Sunset for Cynrise

Easter always brings back chocolaty memories. The question as a child growing up in the Northeastern part of France on Easter morning was whether eggs had been brought by the Easter bunny. And the question as a child also growing up in the Southeastern part of France was whether eggs had been brought by the Easter bells.

It has been a while since the Easter bunny and the Easter bells stopped feeding me with chocolate. But this year there was an even better surprise on Sunday morning, in the form of an SPC-related guest post by Lionel Vial. And as all readers will probably acknowledge, SPCs are a delicacy of their own.

Rush of nostalgia: Easter eggs are no longer what they used to be.

Here is to Lionel.

The case discussed on this Easter day relates to a ruling of the Paris Cour d’appel dated January 20, 2017 which upheld a decision of the French patent and trademark office (INPI) to reject an application for a supplementary protection certificate (SPC) for a biological medicinal product.

French SPC application No. 11C0054 was filed on December 14, 2011 by Laboratoire Français du Fractionnement et des Biotechnologies (hereafter LFB), a French company specializing in medicinal products purified from human blood. The SPC application was based on French patent No. 2722992 filed on July 28, 1994, which claimed a method for the manufacture of a C1-esterase inhibitor concentrate (claim 1), as well as the concentrate obtained by the method (claim 11).

The SPC application was further based on marketing authorization (MA) No. EU/1/11/688/001 for Cinryze® comprising “C1 inhibitor, human (INN)” as active ingredient.

For those whose curiosity goes beyond patent law, C1 is one of the proteins forming the complement system, which itself is part of the innate (i.e. non-adaptive) immune system. The C1 inhibitor is a natural protein, found in blood, the role of which is to regulate the activation of the complement system. The C1 inhibitor is especially useful for individuals suffering from a rare autosomal dominant disease, caused by a deficiency of functional endogenous C1 inhibitor, which manifests itself in the form of angioedema attacks.

The SPC application was rejected on December 22, 2014 by the INPI for not complying with Article 3(d) of Regulation (EC) No. 469/2009 (hereafter the SPC regulation), i.e. the MA for Cinrize® was considered not to be the first authorization to place the product on the market as a medicinal product.

This was because a prior MA had been issued on June 28, 1999 for Esterasine comprising “human C1 esterase inhibitor” as active ingredient.

LFB lodged an appeal against the decision of the INPI before the Paris Cour d’appel and essentially argued that the human C1 inhibitors of Cinrize® and Esterasine were in fact two different products.

The precise arguments used by LFB are not very clearly summarized in the decision.

But it appears that LFB stressed that the way biological medicinal products, such as Cinrize®, are manufactured has an impact on their molecular structure, which, in the present case, was evidenced by a half-life of 56 hours for Cinrize® vs. 30 hours for Esterasine.

This did not convince the Cour d’appel which considered that:

The regulation relating to SPCs does not provide for exceptions to the definitions of a “product” and a first MA for biological medicinal products or blood products which would allow defining them as a function of their methods of manufacture or under their commercial names; it is therefore irrelevant that the SPC application is based on an MA for the “Cinryze” drug since the product protected by the basic patent is “the C1 inhibitor, human”; [besides] if LFB, after having initially claimed the latter, has amended the application by claiming “the C1 esterase inhibitor of the Cinryze drug”, this limitation made after the objections of the INPI cannot be effective since either the patent or the MA only relate to the “C1 inhibitor” as active ingredient of the Cinryze drug. 

To put it more clearly, the Cour d’appel took a very formal approach of Article 3(d) of the SPC regulation and simply considered that, if the names of the active ingredients mentioned in two different MAs are the same, then both MAs in fact relate to the same product, without further consideration as to the true physicochemical identity between the two products, as in the case of biological medicinal products obtained by different methods of manufacture.

LFB also argued that, in the assessment report of the European Medicines Agency (EMA) which led to the MA, the purified and concentrated C1 INH (i.e. C1 inhibitor) after pasteurization and nanofiltration is considered as the active substance.

The Cour d’appel responded that

the subject matter of this report was a marketing authorization application for Cinryse, so that, if [the report] specifies what its active ingredient is, it does not conclude that it would be a new product, the novelty of the medicinal product being different from that of its active ingredient; accordingly this does not contradict the decision of the INPI.

Moreover, the Cour d’appel noted that this latter argument was not submitted to the INPI which, therefore, could not do otherwise than decide that the MA for the drug Cinryze was not the first one for the active ingredient which is the “C1 inhibitor, human”.

It is to be noted that the latter argument was however decisive in overcoming the objection of the Dutch patent office based on Article 3(d) of the SPC regulation for the corresponding SPC application in that country (NL SPC application No. 300510), thereby securing the grant of an SPC.

It is therefore tempting to imagine that the fate of the French SPC application could have been changed for the best had the attention of the INPI examiner been drawn to the definition of the active substance in the assessment report of the EMA.

As a final note, this case reminds us of the ruling of the Paris Cour d’appel of April 12, 2016 which upheld the decision of the INPI to reject SPC application No. 08C0003 covering Cervarix®(GlaxoSmithKline Biologicals) which was discussed here.

In that case also the Cour d’appel refused to take into account the impact of the manufacturing process of biological products (production in yeast cells vs. insect cells) on their structure, sticking to the definition of the product given in the MA.

One can wonder if this literal approach, which has the advantage of simplifying examination of SPC applications, is in keeping with the fundamental objective of the SPC regulation which is to make up for the insufficiency of the period of effective protection of a medicinal product under a patent to cover the investment put into pharmaceutical research as recalled by the CJEU in C‑130/11 (Neurim).

Indeed, in the present case, it appears from the assessment report of the EMA that new clinical data was produced for the C1 inhibitor of Cynrize® in support of the MA application. This is probably because the C1 inhibitor of Cynrize® is a biological product the structure of which depends on the manufacturing process, thereby making it impossible to rely on clinical data obtained with previous C1 inhibitors.

It is generally considered that clinical trials amount for the larger part of investment in drug development. It could therefore be considered that the active ingredient of Cynrize® is a new product the development of which necessitated investment entitling it to SPC protection.

As such, when assessing conformity with Article 3(d) of the SPC regulation, perhaps the necessity to generate specific clinical data in order to obtain an MA for a biological product should be the primary criterion for determining if an MA is the first one to place the biological product on the market, rather than simply determining if the name of the active ingredient is the same one as that of a prior MA.

Thank you Lionel. Easter being about resurrection even more than about chocolate eggs, it remains to be seen whether this SPC application may come back to life on cassation appeal.

CASE REFERENCE: Cour d’appel de Paris, pôle 5 chambre 2, January 20, 2017, SA Laboratoire Français du Fractionnement et des Biotechnologies v. Directeur général de l’INPI, RG No. 16/08814.

Copy and paste

What is new in today’s post? Well, strictly nothing. Nope, nothing new under the sun. 

In fact, the recent ruling by the Cour d’appel de Paris in Avery Dennison RIS France & Avery Dennison Sytèmes d’étiquetage France v. Directeur général de l’INPI is pretty much a copy and paste of Free & Freebox v. Directeur général de l’INPI issued a few months ago and already reported on here.

So is there really a need to discuss it? After all, case law is more interesting when it tackles new issues or when it features a change in practice.

But the point is, sometimes even established case law can be somewhat questionable from a practitioner’s perspective. And in this case, I must say I struggle with fully understanding the court’s reiterated rationale.

Copying an IP judgment – a paradox?

The issue at stake is the limitation of a patent in front of the INPI (which is the French patent and trademark office), and which options are available to third parties to challenge this limitation. Appeals against decisions issued by the INPI are generally supposed to be lodged with the Paris Cour d’appel. Accordingly, a number of third parties have tried to challenge decisions of limitation of patents in front of the Cour d’appel, by directly appealing these decisions – oftentimes parallel to ongoing litigation. And they have lost, their appeals being deemed inadmissible. The present case is no exception.

In particular, the Paris Cour d’appel (with the support of the Cour de cassation in Teisseire v. Directeur général de l’INPI) has consistently held that challenges against the limited claims must be brought in the context of a nullity lawsuit. This means that such challenges have to be brought in front of the Paris Tribunal de grande instance (TGI), not the Cour d’appel.

But here is the thing. Grounds for nullity are supposed to be listed in a limitative manner in the law, be it in article L. 613-25 Code de la propriété intellectuelle (CPI) for French patents, or in article L. 614-12 CPI together with article 138 of the European patent convention (EPC) as far as French parts of European patents are concerned. These grounds of nullity notably comprise lack of novelty, lack of inventive step, insufficiency of disclosure, extension of subject-matter beyond the contents of the application as filed and extension of the scope of protection after grant.

What the statutory grounds for nullity do not comprise is lack of compliance with article 84 EPC (or its equivalent in the CPI), per which the claims “shall be clear and concise and be supported by the description” is not a ground for nullity. Just like a lack of clarity is not a ground for opposition at the EPO either.

Nevertheless, when the INPI examines a request for limitation, they are supposed to check whether the claims as limited are clear and concise and supported by the description. See article L. 613-45 CPI together with article L. 612-6 CPI.

The question is whether and how third parties may challenge the result of this part of the examination conducted by the INPI.

If we turn to the parallel situation of limitation proceedings at the EPO, the answer is clear. Only parties to the proceedings can file an appeal against a decision issued by the EPO. A third party, as its name indicates, is not a party to the limitation proceedings and thus cannot appeal the decision of limitation, even if they deem that the limited claims are e.g. unclear.

In France, third party appeals are not ruled out as a matter of principle. By way of example, it is relatively common for a third party to challenge a decision of restoration of a patent by the INPI. See an example here.

But when it comes to decisions of limitation, third party appeals are usually stroke out in view of the arguments raised by the appellant.

In the present case, the French part of a European patent was limited by Gemalto, parallel to ongoing patent infringement proceedings against two companies of the Avery Dennison group. Avery Dennison appealed the decision of limitation and argued (among others) that the claims as limited are unclear.

The Cour d’appel rejected the appeal as inadmissible and held in particular that: 

[…] The arguments by Avery Dennison supporting their request for cancellation of the decision of the general director of the INPI, per which the claims as limited are not clear and not supported by the description, are analyzed as arguments of invalidity of the patent enforced against them in the framework of the infringement suit. These arguments, which put into question the limitation itself, i.e. whether the modified claims comply with the law, pertain to the jurisdiction of the judge in charge of assessing the validity of the patent. In this case, there is a counterclaim for nullity of the claims of the […] patent pending in front of this judge. His jurisdiction extends to all patent validity challenges, be it arguments of extension of an absence of limitation or arguments of a lack of clarity of the claims or a lack of support in the description, which are indeed exceptions which can lead to the nullity of a patent

Just to be very clear on this: I perfectly understand that it may make a lot of sense for the same court (the TGI) to be in charge of assessing all challenges against the patent claims.

What I do not understand is the last sentence in the above quote. In other terms, why does the Cour d’appel deem that a lack of clarity of the claims or a lack of support in the description, can lead to the nullity of the patent? 

I can come up with three possible explanations. 

Option 1: the court simply did not (does not) understand that not all conditions to be examined before granting limited claims can be challenged after the limitation, based on the listed grounds of nullity. I think this is unlikely, because the point has certainly been explained to the court time and time again in this case and previous similar ones.

Admittedly, it is probably easy to confuse a lack of support in the description (not a ground for nullity) with insufficiency of disclosure (ground for nullity). Both concepts are quite close, as explained in section F-IV, 6.4 of the EPO guidelines for examination. Actually, lack of support can also be easily confused with extension of subject-matter.

But lack of clarity on the other hand is quite clearly different from insufficiency of disclosure, or any other ground for nullity for that matter.

Option 2: the court deems that judges have such a large discretion in examining the actual grounds for nullity, such as insufficiency of disclosure or even lack of novelty, that they can very well revoke a patent under one of these statutory grounds if there is a lack of clarity in the claims.

This would be a pragmatic approach but not a satisfactory one on the legal standpoint. The legislator purposefully set out a number of distinct requirements to be handled differently. So why should judges be allowed to blur the lines between them?

Option 3: the court believes that all statutory conditions may be examined in the context of a nullity claim or counterclaim, including clarity and conciseness mentioned in article 84 EPC or article L. 612-6 CPI.

This would be a very bold position, since, at least as far as European patents are concerned, article 138 EPC provides that “a European patent may be revoked with effect for a Contracting State only on the grounds that“, and then comes a list of grounds which does not contain lack of clarity and conciseness.

But let’s explore option 3 a little bit more.

If this is indeed what the court has in mind, is this situation specific to limited patents? Does it also extend to patents modified in opposition at the EPO? Or has lack of clarity now also become a ground for nullity for all patents, even those which were not modified after grant?

Dear readers, please feel free to provide more information or to speculate as to yet further possibilities not contemplated here…

One other argument which – as far as I understand – was raised in the appeal, was that the modified claims were not a limitation. Here, the court’s position seems to be that modified claims necessarily lead to a limitation of the scope (and thus are allowable) or to an extension of the scope (and thus can be revoked in a nullity challenge).

But aren’t there yet other situations in which the modified claims could result neither in a limited scope nor in an extended scope? What about for example claims which are modified only to provide some clarification? In such a scenario, shouldn’t a third party be allowed to challenge the decision of limitation per se? After all, the INPI is supposed to only grant actual limitations, not clarifications. And if no extension of scope results from the modification, it should not be possible to challenge it in a nullity suit, oder?

I must admit that this latter question is trickier. But at least the main point raised above really needs to be clarified once and for all.

CASE REFERENCE: Cour d’appel de Paris, pôle 5 chambre 2, February 10, 2017, Avery Dennison RIS France & Avery Dennison Systèmes d’Etiquetage France v. Directeur général de l’INPI, RG No.15/25007.

More numbers

Further to last week’s report on the latest statistics regarding the EPO Boards of appeal, today’s post is about another batch of numbers, this time from the French patent office.

But before getting there, I would like to briefly follow up on last week’s post, with two additional comments.

First, I wondered last week about the extraordinary situation in Board 3.3.02, which is now understaffed to the point of being practically unstaffed. A reader kindly brought to my attention that some cases originally distributed to this board seem to have been transferred to another board. For instance, case T488/16 was transferred to board 3.3.01 in October 2016. This makes sense in order to prevent some appeals from getting lost in limbo. But I still wonder what happened to board 3.3.02 in the first place.

Second, the EPO released another report a few days ago regarding the 2016 statistics. Very informative indeed. Three figures in particular caught my attention.

The first figure is the number of so-called “patent filings“, which reached more than 296,000 in 2016, up by 6.2% since 2015. This indicator is put in the spotlight by the EPO every year, even though it is a rather artificial one, as many others have noted. Indeed, these “patent filings” include both European direct filings and PCT filings (whatever the receiving office is). The latter represent a large portion of the 296,000 filings. Of course not all PCT filings give rise to actual proceedings before the EPO. So, the figure should not be interpreted as meaning that the EPO handled 6.2% more applications in 2016 than in 2015.

This leads us to the second figure, which is the meaningful one, namely the number of so-called “total applications, i.e. actual applications for a European patent. The number of total applications is the sum of the number of direct filings at the EPO and of PCT applications having entered European regional phase. Well, it turns out that this indicator is actually down by 0.6% relative to 2015, with a total of 159,353 applications.

It would be interesting to compare this number with the number of national filings in the various EPC contracting states in 2016, to see whether fewer patents were requested overall in Europe, or whether some applicants may have decided to favor the national route, for one reason or the other (such as the upcoming advent of the UPC scaring them off).

Last but not least, the third figure, namely the number of patent grants in 2016. This one is nothing short of astounding. There was a 40% increase in patent grants in 2016, up to 95,940. Obviously, this is good news for applicants. But everyone’s concern is that the quality bar may have been lowered to achieve this impressive figure. This would not be good news for third parties – and all applicants that I know of also happen to be third parties. Of course, it is hard to tell whether this concern has any merit or not. There is only so much that stats can tell us.

For those who love charts and numbers, you can check out the 84 pages of drawings of this U.S. granted (!) astrological patent.

And now, back to Paris, with another report, issued this time by the Institut national de la propriété industrielle (INPI). The report, authored by Emmanuelle Fortune and Mickaël Chion, concerns applications published in 2015, i.e. which were mostly filed in 2013-2014.

It focuses in particular on the respective filing strategies of SMEs (fewer than 250 employees and yearly turnover of less than 50 million euros or annual accounts of less than 43 million euros), large entities (more than 4,999 employees and yearly turnover of more than 1.5 billion euros or annual accounts of more than 2 billion euros), and intermediate ones (anything in-between).

Here are a few subjective highlights from the report.

First, the total number of French national applications filed at the INPI has been remarkably stable for a number of years. The total is 15,105 (again, these are the applications actually published in 2015, not those filed in 2015).

Second, the breakdown of French national applications filed by French legal entities, depending on the applicant’s size:

  • 22.1% of these applications were filed by SMEs;
  • 56.8% were filed by large entities;
  • 6.9% were filed by intermediate entities.

The remainder (14.2%) were therefore filed by public research institutions.

Third, the number of (French) applicants having filed at least one national application, in each category. Here the ratio between SMEs and large entities is the opposite:

  • 66.9% of applicants were SMEs;
  • 14.5% of applicants were large entities;
  • 10.8% of applicants were intermediate entities.

If my math is correct, this means 7.8% of applicants were public research institutions.

Fourth, quite logically, the average number of applications per applicant is heavily dependent on the size of the applicant:

  • each SME filed 1.4 application on average;
  • each large entity filed 16.4 application on average;
  • each intermediate entity filed 2.7 application on average.

Again, the report does not address public research institutions. But some simple math makes it possible to conclude that there were 3.2 applications on average for those. I would have expected this number to be much higher.

Yet, on the one hand, the report uses fractions when there are co-applicants, which I think is often the case when public research institutions are involved. To take one example, if the CNRS files an application together with three other partners, this will count as only 0.25 application for the CNRS. This can partly account for the low number of applications per public institution.

And on the other hand, the above average figures probably hide very large discrepancies between individual entities. I assume that some well known actors such as the CNRS, or Peugeot Citroën Automobiles, Renault, L’Oréal and the like file a very large number of applications every year, which necessarily skews up numbers in their respective categories.

The fifth point that I would like to highlight here is the proportion of French applications giving rise to PCT or direct EP extensions:

  • 50.8% of applications filed by SMEs gave rise to such an extension;
  • 60.8% of applications filed by intermediate entities gave rise to such an extension; and
  • 60.8% of applications filed by large entities gave rise to such an extension.

Reconstructing the missing data regarding public research institutions leads me to a very large proportion of 86.7% of applications giving rise to an EP or PCT extension.

I guess possible factors for the lower extension rate among SMEs is the cost of the extensions, and the more local nature of their markets. At the opposite end of the spectrum, public research entities absolutely need to think globally and invest in the long run in their patent applications before they can hopefully get a profit from them. Also they probably tend to only file applications on significant inventions and not on small, incremental ones, as private companies often do for strategic reasons.

The last batch of figures for today, is probably the most interesting one. It relates to the estimated number of applications or patents in force in France, on December 31, 2015.

The total number is 520,068. In understand it includes French patents, French applications, and granted European patents for which at least one renewal fee was paid in France.

So, good luck folks for your freedom-to-operate analyses… The majority are European patents (72.5%), the rest being French national applications / patents.

The breakdown between French applicants and foreign applicants / patentees is also very uneven: 69.4% of applications / patents in force are held by foreign persons or entities (although the vast majority of applications / patents filed via the national route are held by French persons or entities).

Only 4.4% of all patents / applications in force are French patents / applications held by French SMEs. To this number, we should also add the proportion of European patents held by French SMEs. The figure is not provided in the report, but it is likely very low.

This should somewhat put into perspective the often heard assertion that the patent system is good for SMEs. This is certainly true for part of them. But on the other hand, local SME patents are outnumbered by large entities’ filings and foreign filings – at least in this country.

For those readers really interested in numbers, the INPI report contains further data on technological fields, the regional origin of French applicants etc. It is not too much PR-oriented, simply factual and therefore satisfactual (a tribute to a classic song).

Hot numbers

Case law decisions are seldom an easy read. So today’s post will be relaxing, as it deals with some recently published stats. Numbers instead of letters for a change, in the form of the annual report of the Boards of appeal of the EPO, published in the OJ. This yearly publication is a nice source of general information on the activity of the Boards of appeal in the past year.

Here is my selection of subjective highlights from the report. I will focus only on the technical boards of appeal, which handle the vast majority of appeals at the EPO.

First, the total number of new cases, has increased to a record total of 2748. That’s a 15% increase relative to 2015, but only a 6% increase relative to 2012, since there was a drop in new cases in 2013 and 2014.

Second, the total number of settled cases is almost stable at 2229 (down by 3% relative to 2015). However, the number of settled cases after a decision on the merits (i.e. excluding cases in which the appeal was withdrawn, or the statement of grounds of appeal was not filed, etc.) was only 1243, down by 9% relative to 2015.

What I think this all means is that backlog is likely to increase – unless the proportion of withdrawn appeals and the like were to increase for some reason.

This seems to be confirmed by the comparison of the number of pending cases on December 31, 2016, relative to the number of pending cases on December 31, 2015: 8381 vs. 7862. That’s a 6.6% increase.

This also seems to be confirmed by the evolution of the number of cases pending over two years on December 31, 2016, which is 3979 (up by 5% relative to December 31, 2015). The oldest appeals still pending were filed in 2008.

The overall length of proceedings was 2 years and a half, or more precisely 37 months on average (40 months for ex parte appeals and 34 months for inter partes appeals), up by 1 month since 2015.

Hopefully measures will be taken to curtail the increasing backlog. At the very least, the positions in the Boards which are still vacant should be filled soon. In fact, based on the Supplementary publication No. 1 in the 2017 OJ (Information from the Boards of Appeal Presidium, business distribution and texts relating to the proceedings), there are still a number of missing Board of appeal members as of the beginning of 2017.

The most striking example is Board 3.3.02, with no chair and three positions of technical members out of four which are vacant. A helpful footnote indicates that “in view of the vacancy situation in Board 3.3.02, the provisions of Article 3, paragraph 3 will be followed for the composition of the board in particular cases“. Article 3(3) of the Business distribution scheme provides that “if the circumstances of the appeal make it necessary, the Chairman may designate a technically qualified member from another Board. In so doing he shall procure the consent of the Chairman of that Board“. But I am not sure how this can work since there is not even a chairman in this Board.

I would certainly be curious to get some updated information from knowledgeable readers about the vacancy situation – and especially, about what the heck is the matter with Board 3.3.02.

Anyway, back to the 2016 annual report, and let’s now look at the proportion of ex parte and inter partes cases.  Here, the trend seems to be an increase in the proportion of inter partes cases. These cases represent 66% of all new cases in 2016, up by 5.3% since 2014. Inter partes cases are generally more complex than ex parte cases. So this trend will not help reduce the backlog.

In terms of technical fields, appeal cases are traditionally distributed into four groups: mechanics cases (handled by Boards 3.2.01 to 3.2.08), chemistry cases (handled by Boards 3.3.01 to 3.3.10), physics cases (handled by Boards 3.4.01 to 3.4.03) and electricity cases (handled by Boards 3.5.01 to 3.5.05). Of course those are very rough categories.

Since 2014, there has been a marked increase in both the number and proportion of mechanical cases (36.8% of all new cases in 2016), an increase in the number of chemical cases, which only translates into a moderate increase in relative proportion (32.8% of all new cases in 2016), a stability in the number of physical cases (9.4% of all new cases in 2016) and actually a reduction in the number of electrical cases (21% of all new cases in 2016).

It is also quite interesting to look at the proportion of opposition cases relative to the total number of cases, depending on the technical field:

  • Mechanics: 86%.
  • Chemistry: 77%.
  • Physics: 37%.
  • Electricity: 27%.

I assume that the major explanation for this large discrepancy is that the refusal rate is very low in mechanics and chemistry, and that it is higher in physics and electricity, especially because those are the categories in which most computer-implemented inventions are classified. As far as I can tell based on the work my partners Aujain and Patrick do, prosecuting software-related applications at the EPO is an entirely different game from prosecuting other applications. Now, a higher refusal rate probably translates into a higher examination appeal rate.

The outcome of the appeals, further to a decision on the merits, differs depending on the nature of the cases (ex parte or inter partes). The majority of examination appeals are dismissed (54.7% in 2016), but the contrary is true for opposition appeals (only 39.3% in 2016).

In opposition cases, the actual outcome of a successful or partly successful appeal can of course vary greatly. In 4% of cases, the opposition is rejected. In 20.5% of cases, the patent is revoked. In 23.8% of cases, the patent is maintained in amended form, and in 12.4% of cases there is a remittal to first instance.

Has anyone ever had a feeling that getting your appeal in a proper success percentile was a matter of roulette game?

All of this is fine and well, and we are grateful for this report. But there is also a lot that the report does not say. I will take three examples.

First, the report does not address discrepancies from one board to the other in terms of duration of the proceedings.

In the past I sometimes performed a quick and empirical analysis of the length of appeal proceedings in front of a particular board, based on a representative sample of recent decisions, when my client was interested in predicting how long it would take until a final decision for a particular case.

It turns out that the variation from one board to the other is huge, probably from less than 2 years in front of some boards to more than 5 years in front of other boards. This is a major problem which I think would deserve to be better documented – and addressed.

Second, the report does not address board-to-board discrepancies in terms of practice and outcome which, again, I suspect, can be significant.

From time to time, some law firms publish studies focusing on certain aspects.

For instance, JA Kemp recently published a review of software patent decisions in 2016. The review in particular shows a high refusal / revocation rate, which again is to be expected in this specific technical field.

Also, a very informative article by Maarten Nollen can be found in epi Information 1/2015, which focuses on revocation decisions issued in 2014. The article again illustrates interesting differences depending on the technical field at stake.

Third, the annual report does not contain any global evaluation of the outcome of opposition proceedings when taking into account first instance and appeal. Everyone has in mind a rule of thumb of the “three thirds” (i.e. one third of oppositions rejected, one third of patents revoked, and one third of patents maintained in amended form). However, interestingly, the rule may not be accurate when one looks at oppositions under appeal. In the abovementioned article, Maarten Nollen claims that the overall revocation rate for such cases is actually more than 50%.

So, too bad that the annual report is somewhat limited and that no comprehensive statistical analysis of the activities of the Boards of appeal has been made available. On the other hand, this is not completely surprising. Statistics are almost by nature political. Therefore, is it not a natural tendency for all institutions to make a selection of numbers according to their agendas?

Clean sweep

There are at least three interesting aspects in today’s decision, as well as a sort of infuriating one. The interesting points are limitation, public prior use and inventive step. The infuriating one is a mistake made by the court, which stumbled over dependent claims – despite vocal criticisms of this type of mistakes made by various commentators over the years.

But before I address these points in turn, a few words on the background. The claimant in this case is Concept Microfibre, a French company specialized in microfiber textiles, as its name suggests. They own two French patents filed on the same day, FR 2926204 (FR’204) and FR 2926205 (FR’205).

In 2012, Concept Microfibre sued another French company Distribution de Matériel Européen (DME) as well as its Italian mother company, Filmop, for infringement of the two French patents. Further to the classical nullity counter strikes, the Paris Tribunal de grande instance (TGI) revoked claims 1, 2 and 3 of FR’205 (which were relied upon by the patent proprietor) in its judgment dated July 3, 2014; but the other patent FR’204 was upheld, and the defendants were found liable for infringement.

They appealed, which leads us to the judgment of September 27, 2016 by the Paris Cour d’appel.

On appeal, the patentee did not fight the revocation of claims 1, 2 and 3 of FR’205 by the TGI. So, this was quite easy to deal with for the appeal judges, and this part of the TGI decision was confirmed. What was more challenging for the court was to handle the other patent FR’204.

The first challenge was that the FR’204 patent was limited during the appeal proceedings, or more precisely at the onset of the appeal proceedings. The appeal was lodged on August 27, 2014, and a request for limitation of FR’204 was filed less than 2 months later, on October 16, 2014, at the INPI (French patent and trademark office). The limitation was accepted by the INPI on January 9, 2015.

The limitation consisted in combining claim 1 with claims 2 and 4.

The alleged infringers claimed that this limitation was invalid, because the limitation was requested “in order to adapt the right so as to escape a looming revocation” (uh, yes, that’s kind of the whole point of limitation proceedings) “and so as to harmonize it with the features of the products that they market” (right, too bad the patentee did not add a feature clearly not present in the alleged infringing products).

The alleged legal basis for the invalidity of the limitation was the legal principle “fraus omnia corrumpit“.

As much as I like Latin phrases, especially when I happen to know what they mean, the argument was clearly a long shot. The court easily concluded that the limitation was neither fraudulent nor improper, and that the defendants had had enough time to challenge the validity of the limited claims.

What I do find puzzling in this limitation case, though, is why the claims were limited in the first place. Usually, claims are limited on appeal when the patent is revoked in first instance (see a recent example in the Orange v. Free litigation). But in this case the patent was upheld in first instance.

Did the appellants immediately file submissions together with their appeal of August 27, 2014, and did these submissions contain new arguments which appeared more serious and threatening to the patentee? It is possible, but we cannot know for sure as the file wrapper is not part of the public record.

As far as I can tell, no new prior art was cited on appeal.

On the other hand, it seems that the appellants developed a proper argumentation of lack of inventive step, which was not the case in first instance.

In first instance, it looks like the defendants were so confident with their lack of novelty attack that they did not really focus on inventive step. Thus, the TGI simply discarded the inventive step attack by noting that:

regarding the first part of the characterizing portion [of the claim], the defendants did not make any observation on its inventive character and on the approach that the skilled person would have to make this composition and its particular structure. 

So I can only speculate that a convincing argument of lack of inventive step was newly introduced very early on appeal, which led to the limitation – unless readers have other ideas?

Anyway, the proprietor may actually have underestimated the new argument in spite, as the main claim as limited was ultimately found not to be inventive by the court!

The claim at stake was the following:

Cleaning cloth, in particular for cleaning the floor, intended to be carried by a broom, said cloth having a cleaning surface intended to come into contact with the floor, said cleaning surface comprising a textile composition made of polyolefine, and a textile composition made of hydrophilic microfibers, characterized in that:

– each of said textile composition made of polyolefine and said textile composition made of hydrophilic microfibers comprises a thread extending towards the cleaning surface, 

– the titer of the thread of said textile composition made of polyolefine is greater than the titer of the thread of said textile composition made of hydrophilic microfibers, 

– the first textile composition defines scrubbing areas and the second textile composition defines absorption areas, and

– on the cleaning surface, the textile composition made of polyolefine is slightly below the textile composition made of hydrophilic microfibers.

Brooms are not just useful for scrubbing and absorbing fluids.
Brooms are not just useful for scrubbing and absorbing fluids.

The court relied on an EPO-like approach to assess inventive step, in particular with respect to the definition of the closest prior art:

the closest prior art which is selected must be relevant, that is it must correspond to a similar use and must require the fewest structural and functional modifications to arrive at the claimed invention; said closest prior art must therefore have the same purpose or effect as the invention or at least belong to the same technical field as the claimed invention or a closely related field. 

The court identified the technical problem addressed in the patent as improving the efficacy of cleaning cloths both for scrubbing dirt and for absorbing fluids, owing to the two textile compositions. Then, the court identified three relevant documents which could represent the closest prior art, without really singling out one among the three. They all belonged to the same technical field although their purpose was slightly different (namely, the prior art cloths were intended for sweeping, not scrubbing).

The court then held that all claimed features could be found in various prior art documents. As far as I understand:

  • Two Korean documents both taught two textile compositions, one made of hard polyolefine fibers (suitable for scrubbing) and one made of hydrophilic fibers (suitable for absorbing fluids), the titer of the former being greater than the titer of the latter.
  • A PCT application disclosed distinct areas, with fibers made of a single thread extending towards the cleaning surface.
  • Finally, a U.S. patent disclosed a cloth made of fabric comprising thread loops of different lengths depending on their purpose (absorption of dirt for the longer loops and absorption of liquid for the shorter ones).

The court did not explicitly state that all these documents could be combined due to a “partial problem” approach, but this is probably what they more or less had in mind. At any rate, they noted that the claimed invention:

does not contravene any prejudice, does not represent any breakthrough relative to the methods already taught, does not overcome any technical difficulty and does not provide any unexpected or surprising result. 

On the face of it, and with the important caveat that I have not examined the prior art nor the submissions of the parties (which are not public), this conclusion seems to make sense.

On the other hand, what makes absolutely no sense is that one of the dependent claims was then revoked for lack of novelty:

Claim 5 recites that the polyolefine is polypropylene, but this claim lacks novelty, since claim 1 of Korean patent 10-0718962 already discloses fibers areas made of polypropylene. 

It is unfortunately relatively common for our judges to get dependent claims wrong. Here, the court apparently focused only on the features contained in claim 5, without realizing that these features should be read in combination with those of claim 1. If claim 1 is novel, then claim 5 is also novel. It can at best lack inventive step, like claim 1.

By the way, the frequency of this type of error regarding dependent claims is probably a factor to be taken into account by patent proprietors when determining their litigation strategy. If you know that your main claim is weak, it is probably better to amend it by way of a limitation rather than assume that a stronger dependent claim will survive if the main claim is revoked. Of course, that can happen, but you’d better not count on it.

As mentioned at the beginning of the post, the way the court handled the public prior use defense was also interesting, I will try to address it in another post.

CASE REFERENCE: Cour d’appel de Paris, pôle 5, chambre 1, September 27, 2016, Filmop Srl & SASU Distribution de Matériel Européen v. SAS Concept Microfibre, RG No. 14/18000.