15 July 2018

Case law update

UK Supreme Court considers pregabalin case
During a 4-day hearing in February, the UK’s Supreme Court heard the latest instalment of the long-running case between Warner-Lambert and Actavis/Mylan concerning pregabalin, which is sold as the pharmaceutical product Lyrica®.

This case concerned the validity and infringement of Warner-Lambert’s Swiss-type claims covering pregabalin for the treatment of pain. Although the Supreme Court decision is not expected for a few months, there are a number of highly important points being considered, which means that the decision is eagerly anticipated, namely: (1) the role of plausibility in the test for sufficiency of disclosure; (2) the allowability of post-trial amendments; and (3) the direct and indirect infringement of Swiss-type claims.

As previously reported, the Court of Appeal upheld the court of first instance’s finding that claim 3 (directed to neuropathic pain and the only claim which is the subject of the Supreme Court appeal) of Warner-Lambert’s patent was invalid for lack of sufficiency. The Court of Appeal held that the data in the patent, which related to animal models of inflammatory pain, rendered it plausible that pregabalin would be effective in treating peripheral neuropathic pain but not central neuropathic pain, rendering the claim insufficient.

The Court of Appeal also upheld the rejection of Warner-Lambert’s application to amend the claim down to peripheral neuropathic pain after the first instance judgment had been handed down as being an abuse of process.

On the issue of infringement, the Court of Appeal provided obiter guidance, proposing a test for direct infringement based on the manufacturer’s knowledge  or the reasonable foreseeability of the ultimate intentional use for the patented indication, qualified by a caveat that the element of intention can be negated where the manufacturer has taken all reasonable steps to prevent infringement. On indirect infringement, the Court of Appeal reiterated that it was required that means were provided which were for putting the invention into effect, but there was no requirement for a downstream act of manufacture.

We will provide an update when the Supreme Court’s decision is available.

UK High Court looks at right to claim priority

Issues around claiming priority have featured in a number of cases considered by the Patents Court recently and once again in Accord Healthcare Ltd v Research Corporation Technologies Inc [2017] EWHC 2711.

In this case, there was a valid assignment of the relevant rights in 1997, the month before the claim  to priority was made. However, an interesting argument was run by the claimant, Accord. They said that the document was limited to an assignment of the bare legal right and that the equitable right to the invention was owned by another entity (in this case, the University of Houston). The “substantive” right, Accord said, was the equitable right and not the mere legal title. They concluded that the patent was therefore invalid over its own priority document, which disclosed the same invention.

The background to this line of attack followed two earlier cases. It was confirmed in Edwards v Cook [2009] FSR 27 that, when an applicant claims priority from a patent filed by a third party, they must, at the time of their patent filing, own the substantive right to make that priority claim. Subsequently, in Idenix v Gilead [2016] EWCA Civ 1089 it was alleged that the patent under consideration was invalid over its own priority document because, it was argued, there was a mistake when assigning the substantive priority right. It was discussed obiter whether the assignment had to be made good in formal law, or whether a simple equitable transfer could be implied to cut through the red tape. However, without a clear decision on this point, we were left none the wiser on this particular issue.

Returning to Accord Healthcare Ltd v Research Corporation Technologies Inc, Mr Justice Birrs agreed with Accord to the extent that he held that the term “substantive title” in the case law did indeed refer to the division between legal and equitable title, saying: “When the cases refer to the applicant holding the substantive right and title to the invention, they are referring to this legal/equitable distinction.” He added that, following from those principles, a person who at the relevant time and under the relevant applicable law, acquired only the bare legal title to an invention and not the equitable title, when the  equitable title is held by another, does not then hold the substantive right and title to the claim to priority.

However, on the facts of the case, the judge found that the problem had been overcome. Under the US laws governing the rights of a bona fide purchaser for value (35 USC §261) and taking into account the circumstances at the time, on those facts the title  had passed and the priority claim was still valid.

Whilst the judge has, in this case, found a way to rectify what could have been a costly slip relating to the assignment of rights, this is a dangerous area and applicants would be wise to take care when assigning rights, especially those relating to the right to claim priority. Our attorneys will be happy to advise on best practice in this area.

L’Oréal v RN Ventures – Registering an exclusive licence and recovery of costs

Whilst it is not compulsory to register a patent licence at the UK Intellectual Property Office (UKIPO), an exclusive licence must be registered at the UKIPO within six months of the date of the licence agreement in order to protect the right of the exclusive licensee to recover their costs and expenses in any successful infringement proceedings. This can be significant, as demonstrated in the recent case of L’Oréal v RN Ventures, where the claimants were L’Oréal S.A., the patentee, and L’Oréal (UK) Limited, the exclusive licensee.

The first instance decision established liability for patent and registered design right infringement. However, the claimants’ failure to register the exclusive licence promptly hindered their attempts to recover their legal costs from the defendant.

The patentee granted an exclusive licence to L’Oréal (UK) Ltd on 1 July 2008. The licence was amended on 1 August 2012 but not registered until 9 December 2016. In the circumstances, Section 68 of the Patents Act is clear that the exclusive licensee is precluded from recovering costs, having failed to register the licence within six months. However,  in this case, where both the patentee and the exclusive licensee were claimants, the issue of costs was not clear from the Patents Act. Concerned that the restriction on recovery of costs provided by Section 68 could be circumvented by the co-claimants, the judge concluded that the exercise of “a discretionary power to award costs should be informed by, and should reflect, the statutory policy. In the present case, I consider that as a matter of discretion, I should deprive both Claimants of a proportion of their costs; the question is what proportion.”

This is a timely reminder to licensees to register their licences promptly or risk losing out. The process is straightforward and inexpensive. Please contact any attorney at Venner Shipley for more information.

EPO considers “partial priority”

In recently published decision T 0282/12, the Board of Appeal of the EPO applied the Enlarged Board’s decision on partial priority (G 1/15) and confirmed that partial priority may also apply when considering whether an application from which priority is claimed is the “first application” as required by the Paris Convention.

For a claim to priority to be valid, the application from which priority is claimed to be the “first application” disclosing that subject matter. In the case under consideration, the Board had to decide whether the granted patent’s priority claim was invalid in view of an earlier document which was the “first application” from which priority should have been claimed.

The patent under consideration and the application from which priority was claimed were both directed to  a tablet comprising a  gelatinous first and second coating, and a gap between the two gelatinous coatings of from 3 to 33% of the length of the tablet. However, the patentee had filed an earlier application (from which priority was not claimed) which was identical to the granted patent, except that the gap between the gelatinous coatings was from 5 to 33% of the length of the tablet.

The Board’s decision focused on the concept of partial priority, which was clarified in the Enlarged Board of Appeal Decision G1/15. Although this decision was mainly concerned with the concept of “poisonous divisionals”, the Board of Appeal decided that the rationale of this decision also applied to the circumstances of the case.

The Board confirmed that it was inappropriate to use an “added matter” test to determine the validity of the priority claim. Such a test would have considered whether it would have been permissible to amend the range of from 5 to 33% to a range of from 3 to 33%. Such an amendment would have been considered to introduce new subject matter by the EPO, and, since the concept of “partial” validity of an amendment does not exist, the Board stated that performing an “added matter” test to examine the validity of priority may, in some circumstances, lead to the wrong conclusion.

As the invention claimed in the patent and priority application (3 to 33%) overlapped with the invention disclosed in the earlier application (5-33%), the Board held that the inventions were partly the same. It was also noted that it would be unjustified to grant an entirely new priority claim in respect of subject matter previously disclosed where alternative subject matter has been added. Therefore, it was held that the priority claim was only partially valid (for the range of from 3 to less than 5%, which was the subject matter not disclosed in the earliest application).

This decision confirms that the concept of partial priority from G 1/15 applies to any priority claim and not just to divisional applications.