Suspect suspicions

What are the top three traits of the French system that foreign companies like best? 

Good transportation infrastructure? Maybe. L’art de vivre? Very probably. But first and foremost: the saisie-contrefaçon. OK, there may be some patent attorney bias here.

As readers of this blog are surely aware, the saisie-contrefaçon (infringement seizure) is a special tool in the hands of patent right holders, in the form of an ex parte order for an unannounced inspection at a third party’s premises in order to gather evidence of possible infringement.

Traditionally, the order for seizure has been viewed as straightforward to obtain.

Basically, you show up in front of a judge; you show your patent, the status of the renewal fees, an excerpt from the patent register; then you explain what kind of evidence you want to get and where. And you’re pretty much good to go.

But from time to time, a court decision takes a different approach and makes this traditional view entirely derail.

Such is the judgment recently issued by the Paris Cour d’appel in Arconic v. Constellium Issoire.

Arconic owns European patent No. EP 1392878 on a process to produce sheets of aluminum.

It may be useful to copy here claim 1 of the patent, as a reference:

A process for producing a sheet or plate product comprising:
(a) providing an aluminium alloy consisting of 0.5 to 1.8% Si, 0.5 to 1.5% Mg, up to 1.2% Cu; up to 1% Mn, up to 1% Zn, up to 0.4% Cr, up to 0.5% Ag, up to 0.3% Sc, up to 0.2% V, up to 0.2% Hf, up to 0.2% Zr, the balance being aluminium and incidental impurities;
(b) heating the alloy;
(c) hot rolling the alloy to reduce its thickness by at least 30%;
(d) thermally treating the alloy hot rolled in (c) at 543°C (1010°F) or more;
(e) further hot rolling the alloy to further reduce its thickness;
(f) solution heat treating the alloy at 543°C (1010°F) or higher;
(g) quenching the alloy.

On October 4, 2017, Arconic requested and obtained an order for performing a seizure in the premises of Constellium Issoire, which belongs to the Constellium group. Arconic and Constellium are direct competitors as they both manufacture aluminum plate products, notably for Airbus’ A380 aircraft.

The seizure took place on October 10, 2017. On October 26, Constellium filed a motion to obtain the cancellation of the order for seizure. The judge in charge of urgency proceedings granted Constellium’s motion and issued an order on December 22, 2017 canceling the order for seizure.

Arconic appealed, but its appeal has now been dismissed by the Paris Cour d’appel.

So what was the problem with the initial order for seizure, and why did it deserve to be canceled, according to the appeal judges?

The focus of the discussion was Arconic’s statement in its initial request that they had reasons to suspect that Constellium infringed the patent at stake.

Arconic provided evidence for this suspicion, and the court performed a thorough review of said evidence.

The evidence comprised in particular a scientific article from three Constellium employees, a specification from Airbus, a standard and a publication on aluminum alloys, and an excerpt from Constellium’s website.

Based on this evidence, the court concluded that:

  • Arconic’s aluminum alloy is designated as 6013 while Constellium’s is designated as 6156.
  • Both alloys, based on Airbus’ specification, are made by lamination and a so-called T4 thermal treatment.

But the court then stated that this was insufficient to infer that most features of claim 1 of the patent at stake were implemented by Constellium.

In particular, the fact that the 6156 alloy is made by lamination and thermal treatment is perfectly conventional. Claim 1 of EP’878, on the other hand, requires a precise sequence of process steps, including the application of a certain temperature, a defined reduction of thickness of the alloy, etc. Thus, the court said, Arconic in fact did not know which process is used by Constellium.

Admittedly, the composition of the alloy itself, which is also recited in the form of elemental weight ranges in claim 1 of the patent, does cover the 6156 alloy. But the claimed ranges are sufficiently general to also cover further competitors’ products of the same category (the 6061 and 6082 alloys). Besides, it is clear when reading the patent that the invention is about a manufacturing process, not about a new alloy, added the court.

The tin man – which alloy is he made of?

Another reason for Arconic’s infringement suspicion was that, according to them, the mechanical properties of the plates made by Constellium could only be obtained with the patented manufacturing process.

The court accepted that Constellium’s 6156 plates seem to have very similar properties to Arconic’s 6013 plates, since both products are used by Airbus for the A380 aircraft.

But, the court continued, this does not imply that Constellium’s plates are necessarily made with the patented process, since different processes can of course lead to the same product.

As a further remark, the court noted that Constellium itself owns a later patent (EP 1809779) for a process of making 6056 or 6156 aluminum alloy products, and asserts that their industrial process is based on this patent.

As a conclusion, the court held:

Thus, the reasons set out in support of the request [for seizure] turn out to be wrong. More particularly, it cannot be derived therefrom any “suspicion” of infringement, nor “good reasons to assume” that the alloy plates supplied by Constellium would infringe Arconic’s patent. 

The final part of the judgment contains a more legal discussion. Arconic argued that its right to a seizure

only depends on the demonstration that the right at stake exists, without any further requirement of evidence concerning infringement itself.

As I said in the beginning, at the risk of oversimplifying, this is indeed probably the general opinion among the French patent profession.

Arconic in particular pointed to the so-called “enforcement directive” No. 2004/48/EC. Article 7 of the directive begins like this:

Member States shall ensure that, even before the commencement of proceedings on the merits of the case, the competent judicial authorities may, on application by a party who has presented reasonably available evidence to support his claims that his intellectual property right has been infringed or is about to be infringed, order prompt and effective provisional measures to preserve relevant evidence in respect of the alleged infringement, subject to the protection of confidential information.

The directive thus refers to the presentation of “reasonably available evidence” as a prerequisite for obtaining e.g. an order for seizure. But, Arconic remarked, this notion was not transposed in the relevant provision of the Code de la propriété intellectuelle, namely article L. 615-5. Since article 2 of the directive makes it possible for Member States to provide means which are more favorable to right holders, this must be interpreted to the effect that French law does specifically not require “reasonably available evidence” as a precondition for an order for seizure.

The court did not frontally disagree, but replied as follows.

[…] The property right conferred by a patent is neither absolute nor discretionary, and is still subject, in the case of a request for seizure, to the appraisal of its merits by the judge […], notably when, as is the case here, the reasons set forth in its support turn out to be wrong. 

Besides, article 3 of the [enforcement directive] requires that proceedings which are necessary to ensure that IP rights are respected must be fair and proportionate. In the present case, as there is no tangible suspicion of infringement, the court can only remark that the requested seizure measure would, as a main consequence, allow Arconic to know about Constellium’s aluminum alloy product manufacturing process. As these two companies are direct competitors regarding this products in front of companies in the aeronautic business, such as Airbus, Constellium can rightly fear that manufacturing secrets could detrimentally be disclosed, or even that its credibility with common customers could be harmed. Lastly, the court is surprised that it is only on October 4, 2017 that Arconic decided to initiate infringement seizure proceedings, although this direct competition with respect to Airbus dates back to 2004. 

Matthieu Dhenne, whose firm represented the patent proprietor in this case, wrote to me that there are a number of reasons why he believes the decision was wrongly decided.

First, he says the proportionality principle does not apply to an infringement seizure which remains an exceptional measure and is disproportionate by nature. He states that the travaux préparatoires concerning the transposition of the directive show that the proportionality principle was voluntarily not introduced into our statute. As a result, the court’s line of reasoning compromises legal certainty and jeopardizes the entire balance of the system. He also insists that a seizure is intended for gathering evidence, not appraising infringement. Matthieu adds that the court’s suspicion of the patentee was unwarranted and that it cannot be possibly demanded from the patentee that they should search for patents owned by the defendant. Whether any other, especially later, patent is indeed implemented or not by the defendant is irrelevant to the possible infringement of the main patent at stake, he argues.

I agree that there are a number of statements in the two above paragraphs quoted from the judgment which are controversial.

It is true that a seizure can result in business secrets being disclosed to a competitor. But the usual way to prevent this is for the seized party to request that the seized information and documents be sealed, and that an expert be appointed by the court to sort out the evidence, so that only information directly relevant to the demonstration of infringement be communicated to the right holder.

As for the fear that the defendant’s reputation be harmed, it seems irrelevant here, as the seizure was performed in Constellium’s premises, not at a third party’s.

The fact that Arconic waited a lot before initiating legal proceedings should probably not come into play either. Indeed, a patentee’s right to sue for infringement is never time-barred.

That said, I am not sure I am fully comfortable with the notion that a patentee’s right to a seizure should be automatic.

It does make sense for the court to carefully look at the specifics of each case before deciding whether this right can be exerted in the circumstances at hand or not.

In this particular case, it seems to me that what the court really did not like was that the “suspicions” of infringement mentioned in the original request for seizure, were not actual or legitimate suspicions, based on the evidence offered.

Would the outcome have been favorable if the plaintiff had played it differently, for example by (1) not mentioning suspicions of infringement but explaining that a seizure is the only possible way for them to determine whether there is any infringement; and (2) immediately offering that the seized evidence be sealed by default so as to be later remitted to a court-appointed expert?

I guess we will never know and can only have suspicions in this respect.


CASE REFERENCE: Cour d’appel de Paris, pôle 5 chambre 1, September 11, 2018, Arconic Inc. v. SAS Constellium Issoire, RG 18/01099.

Standard or not standard?

Traditionally, non-practicing entity patent infringement suits have been  relatively few and far between in France.

Without the huge financial stakes of U.S. litigation, and without the lure of German bifurcation, the French legal system has, to some extent, resisted the trend so far. There are a few counter-examples, though.

Like the case discussed today, between famous Intellectual Ventures (IV) and SFR, one of the major French telecommunications companies.

Among the many patents owned by IV is EP 1304002, entitled “Arranging Data Ciphering In a Wireless Telecommuncation System” and originally filed as a PCT application by Nokia Mobile Phones Ltd, in Finland.

As you have probably already guessed, IV initiated legal proceedings in front of the Paris Tribunal de grande instance (TGI), alleging infringement of the EP’002 patent. The alleged infringement mainly relates to the WiFi technology.

You will not know who won at the end of the post, because no one did – the lawsuit is not over yet. In fact, the pleadings hearing is presently scheduled to take place on November 23, 2018. So there is still plenty of time left for you to take your morning off at the new courthouse.

The decision discussed today is only an interim order issued by the judge in charge of case management (JME in the local jargon).

Can you believe there are actually patent applications on methods for identifying patent troll activity? Do some of them get acquired by NPEs, just for the irony of it?

Among the various defenses raised by SFR, there is a rather interesting one, which is that the EP’002 patent is a standard essential patent (SEP).

Two standards were mentioned by SFR: 3GPP TS 33.234 (a 3G standard issued by ETSI – short for European Telecommunications Standards Institute), and 802.11.2012 (a WiFi standard issued by IEEE – short for Institute of Electrical and Electronics Engineers). According to SFR, the EP’002 patent was not declared as essential by its then owner Nokia – a member of both ETSI and IEEE – although it should have been. Due to this omission, they argued, the infringement action should be deemed inadmissible.

Now, apparently SFR did not have all the necessary evidence at hand.

They thus wrote both to ETSI and IEEE and requested the “travaux préparatoires” (one of the most well-known French expressions among lawyers, ranking third after “bonjour” and “merci”) for the relevant standards, as well as relevant correspondence between Nokia and both organizations.

France-based ETSI replied that they would provide the requested documentation, but IEEE turned down SFR’s request.

Thus, SFR filed a motion with the JME, requesting a stay and further requesting that IEEE be ordered to hand down the relevant documents. 

IV fought this motion.

First, IV claimed that SFR’s motion was inadmissible.

Indeed, IEEE is based in the U.S., and the French judge has no jurisdiction to directly order a third party to the litigation to hand down evidence, they argued. The only possible procedure would be the letter rogatory, i.e. the French judge should ask U.S. authorities to issue the order.

The judge closely looked at the written response made by IEEE further to SFR’s request. The first part of this response was the following:

Please be advised that it is IEEE’s policy not to provide information that may be used in litigation without a subpoena. This is to protect IEEE’s neutrality in any dispute. If that is necessary, please feel free to let me know and we can arrange the details of service. 

The JME deduced from this response that IEEE was willing to hand down the evidence at stake, and that they just required a formal judicial order for doing so. The judge was happy to oblige, and the formal and cumbersome process of the letter rogatory could thus be avoided.

I note that IEEE’s response does not specify whether the requested subpoena should be specifically issued by a U.S. court, or whether any subpoena would do. It was probably the judge’s understanding that, in the absence of any specific mention, they were open to any form of subpoenaing.

As a second defense against the motion, IV argued that SFR’s request was useless and unjustified.

SFR raised the SEP argument late in the case management procedure, IV said, and only they should have the burden of providing their own evidence. Besides, the second part of IEEE’s written response to SFR reads as follows:

However, a subpoena may not be necessary in this instance as IEEE 802.11 does host a public website that contains a wide variety of working group materials. The IEEE 802.11 website is located http://www.ieee802.org/11/.

But the judge held that SFR was free to raise a new defense at any point within the case schedule (which, in case you are wondering, is nothing like the extremely tight schedule envisioned for the future UPC). Besides, SFR stated that they could not find the relevant documents on the IEEE website, and that in particular the correspondence with Nokia is not supposed to be available on this site. Finally, the supply of evidence by the standard organizations should not take long.

As a result, the judge granted SFR’s request and issued an order for IEEE to send SFR all documents and reports of the working group relating to the relevant part of IEEE 802.11, as well as the relevant correspondence with Nokia, within one month.

On the other hand, the request for stay of proceedings was dismissed – probably because this timeline is supposed to be still compatible with the planned date for the main hearing.

Access to evidence can be challenging in this country especially in the absence of discovery / disclosure. French judges are often reluctant to order a taking of evidence, such as the provision of documents. But in a case such as this one, it does seem rather fair that a defendant should be allowed to explore a particular line of defense by requesting third party-held documents.

We will thus stay tuned, and I am sure the decision on the merits will be most interesting to read – if the lawsuit goes all the way of course.


CASE REFERENCE: Tribunal de grande instance de Paris, 3ème chambre 4ème section, ordonnance du juge de la mise en état, June 7, 2018, Intellectual Ventures LLC v. Société française du radiotéléphone, RG No. 16/16346.

Money money money

It is always about the money, isn’t it?

No, not life. But patent litigation? Maybe so.

Today’s lawsuit pits an optician businessman – and inventor – against the major French-based ophthalmic optics group, Essilor.

This inventor filed a French patent application concerning a nose pad invention in April 2013. On January 1, 2014, he assigned his invention to Essilor International. I should add that he was independent from Essilor, so we are not talking about an employee’s invention here.

The litigation between them later arose because the inventor was dissatisfied with the money he made from the assignment.

We thus need to look at the consideration provided in the assignment for the transfer of rights.

Based on the excerpts mentioned in the judgment, a lump sum of 400,000 euros was provided. In addition, a variable price was set, over a period of time of 19 years, according to a sophisticated formula taking into account the number of countries in which patent applications would be filed and patents would be granted, as well as the number of devices incorporating the invention which would be sold.

As far as I understand, only the lump sum was paid. In 2016, the assignor claimed additional money corresponding to the variable part of the deal. Essilor replied that there were difficulties in working the invention, and that prosecution of the patent applications on the invention was still ongoing.

In January 2017, settlement discussions were initiated, in which Essilor offered 85,700 euros as a complementary payment – to no avail. In May 2018, the inventor filed a complaint with the Paris Tribunal de grande instance (TGI), alleged a breach of contract and claimed damages.

The inventor provided several estimates for these damages. His first estimate amounted to more than 3 million euros for the period of 2015-2017, and then more than 2.7 million euros per year from 2018 to 2034. His second, auxiliary estimate was 4 million euros in total. The third, less preferred estimate was 600,000 euros in total.

Essilor fought back and requested that the action be dismissed. They also provided their own calculation for the minimal amounts to be due, as an auxiliary argument, namely 16,666 euros from year 2 to year 10 and 3,333 euros from year 11 to year 20. This corresponds to the amounts due in consideration of the current state of the patent portfolio, and does not take into account any sale.

After the nose pads… muzzle pads.

Turning now to the judges’ decision, the first interesting point relates to the issue of whether the negotiations between the parties were loyal or not.

The inventor claimed that he was not properly assisted during the negotiations, which were uneven and led him to agree to a clause on the variable part of the consideration which was unfavorable to him.

The court looked at various email exchanges between the inventor and Essilor before the agreement was executed and could not find any evidence of unfair or disloyal negotiations. The court made the following comments:

It is thus the content of an oral exchange in a time frame very close to the execution of the agreement which led to the adoption of the proportion of granted and non-refused patents as the adjusting parameter for the “provisional amount” or minimal amount, in the drafting of the agreement. But it cannot be deduced that this criterion was never previously discussed […]. Contrary to the defendant, [the inventor] provides little information on the exchanges prior to the execution of the agreement, which, based on their contents, do not reflect the alleged weakness of the plaintiff but at best his desire to rapidly achieve the execution of the assignment agreement. 

[…] Even if it is surprising that the provision relating to the variable part of the price, which is so important […], was significantly modified without any written proposal before the final version, this circumstance is not sufficient to qualify the discussions leading to the execution of the assignment as dishonest. The correspondence filed as evidence […] actually proves the very active part taken by the claimant in the different steps of the negotiation, the stakes of which he always clearly understood. 

Next, the inventor blamed Essilor for filing a PCT application based on his first French application.

Indeed, using the PCT route instead of direct national filings results in a delay in the grant proceedings. I would add that this is actually one of the main reasons why applicants file via the PCT in the first place. But in this case, any delay in the grant proceedings leads to less money payable to the inventor – in view of the definition of the variable part of the price.

The court noted that the agreement does not explicitly mention that the patent filings abroad should be done through the PCT route. Nor does it exclude the PCT route. Therefore, the court had to determine the common will of the parties. The court first noted that, according to another clause of the agreement, the assignor explicitly represented that he had not filed any direct or PCT application. The fact that a distinction between PCT and non-PCT was made in this clause (unrelated to future filings), was interpreted by the judges as a pointer to the fact that a future PCT filing should have been explicitly mentioned, in order for it to be allowed.

As a main reason and as a conclusion, the court then held that:

In view of the importance of the patent grant timeline for the general object of the contract, clause 5.2 must be interpreted, despite its lack of precision in this respect, as not allowing Essilor to file an international application. This choice was thus made in violation of the provisions of the [agreement]. 

So that’s a first rebuke for the assignee.

Then came a second one, relating to the absence of exploitation of the invention.

The court first held that, when the assignment price comprises a royalty which depends on the exploitation of the invention by the assignee, this implies a duty for the assignee to exploit the invention; otherwise the clause would be wholly one-sided.

This obligation concerns the means implemented by the assignee, and not the outcome. In other words the assignee does not have to succeed in implementing the invention, but they have to try. And the assignee has the burden of showing that they have used all appropriate means for exploiting the invention.

In this respect, Essilor referred to two messages evidencing some difficulties in the development of the nose pads of the invention.

The court commented as follows:

These two sole exhibits relating to a time span of almost two years cannot possibly show that there is a technical impossibility of exploiting the invention. They merely reveal that each version at stake turned out to raise different development issues, and that in 2016 only the “tube” version was deemed as being able to be made and marketed. 

So, that was held as another fault.

Finally, what is generally the stodgiest part of a judgment (this case being no exception): the assessment of damages.

The court started by holding that the damages should compensate for the loss of opportunity for the inventor to get royalties. Then, they took note of the objections raised by the various patent offices and the amendments made in response which, they implied, lowered the prospects of exploitation of the invention.

The court also took into account:

  • the initial estimate of the annual royalty of 100,000 euros which had been made by Essilor during the negotiation phase;
  • the defects of one of the versions of the device which led to dropping production launch;
  • the fact that the inventor subsequently filed another patent application on a nose pad.

All in all, the court discarded both the claimant’s and the defendant’s estimates, and came up with a global figure of 300,000 euros of damages compensating for the inventor’s loss of opportunity.

There is a very French expression for this approach: “à la louche“, literally “with a ladle“. It means a very rough estimate, close to guesswork. And, à la louche it is in this case, I think.

On the other hand, we cannot really blame the court for this. First, the parties came up with hugely discrepant figures, as is not unusual. Second, loss of opportunity is all about what could have been in an alternate universe, which leaves a lot of room for imagination. Third, the court was not assisted by an expert and had only the partial evidence provided by the parties at hand.

I can’t help but wondering: the parties will continue to be bound by the agreement for many years to come. So, would a settlement not be still the best option for all of those involved?


CASE REFERENCE: Tribunal de grande instance de Paris, 3ème chambre 3ème section, May 25, 2018, Jean-Luc B. v. SA Essilor International, RG No. 17/06753.

It-which-must-not-be-named

Some pharma cases are somewhat delicate to discuss in a blog post.

Case in point, if I provide the commercial name of the drug at stake in today’s litigation, I am afraid that this post may be classified as a spam and may thus never reach my email subscribers.

You see, it is the sort of drug which is prescribed for the treatment of erectile dysfunction, and which keeps coming up in these pestering unsolicited email messages that you may receive on a daily basis.

Just to be clear, today’s drug-which-must-not-be-named is not the famous one that starts with a V (containing sildenafil as an active compound), but the other famous one that starts with a C (containing tadalafil as an active compound).

He-who-must-not-be-named.

Icos Corporation (of the Eli Lilly group) is the owner of a number of European patents in connection with the C. drug.

First, there is EP 0740668, which was the basic patent for a French Supplementary Protection Certificate (SPC No. FR 03C0017), which expired in November 2017. Second, there are EP 1173181 and EP 1200092, designated as “secondary patents” by the Paris Tribunal de grande instance (TGI).

In November 2014, generic drug company Mylan obtained a marketing authorization (MA) related to the C. drug. In January 2016, Mylan initiated nullity proceedings with respect to the EP’181 and EP’092 patents in front of the Paris TGI. The parties later reached a settlement agreement with respect to EP’092, so that only the fate of EP’181 remained to be decided upon. Icos Corporation and the French distributor Lilly France counterclaimed for infringement of EP’181. The first instance judgment was issued in May 2018.

EP’181 or equivalents thereof were or are also litigated in other countries. According to the summary provided by the court, the patents were revoked in Germany, the United Kingdom, Canada and Japan. It may thus come as little surprising that the same outcome was achieved in this country. On the other hand, the ground for nullity that the TGI took into consideration is relatively unexpected, as will be apparent below.

But before getting there, let’s first look at the statute of limitations defense raised by Icos.

Mylan argued that the statute of limitations is not applicable to patent nullity suits. This argument was rejected by the court, in keeping with earlier decisions.

Turning to the determination of the starting point for the limitation period, the court recalled its now established principle of an in concreto determination.

The court thus explained that the grant of the EP’181 patent was not the starting point for the limitation period. The general principle is the following:

The starting point for the limitation period must thus be set at the date, determined in concreto, at which Mylan was or should have been aware of EP’181, due to its intent to market a generic of the drug [C.], which led to the MA obtained on November 21, 2014, since this patent is an impediment to its exploitation.  

In this case, a determining factor to be taken into account was the date at which Icos obtained its own MA:

In this case, the first MA for [C.] was granted in November 2002. By way of application of article R. 5121-28 of the Code de la santé publique, the generic company can only apply for an MA as from the eighth year after the grant of the originator’s MA, and cannot be granted one before the tenth year. Therefore, Mylan could not file an MA application before November 2010.

This reasoning is fully consistent with that applied in another recent case which already involved Mylan.

However, this is not the end of the story here. The court further held:

In this case, an additional fact should be taken into account in the in concreto analysis of standing and the starting point for the limitation period. […] [Namely, Icos corporation] filed a request for limitation of the EP’181 patent on February 14, 2014 with the European patent office, and the limitation of the patent was published on March 25, 2015. 

Thus the patent enforceable against Mylan could only be known on this date, so that the starting point for the limitation period is March 25, 2015. 

In another recent case, the starting point of the limitation period was postponed by a court to the date of the decision of the Board of appeal of the EPO in the opposition appeal regarding the patent at stake. The relevant paragraph of this decision may be worth quoting again here:

[…] It is only on [July, 7, 2014, i.e. the date of the Board of appeal’s decision] that the drafting of the patent which is sought to be revoked was stabilized and that Ethypharm was able to precisely know the content of the claims of said patent as well as all the facts making it possible for them to act, so that the action is not time-barred and is admissible. 

We now have a confirmation that limitation proceedings, just like opposition proceedings, may result in a postponement of the limitation period for nullity actions.

It remains to be seen how general this principle is and in particular whether it extends e.g. to the impact of other lawsuits involving third parties.

Turning now to the merits of the case, claim 1 of EP’181 as limited reads as follows:

A pharmaceutical unit dosage composition comprising 1 to 5 mg of [tadalafil], said unit dosage form suitable for oral administration up to a maximum total dose of 5 mg per day.

Independent claim 10 is a Swiss-type claim containing similar features.

Mylan raised all classical grounds for nullity, but the court focused on insufficiency of disclosure.

After reviewing the description of the patent, the court noted the following facts:

  • There are several molecules belonging to the class of type 5 phosphodiesterase (PDE5) inhibitors.
  • Among them, particular reference may be made to sildenafil, the active compound of V., marketed at the priority date of the patent in doses of 25, 50 and 100 mg.
  • However, sildenafil generates a number of side effects, such as facial red patches, or a lowering of blood pressure.
  • The invention thus relates to a low dosage of the known alternative drug tadalafil, in order to provide an effective treatment of erectile dysfunction without the side effects associated with sildenafil.
  • The patent also contains a number of examples showing the efficacy and the absence of side effects of low dosage forms of tadalafil.

The court was apparently quite puzzled by the patent as a whole:

The problem expressed in the description of the patent is to provide a principle which avoids the issues of red patches and side effects of sildenafil by a particular dosage of tadalafil. 

Indeed, and as rightly noted by Mylan, no side effect associated with tadalafil is mentioned in the patent, so that the dosage suggested for tadalafil curiously addresses a problem associated with another active compound. 

The court then referred to a standard mentioned in the so-called “finasteride” judgment of December 6, 2017 by the Cour de cassation, commented on this blog:

[…] When a claim relates to a [second] therapeutic application of a substance or composition, obtaining this therapeutic effect is a functional technical feature of the claim. Therefore, in order to meet the requirement of sufficiency of disclosure, it is not necessary to clinically demonstrate this technical effect; but the patent application must directly and unambiguously reflect the claimed therapeutic application, so that the skilled person can understand, based on commonly accepted models, that the results reflect this therapeutic application.

The court then came back to the technical problem presented in the patent:

Icos Corporation and Eli Lilly do not dispute that no prior art document describes any side effect related to the use of tadalafil.
And they cannot validly argue that the absence of documentation in this respect does not amount to the absence of a problem, because the onus is on them to show that there was a problem to be solved and that it is solved by the teaching of the patent.
It thus appears that the problem described in the patent relates to sildenafil and not tadalafil, and it cannot be extrapolated that both active compounds have the same side effects, unless one were to admit the resolution of artificial or speculative problems.
In fact, the examples cited in the patent demonstrate that the dosage mentioned in the patent does not address the listed “problems”. 

In summary, the problem to be solved cannot be considered as the reduction in the side effects of tadalafil, because such side effects were not known in the prior art – only side effects of sildenafil were known.

Most of the examples of the patent also do not demonstrate the existence of side effects of tadalafil associated with higher dosages, so that these were held not to “reflect” the alleged therapeutic application (using the wording of the Cour de cassation).

The conclusion reached by the three-judge panel will not doubt cause a stir, as the invention recited in claim 1 was found not to be sufficiently disclosed in the patent.

The finasteride case related to a second therapeutic application invention, for a known molecule. It is well accepted both at the EPO and in French national courts that the new therapeutic application has to be demonstrated in a plausible manner in the patent, otherwise the patent is insufficient.

Yet, in the present case, claim 1 is a classical product claim, with no functional feature. According to EPO case law, there should be no problem of insufficiency of disclosure, because the skilled person is able to manufacture the composition containing the active substance at stake in the claimed dosage range. The question of whether said claimed dosage range provides any technical benefit or not only pertains to the appraisal of inventive step.

Now, as regular readers of this blog are well aware, the French approach to validity is much more fluid than the EPO’s.

If a court is convinced that an invention does not properly solve the alleged technical problem, or that the technical problem is artificial, this can give rise to a number of invalidity objections, including insufficiency of disclosure. My understanding is that the technical problem tends to be viewed by French courts as an integral part of the claimed invention itself.

But there is yet another cause for controversy in the judgment.

I mentioned above that most of the examples of the patent do not demonstrate the existence of side effects of tadalafil associated with higher dosages. That said, there is one example, namely example 7, which does analyze in detail the occurrence of various side effects depending on the dosage of tadalafil. The table of results is in fact even reproduced in the judgment. The court first remarked that some side effects are not present at all at any dosage. So far so good. But, regarding those side effects which are indeed shown to be less frequent in the claimed dosage range than at a higher dosage, the court noted:

Regarding headache, back pain and myalgia […], the reasoning is the same because these effects were never previously observed.

This part of the judgment seems to imply that, at least in the context of drug dosage patents, the existence of the technical problem to be solved must be acknowledged in the prior art, and cannot be demonstrated for the first time in the patent itself.

The invention can thus not be a so-called “problem invention“.

Things should be put into perspective, though, and the present case may not necessarily be generalized. Maybe the court did not believe that example 7 was convincing at all. At the very least, the fact that the dosage originally claimed in the patent, namely from 1 to 20 mg, had to be later restricted to 1 to 5 mg, due to some relevant prior art, certainly contributed to the court’s perception of the patent being invalid.

In fact, the court reviewed all the following claims and concluded that they suffered from the same deficiencies as claim 1, mentioning a lack of inventive step in passing for some of them. Fluidity of the grounds for nullity indeed.

As a final note, this is probably one of the last judgments penned by Ms. Courboulay, who, given her seniority and her involvement in many conferences and events, was often considered as the leading judge in the 3rd (IP) chamber of the Paris TGI.

Ms. Courboulay has now officially retired; but given the large number of important rulings which she authored, there is little doubt that her influence will continue to be felt in the coming years.


CASE REFERENCE: Tribunal de grande instance de Paris, 3ème chambre 1ère section, April 5, 2018, Mylan v. Lilly France & Icos Corporation, RG No.16/05073.

The single question

When you come to think about it, most of the issues that are discussed on a daily basis in patent cases seem to always boil down to one single question: same or different?

Take novelty: is the claimed subject-matter the same as that of the prior art or is it different? Or take infringement: does the allegedly infringing product or process differ from the claims of the patent? The list continues with extension of subject-matter, priority, etc.

Nevertheless, we patent attorneys or lawyers do not get bored, because this multifaceted single question is in fact extremely complex and gets renewed all the time. The most perfect example is probably supplementary protection certificates (SPCs), an area of law in flux if there ever was one.

Spot the differences – a patent attorney’s favorite game.

Merck Sharp & Dohme Corp. (MSD) is the owner of European patent No. EP 0720599. The patent is directed to the treatment and prevention of atherosclerosis and more particularly to a class of compounds called hydroxy substituted azetidinones, among which the molecule known as ezetimibe.

Ezetimibe is in fact explicitly recited in claim 8 of the patent.

Of note are also claims 9, 16 and 17, which are worded as follows:

9. A pharmaceutical composition for the treatment or prevention of atherosclerosis, or for the reduction of plasma cholesterol levels, comprising an effective amount of a compound as claimed in any one of claims 1 to 8, alone or in combination with a cholesterol biosynthesis inhibitor, in a pharmaceutically acceptable carrier.

16. A pharmaceutical composition of any of claims 9, 12 or 15 wherein the cholesterol biosynthesis inhibitor is selected from the group consisting of HMG CoA reductase inhibitors, squalene synthesis inhibitors and squalene epoxidase inhibitors.

17. A pharmaceutical composition of claim 16 wherein the cholesterol biosynthesis inhibitor is selected from the group consisting of lovastatin, pravastatin, fluvastatin, simvastatin, Cl-981, DMP-565, L-659,699, squalestatin 1 and NB-55 598.

Two SPCs were successively granted by the French patent office (INPI) based on this European patent, namely:

  • First, SPC No. 03C0028, for a medicament comprising ezetimibe as an active, based on a marketing authorization (MA) for the drug Ezetrol®.
  • Second, SPC No. 05C0040, for a medicament comprising a combination of the active compounds ezetimibe and simvastatine, based on an MA for the drug Inegy®.

The European patent expired in 2014. The first (mono) SPC expired on April 17, 2018. The term of the second (combo) SPC is April 2, 2019.

In August 2017, the generic drug company Biogaran obtained an MA for a combination of ezetimibe and simvastatine and began preparing for the launch of this generic version of Inegy®.

In December 2017, Biogaran filed a nullity action against the combo SPC in front of the Paris Tribunal de grande instance (TGI). In February 2018, the U.S. MSD company and its French subsidiary initiated urgency proceedings and requested an injunction against Biogaran in view of an imminent infringement threat.

On April 5, 2018, an order was issued per which MSD’s request for injunction was denied. An appeal was filed, and the Paris Cour d’appel dismissed MSD’s appeal on June 26, 2018.

French legal proceedings are, as a general rule, not extremely quick. But sometimes they can be, as the present case shows. In fact, I did not even have time to become aware of and report on the first instance order, before the appeal ruling came out. Well, the fact that this blog has been somewhat slow in the past few months does not help, I will grant you that.

The reason why the President of the Paris TGI denied MSD’s request in the order of April 2018 is that the combo SPC was considered as invalid. This was confirmed on appeal.

Before delving into the details of the ruling, we need to go back, as always, to article 3 of the SPC regulation (officially known as Regulation (EC) No. 469/2009 of the European Parliament and of the Council):

A certificate shall be granted if, in the Member State in which the application referred to in Article 7 is submitted and at the date of that application:
(a) the product is protected by a basic patent in force;
(b) a valid authorisation to place the product on the market as a medicinal product has been granted in accordance with Directive 2001/83/EC or Directive 2001/82/EC, as appropriate;
(c) the product has not already been the subject of a certificate;
(d) the authorisation referred to in point (b) is the first authorisation to place the product on the market as a medicinal product. 

Biogaran contended that the combo SPC was invalid for non-compliance with articles 3(a), 3(c) and 3(d). Their position was that:

  • regarding article 3(a), simvastatine is not claimed “as such” in the EP’599 patent, but merely as a substance known from the prior art, which can be used together with ezetimibe, which is claimed “as such“;
  • regarding article 3(c), an SPC had already been granted for the product at stake (namely the mono SPC), because the combination of the drug Ezetrol® with a statine such as simvastatine was already contemplated notably in the summary of product characteristics (SmPC) for this drug; and
  • regarding article 3(d), the MA for Inegy® was not the first MA for the product at stake, for the same reasons.

Interestingly, two further SPC applications similar to the granted combo SPC, namely for the combination of ezetimibe with atorvastatine, and of ezetimibe with rosuvastatine, were rejected by the INPI in February 2018.

In their ruling, the appeal judges made extensive reference to the Actavis judgment of the CJEU, C-443/12.

According to this ruling:

[…] where, on the basis of a patent protecting an innovative active ingredient and a marketing authorisation for a medicinal product containing that ingredient as the single active ingredient, the holder of that patent has already obtained a supplementary protection certificate for that active ingredient entitling him to oppose the use of that active ingredient, either alone or in combination with other active ingredients, Article 3(c) of Regulation (EC) No 469/2009 of the European Parliament and of the Council of 6 May 2009 concerning the supplementary protection certificate for medicinal products must be interpreted as precluding that patent holder from obtaining – on the basis of that same patent but a subsequent marketing authorisation for a different medicinal product containing that active ingredient in conjunction with another active ingredient which is not protected as such by the patent – a second supplementary protection certificate relating to that combination of active ingredients.

The facts in Actavis were somewhat different from those of the present case. In Actavis, the patent at stake protected irbesartan and a first MA had been obtained for the mono drug. Then, a second MA was obtained for a combo drug comprising irbesartan and a diuretic, hydrochlorothyiazide (HCTZ). But HCTZ was not specifically named in the patent, whereas in the present case simvastatine is expressly designated in claim 17 of the patent.

That said, this different circumstance does not appear to be essential in view of the broad exclusionary language used in the order of Actavis. The Cour d’appel therefore directly applied Actavis as follows:

[…] MSD, based on the one hand on the EP’599 patent protecting the new active ezetimibe, and on the other hand of the MA […] for Ezetrol® containing ezitimibe as a single active compound, obtained […] SPC ‘028, making it possible to object to the use of said active, either alone or in combination with other actives.
MSD, based on the same patent but on a later MA […] for a different drug Inegy® containing the active ezetimibe in combination with another active, simvastatine, which is not, as such, protected by said patent, requested a second SPC on this combination of actives.
It should be added that the reasons of judgment C-443/12 specify that it is not allowable for the proprietor of a basic patent in force to obtain a new SPC […] every time it markets […] a drug containing, on the one hand, the active protected as such in its basic patent and constituting  […] the core inventive advance of this patent, and on the other hand, another active, which is not protected as such by said patent. 
It is not challenged in this case that simvastatine, which is an active of the category of statines or “HMG CoA reductase inhibitors” is not protected as such by this patent, nor in fact by another patent. 

As a result, the combo SPC was held invalid under article 3(c).

MSD’s defense was that there were two inventions in the basic patent. The first invention was a new class of compounds including ezetimibe. The second invention was the use of ezetimibe with statines.

The court replied that only ezetimibe is a novel active compound. The court also noted that, based on the description of the patent, the combination of compounds did not involve an inventive step (or should this be “inventive advance”? the French expression “activité inventive” can be used for both terms). Although MSD filed an expert declaration to support such inventive step, the court held that such declaration could not cure the lack of inventive step based on the patent itself.

The court also agreed with Biogaran’s auxiliary argument per which, assuming that the mono and combo drugs were considered as different products, the SPC would still be invalid, under article 3(d) this time, because the MA for Inegy® would not be the first MA for the product, because the SmPC for this drug mentioned the association with statine compounds, and in particular simvastatine.

On a procedural standpoint, the outcome of the judgment is thus that the rejection of MSD’s request for injunction is confirmed. The nullity action on the merits is still pending, although of course we now have a good indication of how this is likely to turn out.

Going back to the central question asked at the beginning of this post, “same or different?“, is a drug containing ezetimibe together with a statine compound “the same” as a drug containing ezetimibe as the single active, for the purpose of SPC law? 

The answer appears to be much more complex than the question.

As a Post Script to this report, Biogaran’s invalidity argument based on article 3(a) was not really discussed in the appeal judgment. However, it is notable that a new CJEU ruling has been issued in this connection, namely C-121/17. Since it has already been reported on many blogs (see e.g. here), I will not go over it in detail, but I just wanted to mention it, as Lionel Vial had previously reported on the opinion of the Advocate General in this case on this blog.


CASE REFERENCE: Cour d’appel de Paris, pôle 5 chambre 1, June 26, 2018, Merck Sharp & Dohme Corp. & MSD France v. Biogaran, RG No. 18/52397.