In the patentee’s shoes

It is not always easy to be in the patentee’s shoes – as today’s decision will confirm again. In fact, patent proprietors and alleged infringers are not on a equal footing, since the latter need only prevail on one defense, while the former must thwart all possible challenges in order to win the case. And this is all the more difficult when the patent gets off on the wrong foot at the examination stage.

As readers may have guessed based on the lexical field of the first paragraph of this post, today’s decision is concerned with the footwear industry.

French company Exten.S owns European patent No. EP 1383402 directed to a sole for a shoe. Together with its exclusive licensee Eram (a well-known shoe distributor), Exten.S sued a Spanish company called Calzados Hergar for infringement of the patent in France.

On November 25, 2008, the Paris Tribunal de grande instance (TGI) revoked claims 1 to 4 of the French part of the European patent – as requested in the defendant’s counterclaim. The judgment was confirmed by the Cour d’appel on October 27, 2010. An appeal on a point a law was submitted to the Cour de cassation, and on January 31, 2012 the court set aside the appeal judgment. The patentee waited almost two years before reinstating the case in front of the Cour d’appel, which finally leads us to the judgment discussed today, which is dated April 8, 2016.

So this is a long story which could probably have been much shorter. Indeed:

  • The TGI originally revoked claims 1 to 4 due to extension of subject-matter.
  • The Cour d’appel fully agreed in 2010.
  • The Cour d’appel still fully agreed in 2016.

In the meantime, Exten.S and Eram regained hope with the 2012 ruling of the Cour de cassation. However, the first appeal judgment was set aside on purely procedural grounds. It turns out that some exhibits filed by the claimants had been discarded by the court (because they were in a foreign language), although they should not have, said the supreme court, because partial translations were in fact provided. So, the supreme court did not look at the merits of the case, which is why it was relatively straightforward for the Cour d’appel to copy and paste its first judgment upon remittal…

Let’s now examine why the subject-matter of the patent was found to have been extended in an unallowable manner relative to the contents of the application as filed.

According to the introduction of the patent, the invention relates to a sole of a shoe making it possible for different foot widths to be fitted easily. Usually shoes are manufactured with a width chosen by the manufacturer, which does not vary as a function of the width of the wearer’s foot. It is also known how to adapt to several foot widths by manufacturing an upper part in elastic material, but without being able to enlarge the lower part in contact with the sole. The purpose of the invention was to remedy these disadvantages.

Claims 1 and 2 of the (PCT) application as filed accordingly read as follows:

1. Extensible sole for shoes of the type where the rigid sole base is glued onto the edges of the upper, characterized in that said base is glued or molded on an insert, which is transversally mounted in an extensible manner, between the gluing zones of said base and said upper.

2. Extensible shoe according to claim 1, characterized in that it comprises at least one insert provided with protrusions in its lower surface, produced by molding a shape memory extensible material glued or injection welded on a rigid sole base, the forepart of which is provided with openings wherein protrusions are embedded, in a sealed way.

One half shoe, one quarter fur coat and one quarter Peruvian hat make a great invention.

One half shoe, one quarter fur coat and one quarter Peruvian hat make a great invention.

Claim 1 as granted was more or less obtained by combining original claims 1 and 2 – the important part of the sentence being of course “more or less“:

1. Extensible sole for shoes of the type where the rigid sole base is glued onto the edges of the upper, characterized in that said base comprises an insert, transversally extensible and provided with one or several protrusions in its lower surface, said insert being produced by molding a shape memory material and being glued or injection welded on said base, the forepart of said base being provided with one or several openings, wherein the protrusion or protrusions are embedded, in a sealed way.

The original wording of openings (plural) and protrusions (plural) was replaced by a broader language encompassing also a single opening and a single protrusion. Sadly for Exten.S, the court deemed that there was no support in the application as filed for such a broadening:

In the description of the PCT application […] it is recited, in relation with the base of the sole, “openings” (p.1 l.25), “the openings” (p.2 l.29 and 36 and p.3 l.1) and “openings” in claim 2. […] Claim 2 […] teaches the presence of openings in which the protrusions are embedded in a sealed way. Figures 1, 3 and 4 of this PCT application show several openings (reference 4), actually five, on the base of the sole, which match the number of protrusions. 

There was only one hint at a single opening in the text but it was considered to relate to a different embodiment:

[…] Although according to p.1 l.24 to p.2 l.1, “the deformable part of the forepart can be obtained by producing one or several longitudinal openings”, this passage relates to “other embodiments”, which is not challenged. Therefore, neither the description nor the claims or drawings of the PCT application mention the presence of a single opening in the base of the sole. 

It would probably have been useful to explain in the reasons for the decision why the context of this sentence was different from the context of granted claim 1, so that no generalization to one or several openings could be allowed – beyond the note on the wording “other embodiments” which can mean several things.

When briefly reviewing the PCT application, it did not immediately strike me why there should be an incompatibility between the option of the single opening and the other features of claim 1 as granted. But a more thorough review could lead to a different conclusion.

Another interesting line of defense based on implicit disclosure was brought up by the patentee and the licensee, also to no avail:

The appellants cannot claim that, since the protrusions cooperate with the openings, a single opening in the forepart of the base of the sole is implicitly disclosed, in view of a single passage of the description of the PCT application (p.1 l.19) per which “this extensible insert is flat on the upper face and provided with one or several protrusions on the lower face. These protrusions are intended to be set countersunk in the base of the sole”. Indeed, as already stated, the PCT application only discloses the presence of several openings and anyway the respondent rightly notes that the presence of a single protrusion in the insert does not necessarily imply the presence of a single opening in the base of the sole. 

This is tough, but very much in line with the criterion of direct and unambiguous disclosure applied at the EPO. If one protrusion does not necessarily equate with one opening, then there is insufficient support in the original PCT application for claim 1 as granted. Even though it might be obvious for the skilled person to come up with the idea of “one opening“, obviousness or equivalents should not come into play in this analysis.

Finally, another ground of extension of subject-matter was entertained by the court, which I have to say is more difficult to understand:

It should additionally be noted that, according to claim 1 of the PCT application, the base of the sole is glued or molded on an insert, but this feature cannot be found in claim 1 of the patent in suit as granted […] according to which, to the contrary, “said insert […] is glued or injection welded on said base” and the insert “is […] mounted between the gluing zones of said base and said upper”.

Basically this is a case of impermissible deletion of an essential feature. But it is stated in a confusing way in the ruling. My two cents is that the deletion of the term “glued or molded” is not really objectionable as claim 1 still requires that the insert be glued or injection welded on the base. And in fact this wording is from original claim 2 and thus seems to correspond to a particular embodiment of the “glued or molded” general statement in original claim 1.

On the other hand, there may indeed be an issue because the feature “mounted between the gluing zones of said base and said upper” no longer appears in claim 1 as granted – although, again, the ruling is not crystal clear in this respect.

All in all, the present decision, which fully confirms two previous similar decisions on the same patent, comes as a further reminder (if needed) that French courts tend to be very strict nowadays in their appraisal of extension of subject-matter: see other examples here, here and there.

The EPO has had the reputation of being the toughest forum for the appraisal of added matter, but there now seems to be some competition in France.


CASE REFERENCE: Cour d’appel de Paris, pôle 5, chambre 2, April 8, 2016, Exten.S & Eram v. Calzados Hergar, RG. No. 14/00580.

Patent in dispute

Most patent legal disputes arise between patentees and third parties, or between patentees and the patent office. But from time to time there are also disputes within a patentee family – because this is what families are like.

By patentee family I mean a group of persons and/or entities who co-own a patent.

One such family is comprised of two French public institutions, namely Université Pierre et Marie Curie (UPMC) and Assistance Publique-Hôpitaux de Paris (APHP), together with an individual, Mr. Julian Itzcovitz, who collectively own European patent application No. EP 2268361 as well as some corresponding foreign applications or patents, directed to a medical device comprising a percutaneous probe, notably for cancer treatment.

Why such an unusual co-ownership? It turns out the invention was jointly made by a neurosurgeon, Prof. Alexandre Carpentier, and by Mr. Itzcovitz who was a private consultant. They jointly filed a U.S. provisional application and then a PCT application claiming the priority of the U.S. provisional. Then, Prof. Carpentier’s share in the patent family was assigned to UPMC and APHP, his employers (in a typical case, the two public institutions would in fact have been the original applicants in the PCT application). On the other hand, Mr. Itzcovitz retained its share, established to be 20%, as he was not an employee.

Under French law, the rules of co-ownership are to be specified in a co-ownership agreement. In the absence of guidelines agreed upon by the parties, article L.613-29 Code de la propriété intellectuelle provides a few default rules. In particular, in terms of licensing, a distinction is made in the article between non-exclusive licenses and exclusive licenses. The default rule is that non-exclusive licenses can be freely granted by each co-owner subject to a compensation to the other co-owners and subject to a right of preemption by the other co-owners.

When it comes to exclusive licenses, the rule is more strict:

An exclusive license can only be granted if all co-owners agree or if a court provides an authorization.

This is a serious constraint indeed. In the present case, although a co-ownership agreement was executed between UPMC, APHP and Mr. Itzcovitz, it does not seem that this agreement contained any provision overruling the unanimity rule set in article L.613-29.

UPMC and APHP planned to grant an exclusive license of the group of patents and applications to a start-up company called Carthera, founded by the inventor Prof. Carpentier. Although the two public entities owned 80% of the shares, this was not quite enough to proceed with the plan, as they still needed the approval of the second inventor Mr. Itzcovitz. But he refused to give it.

Therefore, UPMC and APHP sued Mr. Itzcovitz in front of the Paris Tribunal de grande instance (TGI) in order to obtain the authorization from the court to grant the license without his consent. Carthera, the putative licensee, intervened.

Instead of having to resolve a dispute over a patent, why not file a patent on dispute resolution?
Instead of having to resolve a dispute over a patent, why not file a patent on dispute resolution?

The court defined the scope of its intervention in the dispute as follows:

[…] The court’s authorization is supposed to override an unjustified refusal by one of the co-owners of granting a license contemplated by the other co-owners. It should thus be determined if the reasons set forth by Mr. Julian Itzcovitz for justifying his refusal of the license agreement are serious and well-founded. 

Therefore, the court reviewed the draft of license agreement and examined the reasons mentioned by the inventor for rejecting the proposal.

The proposed license was worldwide and covered products for anti-tumor therapy in all organs. Royalties were to be provided in the form of:

  • a first lump sum of 73,000 euros to be paid in three installments (I understand that this corresponds to a refund of the expenses related to the various patent applications);
  • another lump sum of 80,000 euros due within 6 months of a first marketing authorization in the U.S., and the same lump sum due within 6 months of a first marketing authorization in Europe; and
  • a royalty rate of 4 to 5% for products sold in countries where a patent is in force, as long as the patent remains in force, or of 1 to 2% for products sold in other countries, for 15 years.

The draft also included a sublicensing provision, as well as a termination provision in case the licensee cannot or does not exploit the technology or ceases to do so, or is late in doing so.

The disgruntled inventor listed four reasons why the contemplated license was in his opinion bad for business, and the court assessed each of those.

First, the scope of the license was too broad, both geographically and in terms of subject-matter, in view of Carthera’s actual plans, which were to target only the US and the EU, and to focus on brain tumors first, and then at a later stage liver and lung tumors.

Second, Carthera was unable to implement the invention in a timely manner, in view of its clinical trial schedule and its business plan. In fact the subcontractor responsible for miniaturizing the probe was already behind schedule. And Carthera was still a poorly staffed start-up company.

Third, other companies could be interested in implementing the invention but there had been no effort to get in touch with prospective customers.

Fourth, the royalties were too low. When Mr. Itzcovitz first received the draft license agreement during the negotiations phase, he suggested a different royalty structure with much higher non-refundable yearly lump sums covering a number of sales, and then a lower royalty rate for additional sales not covered by the lump sums. His analysis was based on the belief that market opportunities for the invention were huge. During litigation, Mr. Itzcovitz filed an expert valuation of the patents / applications. According to the expert, the actual value of the patents based on the potential market was 13,600,000 euros; but this value was reduced to 3,410,000 euros in the event of a limited exploitation by Carthera. Therefore, the loss suffered by his client was 20% of the difference between the two amounts, i.e.  approximately 2 million euros. The expert also noted that the royalty rates offered in the license agreement were lower than typical royalty rates in the field.

UPMC and APHP countered the defendant’s analysis by providing their own expert opinion.

The key point in their argumentation was that the invention was still at an early development phase. It was still quite uncertain whether the invention could be exploited and marketed at all. Safety and efficacy trials still needed to be conducted, marketing authorizations needed to be obtained. In fact there was not even a working prototype of the probe – as a side note, the latter argument would certainly be fodder for a third party wanting to challenge the validity of the patents…

In summary, the claimants’ position was that the level of uncertainty was high and that the invention was not ready yet to be on the market. When this was properly taken into account, the contemplated license agreement made perfect sense.

The court was fully convinced by this argument:

In the case of an early license agreement, the licensee needs to finance implementation and development studies, clinical trials and more generally research and development expenses; they cannot take on expensive patent fees before the marketing phase, or they would run out of funding. In the present case, in Mr. Julian Itzcovitz’ proposal, lump sums are requested for the patent co-owners which are to be paid before marketing starts, which would amount to a total of 933,000 euros. As stated by Prof. Galloux, this would result in excluding start-up entities such as Carthera which have to get funded by fundraising in the development process and cannot take on such significant initial patent fees. 

As for the typical royalty rates mentioned by Mr. Itzcovitz’ expert, the court deemed that they were not representative of similar economic situations. The overall valuation of the patent family provided by this expert was also deemed unrealistic – still in view of the uncertainty factor.

Turning to the argument that there were other potential licensees, the court held that there was no evidence of their existence. Only Carthera seemed to be a candidate. Having to find another licensee would also considerably delay the implementation of the invention.

Furthermore, the court held that the choice of Carthera as a licensee was relevant since the head of its scientific committee was the main inventor of the patent. There was no evidence that the delay in the development process could be attributed to insufficient skills or efforts.

Said the court:

[…] In this configuration of an invention at an early stage of its development and a license granted to a start-up company, it is normal to provide that the company taking the financial risk of developing the invention should get an exclusive license with a broad scope in terms of geography and application fields. Indeed, it is rational and balanced that, in case the invention is successful in originally limited fields and territories, it should benefit from profits from the exploitation in other fields and territories, either by directly exploiting the invention itself or by hiring sublicensees (as contemplated in the agreement) if it is not able to do so. It should be added that the patent owners will be compensated proportionally to the sales owing to the royalties in the draft agreement. 

The court also noted that the patentees did not run any financial risk since all patent expenses would be paid by the licensee under the license agreement.

Finally, there was an undertaking for the licensee to make all reasonable efforts to exploit the invention in the agreement. Should there be a breach of this undertaking, the patent owners would be entitled to legal action against the licensee.

The conclusion was the following:

Therefore Mr. Julian Itzcovitz does not demonstrate that he would suffer a loss due to the license agreement which would justify his objection to the agreement. It is thus ordered that the exclusive license agreement with Carthera is authorized according to the draft submitted to Mr. Julian Itzcovitz on March 20, 2013 […]. 

As an additional claim, UPMC and APHP requested 10,000 euros of damages due to the delay in the patent valorization caused by Mr. Itzcotvitz’ refusal. The request was however denied because Mr. Itzcovitz had offered a mediation process but the main co-owners preferred to file suit instead.

Finally, Mr. Itzcovitz as the losing party was condemned to pay 10,000 euros in total as a reimbursement of attorney’s and expert’s expenses. This is relatively lenient, as is usually the case  with a natural person.

A lot was probably not said in the ruling. There may have been personal grievances which could explain why the relationships got that bad in the co-ownership. That said, on the face of it, the ruling makes a lot of sense. It’s probably in everyone’s interest (including patients) to make a deal giving an actual chance to a new medical technology to be exploited, rather than to be too greedy upfront.


CASE REFERENCE: Tribunal de grande instance de Paris, 3ème chambre, 2ème section, March 20, 2015, Université Pierre et Marie Curie & Assistance Publique-Hôpitaux de Paris v. Carthera & Julian Itzcovitz, RG No. 2013/17374.

Time goes by so slowly

The U.S. used to have submarine patents staying under water as pending applications for many years without getting published and suddenly emerging upon grant and awarding 17 years of protection to their owners.

We in France have had a similarly exotic and frightening species of IP rights, that one could call zombie patents:  patents that have apparently been dead for years but that are in fact quietly waiting in their graves for an awakening – which can be triggered e.g. by a decision from the highest court in the country.

European patent No. EP 0984773 to Astrazeneca AB, directed to a pharmaceutical formulation of omeprazole, was such a zombie patent. The patent was filed in 1998 and granted in 2003, and the French translation of the granted patent was duly filed at the Institut National de la Propriété Industrielle (INPI) as was required in those pre-London days. Unfortunately, the sixth renewal fee which was due in 2003 was not paid in due time – nor within the 6-month grace period.

As a result, a formal decision of lapse was issued by the INPI on January 30, 2004 and a mention of this decision was published in the official bulletin (Bulletin Officiel de la Propriété Industrielle or BOPI) on February 27, 2004.

Several pharmaceutical companies apparently relied on this lapse and started marketing generic drugs, such as Ethypharm, which launched its formulation in April 2004.

Five years went by, until one day in April 2009 Astrazeneca filed a request for restoration of right at the INPI. One would think that the request would be expediently dealt with but, as is often the case, one would be wrong. It took the INPI four years to issue its decision on the case, which was… positive. And therefore, in 2013, the patent woke up from the dead.

Obviously Ethypharm was not too happy about this turn of events and filed an appeal against the decision. The Cour d’appel de Paris had sympathy for the generic manufacturer’s case and canceled the decision from the INPI in a judgment dated January 15, 2014 – a swifter process than the proceedings in front of the INPI.

Quite predictably, Astrazeneca filed an appeal on points of law with the Cour de cassation, which brings us to the ruling issued on April 12, 2016, in which the highest court set aside the judgment of the Cour d’appel and therefore reinstated the 2013 INPI decision – and thus revived the patent for the two additional years that are left until it expires.

At this stage there are two questions any puzzled reader would be entitled to ask:

  • Why such a mess?
  • How can a patent possibly be reinstated by a request for restoration of right filed five years after the loss of right occurred?

I think there are two main factors which can help answer these questions:

Let’s first look at the old pre-2008 statute. At that time, the restoration of right further to a lapse due to non-payment of a renewal fee was handled differently from a restoration of right further to non-compliance with another type of time limit.

The former version of article L.613-22 CPI (Code de la propriété intellectuelle) provided in its second paragraph that:

The patent proprietor can file a request for restoration of right within three months from the notification of the decision [of lapse] if it had a legitimate excuse for not paying the renewal fee. 

In the omeprazole case, the decision of lapse having been issued in January 2004, the three month-deadline should have been long expired by the time the request for restoration was filed, and also by the time the law changed in 2008, right?

Well, no, and this is because of the pravastatine case law. It was decided in this famous case (which involved a zombie SPC) that when a decision of lapse is notified to the wrong recipient (i.e. to a recipient who was not entitled to receive the decision), the time limit of article L. 613-22 does not start. Since it does not start, it cannot expire.

This is exactly what happened in the present case. The decision of lapse was not notified to the patent proprietor in Finland. It was not notified to a representative of the patent proprietor either. Instead, I understand from the decision of the Cour de cassation, or rather from the statement of grounds of appeal annexed to the decision, that the 2004 decision of lapse was notified to… the annuity provider:

[…] The director of the INPI states that the notification was made to Mrs Caroline C, who is not an employee of Astrazeneca AB, nor a patent attorney, nor an attorney at law, nor a representative registered with the INPI, and therefore this notification was not made to a person who would be entitled due to the annuity provider, RWS group. Thus, this illegal notification did not trigger the three-month time limit for the restoration, and the request filed by Astrazeneca AB was not outside the time limit. 

OK. But what about the change of law which took place in 2008? How does this come into play?

By way of an executive order dated December 13, 2008, the statute was amended in such a way that paragraph 2 of article L.613-22 CPI was canceled. As a result, the system of restoration of right further to a lapse was aligned with the normal system of restoration of right further to non-compliance with other types of deadlines.

The new relevant provision is article L.612-16 CPI, which will look familiar to European practitioners as it is similarly drafted as the restitutio in integrum provisions in the EPC:

The applicant who does not comply with a time limit set by the [INPI] may file a request for restoration of right if they have a legitimate excuse and if the failure to comply with the time limit directly results in the refusal of the patent application or of a request, in the lapse of the application or the patent or in the loss of any other right. 

The request must be filed with the director of the [INPI] within a deadline of two months from the removal of the cause of non-compliance. The omitted act shall be accomplished within this deadline. The request is only admissible within a deadline of one year from the expiry of the unobserved time limit. 

When the request relates to a failure of payment of a renewal fee, the unobserved time limit is the end of the grace period […].

So, in the new system, the deadline of three months from the notification of the decision of lapse has been replaced by the usual double deadline: two months from the removal of the cause of non-compliance and one year from the expiry of the unobserved time limit.

Since this second deadline is an absolute time bar and is independent from any actions taken or not taken by the patent proprietor and the patent office, it seems that there can no longer be zombie patents in this new system. If this provision had been in place before, Astrazeneca would have been barred from filing a request for restoration of right on the first of December, 2004 (one year after the six-month grace period following the due date for the sixth renewal fee, on the first of June, 2003).

The illustrated device is useful for store clerks: it displays the minimum birth date for an individual who is entitled to purchase alcohol or tobacco. I suggest a variant for patent office clerks displaying the maximum date of lapse of a patent for a patentee who is entitled to restoration of right.

The illustrated device is useful for store clerks: it displays the minimum birth date for an individual who is entitled to purchase alcohol or tobacco. I suggest a variant for patent office clerks displaying the maximum date of lapse of a patent for a patentee who is entitled to restoration of right.

The new provision came into force a few months before Astrazeneca filed its request for restoration. How did this affect the request? As the Cour de cassation summarizes it:

[…] in order to set aside the decision [to restore the patent], the judgment [by the Cour d’appel] stated that the executive order […] entered into force on December 2008 and deleted the second paragraph of article L.613-22 CPI so as to replace it with article L.612-16; and that this was a procedural law and thus was immediately applicable; that Astrazeneca was subjected, in order to benefit from a restoration of right, to the time limit of two months from the removal of the cause of non-compliance in the new provision; that the publication in the BOPI of the decision [of lapse] removed the circumstance which had prevented Astrazeneca to pay the sixth renewal fee when the new article L.612-16 came into force, so that the request filed on April 6, 2009 was late and inadmissible. 

So, in summary, for the Cour d’appel, the time limit of two months came into force with the new law, and since the cause of non-compliance had long been removed, this deadline started on the day the new provision came into force, and was expired by the time Astrazeneca filed its request – so that the restoration could not be granted.

On appeal in front of the Cour de cassation, Astrazeneca criticized the computation of the two-month deadline. They said that a law cannot have a retroactive effect, and that the judgment by the Cour d’appel amounted to such a retroactive effect because the publication of the mention of the decision of lapse in the Bulletin in 2004 retroactively acquired a legal effect in 2008. Also, they explained that this publication was not an actual removal of cause of non-compliance.

But very interestingly, the Cour de cassation set aside the judgment on another ground, that the court came up with on its own – I am not sure I have ever seen this before. Namely, the court ruled that the former pre-2008 rule in fact still applied to the request for restoration filed in 2009. Said the supreme court:

[…] legal remedies against a decision are determined by the law which is in force on the day the decision is issued; 

[…] the decision of lapse of patent right was open to restoration of right under article L.613-22 [CPI] second paragraph, within a time limit of three months from the notification, and since the notification was illegal, the deadline did not start running, and thus the Cour d’appel violated the law […]. 

As a side remark, Ethypharm was not the only third party involved in this dispute. Parallel cases involved Actavis, and therefore there are two other judgments by the Cour de cassation of the same date with substantially the same content.

All in all, this is a rather spectacular result which does seem to make sense on a legal standpoint. The real aberration is probably the error made by the INPI. Why on earth a decision of lapse was notified to someone else than the representative is puzzling – and I guess there must have been a representative actually appointed since the patent was validated by filing a French translation.

Fortunately this kind of fiasco would no longer be possible nowadays – or could it?


CASE REFERENCE: Cour de cassation, ch. com., April 12, 2016, Astrazeneca AB v. Ethypharm & Directeur général de l’INPI, pourvoi No. V 14-17.439.

Three strikes – you’re out

One, two, three strikes you’re out. Today, I will be discussing an invalidity decision again, and a rather remarkable one. It is not every day that three different grounds of nullity are held against a patent, including what some practitioners could consider as their white whale, namely… the lack of industrial application.

The origin of the case is a dispute between two inventors owning a French patent and a corresponding European patent relating to a cloth coated with mother-of-pearl, and their licensee, Van Robaeys Frères. As part of the dispute, the patent proprietors in particular requested from the Dunkerque Tribunal de grande instance (TGI) that the license agreement should be terminated. The disgruntled licensee retaliated by filing a nullity suit in front of the Paris TGI – which, as explained in a recent post, has exclusive jurisdiction in patent matters.

The first part of the judgment is dedicated to an inadmissibility defense based on an alleged lack of standing. This has actually been a serious defense since a famous Barilla case three years ago, in which a nullity claimant was found to lack standing because they had not demonstrated that they were preparing for carrying out acts prohibited by the patent.

Yet, in the present case, the nullity claim was quite logically found to be admissible:

With respect to patent nullity actions, those who can act are those who can establish that, at the time the complaint is filed, the claims which are sought to be revoked, are or may be an impediment for carrying out their economic activity, because they work or plan to work in the field of the patented invention. In this case, as a licensee in a license agreement on the exploitation of the French patent for which a termination is requested by the licensor, Van Robaeys Frères has an economic activity notably in the field of linen cloths, and thus has standing for seeking nullity of the patents of Mr. Thierry D’Arras & Albert Paoli, which it will no longer benefit from due to the termination. 

That being settled, let’s have a quick look at the two patents at stake, FR 2941712 (FR’712) and EP 2393979 (EP’979). Claim 1 of EP’979 reads very simply:

A cloth comprising a support and a light deconstructing layer characterized in that said layer comprises mother-of-pearl.

Claims 2 to 8 are dependent claims. Claim 9 relates to:

A method for preparing a cloth according to one of claims 1 to 8, comprising a step to impregnate a support in a mother-of-pearl solution.

Claim 10 depends on claim 9, and claim 11 is directed to

The use of a cloth according to one of claims 1 to 8 or of a cloth obtained with the method according to claims 9 to 10 to manufacture products which reflect away the infrared such as blind fabrics, tent fabrics and clothing.

The claims of FR’712 are identical to those of EP’979, except that claim 1 of FR’712 is somewhat broader as it also recites the alternative of using a substance equivalent to mother-of-pearl.

Mother and her pearls
Mother and her pearls

The first ground of nullity upheld by the court was a lack of novelty due to the inventors’ own activities before the priority date. More precisely, Van Robaeys argued that the invention was disclosed to the public in two ways: because of trials at the Centre européen du non-tissé (CENT) a couple of months before the priority date, and because of a meeting at the Ecole polytechnique a couple of weeks before the priority date.

The inventors’ defense was that both events were confidential. But the court held that this was not adequately proven. In particular, it seems that the court was of the opinion that explicit confidentiality agreements should have been in place, which was apparently not the case:

However, it can only be derived from the exchange of emails concerning the 2008 trials that a draft of confidentiality agreement was received by [the inventors]; and concerning the [meeting] of January 2009, it can be derived from the report dated January 19, 2009 on the meeting at Polytechnique that it was intended that all documents would be confidential, that “the university insists on the execution of a confidentiality agreement”, that “a draft of confidentiality agreement” was received by Mr. … from Polytechnique, but no confidentiality agreement was submitted by the parties. 

Yet, it is conventional to execute an agreement of this type […]. 

The court did not investigate whether it could be considered that there was an implicit obligation of confidentiality due to the circumstances of the two disclosures – and it is possible that the patent proprietors did not phrase the argument in this manner.

This is a defense that might have been successful in front of a Board of appeal of the EPO. There are not enough details in the judgment to really understand the full circumstances of the disclosures, but one could probably argue that there was a common understanding by the participants that the information made available during the trials and the meeting was provided in confidence.

So, are French courts more severe than the EPO on this issue? That’s very possible, as this is not the first decision that I have seen where an explicit confidentiality agreement is viewed as necessary in order to disqualify a disclosure as a public one. On the other hand, another decision issued by another section of the Paris TGI earlier in 2015 (and that I might comment on in a further post) accepted that the supply of prototypes to a lab for testing purposes implies a duty of confidentiality for the lab.

The bottom line is that, even if French courts may not draw the line at exactly the same position as the Boards of appeal of the EPO, in the end the question of whether a disclosure is considered as a confidential one or a public one is extremely fact-dependent, and there are never two exactly similar situations.

With that, claims 1 to 5 and 11 were found to lack novelty, which left claims 6 to 10 still standing.

Lack of inventive step was the next ground of invalidity tackled by the court, and it was quickly discarded. Indeed, it seems that none of the documents relied on by the claimant disclosed the use of mother-of-pearl on a cloth for filtering infrared and ultraviolet rays without interfering with visible light, which was the technical problem at stake.

Thus, the court turned to insufficiency of disclosure, which as readers may know is not a ground of invalidity that patent proprietors should take lightly in this country.

At this point, the judgment gets very surprising.

The court started by examining claim 6, which recites that “the light deconstructing layer is continuous“. According to the court, the description sets out that a continuous layer can be obtained by dipping or spraying, so that there is no insufficiency issue.

But then, the court turned to method claims 9 and 10 and explained that the notion of “mother-of-pearl solution” recited in these claims raises significant difficulties:

It is only mentioned in claim 10 that the mother-of-pearl solution comprises 10 to 20% mother-of-pearl, and it is mentioned in the description […] that “said mother-of-pearl is a powder of mother-of-pearl. Among the powders of mother-of-pearl which can be used in the invention, the one obtained by grinding the inside of mollusk shells can be cited.” 

Yet, the patent does not provide any indication on the formulation of the mother-of-pearl solution, although this element is essential since it defines the composition of the “layer” which needs to be homogeneous during preparation, its condition, its ability to penetrate or not the support or its ability to adhere to said support. 

Thus, it can be derived from the opinion drafted by Prof. D. […] that “the possibility to implement the invention depends on the possibility to implement the method of claims 9 and 10 […]. On the chemical standpoint, the term ‘solution’ is not sufficient to make it possible to carry out the invention and it raises many questions. Mother-of-pearl is mainly formed of calcium carbonate in the aragonite crystalline form, and it is very poorly soluble in water. One needs to know exactly what the solution is made of.”

The technical opinion of the engineer Mr. V. […] is consistent with this and adds that the composition the solution should probably vary depending on the fiber which is used […]. 

Therefore, the court held that method claims 9 and 10 are invalid due to insufficiency of disclosure and then added that “the product of claims 6 to 8 is also invalid because the methods for making the cloth are invalid“.

To say the least, this wording is clumsy. After stating that there was no defect of insufficiency of disclosure in claim 6, the court sort of changed its mind and held that the claim was invalid because the method of claims 9 and 10 is insufficiently disclosed.

It would certainly have been much clearer to start with claims 9 and 10, and then explain that since the skilled person does not know how to carry out the claimed manufacturing method, and in the absence of another readily available method, the product claims necessarily suffer from the same defect.

This clumsy wording notwithstanding, the court’s reasoning seems to make perfect sense. The analysis relies on experts’ opinions and it is true that the description of both patents is quite short and does not provide very detailed information, and in particular no example – in contrast to another recent case discussed here.

And finally, the white whale, i.e. the court’s position on the lack of industrial application of the patent:

It can be derived from the exchanges of emails in June 2011 between the parties as well as from the affidavit of Mr. J in charge of the project […] that the inventors faced unresolved difficulties of implementation of the non-woven linen cloth awnings coated with mother-of-pearl solution in a continuous layer, and it is not demonstrated that these difficulties only concerned roller awnings [as alleged by the defendants]. 

The inventors claimed that products according to the patent were manufactured and marketed, but only photographs and invoices were provided as evidence, which did not make it possible for the court to determine whether the invention was actually implemented in those products or not.

This lack of industrial application is in fact very similar to an insufficiency of disclosure. So, the whale may not be so white after all, upon closer inspection. But it is true that if an invention cannot be carried out by the skilled person, then it is not possible to make it or use it “in any kind of industry, including agriculture” as Article 57 EPC puts it.

And that was the last nail in the patents’ coffin.

As a final word, we should always bear in mind that French court are strictly bound by the parties’ submissions; therefore, surprising court’s findings may sometimes only reflect unusual parties’ submissions. But to some extent, it seems like this judgment is really a pearl.


CASE REFERENCE: Tribunal de grande instance de Paris, 3ème chambre 1ère section, September 10, 2015, SA Van Robaeys Frères v. D’Arras & Paoli, RG No. 13/12618.

Lyon’s share

It has been almost seven years now since patent litigation in France has been fully centralized in Paris. Patent cases used to be heard in various Tribunaux de Grande Instance (TGIs) in the entire country. The number of TGIs having jurisdiction for patent matters was progressively reduced and finally all cases were consolidated in Paris.

Similarly, at the appeal level, the Cour d’appel de Paris has now exclusive jurisdiction in all patent cases. We can still see from time to time decisions issued by other Cours d’appel in relation with legal actions started a number of years ago before the centralization was completed.

But new cases do not normally end up in a court outside of Paris, save if the plaintiff makes the unfortunate mistake of filing its writ of summons with the wrong court.

The present case is an exception, but certainly not one due to an ill-informed litigant. On the contrary, this was certainly the result of a sophisticated (although, in the end, unsuccessful) strategy by Swedish pharmaceutical company AstraZeneca AB.

AstraZeneca owns European patent No. EP 0907364 covering the active substance quietapine for treating schizophrenia, and markets a corresponding pharmaceutical product called Xeroquel.

Generic company Mylan filed a nullity action in connection with the French part of the patent on April 28, 2015, in front of the Paris TGI – which, as recalled below, has exclusive jurisdiction for patent matters, including nullity actions of course. Apparently, another nullity action had already been started earlier in 2014 by Accord, and Mylan filed an intervention so as to be part of that nullity action. How Mylan can be part of two different actions having the same purpose is an interesting question which is however not addressed in the decision that I am reporting on today.

Mylan launched its generic version of Xeroquel at risk, without waiting for the outcome of the nullity action. Accordingly, AstraZeneca filed a counterclaim for infringement of the French part of the European patent on June 9, 2015, still in front of the Paris TGI.

Now comes the interesting part.

AstraZeneca attempted to obtain interim relief against Mylan. The usual way to do this, if an infringement claim is already pending in front of the Paris court, is to file a motion with the judge in charge of case management, who then decides on the motion pending the full trial on the merits. But AstraZeneca did not take the usual path.

Instead, AstraZeneca filed a motion for interim relief in front of the “juge des référés“, i.e. the judge in charge of urgency proceedings, at… the Tribunal de commerce (sometimes nicknamed T. com.) in Lyon. In this motion, AstraZeneca did not submit a patent infringement claim, but rather a claim for unfair competition.

Why apply to the juge des référés of the T. com.? Because, AstraZeneca stated, this is the judge having general jurisdiction for granting interim relief in situations of unfair competition. But why a judge in Lyon? Because, the defendant having its seat close to this city, this is the judge who had territorial jurisdiction – still in keeping with general, non-patent rules of judicial organization.

The Lyon judge accepted to hear the case and issued an order prohibiting Mylan from marketing the quietapine generic drug until the expiry of the French part of the European patent, i.e. May 27, 2017, or until a final decision of revocation is issued; a recall of the products was also ordered, as well as a publication of the decision.

In summary, AstraZeneca obtained the most positive result that they could ever have hoped for.

The order was issued on November 12, 2015. Mylan reacted by immediately filing an appeal and by requesting accelerated appeal proceedings. The entire process was, I must say, particularly fast and efficient, since the decision of the Cour d’appel de Lyon on this matter is dated December 17, 2015 – so the complete appeal process took only one month. The Cour d’appel set aside the first instance order and declared that the motion filed in front of the juge des référés in Lyon was in fact inadmissible because the judge had no jurisdiction.

A word must probably be said here of the differences between a TGI and a T. Com.:

  • TGIs are general courts dealing with civil matters. T. com.s, on the other hand are specialized in handling disputes between commercial companies (or persons).
  • TGIs are exclusively composed of government-appointed judges, while T. com.s are composed of elected judges.
  • Accordingly, TGI judges are professional judges, who are civil servants, while judges in T. com.s are company managers.

I have heard some lawyers familiar with T. com.s say that these courts are somewhat unpredictable and can sometimes render pretty wild decisions. What is almost certain is that the juge des référés was not fully aware of the subtleties of IP law, which is very far from his or her everyday practice.

Judicial organization in France shown on a simplified diagram.
Judicial organization in France shown on a simplified diagram.

So, again, it was a bold and clever move for AstraZeneca to request the preliminary injunction far from the Ile de la Cité in Paris. The judge in charge of case management at the TGI would likely have made a more severe assessment of the patentee’s case – not least because the European patent was already revoked in six other countries, including Germany, the UK and the Netherlands, as we learn in the Cour d’appel decision.

Now, going back to the issue of jurisdiction, article L.615-17 of the Code de la propriété intellectuelle provides that

Civil actions and motions relating to utility patents, including […] when they also concern a connected issue of unfair competition, are exclusively heard by [TGIs] mentioned in a decree […].

The decree in question names the Paris TGI as the one having exclusive jurisdiction for the purposes of article L.615-17.

Therefore the central issue, which was revisited by the Cour d’appel, is to which extent the claim brought by AstraZeneca in Lyon was related to a patent, or a connected issue of unfair competition.

The answer to this question prima facie seems pretty obvious, so how did the patent proprietor defend its position?

Again, they were rather creative, in that they stayed away from the Code de la propriété intellectuelle (which contains the definition of patent infringement), and rather argued that Mylan had committed other torts, and more specifically:

  • violated articles L.4113-6, L.4163-2, L.5122-10 and R.5122-17 of the Code de la santé publique, article 1382 of the Code civil and article 1.2.2.1 of the rules of ethics applicable to pharma labs, by offering free unsollicited samples of generic quietapine to pharmacists;
  • violated articles L.5122-1 and L.5122-2 of the Code de la santé publique, article 1382 of the Code civil as well as the recommendations issued by the ANSM (i.e. the regulatory authority in charge of pharmaceutical products), by inserting the mention “identical to the original drug” on its ads; and
  • violated article 1382 of the Code civil by committing passing off, in view of the aspect of the generic quietapine packaging and tablets.

But such creativity did not pay off in front of the Cour d’appel, which held that:

the facts and evidence submitted to the judge for defining a manifestly illicit breach caused by disloyalty in free competition are necessarily linked to the rights that AstraZeneca derives from their patent, which confers a monopoly to them until its expiry or until its revocation by a court, the effect of which is retroactive, so that the civil action started in front of the juge des référés of the Tribunal de commerce de Lyon is necessarily a connected unfair competition action, so that he does not have jurisdiction due to the subject-matter and the exclusivity of jurisdiction imparted by statute to the Paris TGI. 

Said otherwise, all torts possibly committed by Mylan in this case are closely related to the alleged patent infringement. Patent infringement is a matter for the Paris TGI to rule upon, not for the Lyon T. com., and so are any side claims linked to this patent infringement (such as the passing off claim).

The court also stated that the various violations of the Code de la santé publique alleged by the patentee were not relevant, because this is a law which does not regulate competition between pharma companies:

All the violations of the Code de la santé publique which are alleged do not aim at protecting competition but rather public health, notably by imposing rules of ethics to pharmaceutical labs and by imposing advertising rules protecting drug consumers. 

The alleged violations are not within the ambit of jurisdiction of the juge des référés of the tribunal de commerce, for deciding measures of injunction […] similar to those that the infringement judge could take, because these violations, if they existed, would not constitute a manifestly illicit breach of free competition. 

And thus the logical conclusion was that:

[…] although it is certain that the juge des référés of the tribunal de commerce has in principle jurisdiction with respect to proven unfair competition, when there is a manifestly illicit breach, in order to take preliminary and injunction measures, even if there is a serious defense, because he is the natural judge between two commercial companies, […] the special provisions of the Code de la propriété intellectuelle prevail when, as in the present case, commercial parties are opposed in a lawsuit relating to intellectual property, the judge of which, having jurisdiction for ruling on the validity of the title or on infringement, has been previously applied to, before the urgency unfair competition claim. 

The judge of the Lyon tribunal de commerce has thus in this case no jurisdiction for ruling as he did and committed abuse of power.

Last but not least, the court ordered AstraZeneca to pay 100,000 euros of attorney fees to Mylan, which looks like a fairly high amount in the context of urgency proceedings. Courts have an almost complete discretion in terms of reimbursement of attorney fees, which they decide on as a matter of equity. Usually, when the amount is remarkably high, there is a sense that the court may have wanted to punish the losing party and to send a warning message.


CASE REFERENCE: Cour d’appel de Lyon, 1ère chambre civile, section A, December 17, 2015, Mylan SAS v. AstraZeneca SAS & AstraZeneca AB,
RG No. 2015/08783.