had applied for an expedited listing of the FRAND trial in part because Panasonic had launched parallel proceedings in other jurisdictions, including Germany, and Xiaomi had expressed a concern that, as a result of the parallel proceedings, “it might be forced either to agree to supra-FRAND rates or even to leave the market in some or other jurisdictions” before the High Court had given judgment on the FRAND trial. Meade J decided expedition was appropriate given that Panasonic did not wish to be prevented from enforcing any injunction that might be granted outside the UK in the meantime. 

Confidentiality regimes

The Court has always sought to balance the competing interests of the parties when deciding what confidentiality regime is appropriate in any given situation. Whilst forming an early confidentiality club is now more or less standard practice in FRAND disputes, the terms of that club continue to be debated. In InterDigital v OnePlus⁹⁵ the Court of Appeal endorsed the guidance given in Mitsubishi v OnePlus⁹⁶ on the appropriate terms. The appeal concerned the restriction on licensing activities for the individual at OnePlus who had sight of InterDigital’s licences. At first instance⁹⁷, Mellor J ordered a ‘wide’ restriction, so that the OnePlus employee could not be involved in any licensing negotiations with any counterparty during the litigation and for two years afterwards. OnePlus appealed, arguing that the restriction on licensing activities should only apply to negotiations with the specific counterparty to the InterDigital licence that was disclosed. Birss LJ, delivering the leading judgment, found that knowledge of any SEP licence can still present a competitive advantage when negotiating with any counterparty. Therefore, Mellor J's “wide” restriction was upheld.

Confidential information

The influence of foreign law on the question of whether a disclosure was made available to the public was dramatically illustrated in AutoStore v Ocado⁹⁸ with catastrophic consequences for AutoStore and its patents. Unusually, the proceedings were conducted as a split trial where the prior disclosure issues came on first. The key question HHJ Hacon had to answer was whether or not the prior disclosures of AutoStore’s systems (which AutoStore had admitted were enabling disclosures of the patents in issue) were confidential. The disclosures in question were made in Russia while pitching for a contract, but this fact did not matter: HHJ Hacon noted that the criterion of being “made available to the public” in s. 2(2) of the Act “is not affected by the place where the disclosure of any matter occurs, or by the domicile or location of either the discloser or recipient of the disclosure”. What did matter was the applicable law governing the parties’ dealings. The parties were in dispute about this – indeed, they even disputed which law should be applied in order to decide the applicable law. AutoStore argued that Art. 12(1) of Rome II⁹⁹ applied, such that Norwegian law was applicable to the confidentiality issue since this was the law “that would have been applicable to [the contract] had it been entered into.” The Judge disagreed and applied the provisions of Rome II governing any unfair competition (Art. 6(1)) or damage (Art. 12(2)) that would have occurred had any obligations of confidence been breached. In both instances, Russia was the relevant country and so Russian law applied. This, in turn, had the result that obligations of confidence could only have been established if the relevant parties entered an express contract of confidentiality, which had not happened. Accordingly, the disclosures were available as prior art and the patents were held invalid. Somewhat adding insult to injury, HHJ Hacon commented that he would have found that an equitable obligation of confidence arose had English law applied to the disclosures.

As students of patent law know, a public disclosure may take place where a skilled person can deduce by observation the operation of an invention even if the inner workings are inside a locked box¹⁰⁰. However, if reverse engineering of a publicly visible apparatus is necessary to elucidate such information, the situation becomes more complicated. In JCB v Manitou¹⁰¹ the information concerning a particular configuration (Configuration C) used on the majority of Manitou’s publicly operated telehandlers was said to be confidential, notwithstanding that it could be obtained by reverse engineering. In addition, certain information in Manitou’s Product and Process Description (PPD) was also said to be confidential, its value lying in its ability to act as a short cut to reverse engineer Configuration C. HHJ Hacon held that information relating to Configuration C was confidential but that it was in the interests of open justice to include the information from Manitou’s PPD in the public version of the confidential annex to his judgment. Both sides were given permission to appeal this decision.

On appeal, Arnold LJ analysed the case law¹⁰² and decided in Manitou’s favour that the information was confidential and that there would be a breach of confidence if a short cut had been taken. Arnold LJ noted that the practice of the English courts is that open justice should give way to the protection of trade secrets only when, and strictly to the extent, necessary. However, where it is necessary, open justice must give way to a greater principle, which is justice itself. Arnold LJ also reviewed sua sponte the position under the Trade Secrets Directive¹⁰³, Art. 9(2)(c) of which gives the court the power to publish non-confidential versions of judgments from which passages containing trade secrets have been removed or redacted. Practitioners engaged in a confidentiality dispute will benefit from a review of the judgment and its summary of the law in full.

Experiments

An order for Mayne Pharma¹⁰⁴ disclosure (of work up experiments) was made by Mr Campbell Forsyth sitting as a Deputy Judge in Safestand Ltd v Weston Homes Plc¹⁰⁵. Weston Homes conducted experiments to support their position that their Kwik Kage System did not infringe Safestand’s patents for support trestles used on building sites and applied for permission to rely on the results in an amended Notice of Experiments. Safestand were successful in their application for Mayne Pharma disclosure to avoid the risk that the results being relied upon were partial or selective, particularly bearing in mind the complexity of parameters relevant to the claims such as longitudinal stability.

Experts

This section in last year’s review concluded with the remark that “As matters now stand, the extent to which interaction between a party’s own experts is desirable or even required is unclear and further clarification from the Court is awaited with interest.” Some clarity emerged in 2023. Whilst writing his decision in the Teva v Grünenthal¹⁰⁶ case, Meade J took the opportunity to endorse the comments made last year by Mellor J in Alcon v AMO¹⁰⁷ that caution against keeping experts in silos. Three points can be derived from Meade J’s judgment on this issue: (1) it is important that experts have a genuine opportunity to consider their colleagues’ draft reports to raise queries and concerns and to modify their own evidence if required; (2) how this is achieved will depend on the case – sometimes the exchange of draft reports will be sufficient; in other cases a meeting may be necessary, whether face to face or otherwise; and (3) mere rubber-stamping of one another’s evidence is not enough.

In the same vein, in Astellas v Teva and Sandoz¹⁰⁸, Mellor J found cause to criticise how the instructing solicitors had handled the interaction between the experts dealing with different aspects of the evidence, and also questioned whether the experts had been provided with the most helpful instructions and background information. If an expert raises a question that can be answered by data held by the client or by having a discussion with another expert, then solicitors must reflect carefully about how to respond to such a question.

The Sycurio¹⁰⁹ case provides a reminder of the importance of selecting an appropriate expert. In her judgment, Bacon J went so far as to disregard almost entirely the evidence given by Sycurio’s witness because it fell outside the witness’ core area of expertise. Sycurio had sued PCI-Pal on its GB patent for a method of reducing fraud in call centres by blocking the telephone tones which contain sensitive information (e.g. payment card details) and which could otherwise be “decoded” by nefarious call centre agents. Bacon J decided that the invention related to a specific technical problem within the area of telephone payment systems and not, as Sycurio and its expert witness contended, a more general concept of payment card security systems. Bacon J, in explaining the role of an expert witness, referred to CPR 35 and emphasised that an expert witness must give evidence on matters “within their expertise”. The Judge continued by commenting that an expert “should not … give evidence on the basis that they have sought to read in and educate themselves in the relevant field for the purposes of the case in question”. Again, and unsurprisingly, Bacon J noted that it is the solicitors that bear the responsibility.

Fact evidence

Cook v Boston Scientific¹¹⁰ settled after trial but before judgment was completed. Mr Campbell Forysth (sitting as a Deputy High Court Judge) nevertheless took the opportunity to comment on an issue arising at trial over whether the trial witness evidence complied with CPR PD 57AC. Cook had made an application to vary the certificate of compliance required by paragraph 4.4 of CPR PD 57AC by reason of it not being possible to comply with the relevant requirements during the preparation of the evidence. The application was made without notice so Boston did not receive the application notice or supporting evidence. No doubt curious as to why compliance was initially impossible, Boston wanted to receive a copy of the application notice and supporting evidence and pointed to CPR 23.9 as a basis for being entitled to do so. Cook denied that CPR 23.9 was triggered because the application to vary the certificate was not “against” Boston. The Deputy Judge disagreed – the effect of Cook’s successful application to vary the certificate was that Cook was then permitted to rely on evidence which is prepared outside the requirements of CPR PD 57AC and the Statement of Best Practice, which clearly had an impact on Boston. Therefore, in future, parties applying to vary their certificate of compliance under paragraph 4.4 of CPR PD 57AC should be prepared to hand over the supporting evidence regarding their earlier failure to do so.

Damages

Roughly half of the Court of Appeal's forty-page judgment in Warner-Lambert v Dr Reddy's¹¹¹ was taken up with covering the complex procedural history behind the application, which concerned amendments to Warner-Lambert's pleadings as part of the damages inquiry in the pregabalin litigation. Readers may recall that the damages inquiry in question is for the purpose of determining the amount of compensation owing to Dr Reddy’s under Warner-Lambert’s cross-undertakings given in relation to various interim orders and also to compensate loss suffered by reason of Warner-Lambert’s unjustifiable threats of patent infringement proceedings. The underlying point of law was whether, given the claims covering pregabalin to treat inflammatory pain had been held valid, Dr Reddy's damages should be reduced to account for sales of pregabalin products that would ultimately have been used to treat inflammatory pain, even if no infringement was made out. Warner-Lambert suggested this should be the case as its monopoly in relation to inflammatory pain made it unjust for damages to be payable. Arnold LJ, giving the leading judgment, firmly rejected this idea and the other Lord Justices of Appeal agreed. Males LJ put the point succinctly: “If, by obtaining an interim injunction, a patentee prevents competitors from engaging in non-infringing activity and thereby causes them loss, there is nothing unjust or inequitable in requiring the patentee to compensate them for such loss.”

In relation to Warner-Lambert’s second proposed amendment that would have introduced a new allegation of infringement (supply by pharmacists of Dr Reddy’s product for treatment of the patented inflammatory pain indication), it was not necessary for the Court to decide whether there was any reasonable prospect of success (although Arnold LJ certainly expressed his doubts) because in any event such late amendment application constituted an abuse of process, coming as it did after the liability phase of the proceedings had concluded.

Costs

Following GE’s successful defence to Siemens’ infringement action against its Haliade X wind turbines being installed in Dogger Bank¹¹², the parties argued the costs consequences of that decision¹¹³. The first issue was the meaning of “costs of and occasioned by”. Siemens had originally asserted two patents, one of which was subsequently dropped before trial. Before Siemens made that decision, GE had replaced one piece of prior art with another. When the patent was dropped, an order was made that Siemens pay GE’s costs associated with that part of the proceedings save for the “costs of and occasioned by” GE’s amendment which changed the prior art. Siemens argued that GE should pay the historical costs of the dropped prior art, as Siemens had incurred costs in dealing with that prior art that were wasted. Meade J disagreed. The ordinary meaning of “costs of and occasioned by” only refers to costs arising after any amendment, and there was nothing in the circumstances to displace that ordinary meaning. If parties wish for costs to be retrospective in a similar situation, the appropriate wording in the order is “costs thrown away”.

The parties also debated the appropriate way to calculate the split of costs where there are separate issues on which the overall ‘loser’ has prevailed. The traditional method, and that adopted by Siemens, is for the parties to count paragraphs in evidence and/or skeletons and apportion costs accordingly. Instead, GE did its calculation via a review of the billing narratives, arguing that paragraph counting over-emphasises the importance of the issues at trial, rather than how they had developed over the entirety of the case. Siemens submitted that such an approach lacked transparency and was subject to perception bias. Meade J disagreed that the billing narrative approach was any more prone to perception bias than paragraph counting, but did accept, in principle, a lack of transparency given he had not seen any of the actual billing narratives. However, given the solicitors’ familiarity with the proceedings, and the fact that the method had withstood Siemens’ challenges, Meade J proceeded with GE’s calculations (subject to the usual high margin of error). Separately, GE resisted any apportionment of counsel’s brief and refresher fees on the basis that they would have been the same whether the relevant issues were in the case or not. This was rejected, with Meade J finding it undesirable for counsels’ fees to not be subject to any review and that had the parties known that certain issues would not be in the case when trial length and brief fees were arranged, then they would have been shorter and smaller, respectively.

In Oxford University Innovation Ltd v Oxford Nanoimaging Ltd¹¹⁴, costs had been managed under cost budgets. OUI claimed for indemnity costs from ONI but failed – the Court found no exceptional behaviour from ONI to justify penalising them. OUI also made a request for a summary cost assessment which was also denied. The Judge favoured a detailed assessment due to the substantial sums involved. ONI was ordered to make an interim payment of £925,000 to OUI, being the total amount of budgeted costs (c.£687K) and 60-65% of the unbudgeted costs (c.£379K).

Unitary Patent/Unified Patent Court

After more than a decade in the making, the Unified Patent Court (UPC) finally opened its doors on 1 June 2023. Alongside it, the unitary patent (UP) was also introduced: a new European patent right with effect across all countries participating in the UPC at the time of grant. There are currently 17 participating states (Austria, Belgium, Bulgaria, Denmark, Estonia, Finland, France, Germany, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovenia and Sweden), most of which are hosting a Local or Regional Division (which will generally hear infringement actions, actions for provisional measures and injunctions). Bulgaria, Malta and Luxembourg are not hosting Local Divisions but Germany has made up for that by hosting four, in Düsseldorf, Hamburg, Mannheim and Munich. Ireland will hold a UPC referendum in June 2024 which, if the Irish population returns a ‘yes’ vote, will allow Ireland to ratify the UPCA and become a participating state, at which point it has expressed an intention to introduce a Local Division in Dublin.

Shortly after the UPC start date, Milan was finally confirmed as the third seat of the Central Division (which will generally hear revocation actions and actions for declarations of non-infringement). From June 2024, Milan will have responsibility for human necessities patents (excluding SPCs), while the Munich seat will be responsible for mechanical engineering, lighting, heating, weapons, blasting, chemistry and metallurgy (excluding SPCs) and the Paris seat will be responsible for all other International Patent Classifications plus SPCs. Until the Milan seat becomes functional, its cases are being split between the Munich and Paris seats.

A summary of the highs and lows of the first seven months of the UPC and some of the early decisions now follows.

Early statistics (as at year end) – Almost 600,000 UPC opt-outs were filed in the first seven months, representing at least a third of all European patents (EPs) that would otherwise fall under the jurisdiction of the UPC, and most likely more, given the possibility to file bulk opt-outs covering multiple EPs. Over a thousand of those opt-outs had already been withdrawn by the end of 2023 and some of the patents for which the opt-out was withdrawn were asserted within the UPC shortly thereafter. There was also significant uptake of the new UP (which must be litigated within the UPC and cannot be opted out), with over 15,000 requests for UPs filed. A total of 67 infringement actions and 24 revocation actions were filed in 2023, with the Munich Local Division proving most popular for infringement actions, 34% of all infringement actions being filed in that Division.

English was the dominant language of revocation actions (85%), which must be filed in the language of the patent. German was the most popular language for infringement actions (59%), followed by English (30%), although it will be interesting to see how this evolves over time, particularly given that all Local Divisions and the Nordic-Baltic Regional Division (the only Regional Division so far) have confirmed that they will accept English as the language of proceedings (a detail that was confirmed only shortly before the UPC start date). The language of proceedings was switched to English after filing in a number of actions (Plant-e Knowledge v Arkyne Technologies¹¹⁵ and Amgen v Sanofi¹¹⁶), although a change from German to English was refused by the Mannheim Local Division in Panasonic v Oppo¹¹⁷ (currently under appeal).

IT – Unfortunately, the early days of the UPC were beset with IT issues as the UPC case management system (CMS) struggled to cope with the influx of last-minute opt-out requests before the UPC start date. This led to the first UPC cases being filed by hand following a number of last-minute dashes to various UPC registries. It also led to one of the first procedural UPC decisions in the proceedings between Sanofi and Amgen¹¹⁸. On day one of the UPC, Amgen filed an infringement action against Sanofi and Regeneron before the Munich Local Division and, in parallel, Sanofi filed a revocation action against Amgen in relation to the same patent before the Munich Central Division. However, with the CMS being down, both actions were filed by hand at different registries: Sanofi’s revocation action was filed in Luxembourg and Amgen’s infringement action was filed in Munich.

Amgen objected that Sanofi’s revocation action was inadmissible on the basis that Amgen had filed their infringement action first, so Sanofi was blocked from filing a revocation action by Art. 33(4) of the UPCA, which required them to bring their revocation action in the same Division as the existing infringement action. Amgen also argued that, even if the revocation action was not blocked by Art. 33(4), the Luxembourg registry was the wrong place for the revocation action to be filed and that it should have been filed in the sub-registry of the Munich Central Division instead. However, the UPC Judge (András Kupecz, sitting in the Munich Central Division) sided with Sanofi, finding that Sanofi had filed their revocation action 20 minutes before Amgen’s infringement action and that the Luxembourg registry was an appropriate location to file proceedings under Rule 4.2 of the Rules of Procedure (RoP), which allow parties to file at any registry when the CMS is non-functional.

The result is bifurcated proceedings, with the Munich Central Division hearing Sanofi’s revocation claim and the Munich Local Division hearing Amgen’s infringement claim. To add further complexity, the Munich Local Division is also hearing a counterclaim for revocation by Regeneron (the second defendant in the infringement action, which, unlike Sanofi, did not file a separate revocation action).

Preliminary Injunctions (PI) – Although it will be many months before the first main action decisions are available (the first trials are not expected to take place until summer of 2024) there have been a number of early PI decisions. In myStromer v Revolt¹¹⁹ (Düsseldorf Local Division), a PI was granted against Revolt on 22 June 2023, only 3 weeks into the new system, after Revolt’s e-bike was displayed at a trade fair in Frankfurt. One point of interest is that the PI was issued on an ex parte basis despite Revolt filing a protective letter, with the decision noting that the court did not find the arguments in the protective letter convincing. This leads to some uncertainty regarding the utility of filing protective letters in the new system and it will be interesting to see whether other decisions follow the same approach.

The first inter partes PI decision was issued in CUP&CINO v Alpina¹²⁰ in the Vienna Local Division, which related to milk frothing technology. The case is notable for one of CUP&CINO’s patent attorneys mistakenly opting the patent out of the UPC after the PI action had been filed. However, the patent attorney in question was able to breathe a sigh of relief when the judges confirmed that it is not in fact possible for an opt out to be filed after an action has been commenced. Unfortunately for CUP&CINO, having heard the parties’ arguments and seen Alpina’s milk frother in action at the hearing, the Court was not convinced of infringement and denied the PI. 

Up next were the 10x Genomics v NanoString¹²¹ proceedings in the Munich Local Division. 10x Genomics sought PIs against NanoString in respect of two of its patents relating to RNA and protein analyte detection. The Munich Local Division granted a PI in relation to the first patent in a decision running to over 100 pages, which included a detailed analysis of patent validity and harm to the patentee. Notably, the PI was issued without any requirement for 10x Genomics to provide any security. NanoString appealed the decision, leading to the first UPC Court of Appeal hearing in December¹²².

10x Genomics was less successful in relation to the second patent: the Munich Local Division rejected the PI application on the basis that infringement had not been established. However, luckily for 10x Genomics, it already had an injunction in place in Germany under the same patent, although this raises the question of how the Munich Local Division had jurisdiction to consider the request in the first place in light of the lis pendens rule in the Brussels Regulation (a point that is not addressed in the decision).

AIM v Supponor¹²³ involved another unsuccessful PI request. AIM had initially opted its patent out of the UPC but sought to withdraw that opt-out shortly before filing the PI request (a common UPC strategy which protects the patent from a centralised revocation action before an infringement action is filed). Unfortunately, AIM’s strategy backfired as the Helsinki Local Division held that the patent’s opt-out could not be withdrawn, since the patent had been subject to German infringement and nullity proceedings in 2022, still pending on appeal, and therefore Art. 83(4) of the UPCA applied to block the opt-out withdrawal.

The final PI decision of 2023, issued on 20 December, was in SES-imagotag v Hanshow¹²⁴. The Munich Local Division dismissed SES-imagotag’s PI request, finding that SES-imagotag’s patent to electronic price tags was not infringed. In so doing, the Court followed Hanshow’s argument that claim amendments made during patent prosecution are relevant for interpretation of the claims and that the original claims should be used as a guide to claim interpretation, an approach that is out of step with both the EPO and many national courts of UPC states. It will be interesting to see whether the Court of Appeal provides any clarity on this point.

Seizure and inspection orders – The UPC demonstrated its ability to act quickly and decisively in a number of early seizure and inspection orders. In Oerlikon v Himson and Oerlikon v Bhagat¹²⁵, the Milan Local Division issued ex parte seizure orders for a trade fair within a day of Oerlikon filing the applications in June 2023. In Jozef Frans Nelissen v OrthoApnea¹²⁶, the Brussels Local Division also flexed its muscles, granting a request for an ex parte inspection at a symposium in Belgium in September 2023, within a day of the application being filed.

Access to documents – One of the most controversial aspects of the new system concerns transparency and, in particular, public access to documents on the register. Rule 262.1 of the RoP distinguishes between public access to (a) decisions and orders and (b) written pleadings and evidence, the former being available as of right and the latter requiring a “reasoned request”. The distinction between the two sets of documents, apparently to address GDPR concerns, was introduced to the RoP in July 2022 and changed the previous draft of the rules. Practitioners were reassured at the time that the threshold for granting document access requests would be low but unfortunately this does not appear to have been the case so far in practice. Requests by interested parties for access to written pleadings and evidence were denied in the Sanofi v Amgen¹²⁷ and Astellas v Osaka¹²⁸ proceedings (Munich Central Division), Oerlikon v Himson¹²⁹ proceedings (Milan Local Division), 10x Genomics v Nanostring¹³⁰ proceedings (Munich Local Division) and NJOY Netherlands v VMR¹³¹ proceedings (Paris Central Division). The sole case in which a request for access under Rule 262.1(b) was granted was in Ocado v Autostore¹³² (now resolved by a global settlement), in which a request for access to the statement of claim was granted by the Nordic-Baltic Regional Division, although access to the orders made in parallel cases between Ocado and Autostore in the Düsseldorf and Milan Local Divisions was denied on the basis of lack of jurisdiction. That order was subsequently appealed and the order stayed pending the Court of Appeal’s decision.

Further requests for documents were filed in other proceedings but remained outstanding at the end of 2023, including AIM v Supponor¹³³ (Helsinki Local Division), Joseph Franz Nelissen v OrthoApnea¹³⁴ (Brussels Local Division), NJOY Netherlands v Juul¹³⁵ (Paris Central Division), Plant-e v Arkyne¹³⁶ (Hague Local Division) and a new request in Astellas v Osaka¹³⁷ (Munich Central Division). It is hoped that the Court of Appeal and/or the Divisions considering the outstanding requests for documents will take a more generous approach to reasoned requests in 2024 to ensure transparency and open justice within UPC decision-making.

2024 will be another exciting year for the UPC, with the first main action decisions expected in the second half of the year and opportunities for the Court of Appeal to clarify the approaches to be taken in relation to important substantive legal issues including infringement analysis and jurisdiction and a whole host of interesting and no less important procedural issues. Depending on the outcome of the Irish referendum in June, it may also be the year that we see Ireland joining the list of participating states and steps being taken to set up a new Local Division in Dublin.

Continue reading the other sections in publication:

1. Claim construction and infringement
2. Validity
3. FRAND
4. Supplementary protection certificates (“SPCs”)
5. Procedural issues
6. Unitary Patent/Unified Patent Court

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