UK: English Patents Court Rules Patent Not Infringed Four Months After Claim Filed

The English High Court (Patents Court) is a world-leading forum for efficient, high quality resolution of patent disputes. Demonstrating again the benefits of the court's flexible and adaptable procedure, Mr Justice Arnold has delivered a full first instance judgment in a patent infringement case regarding therapeutic patches less than four and a half months after the claim was filed. This is less time than is needed to obtain preliminary relief in many jurisdictions.

Irrespective of 'Brexit', it is business as usual at the English Courts, which means the continuation of the UK as the European forum of choice for the resolution of patent disputes - both those of greater complexity and value (the Patents Court) and those of a simpler nature with less at stake in financial terms (the Intellectual Property Enterprise Court).

Summary

Napp commenced proceedings for patent infringement in February 2016 and applied for an interim injunction (i.e. to restrain infringement pending determination of the main claim for infringement). Instead of setting a timetable for hearing of Napp's interim application, Mr Justice Arnold ordered an expedited trial of the claim for infringement, for early June 2016, and the defendants undertook not to launch their products pending determination of the claim.

The judge returned his reasoned decision, finding no infringement or threat of infringement of the patent and hence disposing of the claim, on 28 June 2016: Napp v Dr Reddy's & Sandoz [2016] EWHC 1517 (Pat).

Background

Napp has (through a subsidiary) marketed a seven-day buprenorphine transdermal patch under the brand name BuTrans since 2005. Both Sandoz and Dr Reddy's sought marketing authorisation for buprenorphine transdermal patches, based on bioequivalence with Napp's BuTrans.

Sandoz's marketing authorisation was given on 10 February 2016. Napp commenced infringement proceedings against Sandoz on 19 February 2016, and against Dr Reddy's on 22 February 2016. By the hearing of the trial, on 7-9 June 2016, Dr Reddy's marketing authorisation was still yet to grant.

The issues between the parties

In theory, the issues between the parties were relatively confined for a patent case:

  • Except for a technical challenge regarding the clarity of the claim language, the validity of the patent was not in dispute.
  • The court was, however, required to rule on the meaning of several numerical limits in the language of the patent claim, and also on whether the claim language defined the manufacturing input or output (i.e. the composition of the patch).
  • Arnold J also considered whether a de minimis principle applies to the tort of patent infringement, how a requirement that infringement be more than de minimis impacts a claim for relief made on a quia timet basis, the relevant standard and burden of proof in such a claim, and the appropriateness of injunctive relief where infringement is not de minimis, but is nevertheless on a very small scale.

In practice, the analysis of some of these issues entailed consideration of detailed statistical evidence on the probability of any patch sold by the respective defendants' falling within the claim of the patent. Noting that Napp had chosen to proceed in seeking relief at an early stage, necessitating consideration of a smaller number of samples for this purpose, the judge did not permit Napp to take advantage of the additional statistical uncertainties which followed from this approach. However, in practice, this made little difference to the outcome.

The key rulings made

Construction

The patent claim was as follows:

"A buprenorphine transdermal delivery device comprising a polymer matrix layer containing buprenorphine or a pharmaceutically acceptable salt thereof, for use in treating pain in humans for a dosing interval of at least 7 days, wherein the transdermal delivery device comprises 10%-wt buprenorphine base, 10 to 15%-wt levulinic acid, about 10%-wt oleyloleate, 55 to 70%-wt polyacrylate, and 10%-wt polyvinylpyrrolidone".

The claim, said the judge, was to output weight ratios, not the ratios of material input into the manufacturing process.

In keeping with the Court of Appeal's guidance in Smith & Nephew v ConvTec [2015] EWCA Civ 607, and in keeping with its use "on its face" in the context of the patent, the number "10%-wt" (i.e. of buprenorphine) was, said the judge, expressed to the nearest whole number. In other words, the claim covered weight proportions of buprenorphine in the range ≥9.5 to <10.5 %-wt. To interpret the claim as Napp contended (≥7.5 to <12.5 %-wt) would, said the judge, be to deny a reasonable degree of certainty for third parties.

Similarly, "10 to 15%-wt levulinic acid" meant ≥9.5 to <15.5 %-wt, not the ≥7.5 to <17.5 %-wt contended for by Napp.

However, the inclusion of the word "about" before "10%-wt oleyloleate" would not be disregarded by the skilled person as being meaningless. Although it was "very difficult indeed" to ascertain what was intended to be signified by its inclusion, which appeared to be contrary to paragraph 4.7 of the EPO's Examination Guidelines, the judge decided not to rule that the claim lacked clarity (with the consequence that it would be invalid for insufficiency). Instead, the judge considered that the better course was to take "about" as connoting a "small degree of permitted imprecision over and above that implied by the usual rounding convention", such that the claim covered weight proportions of oleyloleate in the range ≥9.0 to <11.0 %-wt.

No infringement

Upon the claim construction explained above, and the unchallenged factual evidence and PPDs in the case, neither Sandoz nor Dr Reddy's infringed (or threatened to infringe). (The details of Sandoz's and Dr Reddy's respective products and manufacturing processes were regarded as confidential; they were confined to confidential annexes to the judgment which have not been made available to the public).

However, in case he was wrong on this the judge considered whether, if (a) the claimed percentage weights were of the final product but (b) the claimed numerical limits were to be interpreted as contended for by Napp, there would be infringement.

Arnold J considered the authorities addressing (or not addressing) a de minimis principle. The strongest support for the existence of a principle that patent infringement must be more than de minimis is, perhaps, Arnold J's own judgment in Generics v Warner-Lambert [2015] EWHC (10 September 2015), which is currently under appeal. In the present case, the judge considered that the court was forced, as a matter of practical reality, to draw a line somewhere.

This meant that if there is a "clear threat to do acts which will fall within the claim sufficiently often that they cannot be discounted as de minimis", then that is sufficient to justify the bringing of proceedings on a quia timet basis.

Napp, said the judge, bore the burden of proving, on the balance of probabilities, that the proposed acts result in infringement on a scale which is "more than de minimis".

However, even if the established infringement could not be discounted as de minimis, if it was nevertheless on a "very small scale" (e.g. 0.1%), then an injunction would be both disproportionate and a barrier to legitimate trade contrary to Art 3(2) of the Intellectual Property Enforcement Directive.

After setting out his position on the law, the judge turned to the expert evidence before the court as to the probability of the defendants' respective patches falling within the scope of the claim.

No infringement by Sandoz, on the alternative construction of the patent claim

The judge analysed in some detail the statistical evidence before the court. On Sandoz's approach, upon which the prediction was that one patch in 69 million patches would infringe, this was "plainly de minimis". However, even on Napp's approach, the prediction was that only 1 patch in 25,600 would infringe, and this would still be de minimis.

No infringement by Dr Reddy's, on the alternative construction of the patent claim

Dr Reddy's approached the dispute on the basis that, in order to avoid infringement, it would implement a testing regime based on a statistical protocol and would undertake not to infringe. However, the final statistical protocol which would be adopted was conditional on the court's decision regarding (1) the construction of the claims, (2) the appropriate confidence level to use in the statistical analysis, and (3) the court's view as to what would constitute a de minimis level of infringement.

The judge concluded that the appropriate level of confidence was 50%, reflecting the balance of probabilities, and the de minimis limit was 1 in 10,000.

Concluding comment

The Napp v Dr Reddy's & Sandoz dispute exemplifies the determination of the English Patents Court to offer an efficient, high quality forum for the resolution of complex and valuable patent disputes.

Despite the complexity of the mathematical analysis that came into play in the case, and the need for rulings in areas of the law which remain in development, the court exercised its discretion to adopt a flexible and fast-tracked case management procedure and to achieve a well-reasoned first instance judgment in a commendable time frame. As a result, no separate preliminary or interim procedure was necessary.

For cases of less complexity and/or with less at stake in monetary terms, a more streamlined (but still flexible) procedure is available in the Intellectual Property Enterprise Court, along with cost capping mechanisms and judicial specialism in intellectual property. Patent disputes that reach the Court of Appeal are heard by long-experienced judges promoted after demonstrating excellence in the Patents Court. Even the UK's Supreme Court includes Patents Court alumni.

The structures and procedures underpinning the UK legal systems have enabled the development of the adaptable and efficient procedures available today, as well as the high quality of judicial reasoning that is delivered in patent disputes, by courts at all levels.

Brexit will not impact upon this. Why? Because the existing system for the grant and enforcement of European patents covering the UK is established by agreements made outside the remit of the EU and EEA. And because the UK court systems predate the UK's entry into the EU, and developments made since the UK's entry have remained outside the remit of the EU's structures and legislation, at least for patent disputes.

Find out more about what Brexit means for intellectual property.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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