Contributed By Pinsent Masons
Inventions may be protected by the patent system, which has a statutory basis developed and refined by case law. Confidential information and/or trade secrets (including those relating to inventions) may be protected by the law of breach of confidence, a common-law right developed by UK courts. Actions in breach of confidence or for infringement of trade secrets may assist with protecting inventions or ideas that do not have patent protection.
Applications for a “GB” patent providing protection in the United Kingdom (UK) are filed with the UKIPO. The legal framework for patents is provided by the UK Patents Act 1977 (Patents Act), certain sections of the Copyright, Designs and Patents Act 1988, related procedural rules and regulations set out in associated laws, the Patents Rules 2007, the Manual of Patent Practice, together with various guides and guidance notes issued by the UK Intellectual Property Office (UKIPO).
The filed application must contain a request for the grant of a patent, a written description of the invention, including any relevant diagrams (called a specification) and (either immediately or within twelve months of filing) a list of claims and an abstract. Provided the procedural and substantive requirements are met and the relevant fees paid, the application will proceed to the preliminary examination-and-search phase. Assuming the application continues to comply with procedural requirements, this will be followed by publication, substantive examination, grant and final publication of the granted patent.
A UK patent may also be obtained via the European Patent Office (EPO), either directly or via the UKIPO, in the form of a European patent application designating the UK (an EP(UK) patent). The EPO presently covers 38 Member States, including all 28 states of the European Union (EU), two extension states and other states with which the EPO has validation agreements. Accordingly, one single European patent application potentially provides protection in 44 states (as a collection of national designations). Granted European patents must, in most cases, be validated in each designated country within three months of grant and each country has its own specific requirements for validation based on national law. After grant, the EP(UK) patent is subject to a nine-month opposition period.
Alternatively, UK and EP(UK) patents may be designated as part of a Patent Cooperation Treatyapplication (an international application). The international application system, administered by the World Intellectual Property Office (WIPO), provides a streamlined service for patent applications made globally. Over 140 countries are party to the PCT system, meaning that a single application designating all relevant states may be filed to preserve priority date, and national or regional applications may be filed subsequently. The international application does not itself become a granted patent. Applications filed through the PCT system are processed as UK or EP(UK) applications by the UKIPO or EPO respectively.
Protection against misuse of confidential information: know-how and trade secrets may be protected by an obligation of confidentiality under UK common law. Obligations of confidentiality may arise from both the circumstances in which information is disclosed and/or specific agreements or contractual terms. For example, employee agreements, collaboration agreements and confidentiality/non-disclosure agreements routinely include terms sufficient to impose an obligation of confidentiality.
Specifically, pursuant to the English common law set out in Coco v A N Clark, Saltman v Campbell and later, related cases, it is a breach of confidence to use without authorisation information that has the necessary quality of confidence and has been imparted in circumstances imposing an obligation of confidence, where that use would cause detriment to the party who imparted that information.
The UK's Trade Secrets (Enforcement, etc) Regulations 2018 recently came into force implementing the EU Trade Secrets Directive which seeks to harmonise minimum protection for trade secrets (as a subset of confidential information) and ensure that all EU Member States provide minimum levels of protection for trade-secrets’ holders.
Under the Directive, a trade secret is considered to be information that is secret, has commercial value because it is secret and has been subject to reasonable steps under the circumstances, by the person lawfully in control of the information, to keep it secret. Information is only considered secret if it is "not…generally known among or readily accessible to persons within the circles that normally deal with the kind of information in question".
It takes around four years for a patent to be granted, on average, although in some cases it can take considerably longer. It is also possible to fast-track a grant, provided certain conditions are met.
In the UK, although it is not mandatory to appoint a patent lawyer to initiate grant proceedings, due to the complexity of the grant procedure, particularly in relation to drafting of the specification and responding to examination reports, taking the help of a qualified professional representative is advisable.
For applications filed at the EPO, applicants who have neither a residence nor principal place of business in an EPC contracting state must be represented by an authorised professional representative or by an authorised legal practitioner.
Official fees charged by the UKIPO for processing an application through to grant are currently GBP325, although an applicant is likely to incur additional costs for various professional services required to support the application (including, for example, patent lawyer fees, technical expert fees and translations). Official fees charged by the EPO for processing an application through to grant are in the region of EUR4,000.
Provided the relevant renewal fees are paid, the term of patent protection is 20 years from the date of filing the application. For patents relating to pharmaceutical and plant-protection products, an extension of up to five years may be available in the form of supplementary protection certificates (SPCs) (see 6 Remedies, below).
Rights and obligations of owner of intellectual property rights: a granted patent in the UK confers a monopoly right in respect of the patented invention upon the proprietor, for the term of the patent.
The precise scope of the monopoly right conferred is stipulated by legislation, specifically the Patents Act. The proprietor is entitled to the control of certain acts constituting infringement under section 60 and to seek relief in respect of such acts carried out by unauthorised third parties.
Where the proprietor satisfies a court that under section 60 a third-party’s acts infringe (or would infringe) the patent, the court will typically award relief such as an injunction and/or damages (see 6 Remedies).
Interim injunctive relief and other measures (see 6 Remedies) are available only by way of a court order (unless consented to or agreed contractually), following an application to the court and subsequent determination by the court that such relief should be awarded.
Supplementary Protection Certificates (SPCs): SPCs confer a maximum five-year extension to the term of a patent and are available in respect of certain medicinal, pharmaceutical or plant-protection products (see below). SPCs recognise the erosion of patent term during which a proprietor pursues the regulatory approval required to market a medicinal or pharmaceutical product. SPCs are granted to the proprietor of a ‘basic’ patent or its successor in title (as to which, see below).
Article 3 of both Regulation 469/2009 (medicinal products) and Regulation 1610/96 (plant protection) provide that an SPC certificate shall be granted if, in the Member State in which the application is submitted, certain conditions are fulfilled. Namely, at the date of that application:
• the product is protected by a basic patent in force;
• an appropriate and valid authorisation to place the product on the market has been granted;
• the product has not already been the subject of a certificate; and
• the authorisation referred to above is the first authorisation to place the product on the market as a medicinal/plant-protection product. Additionally, the holder of more than one patent for the same product will not be granted more than one SPC for that product.
When all requirements are met, the SPC will be granted. The SPC takes effect at the end of the term of the basic patent (provided that the basic patent has not previously lapsed or been revoked), and assuming that annual fees are paid. A SPC for a medicinal product may also be extended by way of a six-month paediatric extension if the requisite criteria are met.
Following publication of the patent application but prior to its grant, third parties have the opportunity to lodge written objections (observations) regarding the patentability of the invention. Observations are lodged with the UKIPO’s Comptroller-General of Patents, as per the Designs and Trade Marks (Comptroller) (Patents Act, section 21). The filing of an observation does not make the observer party to proceedings. Although observations can be made at any stage, the UKIPO advises that they be raised within three months of publication because in practice a patent can be granted within three months of the publication date. The UKIPO will provide copies of third-party observations to the applicant and will consider them during the examination process.
At the EPO, a similar provision exists in relation to published European patent applications. Third-party observations can be lodged with the EPO until the decision to grant or refuse the patent is made. Such observations must be filed in writing in English, French or German and must include a statement of the grounds on which they are based. Observations (which can be filed anonymously) are communicated to the applicant and made available to the public.
Within nine months of grant of a European patent, third parties may file a written opposition to the grant of the patent. This is a centralised procedure and the outcome is effective for all designated countries. Unlike third-party observers, opponents will become a party to the opposition proceedings. Any opposition must set out specific grounds for objection (patentability, lack of sufficiency and/or added matter). The EPO will consider it and the proprietor will have four months to respond, which may include filing amendments. The EPO evaluates the opposition and considers any submissions by the parties (which may include an oral hearing), following which the EPO’s opposition division will issue a final determination. The EPO may issue interim preliminary non-binding opinions to allow the parties to focus their submissions on the points the EPO considers relevant and to assess the merits of their respective arguments.
Upon final determination, the outcome will affect all designations for which it was granted. Any amendments to specific national designations under the law and procedure of the relevant country will be supplanted by the EPO’s decision (if it results in amendments).
In the event of refusal by the UKIPO to grant a national patent (and certain other decisions of the Comptroller under the Patents Act), the applicant or aggrieved party may appeal to the Patents Court (a specialist intellectual property court within the Business and Property Courts of England & Wales) or, under certain circumstances or in respect of certain decisions, Scotland’s Court of Session (Patents Act, section 97).
In the event of refusal by the EPO, the applicant may appeal to the EPO’s Boards of Appeal, which include technical and legal boards of appeal. The boards act as a final procedural determiner of matters before the EPO.
Renewal fees for UK and EP (UK) patents are due annually. A patent will ordinarily lapse if the fee is not paid within the prescribed period. However, provided the renewal fee and a late payment fee (currently GBP24 per each extra month) are paid within six months after the due date, the patent will be treated as if it had not lapsed. After six months following the due date, at which point the patent has ceased to have effect, the patent can only be restored upon a successful application to the UKIPO. If the UKIPO is satisfied that the failure to pay the renewal fee (and any late payment fee) was unintentional, the application will be allowed and the patent will be restored upon payment of the fees owing. Note that third-party rights may accrue in the period between the lapse of the patent and its subsequent restoration.
In the case of SPCs the annual fees are payable for each year of the effective period of the certificate, and are payable as a single cumulative amount.
Late payments are possible up to six months after the due date, but attract an additional fee (one half the amount of the unpaid fees). If fees are not paid, the certificate will be treated as having lapsed on the date of expiry of the basic patent and so will not take effect.
The Patents Act governs both UK and EP(UK) patents once granted. A patent infringement claim can only be brought after a patent has been granted. The Patents Act, section 60 sets out the acts that are considered to infringe a patent, if carried out without the patent proprietor’s consent. Patent infringement claims are governed by of the Patents Act, section 61, which states that civil proceedings may be brought to court by the patent proprietor in respect of any act of infringement. In such proceedings a claim can be brought seeking an injunction, an order for delivery-up or destruction of infringing goods, damages, an account of profits and/or a declaration that the patent is valid and has been infringed (see 6 Remedies for more information). The limitation period for bringing patent infringement cases is six years (as with other torts). See 2.8 Protection for Potential Opponents below for further information. The claimant has the burden of proving infringement.
The parties to infringement proceedings may agree to refer the dispute to the Comptroller. The Comptroller leads the UKIPO. In such a referral the patent proprietor may seek only an award of damages in respect of the infringing goods and/or a declaration regarding the validity or infringement of the patent. If the Comptroller considers that the question referred to him or her would be more appropriate for determination by the court, the Comptroller can decline to deal with the matter and instead the court will have jurisdiction to determine the question as if the reference were proceedings brought in the court.
The patent proprietor may also request a non-binding opinion from the Comptroller as to whether his or her patent is infringed (as well as any other prescribed matter in relation to the patent) (Patents Act, section 74A). Such an opinion can be sought after the patent has expired or been surrendered.
Opposition proceedings at the EPO may be brought within nine months of grant of the patent. There are no national opposition proceedings before the UKIPO; therefore action to remove the effects of a patent in the UK takes one of the following forms:
A declaration of non-infringement made by the Comptroller has the same effect as a declaration by the court, save that a decision by the former does not estop a party to civil proceedings where infringement is in issue, from putting validity in issue even if these issues were involved in the decision.
Further to the statutory power to grant declarations under section 71, the court has an inherent power to grant declarations of non-infringement. This power is wider than the statutory power. For example, the court may consider it necessary and appropriate to grant a declaration in respect of non-UK designations of European patents where it considers that foreign designations are inescapably connected because they are all designations of the same patent and have identical wording. In these circumstances the court may also consider claims for declarations about the interpretation and non-infringement of foreign designations (Actavis v Lilly ).
Arrow declaration: the court may exercise its discretion and order relief to the effect that a product or process was known or obvious at a relevant date, referred to as an “Arrow declaration” (Fujifilm v Abbvie and Glaxo Group Ltd & Others v Vectura Ltd ). An Arrow declaration may assist a party in clearing the way of patent rights that have not yet been granted and can be used as a “Gillette defence” to any later claim for infringement of a granted patent with a priority date on or after the relevant date (see 3.4 Defences against Infringements).
Any disputes arising under the Patents Act, eg, concerning patent infringement or validity, may be brought before the court or, in some circumstances, the Comptroller.
The jurisdiction of the Comptroller to hear disputes concerning patent infringement and/or validity is discussed in 3 Infringement and 4 Revocation/Cancellation, below. Part 7 of the Patents Rules 2007 governs proceedings heard before the Comptroller.
The UK comprises three jurisdictions: England and Wales, Scotland and Northern Ireland. Each jurisdiction has its own legal system, courts and procedures. The Civil Jurisdiction and Judgments Act 1982 governs allocation between the courts within the UK of certain civil proceedings. This section focuses predominantly on the courts of England and Wales.
Any claim under the Patents Act in Scotland is to be held before the Court of Session and in Northern Ireland, the High Court in Northern Ireland (section 130).
In England and Wales, where the vast majority of patent litigation in the UK is conducted, it is to be held in the High Court. Any claim under the Patents Act must be commenced in either the Patents Court or in the Intellectual Property Enterprise Court (IPEC). Both courts are part of the Business and Property Court of the High Court of Justice.
The IPEC is appropriate for smaller, shorter, less complex and lower-value actions and the procedures applicable in the court are designed particularly for cases of that kind. The objective of the IPEC is to provide cheaper, faster and less formal procedures to encourage individuals and smaller organisations to innovate and safeguard their rights. The IPEC has a limit on a quantum of damages that can be awarded of GBP500,000. Costs’ orders will be made which are proportionate to the nature of the dispute and are also subject to a cap of GBP50,000. Certain intellectual property disputes where the amount sought is GBP10,000 or less will be handled on the “small claims track”.
For more complex, important and valuable litigation the Patents Court is the appropriate forum. Given the value of disputes in the Patents Court there is no cap on recoverable monetary relief or costs. If the amount of damages sought is under GBP500,000, the case can still be heard by the Patents Court.
The defendant in proceedings in the IPEC has the right to seek to apply to have the proceedings transferred to the Patents Court. The court will consider a number of factors including the size of the parties, the complexity of the claim, the nature of the evidence, whether there is conflicting factual evidence and the value of the claim when considering whether or not it is appropriate to transfer.
Any claims for breach of confidence can be brought in the High Court’s Chancery Division (within which the Patents Court sits), or in the IPEC.
Upon appeal from the Patents Court, matters would proceed (if permitted) to the Court of Appeal and in certain circumstances from there to the Supreme Court.
The Civil Procedure Rules (CPR) encourages parties to resolve disputes without commencing litigation and to consider alternative dispute resolution.
Mediation: a mediator works as an independent neutral intermediary, selected by the parties, whose role is to assist the parties to work towards settlement.
The UKIPO and the Centre for Effective Dispute Resolution (CDER) provide mediation services geared towards the resolution of intellectual property disputes. Additionally, the IPO maintain a list of providers who are able to provide mediation services for different forms of intellectual property disputes.
Arbitration: arbitration presents an alternative to litigation, where either the parties have elected to resolve their dispute by arbitration or a contractual requirement provides for arbitration as the mechanism for dispute resolution. Depending on the circumstances, sometimes this can be faster and more cost-effective.
There are many organisations through which arbitration can proceed, which include: the WIPO, the International Dispute Resolution Centre, the London Court of International Arbitration, ICC UK and the Chartered Institute of Arbitrators.
Courts generally expect parties to have exchanged sufficient information to understand one another’s position and attempt to settle the issues between them without recourse to litigation, and to consider a form of alternative dispute resolution to assist with settlement, prior to instigating proceedings (CPR pre-action protocol). Where the urgency of the application is such that it is not practicable to comply, the court does not expect the pre-action protocol to be complied with.
If communications contain a threat of infringement proceedings, a claim for unjustified threats may arise, so parties should be mindful of Patents Act, section 70. Such a threat shall arise if, upon receiving any communication, a recipient would understand that a patent exists and a person intends to bring proceedings. Therefore any communications must be considered and phrased accordingly.
In intellectual property matters, individuals may choose to represent themselves rather than instruct a lawyer. Parties may be represented by a solicitor, a patent lawyer (if they have an appropriate advocacy qualification), a barrister or a combination of these representatives.
If a litigant is a corporate entity, it may be represented by an employee, provided that the employee is authorised by the company and the court gives permission (CPR 39.6).
An interim injunction may either require a party to perform or refrain from performing a specific act. An application for an interim injunction must be filed at court and served upon the respondent together with supporting evidence, after the claim form is served (although it is possible to serve both the application and claim form at the same time if copies are received) unless the applicant seeks an ex parte injunction. A hearing date is set at which the merits of the application are considered.
The court first considers whether there is a serious question to be tried, or a real prospect of success so that the claim is not vexatious, and that they have a good arguable case that there either is or will be infringement (American Cyanamid v Ethicon ).
Provided that the applicant succeeds in establishing that there is in fact a serious issue to be tried, the court will consider the adequacy of damages in place of an injunction. If damages would adequately compensate the applicant, the court will not award interim injunctive relief. The adequacy of damages from the respondent’s perspective is also considered.
If the court considers that damages would not be adequate, it will consider the “balance of convenience” test and will weigh up the relative harm that will be caused to either party by the grant or refusal of an interim injunction. The court will also consider the status quo and whether this should be disturbed. The court conducts its assessment on the basis of the facts and evidence before it. It will consider factors such as market conditions, the financial position of the parties as well as their conduct.
If an interim injunction is awarded, the applicant must give a cross-undertaking as to any damages incurred by the respondent during the term of the injunction if it later turns out to have been wrongfully granted. Following this, if the respondent seeks recovery pursuant to the cross-undertaking, the award can be expected to be fair (AstraZeneca v Krka).
In Scotland a potential opponent can lodge a caveat in the Court of Session. This is an instrument that gives the potential opponent prior warning of any attempt to obtain an interim interdict (an interim injunction in Scots law) against it, allowing them to oppose an interim order. There is no equivalent to a caveat in England and Wales.
A party to litigation can protect itself in terms of reducing the prospects of an injunction being awarded against it by following the law and procedural code. Where a party is aware of the potential for a claim of patent infringement, it can choose to:
• clear the way by invalidating the patent;
• initiate correspondence with the other side in the interests of transparency;
• provide undertakings with respect to its intended actions;
• seek a declaration of non-infringement;
• or pursue a combination of the above.
Case law has shown that the courts expect litigants to behave responsibly to ensure the dispute in question can be resolved in an orderly manner.
Intellectual property claims are governed by the Limitation Act 1980. It provides that the limitation period for bringing patent infringement cases is six years (as with other torts) from the date on which the cause of action accrued. It is possible that the limitation acts as a stop on recovery of damages rather than stopping the initiation of proceedings.
Disclosure is available in patent litigation but whether standard disclosure is awarded, dispensed with or ordered on specific issues is dependent on the circumstances of the particular case. Where disclosure is awarded generally in respect of validity it will be limited to a two-year period either side of the earliest claimed priority date. For patent infringement, a product or process description can be provided in lieu of disclosure.
There is no automatic disclosure process in the IPEC so it is more restricted than in the High Court.
Search Orders (Anton Piller Orders)
In exceptional circumstances, where key documents might otherwise be destroyed or disposed of, the court may make a search-and-seizure order allowing the applicant’s representatives to enter the respondent’s premises to search for, inspect and remove documents that are material, without prior warning to the respondent. This requires that the damage caused to the applicant be extremely serious and that there is high risk that vital evidence will be destroyed, plus strong support for the proposition that the respondent has incriminating evidence.
Norwich Pharmacal Orders (NPO)
A NPO is an order for the disclosure of documents or information by the respondent to the applicant, which takes its name from Norwich Pharmacal Co v Commissioners of Customs and Excise. It provides information on others involved in the supply of infringing goods and is made on the basis that a person, whether or not innocent, who has been caught up in wrongdoing, is under a duty to assist those who have been injured by that act.
Mandatory interim injunctive relief
Article 7 of the EU Directive 2004/48 on the enforcement of intellectual property rights (IP Enforcement Directive) provides that, on application by a party who has presented reasonably available evidence to support their claim that their intellectual property right has been infringed or is about to be infringed, judicial authorities may order prompt and effective provisional measures to preserve relevant evidence in respect of the alleged infringement. Such measures may include the detailed description (including samples), or the physical seizure of the infringing goods, and, in appropriate cases, the materials and implements used in the production or distribution of these goods and any documents relating to the same.
The CPR governs the conduct of civil litigation in England and Wales. The overriding objective of the CPR is to enable the court to deal with cases justly and at proportionate cost.
Court action is started when a court issues a claim form at the request of the claimant(s). The claimant must complete a claim form and file this with the court along with the appropriate fee. The claim form includes details of the claimant and defendant(s), a brief outline of the claim and indication of the value of the claim.
Particulars of claim must be contained in or served with the claim form, or served within 14 days of the claim form. Particulars of claim set out the legal basis for the claimant’s claim and the facts relied upon to substantiate liability. In practice they are succinct. Particulars of claim for patent disputes must meet the same criteria, set out in the CPR, as for other disputes.
A statement of case in a claim for infringement must contain particulars as set out in CPR Practice Direction 63. In a claim for patent infringement the statement of case must include details of the patent claims that are alleged to be infringed and give at least one example of each type of infringement alleged.
Where patent validity is challenged grounds of invalidity must be provided. The grounds of invalidity specify the grounds on which validity of the patent is challenged and particularise every issue that it is intended to raise.
A copy of any document and, where necessary, a translation of any such document referred to in the statement of case and/or grounds of invalidity must also be served.
The defendant may make a request for relief by making a counterclaim along with his or her defence. For example, a defendant alleged to infringe a patent may both deny any such infringement in their defence and also challenge the validity of the patent in their counterclaim.
In all cases parties may amend their statements of case during the course of proceedings either with the consent of the other parties or the consent of the court.
Class actions are possible in England and Wales. The CPR provides for the management of collective actions and the supplementary Practice Directions provide details on their practical application. There are no limitations on the type of claims that can be filed as class actions.
When seeking to assert patent rights against others, patent proprietors must have regard to the provisions considered at 2.4 Specialised Bodies/Organisations for the Resolution of Disputes regarding threats. If communications contain a threat of infringement proceedings these could give rise to grounds for an unjustified threats claim against the proprietor.
Also, whilst it is established that the existence of a patent right per se cannot be considered to be an abuse of dominant position under Article 102 of the Treaty on the Functioning of the European Union (TFEU), it has been held that the way in which a patent right is exercised could be considered abusive (see 3 Infringement).
A patent proprietor and/or exclusive licensee may bring an action for infringement. The defendants to such an action are the party or parties accused of committing the alleged infringing act.
Where a patent is co-owned by multiple proprietors, one proprietor can bring an action for infringement without the consent of the others, provided that the other proprietors are joined as nominal defendants to the proceedings. If the co-proprietors are joined as defendants, they are not liable for costs or expenses unless they enter an appearance and take part in the proceedings. A co-proprietor made a defendant is not obliged to serve a defence but if they do not do so the court may prevent them from submitting evidence or calling witnesses later in the proceedings (Patents Act, section 66).
An exclusive licensee of a patent may also bring a claim for infringement. As with co-proprietors, the patent proprietor must be joined as a defendant, unless it has consented to be joined as a claimant. The same principles apply on costs as above (Patents Act, section 67).
If a licence to a patent has been granted by way of a licence of right (Patents Act, section 46) or a compulsory licence under section 49 then, unless the licence agreement expressly provides otherwise, the licensee may request the proprietor of the patent to commence proceedings for infringement. If the proprietor refuses to do so or fails to do so within two months, the licensee may commence proceedings in their own name. The same rules apply in relation to joining the proprietor and costs.
There is a difference between direct and indirect infringement. Infringing acts of both types are set out in the Patents Act, section 60.
Pursuant to section 60(1), a patent is infringed if any of the following acts are carried out in the UK without the consent of the proprietor where the invention is:
• a product, a person (or company) makes, disposes of, offers to dispose of, uses or imports the product or keeps it, whether for disposal or otherwise;
• a process, a person (or company) uses the process or offers it for use in the UK when it is known, or it is obvious to a reasonable person in the circumstances, that its use there without the consent of the proprietor would be an infringement of the patent; or
• a process, a person (or company) disposes of, offers to dispose of, uses or imports any product obtained directly by means of that process or keeps any such product, whether for disposal or otherwise.
The above, taken from section 60(1)(a)-(c) are acts of “direct” infringement.
In accordance with recent case law, it is possible directly to infringe a patent by the use of a variant. In Eli Lilly and Company v Actavis UK Ltd and Others, the Supreme Court held that although only pemetrexed disodium was expressly claimed. Other salt forms of pemetrexed directly infringed because they achieved the same result as pemetrexed disodium in substantially the same way.
Section 60(2) defines acts that may not directly involve patented products or processes but would nevertheless be considered infringing acts. Acts of “indirect” infringement occur when, without the consent of the proprietor, a person (or company) supplies or offers to supply in the UK a person (or company) other than a licensee or other person (or company) entitled to work the invention with any of the means, relating to an essential element of the invention, for putting the invention into effect when it is known, or it is obvious to a reasonable person in the circumstances, that those means are suitable for putting, and are intended to put, the invention into effect in the UK.
In Warner-Lambert Company LLC v Generics (UK) Ltd t/a Mylan and Another, the Supreme Court, provided obiter comments (because the relevant claims were held to be invalid) on indirect infringement. The Supreme Court concluded that the invention protected by a Swiss claim form is limited to the manufacture of the product for the designated use and consequently does not extend to steps taken by a later party, such as those involved in prescribing or dispensing the medicine to the patient. Accordingly, in that case, the marketing of the alleged infringer's medicine could not contribute to the infringement of a claimed process that had already been completed with the packaged product.
There is also a common-law offence of contributory infringement. Under common law, there are two forms of contributory infringement:
• where it can be shown that a party assisted an act of direct or indirect infringement as part of a “common design” with the infringer; or
• where a person can be found liable under common law, for inducing or procuring someone else to infringe a patent.
See also 6Remedies.
The scope of protection of a patent is defined by its claims. The extent of the invention (Patents Act, section 125(1)) is “taken to be that specified in a claim of the specification of the application or patent, as the case may be, as interpreted by the description and any drawings contained in that specification, and the extent of the protection conferred by a patent or application for a patent shall be determined accordingly.”
The Protocol on the Interpretation of Article 69 of the European Patent Convention contains a corresponding provision and shall also apply.
Where the validity or infringement of a patent is in issue, the question of construction of the claims is one for the court (see 3.6 Procedure for Construing the Terms of the Patent's Claim).
Only acts done without the consent of the proprietor can be considered infringement. There are also several defences to patent infringement, most of which are contained in the Patents Act, section 60(5). Accordingly, an act that would otherwise infringe will not do so if it falls within one of the following exceptions:
Beyond statutory rights there are also other defences, discussed below:
Compulsory licences are provided for in s48 of the Patents Act. At any time after the expiry of three years, or other prescribed period, from the date of the grant of a patent, any person may apply to the comptroller on one or more of the relevant grounds:
Relevant grounds include where demand for a product is not being met in the UK and the patentee has refused to grant licences on reasonable terms for the exploitation of an invention which is a technical advance of considerable economic significance.
The European Commission is proposing a change to EU regulations on SPCs. The change would allow medicines that are protected by SPCs in EU countries to be manufactured in the EU for export to non-EU countries where the product is not under patent or SPC protection. The current drafting provides that this so-called “SPC manufacturing waiver” will only apply to SPCs granted after any change in the law, proposed to come into force in 2019.
Experts in patent litigation in the UK are independent; their duty is to the court rather than to either party, despite the fact they will have been instructed and paid by one or other. The expert plays a key role, educating the court on the technical field and what represented common general knowledge at the relevant date. The opinions of experts in the field as to how the person skilled in the art would read the prior art and how the claims of the patent would be understood can assist the judge to make findings of fact and to determine the issues of validity and infringement before the court. Experts should be instructed carefully (Arnold J in Medimmune Ltd v Novartis Pharmaceuticals UK Ltd & Medical Research Council).
The invention is that specified in a claim of the specification of the patent, as interpreted by the description and any drawings contained in that specification (Patents Act, section 125)
The courts currently take a “purposive approach”, meaning that the central question is what a person skilled in the art would have understood the language of the claim to mean in the context of the patent as a whole, including its specification and any drawings. See Kirin Amgen Inc v Hoechst Marion Roussel Ltd.
There is no separate procedure for construing the terms of a patent’s claims. Once placed in issue in infringement or declaration of non-infringement proceedings, the court will construe the claim and consider whether the alleged infringing product or process falls within the scope of the claim as construed. It is also necessary to construe claims in invalidity proceedings.
The court has the power to:
Accordingly, it is possible to make an application for claim construction to be determined as a preliminary issue, as the defendants did (albeit unsuccessfully) in Napp Pharmaceutical Holdings Ltd v Dr Reddy's Laboratories (UK) Ltd and Sandoz Ltd.
A claim for revocation of a patent may be brought in court or before the Comptroller. Usually the claimant seeks a declaration that the patent is invalid and an order for the unconditional revocation of the patent.
A patent may be revoked on the following grounds (Patents Act, section 72):
Lack of novelty: a patent lacks novelty (is anticipated) if the alleged invention was already part of the “state of the art” before the earliest claimed priority date. The state of the art comprises all matter (whether a product, a process, information about either or anything else) made available to the public before the priority date of the alleged invention. Subject to certain conditions, the “state of the art” for novelty purposes also includes matter contained in patent applications with an earlier priority date that was published on or after the priority date of the invention.
To anticipate a patent, the disclosure in the “state of the art” must disclose subject-matter which, if performed, would necessarily infringe the claim, and disclose it sufficiently to enable the skilled person to perform it.
Inventive step: a patent lacks inventive step (is obvious) if the alleged invention was obvious to the person skilled in the technical field of the invention as at the priority date of the patent, having regard to the “state of the art” and the skilled person’s common general knowledge.
Insufficiency: classical insufficiency requires that (as at the application date) the specification disclosed the invention clearly and completely enough for it to be performed by the skilled person without undue effort.
A claim may also be found insufficient if it extends beyond the technical contribution of the patent (the “Biogen” insufficiency). A patent can be found invalid for lack of plausibility, as a threshold test of sufficiency.
Added matter: a patent can be held invalid if it adds matter, on the basis that the matter disclosed in the specification extends beyond that disclosed in the application for the patent (as filed), as a result of amendments made during examination
An EP(UK) patent may be revoked by the EPO in opposition proceedings if filed within the relevant period. This results in revocation for all designated countries.
A patent can be found to be partially invalid, ie, some claims are invalid, some valid. The court may revoke the patent unless, within a specified time, the specification is amended to the satisfaction of the court.
Where a patent is subject to revocation proceedings, the patent-owner can apply to the court (or the Comptroller) for an amendment to the claims. The amendment can be sought on a conditional or unconditional basis. A person may oppose the proposed amendment and the court/Comptroller will notify the proprietor and consider it in deciding whether the amendment should be allowed. If allowed, the amendment is deemed to have had effect from the date of grant of the patent. The CPR, Part 63.10, governs the amendment procedure.
Revocation and infringement proceedings are heard together.
In respect of patent disputes (and other intellectual property rights), the CPR, Part 63 supplements and alters the general procedural rules. Furthermore, both the Patents Court and the IPEC have court guides that include procedural and practical requirements.
In England and Wales, the civil litigation system is configured to hear disputes in a single substantive oral trial, which in the case of patent disputes includes both infringement and validity. It is typical for a trial to be divided into separate liability and quantum stages. Usually, trials regarding quantum only begin after the relevant court has determined liability.
In the initial stages of proceedings on liability, and usually following a case-management conference at which both parties appear, a judge will issue case-management directions. These directions (many of which can be agreed between the parties) define pre-trial protocol and various deadlines for the parties, usually tailored to the particular dispute.
A single judge hears the first-instance trial of a patent matter under the Patents Act (and related actions for breach of confidence, etc). The judges in the Patents Court and IPEC tend to be specialists in intellectual property matters. Some judges have more technical expertise than others, eg, in addition to legal studies, some judges have studied or practised in scientific and/or technical fields. Cases in the Patents Court are allocated to specific judges based on the level of complexity, such that more technically experienced judges will receive more complex matters. Although the IPEC is tailored to smaller intellectual property claims, the judges have similar technical expertise.
There are no formal mechanisms for settling a case (eg, court-ordered mediation, court-facilitated mediation or mandatory settlement conferences). However, parties are entitled to settle the dispute at any stage of the proceedings and by any means they wish (eg negotiation or facilitated mediation). Parties typically settle on confidential terms but will need to consider relevant UK and EU competition laws and regulations to ensure compliance.
National courts (including the Patents Court and IPEC) retain exclusive jurisdiction over matters relating to patent infringement. However, the prospect of concurrent proceedings relating to validity (eg, in the EPO and the UK courts) is inherent in the EPC system, and has been the subject of debate before the UK Court of Appeal.
The Court of Appeal has ruled that where there are concurrent validity proceedings before the UK courts and the EPO, in the absence of any other factors a stay of the UK proceedings is the default option. The rationale is that there is no justification for two sets of proceedings simply because the EPC allows for it (IPCom v HTC).
It is incumbent upon the party opposing the grant of a stay to explain why it should not be granted. However, the court will always take into account where the balance of justice lies. For example, in the event that allowing the UK court to proceed with an infringement action might allow the patentee to obtain monetary compensation (eg, damages or an account of profits) which is not repayable if the patent is subsequently revoked, the interests of justice would tend to support the grant of a stay. However, a patentee in this situation might seek to mitigate the effect of this potential injustice by offering a suitable undertaking to repay potential damages that might be suffered by the defendant. Further, if commercial certainty would be achieved in the UK courts earlier than in the EPO, the interests of justice would tend to support continuing even in the face of concurrent proceedings.
Decisions of courts in other jurisdictions as well as the Opposition Division of the EPO and the Technical Board of Appeal, if it found the patent valid, are not binding on UK judges so it can often be necessary to proceed with parallel litigation.
The owner of a patent may bring civil proceedings in respect of any act of infringement of the patent and in those proceedings may make a claim for an injunction to restrain infringement, an order for delivery-up or destruction, damages or an account of profits, a declaration that the patent is valid and has been infringed and/or an order for dissemination and publication of the judgment.
A claim for damages or an account of profits can be made in respect of infringements that take place after publication of a patent application but before grant of a patent. An applicant is only entitled to bring proceedings after the patent has been granted.
Injunctive relief: an injunction to stop a defendant from infringing a patent is the most common form of relief sought. An injunction is an equitable remedy and it is therefore at the discretion of the court to grant. Where the court considers that injunctive relief would impact the lawful activities of third parties, it may not be considered appropriate.
An interim injunction is temporary and stops the alleged infringement(s) until the dispute can be heard at trial. For an interim injunction to be granted, the applicant needs to show (in line with the American Cyanamid principles) that there is a serious issue to be tried or a real prospect of success and that an award of damages at trial would not be an adequate remedy. The court will also consider the “balance of convenience” (ie, weighing up the relative harm that will be caused to each party by the grant or refusal of the injunction and whether to maintain the status quo). Where an interim injunction is granted, the court will almost always require the applicant to give a cross-undertaking as to damages, to compensate for any loss the defendant may suffer if it is later held that the injunction was wrongfully granted because the patent is found to be invalid and/or not infringed at trial.
Generally, injunctive relief is granted following a finding at first instance that at least one valid claim of a patent has been infringed. This is a final injunction and is usually prohibitive, but mandatory injunctions are possible and, in particular, may be sought in cases involving second medical use claims (ie, for the alleged infringer positively to take steps to avoid infringement). Not only is the injunction discretionary but the conditions imposed are variable.
The court may consider it appropriate to grant an injunction that extends beyond patent expiry to restrain the sale of infringing articles manufactured during the life of the patent or to prevent the defendant from creating a springboard into the market after patent expiry (Dyson v Hoover).
Damages or an account of profits: the owner of a patent may either obtain damages in respect of losses caused by infringing activities or an account of profits obtained by the infringer, but not both.
Following a finding of infringement, the court will order an inquiry as to damages or an account of profits, at the claimant’s election.
An award of damages is intended to compensate the patent-owner for the loss suffered and to put them in the same position they would have been in but for the infringing acts.
In the IPEC an award for damages or account of profits is capped at GBP500,000 unless the parties agree otherwise.
Exemplary damages may be available in a patent infringement action (per Lord Devlin in Rookes v Barnard). The Patents Act does not provide for exemplary damages.
Neither damages nor an account of profits can be awarded in respect of infringing activities undertaken by those who were not aware or had no reasonable grounds to suppose that the patent existed (ie, innocent infringers; section 62).
Declaratory and other relief: the court may make a declaration that the patent is valid and has been infringed. Where validity is contested and the patent found to be wholly or partially valid, the court or comptroller may certify those findings by way of a certificate of contested validity. This has costs implications in any later proceedings challenging the validity of the same patent.
Costs: the general rule is that a successful party to litigation is awarded reimbursement of costs (including lawyer, expert and court fees), payable by the unsuccessful party. Where a party has succeeded on some issues only, the court may order an assessment on an issue-by-issue basis, so costs are only awarded for those issues upon which the party succeeded. In practice, the successful party would generally recover only 60-75% of legal fees actually paid (see 8.2 Calculation of Court Fees).
Declaratory relief: where appropriate, the court may make a declaration that an act committed does not constitute patent infringement or may order a declaration of invalidity and order for revocation. Such orders will usually be stayed pending any appeal.
The court may order relief to the effect that a product or process was obvious at a relevant date (Fujifilm v Abbvie).
Relief under a cross-undertaking in damages: if an injuncted party later succeeds on the merits of the underlying claim, the court will discharge the injunction and order an inquiry into damages on the cross-undertaking.
See 6.1 Remedies for the Patentees and 6.2 Rights of Prevailing Defendants.
See 6.1 Remedies for the Patentees.
A decision of the Comptroller may be appealed to the Patents Court. A decision of the Patents Court may be appealed to the Court of Appeal (on points of law) and appealed further to the Supreme Court (on points of law of general public importance).
The first-instance judge may grant or refuse permission to appeal to the Court of Appeal. If refused, it is possible to apply directly to the Court of Appeal for permission. Similarly, the Court of Appeal is entitled to refuse permission to appeal to the Supreme Court but a party can apply directly, within a specified timeframe.
IPEC proceedings are appealed directly to the Court of Appeal.
An appeal to the Court of Appeal is a review of the first-instance decision, not a re-hearing. It is rare that any new evidence will be considered and permission of the court would be needed for it to be introduced. The Court of Appeal will have before it written evidence, exhibits and other documents filed at first instance relevant to the points in issue on appeal, along with the transcripts of the first instance proceedings. Further written and oral arguments may be made on appeal.
Appeals to the Supreme Court should be permitted on points of law of general public importance only and are not a re-hearing.
Pre-action costs (including pre-action warning letters, formal letters of claim and related correspondence) are considered within costs management and budgeting; see 8.2 Calculation of Court Fees. “Costs” is a general term usually considered to include legal fees, court fees and related expenses (eg, expert fees) incurred in preparation of or during litigation.
To commence proceedings, the required court fee is related to the value of the claim: up to GBP300 and rising to claims worth “more than GBP200,000”. The latter claims require a court fee of GBP10,000.
The unsuccessful party is typically responsible for paying the successful party’s costs of litigation, in accordance with the IP Enforcement Directive.
Under the CPR, Part 44, the court retains broad discretion to manage costs, including interim decisions whether costs are payable by one party to another, the amount of those costs, and the time and manner in which they are to be paid. Following the substantive decision and either a hearing or agreement by the parties, the court will make an order on costs. The general position is that costs follow the event - the unsuccessful party is ordered to pay the costs of the successful party.
The court will have regard to all the circumstances of the case, including the outcome on each issue, claim or element and allocate costs accordingly. Although issue or element-specific payments from the overall winner to the overall loser are unusual, in exceptional circumstances they do occur. The court will consider the conduct of the parties before and throughout the proceedings, together with any admissible offer to settle made by a party and drawn to the court’s attention (provided it is not an offer to which costs consequences under Part 36 apply).
In general, costs assessed on the standard basis will result in the successful party recovering approximately 60-75% of its incurred legal costs.
The court retains discretion to award indemnity costs, in which proportionality is not considered a relevant factor. Orders for indemnity costs are unusual and tend to be made only where the conduct of the party liable or some circumstance takes the case "out of the norm". This may result in costs awards exceeding by 10-20% costs awards made on the standard basis.
In the IPEC, recoverable costs are capped for each phase of a claim (eg, particulars of claim, defence and counterclaim, preparing witness statements, expert reports, disclosure and inspection, and experiments). The total recoverable costs to determine liability are capped at GBP50,000; the total recoverable amount for an inquiry as to damages or an account of profits (quantum) is GBP25,000.
Cost budgeting: claims before the UK courts are often subject to management in the form of cost budgets.
Claims with a value of less than GBP10 million issued in the Patents Court (and the broader Intellectual Property List and Chancery Division) are subject to a CPR-mandated costs-management scheme to further the court’s overriding objective. Parties to claims above GBP10 million in value can mutually agree to submit to the budgeting rules.
A key component is the preparation, filing and exchange of detailed costs budgets that anticipate costs for the entire action. These can be amended during the proceedings to account for changes in circumstances.
Alternative dispute resolution is possible for patent disputes but is not commonly used, particularly in the life sciences sector. It is more suited to determining issues of infringement or non-infringement, in addition to issues of ownership and licensing. Under the Patents Act, section 74, validity may only be made an issue in certain kinds of proceedings. Therefore, while the question of validity can be dealt with in arbitration or mediation, because it is between the parties there is no obligation to make an amendment to the patent register following determination by an arbitration panel. As such, the parties would either have to agree that the invalid patent is to be surrendered or agree that the patent will not be enforced against the defendant. However, in the latter instance, the parties must consider whether it is anti-competitive if the right is genuinely invalid as opposed to not being infringed by the defendant’s product or process.
The UKIPO offers an alternative to litigation through the courts by providing an opinion service on issues of validity or infringement. Such an opinion is non-binding but could be used as leverage in settlement negotiations or a springboard to issue proceedings at court. Notably, any material filed in relation to an opinion may also be open to public inspection, including on the UKIPO website. Following a non-binding opinion from the UKIPO that a patent is invalid, the comptroller has the ability to decide to revoke the patent for lack of novelty or inventive step without any third-party involvement. However, it is a high bar for the UKIPO to take such action.
The transfer of patent rights can take place at any time from the making of the invention to the expiry of the patent. It is also important to take account of any non-patented know-how related to the invention, which may be equally or more valuable.
An assignment of a UK or EP(UK) patent or patent application is void unless it is in writing. Post-1 January 2005, the need for assignments to be signed by assignees and assignors was removed for UK assignments (Regulatory Reform (Patents) Order 2004 (SI 2004/2357). Assignments of EU patent applications do need to be signed by the assignee and assignor and must be in writing.
There are specific provisions that may be implied in UK patent assignments and they should include the right to bring proceedings for any previous infringements (Patents Act, section 30(7)).
The public have a right to inspect the register of patents maintained by the Comptroller. There is no obligation to register the assignment or licence with the UKIPO but it is advisable to do so as soon as possible. Registration gives priority to registered rights, which may defeat earlier claims of unregistered rights. Additionally, if the patent-owner fails to register the transaction within six months, its rights to claim costs for litigating an infringement that occurred before registration are diminished, unless the patent-owner can prove to the court it was not reasonable or practicable to register it in that period (Patents Act, section 68).
It is a simple process to register a patent assignment or licence in the UK. An application to the UKIPO is made using Patent Form 21 and a small fee is payable. It must include evidence establishing the transaction; however, this need not be a copy of the assignment itself. A redacted copy of the licence or assignment is sufficient.
To register a licence or assignment in the EPO, the request must be in writing and accompanied by documents satisfying the EPO that the licence or assignment has been granted. A statement signed by the assignor/licensor that the assignment or licence has been granted is also sufficient.
There is no requirement for a licence (exclusive or non-exclusive) to be in writing. However, it is advisable, to ensure certainty of terms, to allow the parties to secure the benefits and rights of the registration and to designate the law and jurisdiction that governs the licence.
See 10.2 Procedure for Assigning an Intellectual Property Right.
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