One-two-three

Still warm from the press and courtesy of Matthieu Dhenne, come tidings of the fall of another important pharma IP, namely the Atripla SPC (Supplementary Protection Certificate).

Atripla is marketed as a pink tablet with “123” impressed on one side. It contains a combination of three anti-HIV drugs, namely efavirenz, emtricitabine and tenofovir.

The U.S. pharmaceutical giant Merck Sharp & Dohme Corp. (MSD) owns European patent No. EP 0582455, entitled “benzoxazinones as inhibitors of HIV reverse transcriptase“. The patent was filed on August 3, 1993.

Two SCPs were filed and granted in France based on the EP’455 patent, and on two successive marketing authorizations (MAs):

  • The first one, FR01C0012, was filed on April 10, 2001 and granted on May 18, 2001. It protected the active efavirenz per se. This SPC expired on November 20, 2013.
  • The second one, FR08C0021, was filed on May 27, 2008 and granted on November 20, 2009. It protects the triple therapy combination of efavirenz, emtricitabine and tenofovir (marketed as Atripla) and is set to expire on August 2, 2018.

On September 20, 2016, Mylan initiated legal proceedings against MSD in France, claiming that the FR’021 SPC is invalid. The Paris Tribunal de grande instance (TGI) issued its judgment on November 30, 2017.

The judgment is interesting both regarding the admissibility of the action and  the merits.

As far as admissibility is concerned, the nullity defendant claimed that Mylan was time-barred from requesting the nullity of the SPC.

As a first line of response, Mylan argued that the general statute of limitations in our Code civil, which provides a five-year limitation period for “personal or movable actions“, is not applicable to actions for nullity of an IP right. Unsurprisingly, the court disagreed, in keeping with recent case law at the first instance and appeal levels. The TGI made in particular reference to a trademark ruling by the Cour de cassation dated June 8, 2017. For the court, applying this ruling by analogy leads to the conclusion that an action for revocation of an SPC is indeed subject to the limitation period under ordinary law.

That being said, the real interesting point is the determination of the starting point for the five-year limitation period. Although there has been a lot of discussion (including on this blog) concerning the starting period for patent nullity cases, there has been no clear guidance for SPC nullity actions, as far as I am aware of.

MSD’s case was that the starting point for the limitation period was the publication of the SPC application. The court disagreed and set the following principles.

The starting point for the limitation period must be set to the day, determined in concreto, when Mylan knew or should have known, because it intended to market a generic version of the drug which received an MA on December 13 [2007], for the combination of [the] three actives, which is protected by the SPC, which represents an impediment for its business.

So, we all get the idea there – although a couple of words may be missing, which happens from time to time when your sentences are too long, and this is probably why my blog software keeps blaming me for using more than the recommended threshold of 25% of sentences containing more than 20 words.

The general principle of an in concreto assessment is in keeping with the TGI’s previous decisions in patent revocation cases. The court went on:

[…] Only the SPC matters as an impediment, and not the patent. 

One should not refer to the date of grant of the patent, since the validity of the patent is not challenged by Mylan, which acknowledges that the efavirenz active compound is the subject-matter of the invention protected by the EP’455 patent and then by the [FR’012] SPC which expired on November 20, 2013. 

Only the validity of the [FR’021] SPC […] is challenged […]. 

Thus the publication of the grant of the patent cannot be set as the starting point for the limitation period, as it would in fact require an unrealistic watch from stakeholders and is unrelated to the development of the project which gives standing to sue. 

Mylan’s standing does not derive from the publication of the title, be it the patent or the SPC, but from its concrete intent to market the same drug. 

In this case, they have to check that this intent to market the product does not infringe any IP, and if this is the case, to seek its revocation before launching. 

Watching patent or SPC registers cannot be required from stakeholders before they intend to develop a competing product. 

[…] In the present case, the first MA for Atripla […] was granted on December 13, 2007. In view of article R. 5121-28 of the Code de la santé publique, the generic company can only apply for an MA starting from the eighth year after the grant of the MA for the original drug, and cannot be granted one before ten years. 

Therefore, Mylan could not apply for an MA before December 13, 2015, and could not obtain it before December 13, 2017. As a consequence, the date at which Mylan’s standing can be taken into account is December 13, 2015, which is the date starting from which it could apply for an MA. Thus, Mylan is not time-barred as it had until December 13, 2020 to start legal action.

What is somewhat paradoxical is that the TGI calls for an in concreto appraisal but then defines what could possibly be a general rule for SPC cases, namely that the starting point for the limitation period is the date at which third parties may start applying for their own MAs.

We will need to wait for further cases to know for sure whether this is indeed a general rule or not.

Turning to the merits of the case, the discussion and the ultimate reasoning of the court are extremely similar to what can be found in the recent decision on Truvada, also reported on this blog a few weeks ago. 

Truvada is another anti-HIV drug based on the combination of tenofovir and emtricitabine. The SPC at stake in today’s decision relates to the combination of the same compounds, plus a third one, efavirenz. And the problems raised by this other combination are analogous.

According to article 3(a) of the SPC regulation (regulation (EC) No. 469/2009 of the European Parliament and of the Council), an SPC “shall be granted if, […] (a) the product is protected by a basic patent in force“.

How to determine whether a product can be considered as being “protected” by a basic patent has been the subject of intense litigation and numerous rulings from the CJEU, which are mentioned in the TGI’s judgment. Again, readers of this blog can refer to the Truvada post, which contains a short summary of the most important CJEU case law prepared by Lionel Vial.

CJEU case law on the interpretation of the SPC regulation: each ruling always leads to more referrals.

In the present case, none of the claims of EP’455 explicitly recites the combination of the three active compounds of the combination. Instead:

  • efavirenz is covered by a generic formula in claims 1 and 5 and is singled out in claims 2 and 12 (as well as in claims 8 and 9 but in combination with other drugs different from tenofovir and emtricitabine);
  • tenofovir and emtricitabine are not cited in the patent;
  • claims 7 and 16 relate to the combination of a generic formula (covering efavirenz), or of efavirenz specifically, together with a nucleoside analog;
  • tenofovir and emtricitabine belong to this category of nucleoside analogs.

According to the court, this is insufficient to consider that the combination of the three active compounds is protected by the EP’455 patent pursuant to article 3(a).

Says the court:

It turns out that the description never explicitly cites either tenofovir or emtricitabine which are not identified in the EP’455 patent, be it individually or collectively in a composition. And in addition the specific combination claimed as an active product “efavirenz + emtricitabine + tenofovir” is not implicitly but necessarily and specifically taught in the description, and no indication makes it possible for the skilled person to select emtricitabine and tenofovir as nucleoside analogs. 

In fact, if I understand correctly, emtricitabine and tenofovir were not even identified and known yet as anti-HIV drugs at the filing date of the EP’455 patent.

Furthermore, the court refused to consider the claims relied upon by MSD (reciting nucleoside analogs) as “functional claims” because “they do not describe the structure which should be present nor the function that the second and third products should have in this structure“.

For the sake of completeness, the court stated that even if the claims were considered as functional, the four-step test established by the Dutch patent office would then not be satisfied. Again, this same test was discussed in the previous Truvada post, so I will not describe it again here.

As a consequence, the SPC was found to be invalid under article 3(a).

By way of overkilling, the court added that the SPC was also invalid in view of article 3(c) of the SPC regulation, per which an SPC “shall be granted if, […] (c) the product has not already been the subject of a certificate“.

In this case, another SPC had been granted based on the same EP’455 patent, namely the efavirenz SPC. MDS relied on the Georgetown CJEU decision (C 484/12). According to this decision, article 3(c) does not preclude the grant of one SPC for a combination of active ingredients, and another SPC for a single active ingredient, based on the same patent.

Nevertheless, according to the TGI, Georgetown is only applicable if the mono and combo products are separate inventions.

In one brief paragraph, the court then held that:

the combination of efavirenz with emtricitabine and tenofovir does not represent a separate invention which may give the right to a second SPC. For this second reason, SPC [FR’021] is invalid under article 3(c) of the regulation. 

Those readers in favor of pan-European consistency (which probably means most readers of this blog) will be happy to know that the TGI’s decision mirrors a similar ruling in the UK handed down on March 21, 2017, per which the corresponding UK SPC was declared invalid by Mr. Justice Arnold.


CASE REFERENCE: Tribunal de grande instance de Paris, 3ème chambre 1ère section, November 30, 2017, Mylan SAS v. Merck Sharp Dohme Corp., RG No. 16/14466.

An electric dispute

When Matthieu Dhenne kindly sent me a copy of the recent judgment Quadlogic Controls Corporation v. SA Enedis, I immediately knew that it would contain a part on the limitation period for nullity claims, as this is one of his favorite topics.

But quite to my delight, when diving into the judgment, I realized that extension of subject-matter is also discussed at length. And it turns out that this is one of my favorite topics.

I will leave it up to readers to decide which favorite topic is more off-putting, his or mine.

Quadlogic is a New-York based company specialized in energy management products. They own European patent No. EP 1260090 to a System and method for on-line monitoring and billing of power consumption.

Enedis, previously known as ERDF, is a subsidiary of EDF, the public company turned private which is still responsible for distributing most of the electricity used in France. Enedis on the other hand is in charge of handling the electricity network.

One huge project that has been keeping Enedis busy for a number of years now is the replacement of traditional electricity meters by smart (and somewhat controversial) meters known as the “Linky” meters. By the end of 2017, 35,000 new Linky meters are supposed to be set up every day.

It is therefore a pretty big deal that Quadlogic stated that the Linky technology infringed the EP’090 patent. In 2015, a number of letters were exchanged between the parties, but no amicable agreement was reached.

Thus, Quadlogic filed an infringement suit in February 2016, after performing an infringement seizure in January. Enedis raised a number of defenses and in particular challenged the validity of the patent and requested its revocation.

At this point, Quadlogic replied that Enedis was time-barred from filing a nullity counterclaim – a classical defense nowadays. However, this time the Paris Tribunal de grande instance (TGI) disposed of the issue relatively quickly.

Although the patent was filed as early as February 2001, it was only granted by the EPO in October 2013.

The court held:

It is established that the nullity of a patent can only be requested as from the date of grant, namely October 9, 2013 so that the nullity requested by Enedis for the first time in its counterclaim of February 21, 2017 is admissible. No limitation period can thus be raised against Enedis. 

As a reminder, there is now a limitation period for nullity claims in this country, according to recent case law, which is 5 years. The starting point of the period is much debated, with diverging views between first instance and appeal judges.

However, it is now relatively clear that the starting point cannot be before the grant of the patent. At least the TGI and the Cour d’appel are on the same page on this – see a recent report here.

The court then turned to the merits of the validity challenge and reviewed the amendments made during examination.

1911 – when electricity was still a miracle.

Claim 1 of the patent reads as follows:

A system for monitoring energy usage on a power line comprising:
(a) an electronic microprocessor-controlled digital electricity metering device coupled to a power line and including a non-volatile non-battery-powered memory, wherein said metering device is operable to perform interval metering for each of a plurality of intervals, is operable to store in said memory data acquired by said interval metering for each of said plurality of intervals, in a manner that enables recovery of measurements for individual intervals of said plurality of intervals and is operable to receive a data request and transmit data in response to said request over said power line; and
(b) a data collector coupled to the metering device via said power line, the data collector being operable to receive data from and transmit data to the metering device over the power line; operable to store data received from the metering device over the power line, and operable to receive data from and transmit data to a remotely located computer.

The expression highlighted above was added during examination and was at the center of the court’s attention.

The court noted that the expression could not be found in any of the 63 original claims and thus turned to the description and drawings. Quadlogic apparently relied on a single short passage as a support, which the court thought was a little bit too light:

Quadlogic only quotes the first sentence of paragraph 132 in its submissions, namely: “Interval metering stores independent records of metering data for future recall”. 

And this single sentence in a patent comprising 60 pages of description, supposed to be the crux of the invention, does not mean that individual records of the metering intervals are made. It mentions the possibility of independent records without stating that there is a prior problem that the skilled person had to solve. 

This mention cannot be considered as supporting the added feature, which makes it possible for the invention to exist, since the metering, storing and recovering of metering intervals on energy consumption were known; this feature is the only novel one in view of the known prior art. Since the entire device was known except this feature which is the only one to confer novelty to the invention, in order to avoid extension beyond the content of the application, elements to support the invention itself must be found in the description and drawings. 

What is remarkable in this explanation by the court is that a feature added in order to distinguish the claimed invention from the prior art seems to be subjected to a more thorough and strict evaluation than more innocent features. The EPO on the other hand usually does not make a distinction between novelty-conferring features and non-novelty-conferring features in the added matter analysis.

What is also remarkable is that the court did not simply look at the sentence in isolation, but took into account the general context of the entire patent. In this case, the supporting sentence is only recited in passing, without any statement of a technical problem to be solved. The way I understand it, in order for the invention to be redefined based on a specific feature, this feature must be originally identified as addressing a particular problem.

The court then delved into a more technical investigation.

This sentence “Interval metering stores independent records of metering data for future recall”  means that the recorded interval metering is independent from the values of counting energy consumption.  

The part of the sentence “for future recall” is much too elliptic to be admitted as supporting the recovery of measurements of individual intervals. It only refers to the existence in the system of a function for recovering stored data owing to a transfer to the computer. 

In other words, the sentence relied on by the patentee does not expressly refer to the notion of storing data so as to be able to recover measurements for individual intervals – as claimed. Moreover, the court found that it was not clear that this is what was implicitly meant there. See also the following statement in the judgment:

Indeed, the fact that measurements are stored as “independent records” does not imply that the measurements, wholly or partly related to these records, can be recovered in an individual manner.

In this respect, the EPO’s gold standard of direct and unambiguous derivability seems to be applied by the French judges.

Extensively examining the rest of the description and drawings, the court noted that there was no actual disclosure of technical means to perform the claimed feature:

No means for separately recovering one of the measurements of the non-volatile memory is ever mentioned in the description of the patent. 

[…]

And table 6 […] effectively shows that the measurements of intervals are recorded one after each other, half hour by half hour during a certain time, which is a measurement and storing mode already widely known without adding any means to individualize data. 

The court continued by noting that the recovery of an individual measurement for a certain interval requires for instance predefined addressable memory areas. But no such embodiment was disclosed in EP’090.

In summary, the subject-matter of claim 1 was found to extend beyond the content of the application as filed, the same conclusion applying to all of the following claims, and the patent was declared invalid.

The issue of infringement was accordingly not addressed.

Whether readers agree or disagree with the court’s findings, the good news is that a very thorough assessment of the technical information made available to the skilled person in the application as filed was performed, which looks every bit as good as what we could find in a decision by a Board of appeal of the EPO.

The judgment is also yet another reminder that completely redefining an invention during examination proceedings by digging for some isolated disclosure may be a winning strategy for the grant, but a losing one during opposition or litigation.


CASE REFERENCE: Tribunal de grande instance de Paris, 3ème chambre 1ère section, November 2, 2017, Quadlogic Controls Corporation v. SA Enedis, RG No. 16/03165.

Smells like revocation

Believe it or not, it is somewhat difficult for this blogger to know what his readers are most interested in. Do they yearn for complex legal discussions? Are they rather keen on getting their hands dirty with an insight into actual patents and prior art documents?

The good thing is that today’s post will contain a little bit of both – hoping that the answer to my question is not “none of the above“.

Reckitt-Benckiser owns European patent No. EP 1891197 which is entitled “Process for manufacturing improved dispensing devices“. This patent owner is no small fish, but rather a giant in the hygiene industry. Think of the brands Air Wick, Calgon, Clearasil, Cillit Bang, Durex. But today, Harpic is the type of products we are talking about.

In June 2013, two companies of the Bolton group, namely the Italian Bolton Manitoba and the French Bolton Solitaire, filed a nullity suit against the French part of the European patent.

On March 13, 2015, the Paris Tribunal de grande instance (TGI) dismissed the nullity claim. Bolton appealed, and the Paris Cour d’appel issued its judgment a couple of weeks ago.

The first interesting aspect in the appeal judgment is… the application of the statute of limitations to the nullity claim.

One would think that we have heard enough about this topic on this blog lately, and one would be wrong.

As is usual now in a patent nullity lawsuit, the admissibility of the request for revocation was challenged by the patent proprietor. The proprietor deemed that the limitation period for the nullity claim started running from the publication date of the application.

In the present case, the application had been published before the amended statute of limitations entered into force on June 19, 2008 (as discussed here, this amended statute brought the default limitation period from 30 years down to 5 years, which initially created the legal mess that we are now in). Therefore, the patentee said, the starting point was postponed to June 19, 2008, when the amended statute entered into force; and the limitation period expired on June 19, 2013, i.e. five days before the nullity complaint was served.

On the other hand, the nullity plaintiff argued that the five-year limitation period only started from the publication of the grant of the patent, namely August 27, 2008, so that the nullity action was timely filed and admissible.

The court ruled that

[…] the limitation period can only start running from the date on which the person against whom [the patent] is asserted can validly act; pursuant to article 64 EPC, a European patent confers rights as from the publication of the mention of grant, so that a nullity action against a European patent application does not exist. The limitation period for the action can thus only start running, in the present case, from the publication of the patent grant at the earliest

There is a lot to digest in this single sentence:

  • It is a good thing that the publication of the application was not upheld as a valid starting point – this is the last thing we need right now.
  • The choice of the patent grant as the starting point is consistent with the recent ruling by the same panel of the Cour d’appel in Halgand v. RP Nicoll, discussed here.
  • The court did not perform an in concreto assessment, which currently continues to be applied by the judges in the TGI (see the discussion here).
  • However, the wording used by the court, i.e. can thus only start running in the present case, from the publication of the patent grant at the earliest“, does not fully contradict the in concreto approach. Here, the nullity plaintiff seems to have taken the position that the starting point did not need to be accurately determined, as it could anyway not be before the publication of the patent grant, which thus ensured the admissibility of the action in any case. And the appeal judges fully followed this approach.

Therefore, all in all, this new ruling does not change much relative to the previous situation. Or, as they say in every good mystery novel, the plot thickens.

Having found the nullity action admissible, the court turned to the merits of the case, and more particularly to the contention that claim 1 of the patent did not involve an inventive step.

This is the second interesting aspect in the judgment, since the Cour d’appel reversed the decision under appeal in this respect, and declared claim 1 invalid although it had survived the first instance proceedings.

The patent in suit is directed to a manufacturing process for a sanitizing toilet block. Claim 1 reads as follows:

A process for the manufacture of a lavatory dispensing device useful for the delivery of at least one treatment composition, preferably a cleaning composition and/or a sanitizing composition to a sanitary appliance, preferably a toilet bowl which method comprises the steps of: 

– providing a composition to an extruder,
– forming an extrudate from said composition;
– inserting part of a hanger into said extrudate;
– compressing the extrudate to encase or enrobe said part of a hanger thereby forming said lavatory dispensing device.

The next generation sanitary appliance for your toilets.

I understand that the relevant prior art was the following:

  • Some prior art references taught the manufacturing of toilet blocks by placing a hanger in a composition comprising paradichlorobenzene, and compressing the composition onto the lower end of the hanger. These blocks are “cageless”, that is they are provided on their own and not in a plastic cage.
  • Other prior art references disclosed the manufacturing of toilet blocks by an extrusion process, and their inclusion into cages.

In the first instance judgment, claim 1 was found to be inventive. The TGI commented on the teaching of the prior art as follows:

– the process of fixing a hanger to a cageless device only concerns compositions containing paradichlorobenzene, known for its low solubility, which has now been prohibited since it is considered as a dangerous material; 

– the insertion of the hanger occurs when the block is molded; 

– none of the […] patents suggests a compression after an extrusion, to attach the hanger; 

– compositions containing at least one surfactant (which leads to the block breaking off) are in the prior art always placed in a support. 

Therefore, the skilled person was not naturally prompted by this prior art to contemplate a toilet block containing surfactants, to be used without a cage, by inserting a hanger into a block obtained by extrusion, and then compressing the extrudate to encase the hanger. 

The existing prejudice that cages were required to support and contain sanitary treatment blocks was overcome, since it is now possible to make cageless devices which comprise a suspending hanger and a composition as a compressed full block tied to the suspending hanger, said solid block compositions comprising one or more chemical compounds, preferably at least one surfactant composition. 

It is remarkable that the first instance court did not apply the problem and solution approach. Though this reasoning “made in EPO” is more and more often relied upon by litigants and judges in France, it is by no means mandatory.

It is also noteworthy that the TGI, when discussing why the skilled person would not have achieved the invention in an obvious manner, made reference to a number of features which are actually not present in claim 1.

For example, the court seemed to consider that the composition of the block comprises surfactants and does not comprise paradichlorobenzene. According to the court, this is very important, as only paradichlorobenzene-based blocks were disclosed as being compressively tied to a hanger – in view of the particularly low solubility of this chemical. But claim 1 does not explicitly exclude the presence of paradichlorobenzene, and does not specifically call for the presence of surfactants (which are recited in dependent claim 10). Claim 1 merely mentions a “treatment composition, preferably a cleaning and/or a sanitizing composition“.

Furthermore, the court considered that there was a prejudice against cageless devices comprising a sanitary composition (as opposed to a merely deodorizing, paradichlorobenzene-based composition). But claim 1 does not explicitly exclude the presence of a cage in addition to the hanger. This is in fact the subject-matter of dependent claim 8.

As for the appeal judges, they did not follow the problem and solution approach either. But they did reach a different conclusion: 

In the end, at the priority date of European patent No. 1891197, in view of the teaching of the above documents, the skilled person […] knew processes for making blocks for toilet bowls suspended by hangers; desirous of making a cageless suspended lavatory block, not based on molded paradichlorobenzene (deemed toxic) but on treatment compositions comprising surfactants, obtained by extrusion, he could use the same process starting from an extruded composition as taught in [a couple of patents]; he also knew from the teaching of [another patent] that it was possible to compress an extrudated block to give it a shape or to close the opening resulting from the insertion of the hanger.   

It is striking that the Cour d’appel shared the TGI’s appraisal of the crux of the invention, namely providing a cageless device for a block comprising surfactants.

The TGI was thus not blamed for its extremely extensive interpretation of claim 1 in view of the description of the patent. 

As far as I can tell, the different conclusion was in fact reached due to a new prior art citation, namely a reference disclosing the compression “of an extrudated block to give it a shape or to close the opening resulting from the insertion of the hanger” – whereas the first instance judges had noted that “none of the […] patents suggests a compression after an extrusion, to attach the hanger”. 

First instance judgments are very often confirmed on appeal in France. One exception to this general trend is when new facts arise, such as a new prior art document like in the present case.


CASE REFERENCE: Cour d’appel de Paris, Pôle 5 chambre 2, October 20, 2017, Bolton Manitoba & SASU Bolton Solitaire v. Reckitt Benckiser LLC, RG No. 15/09777.

One step forward, two steps back

The French statute of limitations for patent nullity actions. Yes: again. Seems like we can never get enough of this topic, can we?

Courtesy of Matthieu Dhenne (who, as regular readers of this blog may have noticed, is no fan of the time-bar on patent revocations), here is the latest installment of the saga.

In the previous episodes:

  • A trend slowly emerged at the Paris Tribunal de grande instance (TGI), per which actions for revocation are time-barred five years from the date at which the claimant became aware or should have become aware of the patent right at stake, as a potential impediment – said date being determined in concreto based on the specifics of the case.
  • Then, a ruling from the Paris Cour d’appel (Halgand v. RP Nicoll) issued on September 22, 2017 seemed to imply that the starting point is or should generally be the grant of the patent.

When I reported on this latest case, I wondered whether the TGI would apply the criterion set by the appeal judges. Well, we may have a beginning of an answer now – and it is a negative one.

Today’s decision was issued on October 5, 2017. The pleadings hearing took place on September 12, i.e. before Halgand v. RP Nicoll was issued. However, it is very likely that the court was aware of this appeal decision before drafting and issuing the judgment of October 5.

As this is not a common law country, there is no obligation for the TGI to defer to the legal analysis put forward by the Cour d’appel in another, unrelated case.

In summary: it seems that the TGI is sticking to its previous doctrine.

Going in circles around a tricky legal issue.

The case concerns French patent No. FR 2804186 (FR’186) owned by Valeo Embrayages (Valeo). The patent was filed on January 25, 2000 and granted on April 26, 2002.

On July 17, 2015, Valeo sent a warning letter to German company LuK GmbH & Co. Kg (LuK). Valeo claimed that several of its patents, including FR’186, were infringed by LuK, and requested that LuK should take a license.

On January 23, 2017, LuK filed an action for nullity of the FR’186 patent in front of the Paris TGI. Valeo raised the defense that the action was time-barred. The judge in charge of case management decided to hold a hearing in front of the whole court on this issue, in parallel to the exchange of submissions of the parties on the merits. Today’s decision thus solely relates to this legal issue.

First, LuK made the point that the defense based on the statute of limitations should not be examined separately from the merits of the case. Indeed, the determination of the starting point for the limitation period is related to the existence of an impediment to their business due to the patent, and therefore to the merits of the case.

The court rejected the argument as follows:

The fact that it is necessary to examine the scope of the patent and its potential points of contact with the technology of the nullity claimant to determine the starting point of the limitation period does not imply any analysis of the validity of the right subjected to the court. Even without the separation ordered by the judge in charge of case management to streamline the proceedings and reduce their cost in case of a success and otherwise remove a complex question, the court would anyway have decided on the issue of the statute of limitations first, and without considering the issue of validity of the patent or its infringement (if it were raised).

It is quite clear that the court has a discretionary power to deal with some issues first, especially a legal defense such as this one.

But LuK’s arguments do reveal one the drawbacks of the statute of limitations being applied to patent nullity suits, and of the in concreto appraisal of the starting point for the limitation period.

Even if determining when a party felt (or should have felt) impeded in its business by a patent is not synonymous with deciding whether there is or has been any patent infringement, it is still dangerously close. 

The court uses the enjoyable expression of “potential points of contact with the technology of the nullity claimant“. However, if would-be nullity claimants feel cornered into admitting or half-admitting infringement in order to be able to sue (and this is even more true if you take into account the issue of standing, which was not at stake here), this will act as a powerful deterrent.

The next point addressed by the judgment is the impact of a cross-license / settlement agreement dated 2014 between the parties.

LuK argued that Valeo was barred from invoking the statute of limitations due to the 2014 agreement. Indeed, one provision of the agreement recited that each party could challenge the validity of licensed patents within 12 months from a license request.

The court determined that the FR’186 patent did not belong to the technical field concerned by the 2014 agreement. Therefore, the agreement had no impact whatsoever on the present case. At any rate the above provision did not prevent the regular application of the statute of limitations as there was no clear intent to discard said statute; and as no license had been granted on this patent anyway.

And finally, the real meat of the judgment, that is the computation of the limitation period. As mentioned above, the TGI maintained its traditional approach: 

The starting point for the limitation period must be set to the date, determined in concreto, on which [LuK] knew or should have known, due to the progress in the development and industrial implementation of its TAC technology (which is the only one targeted by [Valeo]) that the FR’186 patent could impede it.  

Thus, the publication of grant of the patent is not a suitable starting point, as it would in fact demand an unrealistic watch from stakeholders and is unrelated to the performance of the project which gives standing to sue. Neither is the knowledge of the grounds of nullity of the patent, which may arise well before the knowledge of facts and economic considerations giving rise to standing to sue and actually is equivalent to the publication of grant. 

I discussed this point with Matthieu Dhenne, who agrees that this is an instance of what we call in this country “resistance of the lower courts“. Or rather, “coming to one’s senses” is I think the expression he used.

After this important point, the court reviewed the scope of the patent as well as LuK’s “TAC” technology in great detail. Valeo argued that the technology was developed from October 2007 at the latest and was disclosed in April 2010. As a result, the nullity action became time-barred in June 2013, they stated.

The judges disagreed and held that the technical features disclosed in the various LuK patents and publications relied on by Valeo were not sufficiently close to the subject-matter of the FR’186 patent to constitute the starting point for the limitation period:

Moreover, the article of April 14, 2010 and the patent applications filed do not reveal any relevant points of contact between the TAC technology and the FR’186 patent which could prompt [LuK] to worry about the patents of its competitor. 

Hum, those points of contact again!

[The fact that the FR’186 patent] was cited as prior art under category “A” in the search report of an international application of July 4, 2011 […] [is] irrelevant. Therefore, nothing shows that LuK intended, in the course of the development of its TAC technology, to define the nominal position of the gearing means owing to dedicated setting means as an element of its wear correction device. Consequently, the FR’186 patent represented a potential impediment only on the day it was expressly cited against them, i.e. on July 17, 2015. 

As a result, the case will now proceed to the discussion on the merits.

Readers will surely have noted that, since FR’186 was granted in 2002, LuK’s action would be time-barred if the Cour d’appel’s approach were applied instead of the TGI’s. 

This leads Matthieu to make the following remark:

The plaintiff did not submit that the statute of limitations is inapplicable. If there is an appeal, they should. This will provide them with an additional ground of cassation if the Cour d’appel confirms its case law of September 22, 2017 (as the action would be time-barred if the standard set in this case law stands). 

Well, I am sure it is only a matter of time before our supreme court gets to decide on this legal point. Whether people will like what they say is another kettle of fish.


CASE REFERENCE: Tribunal de grande instance de Paris, 3ème chambre 1ère section, October 5, 2017, LuK GmbH & Co KG v. SAS Valeo Embrayages, RG No. 17/01156.

Will time tell?

Hot from the press comes a brand new decision of the Paris Cour d’appel which may leave many practitioners skeptical – if not utterly unhappy.

Many thanks to Grégoire Desrousseaux for forwarding this important judgment!

The statute of limitations in connection with patent nullity actions is a recurring topic.

A few weeks ago on this blog, Matthieu Dhenne criticized the very notion of a limitation period for nullity claims.

Am I just in time for a nullity suit?

Not only does today’s ruling confirm once again that the general statute of limitations, as amended in 2008, does indeed apply to patent nullity claims. But it also contains a surprising finding concerning the starting point of the limitation period.

The context is the following.

Two individuals, Mr. and Mrs. Halgand, filed a French patent No. FR 2840634 in April 2003. The patent was granted in February 2005 and then assigned to a company called Matériaux Equipements Plastiques (MEP) in 2006. The technical field is the protection of purlins or rafters.

Starting from February 2013, there were a number of exchanges between MEP and another company, Raccords et Plastiques Nicoll (Nicoll). According to MEP, Nicoll was exploiting a purlin protection system falling within the scope of their patent, without any authorization. Nicoll did not agree with these allegations.

This finally led Nicoll to launch the first strike and file an action for declaratory judgment of non-infringement in front of the Paris Tribunal de grande instance (TGI). At the same time, Nicoll also claimed that the patent was invalid and requested its revocation. The original applicants of the patent were forced to intervene in the lawsuit as a result of the assignment’s guarantee. MEP counterclaimed for (inter alia) patent, copyright and trademark infringement.

In November 2014, the TGI revoked claims 1 to 10 of the French patent and rejected MEP’s counterclaims. MEP and Mr. and Mrs. Halgand appealed, which leads us to the ruling issued by the Cour d’appel last Friday.

Unlike the TGI, the Cour d’appel held that Nicoll’s nullity claim was time-barred and thus inadmissible.

The argument had already been discussed in first instance, but the TGI had rejected it, holding that:

[…] Only an in concreto appraisal of the point in time at which the nullity claimant effectively became aware of the right which is asserted against them can be made in order to determine the starting point of the limitation period. 

In this case, the starting point of the limitation period is the formal notice sent by [MEP]’s patent attorney […] on February 25, 2013. Therefore, the nullity action against the FR’634 patent contained in the complaint filed on October 4, 2013 is not time-barred. 

This first instance ruling was in keeping with a number of other recent decisions by the TGI, which all emphasized the necessity to assess the starting point of the limitation period on a case by case basis. The relevant date was consistently said to be that on which the claimant knew or should have known of the patent, in view of the specific facts of the case. See for instance B/E Aerospace Inc. & B/E Aerospace Systems GmbH v. Zodiac Aerotechnics, reported here as well as Actelion v. Icos Corporation, reported there.

The appeal judges seem to have gone in a different direction. Here is a translation of the relevant passage in the judgment:

Article 2224 of the Code civil provides for an in concreto appraisal for the limitation period, by setting the starting point of the limitation period to the day on which the owner of a right knew or should have known the facts making it possible for them to assert this right.

Even though the publication of a patent application does not create rights for the proprietor, the publication of the patent is an acknowledgment of its rights. 

It cannot be denied that the publication of a patent is a way for third parties to know their rights, and that a professional who works in the same area as the patent proprietor and who puts on the market a new product must comply with rights which have been made public, without possibly relying on unawareness. 

Moreover, Nicoll, like MEP, works in a very specialized area and has business relationships with Mr. Halgand, who presented a PVC dressing product for purlins and rafters. On that date, the patent application […] had not yet been filed and Nicoll refused to cooperate on the development of a common project in October 2002, letting Mr. Halgand know that they would get in touch with him if they changed their minds. But [Nicoll] does not deny that [Mr. Halgand] then provided prototypes, so that [Nicoll] was perfectly aware of Mr. Halgand’s work and of his plan to file a patent, although Mr. and Mrs. Halgand only filed the patent in suit in 2003, which was granted in 2005. 

Even if MEP sent a formal notice of cease and desist, they did not start infringement proceedings. It is Nicoll which, denying any act of infringement, initiated proceedings for a declaratory judgment of non-infringement and for nullity of the Halgand patent.

Since [Nicoll] was disturbed in the manufacture and marketing of its products due to this formal notice which they believed was ill-founded, it was their right to make the disturbance stop and they had standing to request a declaratory judgment. On the other hand, they could not extend this right by starting a nullity action in relation with a patent which was duly published, past the limitation deadline which must be computed from the publication. But they may rely on this ground as an exception defense within the infringement action against them. 

Now, MEP filed a claim for damages in court due to infringement and requested that the court should state that its patent FR 2840634 is valid, and that there are [acts of] copyright infringement, trademark infringement and disparagement, free-riding and misleading advertising. 

As a consequence, the rights of MEP should be examined first, and Nicoll is admissible to rely on a nullity exception. 

In summary, according to the court, the starting point for the limitation period is the patent grant in 2005, and not the cease and desist letter of 2013.

Let’s look at the silver lining first: if it is indeed a general rule that all nullity suits have to be filed within 5 years from the date of grant, then at least this rule is easier to apply than the one created by the TGI.

This is because the latter requires to have a detailed look at all relevant facts. In Actelion for instance, the court conducted a very complex assessment of scientific articles, annual reports of the company, patent applications and marketing authorizations.

In this respect, the approach adopted in today’s ruling increases legal certainty and predictability.

Now, the big grey cloud: it just does not make sense that a party should automatically be time-barred from filing a nullity suit possibly months or years before actually contemplating a commercial exploitation to which the patent at stake could be a possible obstacle.

The consequences could be potentially disastrous for generic drug companies willing to clear the way prior to launching a new product.

The Cour d’appel clearly stated that patent nullity can always be argued as a defense to an infringement claim, without any time-bar (except that the court in such a case will not officially revoke the patent). By the way, in the rest of today’s judgment, the court did examine the validity of the patent and actually came to a different conclusion from the TGI, holding that the claims are valid.

But the availability of a nullity defense is not going to help generic companies (and others) willing to preemptively knock down a patent before launching a product, precisely in order to avoid launching at risk. Indeed, in such a scenario, it is my understanding that the action would be fully inadmissible if time-barred.

There is still room for some doubt as to whether the Cour d’appel has just set a general rule here, the starting point always being the date of the patent grant, at least for professionals working in a specialized area; or whether the court’s finding should be viewed as limited to the specific facts of the case.

We should bear in mind in this connection that the nullity plaintiff had already been in contact with the patent applicants even before the grant of the patent – and this may have been a critical point for the court.

If the latter view were correct, then this decision would certainly be less at odds with the TGI’s usual approach. It would simply mean that the Cour d’appel had a different appraisal of the facts from the TGI but not that the very principles applied by the first instance judges are wrong.

What else? Well, Nicoll was held not to have infringed the patent, nor to have committed acts of copyright infringement, trademark infringement, free-riding, and the like, and MEP was found liable for disparagement, like in first instance.

What next? Well, time will tell – or not.

Will the TGI now implement this ruling and adopt a new approach for computing the limitation period or keep the current one? Will some desperately needed clarification come from the Cour de cassation? Will the lawmaker correct the unfortunate consequences of the 2008 amendment of the general statute of limitations in patent law?

I would at least not bet on the latter option anytime soon.


CASE REFERENCE: Cour d’appel de Paris, pôle 5 chambre 2, September 22, 2017, Mr. and Mrs. Halgand & SAS Matériaux Equipements Plastiques v. SAS Raccords et Plastiques Nicoll, RG No. 14/25130.