Brompton Bicycle – far from folded

CJEU follows Cofemel in allowing copyright protection where designs are not exclusively dictated by technical function

The CJEU has decided in the Brompton Bicycle case C-833/18 (11 June 2020) that to qualify for copyright, a design must be original – that is, the subject matter must reflect the personality of its author (the creator or designer), as an expression of her/his free and creative choices.  This requirement cannot be fulfilled where the design “has been dictated by technical considerations, rules or other constraints which have left no room for creative freedom or room so limited that the idea and its expression become indissociable“.  Therefore any design satisfying the condition of originality may be eligible for copyright protection, even if its creation has been dictated in part by technical considerations, provided those technical design choices have not prevented the creator from reflecting her/his personality in the design.

Summary

The case confirms that technical designs may benefit from copyright, dependent upon the extent to which creative freedom is possible. In situations where there is none and the design is solely dictated by the function, there will not be copyright protection. The CJEU left it to the local court to decide whether this was the case with the Brompton bicycle designs.  In order to establish whether the product concerned falls within the scope of copyright protection, the referring Belgian court must now decide on the facts whether, through the choice of the shape of the product, its author has expressed her/his creative ability in an original manner (by making free and creative choices) in such a way that it reflects her/his personality. The CJEU said that the question of the potential existence or not of other possible shapes which can achieve the same technical result is not decisive in assessing the factors which influenced the choice made by the creator. Likewise, the intention of the alleged infringer is irrelevant in such an assessment. Significantly, the fact that a patent over the bicycle had recently expired was held not to be a relevant consideration; the individual copyright issues were considered independently of any history of protection by other IPRs.

Comment

This decision will have an important impact in the design sector, because it has confirmed that a design can also have copyright protection if the design  reflects the personality of its creator, as an expression of their free and creative choices, even if the shape of that product is in part necessary to obtain a technical result. Where there is no creative freedom in the development of the design copyright will not apply.

Since copyright protection is one of the longest lasting IP rights, this will make it an attractive option for protection and enforcement, in particular where other rights such as registered designs or patent rights in the product have expired. Whilst the existence of such latter rights was seen by the CJEU as potentially relevant to any assessment of the creative freedom of the author and technical functionality of a design, it was not fatal to a finding that copyright could exist.

As copyright has a much longer term than other IP rights (lifetime of creator plus 70 years for UK copyright, as opposed to 3 years for EU unregistered design rights or 10-15 years for unregistered UK design rights or 20 years for a patent), the decision will be welcomed by some in the design world who seek to maintain rights over key designs.  Others who would wish to get inspiration from designs, the protection in which would otherwise have expired, will find today’s decision more challenging.  We will undoubtedly see other designers seek to rely upon copyright to protect iconic designs, even if mass produced, given the advantages of copyright protection.  Another advantage of copyright is that there are no registration requirements, unlike registered designs or patents. However, designs remain a valuable form of protection, as they do protect a wider category of industrial designs, including those that have functional elements.

We saw the CJEU in Cofemel (September, 2019) endorse the EU test for subsistence of copyright, as being the artist’s own intellectual creation (consistent with Infopaq and Levolo).  This differs from the old UK test of for originality, of sufficient skill and labour test, i.e. sweat of the brow.  However, Cofemel also suggested that the categories of copyright protection were not limited, so could include designs.  However, the Cofemel judgment suggested that the scope for cumulative protection was limited for designs under both EU copyright and design law (also established in Flos).  It rejected the notion of a requirement of aesthetic appeal for copyright protection, but equally suggested that technical considerations may preclude exclusively functional designs from being eligible for copyright protection.

In the Brompton Bicycle case, the CJEU followed Cofemel in the view that a design whose shape is dictated by technical considerations, that do not leave room for the exercise of creative freedom, is not eligible for copyright protection.  It is analogous to the reasoning given in some of the trade mark cases on protecting 3D shapes (such as Lego).  It suggests that there does need to be something creative for a work to qualify for copyright protection, not driven by purely functional concerns or perhaps the technical output from a machine.

Until the repeal of section 52 Copyright, Designs and Patents Act 1988 (CDPA), the UK law limited the use of copyright to protect industrially manufactured designs to 25 years. Since that repeal, the industrial manufacture of a design does not have a limiting effect on the copyright term in the designs for that object. However, under section 51 CDPA, where any article is made to a design embodied in a design document or model, the copyright in that design document or model recording the design cannot be enforced (unless the design or model itself was an artistic work). This section must now be likely to come under review, either by the UK courts or legislature, in light of the Brompton and Cofemel decisions.  The UK Courts have already imported the test for originality, as being the author’s own intellectual creation, as recently seen in the Response Clothing decision of His Honour Judge Hacon in January 2020. This decision recognises the tension between section 51 of the Copyright, Designs and Patents Act 1988 which limits copyright protection for designs to works of artistic craftsmanship and the judgment in Cofemel.  In Response Clothing, the Judge acknowledged the tension, but found he was not constrained by earlier English law from finding that a machine-made fabric design was a work of artistic craftsmanship and followed Cofemel to find that it was entitled to copyright protection. This latter case left English law tipping its hat towards the important EU decision in Cofemel, but not fully importing its full effect.  There is scope for divergence by the Courts in post-Brexit UK in the important area for protection of designs, which is key to many product designs.

Notwithstanding that the UK has left the EU, the Brompton Bicycle case (coming within the transition period) will bind the UK courts, unless the Supreme Court (or Parliament through legislation) decides subsequently to depart from it or Ministers make regulations under the European Union (Withdrawal Agreement) Act 2020 about the judicial treatment of the decision.   Realistically, this is extremely unlikely in the short to medium term, given that Cofemel has already been endorsed and applied by the courts in the UK in the Rapid Clothing v Edinburgh Woollen Mill case.  That does mean that the conundrum of section 51 needs resolving, through primary legislation or the courts striking it down as ultra vires.  That leaves the UK with the prospect of enhanced protection for designs through copyright, including the potential for some designs to gain retrospective protection, when protection from unregistered design rights (UK or Community) might well have expired.

Further, additional changes will also come into effect on 1 January 2021 to recognise equivalent UK rights to Community design rights (both registered and unregistered).  See our Guide to the impact of Brexit upon IP here.

 

Key contacts and authors

Joel Smith
Joel Smith
Partner, London
+44 20 7466 2331
Rachel Montagnon
Rachel Montagnon
Professional Support Consultant, IP, London
+44 20 7466 2217

Patent and Pharma Update, May 2020

Key recent developments in the United Kingdom and Europe relating to patents and the pharmaceutical sector

In this update we welcome our new IP partner in Germany. We have a number of interesting updates from the UK Court of Appeal, including a decision on Arrow declarations, a competition decision, an appeal relating to the lapse of an SPC and a decision on off-label prescription of medical treatments. We cover the German Constitutional Court decision on the UPC and the UK government’s comments on participation in the UPC. We have updates from France on SPCs and a FRAND related injunction. We also discuss several UK High Court decisions on issues such as the use of a public interest defence to avoid an injunction, issue estoppel in patent cases and an example of the interplay between arbitration and IP claims. Throughout the update we consider the impact of COVID-19 and include updates on how the English, French and Italian patent courts are dealing with the crisis.

Continue reading

Update on medicines and medical devices regulation in the EU and the UK and the impact of COVID-19

Two important pieces of medicines and medical devices regulation are currently pending in the UK and the European Union: in the UK, the Medicines and Medical Devices Bill (the UK Bill), and in the EU, the Medical Devices Regulation (the EU Regulation on Medical Devices). COVID-19 has also had an impact, with the EU Regulation on Medical Devices, which was due to start to apply to medical devices on 26 May 2020, having its date of application postponed by the EU for one year, until 26 May 2021, so as to avoid any extra burden on manufacturers during the current pandemic.

The UK Bill

The UK is currently in a transition period following Brexit, which ends on 31 December 2020. During this period medicines and medical device regulation will remain aligned with the EU. However, following the transition period, the UK will not be able to update its regulatory schemes for medicines and medical devices – as it currently relies on legislation such as the European Communities Act 1972 for amendments. The UK Bill therefore delegates powers to update the existing regulatory frameworks across three areas: human medicines, veterinary medicines and medical devices.

The UK Bill was introduced into the UK House of Commons on 13 February 2020 and, although it was passed at second reading on 2 March 2020, further progress has been postponed in light of the Covid-19 pandemic. It is proposed that, when the Public Bill Committee reconvenes, it reports back on the UK Bill by 11 June 2020.The aims of the UK Bill are fourfold:

  1. Providing means to depart from EU rules and regulations in the future;
  2. Ensuring that the regulations can be easily amended through delegated powers without having to bring a new bill before the House of Commons ever time a revision is desired, allowing the regulations to be flexible and responsible;
  3. Strengthening patient safety by strengthening the Medicines and Healthcare Products Regulatory Agency (MHRA), the agency that regulates medicines and medical devices in the UK, including providing it with powers that were not available under the EU such as the registration of medical devices; and
  4. Striking the balance between patient safety and capturing the benefits of innovation, including through the conduct of clinical trials in the UK.

During the second reading, the UK Secretary of State for Health and Social Care, Rt Hon Matt Hancock, suggested that the new rules and regulations could include:

  • Requiring a digital version of product information leaflets for human medicines;
  • Removing the barriers to hub-and-spoke dispensing for smaller independent pharmacies;
  • Permitting prescribing by healthcare professionals such as paramedics and midwives;
  • Creating a compulsory register of medical devices in the UK; and
  • Granting the MHRA power to disclose safety concerns about a medical device to the public.

The EU Regulation on Medical Devices

In April 2017, the EU Regulation on Medical Devices was adopted (Regulation 2017/745 on medical devices), which, together with Regulation (EU) 2017/746 on in vitro diagnostic medical devices, will replace the two existing directives that have been in place for over 25 years, the Medical Devices Directive and the Active Implantable Medical Devices Directive. Although the EU Regulation on Medical Devices was supposed to start to apply to medical devices later this month, its application has been postponed by one year until 26 May 2021, as adopted by the European Parliament on 17 April 2020, so as not to distract from the Covid-19 relief effort. The effective date of the in vitro diagnostic medical devices regulation (2017/746) remains 26 May 2022.

The EU Regulation on Medical Devices aims to improve the safety, transparency and traceability of the regulatory system presently in place in the EU, along with ensuring that it can quickly respond to changes in the field of medical devices.

Key changes that will be brought about by the EU Regulation on Medical Devices include the creation of a broader European database on medical devices (Eudamed), which will contain different modules on actors, Unique Device Identification (UDI) and devices, notified bodies and certificates, vigilance, clinical investigations, performance studies, and market surveillance. Under the new UDI system, a unique identifier will be assigned to and marked on devices, which will improve the traceability of devices, reduce medical errors and fight against falsified devices.

Authors

George McCubbin
George McCubbin
Associate (Australia)
+44 20 7466 2764

Jonathan Turnbull
Jonathan Turnbull
Partner
+44 20 7466 2174

COVID-19: Pressure Points: Supply Chain Difficulties – new global guide, including IP, advertising and collaboration issues

Herbert Smith Freehills has published a new global guide on supply chain difficulties arising from the COVID-19 pandemic and associated restrictions and solutions.

Supply chain difficulties are at the heart of the pressures facing businesses during the COVID-19 pandemic. In our latest guide we look at supply chain pressure points and what is being and can be done to alleviate them.

Click here to access the COVID-19: Pressure Points:Supply Chain Difficulties guide .

In particular we focus on maintaining the links in supply chains (including managing supplier financial distress); competition laws and their relaxation in some cases to relieve supply issues; product-related issues emerging from over-demand or lack of supply (including counterfeiting, misleading advertising and collaborations); and contractual suspension or termination issues including force majeure. Environmental, social and governance (ESG) and human rights issues are also explored.

The guide includes country-specific overviews and insights on the issues covered, including, in relation to the above product issues, content from the UK, Italy, France, EU, China, Russia, Australia, the US, South Africa and the UAE.

The intellectual property and advertising issues discussed in the Product Issues section of the guide, fall into three main areas:

  • Accessing resources/supplies/components
  • Counterfeiting, misleading advertising, parallel imports
  • Innovation and collaboration
In situations where demand outstrips supply or a supply chain fails, product replacements or alternatives may be supplied instead. Imports may be triggered from alternative jurisdictions where products are more freely available or cheaper (but which were never designated for the relevant market), counterfeit products may emerge, or customers may be misled by advertising. At the same time innovation and collaboration, either internally or with third parties – even competitors – may develop to generate new products now needed in the crisis or to replace pre-existing but now unobtainable ones.
Read more on this in the Supply Chain Difficulties guide linked above and see our blog post on COVID Counterfeits and our Innovation and Collaboration hub and client report and the COVID-19 specific publications there.
Key contacts
Mark Shillito
Mark Shillito
Partner, Global Head of Intellectual Property
+44 20 74662031
Joel Smith
Joel Smith
Partner, Head of Intellectual Property, London
+44 20 7466 2331
Alexandra Neri
Alexandra Neri
Partner, Head of Intellectual Property, Paris
+33 1 53577830
Laura Orlando
Laura Orlando
Partner, Head of Intellectual Property, London
+39 02 00681351
Rachel Montagnon
Rachel Montagnon
Professional Support Consultant, IP, London
+44 20 7466 2217

3D Trade Marks: Further guidance from the CJEU regarding shapes necessary to give a technical result

The CJEU has concluded that factors in addition to the graphic representation of a sign could be relevant to the assessment of whether a sign consisted exclusively of the shape of goods which was necessary to get a technical result. Further, the fact that a sign was protected by other intellectual property rights, such as designs, did not mean that trade mark protection could not co-exist (Gömböc Kutató, Szolgáltató és Kereskedelmi Kft v Szellemi Tulajdon Nemzeti Hivatala (Case C-237/19) EU:C:2020:296 (23 April 2020)).

The Hungarian National Intellectual Property Office referred questions to the CJEU following its rejection of an application for registration as a trade mark of a sign representing a three-dimensional object which, due to its external design and the homogeneous material used, always returned to its position of balance. The sign was represented as follows:

The CJEU has added to the sizeable volume of case law on the interpretation of the Trade Marks Directive (2008/95/EC), clarifying further how the grounds for refusal or invalidity in relation to signs that consist exclusively of the shape of goods that are necessary to get a technical result, or the shape that gives substantial value to the goods, should be interpreted.

Shapes necessary to give a technical result

The CJEU ruled that Article 3(1)(e)(ii) of the 2008 Trade Marks Directive (now Article 4(1)(e)(ii) of the Trade Marks Directive ((EU) 2015/2436) (“2015 Trade Marks Directive”)) did not have to limit the assessment of whether a sign consisted exclusively of the shape of goods which was necessary to get a technical result to the graphic representation of the sign. Other information, such as the perception of the relevant public, might be used to identify the essential characteristics of the sign, although when it comes to establishing whether those characteristics performed a technical function of the goods, such information must originate from objective and reliable sources (and so could not include the perception of the relevant public).

The CJEU also considered Article 3(1)(e)(iii) of the 2008 Trade Marks Directive (now Article 4(1)(e)(iii) of the 2015 Trade Marks Directive), and held that, where a product was represented graphically by a sign that consisted exclusively of the shape of the product, the perception or knowledge of the relevant public regarding that product might be taken into consideration to identify an essential characteristic of the shape. Therefore, for the ground to apply, it must be apparent from objective and reliable evidence that the consumer’s decision to purchase the product was, to a large extent, determined by one or more features of the shape that alone formed the sign. Other characteristics of the product not connected to its shape, such as its technical qualities or reputation, are irrelevant.

Further, the CJEU ruled that Article 3(1)(e)(iii) also meant that the ground for refusal must not be applied systematically to a sign which consisted exclusively of the shape of the goods, where the sign enjoyed protection under the law relating to designs or where the sign consisted exclusively of the shape of a decorative item. The objective behind this ground of refusal (to prevent the exclusive and permanent right that a trade mark confers from serving to extend indefinitely the life of other, time limited, rights) did not mean that EU intellectual property law prevented the coexistence of several forms of legal protection. For the ground to apply, it must be apparent from objective and reliable evidence that the consumer’s decision to purchase the product was based to a very large extent on one or more characteristics of the shape, and this was a matter for the competent authority to assess on the facts.

See our previous updates on cases relating to shape marks here and here.

 

Joel Smith
Joel Smith
Partner, London
+44 20 7466 2331
Joanna Silver
Joanna Silver
Senior Associate, London
+44 20 7466 2315

 

The UK will not participate in the UPC confirms IP Minister responding to House of Lords’ letter

IP Minister Amanda Solloway has written to the House of Lords in response to their letter formally requesting confirmation that the UK would not be participating in the UPC. This request by the House of Lords followed a response given by the Government in February to a parliamentary question (recorded on Hansard) which said this was the case (see our post here); no formal statement had otherwise been made.

The IP minister’s response was confirmatory – the UK will not take part in the UPC system. See the extract from her letter (of 24 March) below:

As you will be aware the Government published our approach to negotiations with the EU on 27th February. This set out our vision for future cooperation between legally autonomous sovereign equals. It ruled out any obligation for our laws to be aligned with the EU’s, or for the EU’s institutions to have any jurisdiction in the UK. That explicitly included the Court of Justice of the EU.

Continued participation in the Unified Patent Court would mean ceding jurisdiction over key patent disputes in the UK to a court that is bound to apply and respect the supremacy of EU law, including judgments of the CJEU. Participating in such a system would be incompatible with our overall approach to future relations with the EU that I have set out above.

Consequently, the Government will not be seeking the UK’s continued participation in the Unitary Patent and Unified Patent Court.”

Background

The House of Lords EU Justice Sub-Committee took evidence of the impact of the UK’s non-participation in the UPC at a session on 10 March at which Daniel Alexander QC (leading patent barrister) and Julia Florence (then President of CIPA) spoke.  Subsequently the Committee wrote to the IP Minister to request formal confirmation of the UK’s intentions in relation to the UPC.

The future of the UPC

On 20 March, the German Constitutional Court released its decision by which it found, by a 5:3 majority, that the Act by which Germany was to accede to the UPC Agreement was void, because it was not passed with the required parliamentary majority. Without Germany’s ratification, the UPC Agreement cannot come into force. This decision, along with the UK’s formal withdrawal as well as the uncertainties arising from Brexit, has thrown the future of the UPC into some doubt (see our post  What’s next for the UPC project? Our analysis following the German Federal Constitutional Court decision). 

Author

Rachel Montagnon
Rachel Montagnon
Professional Support Consultant, IP, London
+44 20 7466 2217

COVID-19: PRESSURE POINTS: Order SND/326/2020, of 6 April, which establishes special measures to grant prior operating permits for facilities and to use certain medical devices lacking CE certification as a result of the medical crisis linked to the COVID-19 outbreak (Spain)

The Order establishes a number of special measures for medical devices listed in the annex to the Order, surgical facemasks and surgical gowns:

  • Permit.  A prior operating permit for facilities (as established in article 9 of Royal Decree 1591/2009, of 16 October, which regulates medical devices) will still be required to manufacture medical devices necessary in the fight against the COVID-19 pandemic and the requirements established in that provision must be met. However, the Spanish Medicines Agency (Agencia Española de Medicamentos y Productos Sanitarios) may, upon receipt of an application from the interested party, grant an exceptional permit or temporarily modify an existing permit to manufacture medical devices necessary to protect public health during the COVID-19 health crisis.
  • Guaranteed supply. The Spanish Medicines Agency has been called upon to issue as many express authorisations are possible to use devices necessary to meet the needs generated by the COVID-19 outbreak and which have not undergone the evaluation procedures as required by article 13 of Royal Decree 1591/2009, of 16 October, all with the aim of safeguarding public health.
  • Safety standards. Exceptionally, depending on the product in question and after having assessed the guarantees that the manufacturer is offering, the Spanish Medicines Agency may establish which health safety standards of those established in article 4 of Royal Decree 1591/2009, of 16 October, are applicable.
  • Liability. Any liability that may ultimately be placed on the administration as a result of the exceptional prior operating permit, permits for the use of devices lacking CE certification, in application of article 15 of Royal Decree 1591/2009, of 16 October, or the safety standards not required in respect of a device shall be borne by the General State Administration, in accordance with the applicable provisions of Law 40/2015, of 1 October, on the Legal Regime applicable to the Public Sector, provided that the medical device has been delivered to the Ministry of Health with the aim of attending to those affected by the COVID-19 pandemic or to help to control that pandemic, where the person or entity authorised to manufacture the medical device has not received any profit for doing so.
Lourdes Fraguas
Lourdes Fraguas
Of Counsel - Pharmaceuticals Lead, Madrid
+34 91 423 4217

COVID-19: Pressure Points: A Catalyst for Collaboration (Global)

As COVID-19 infiltrates every aspect of our daily lives and the world races to respond and to address the pandemic, there is a consistent theme which offers all of us hope: collaboration. To combat the outbreak, we have seen the emergence of large numbers of companies joining to pool their resources and to cross-share their valuable know-how.

Whether it is University College London and Mercedes F1 collaborating to make a breathing aid for COVID-19 patients, or pharma giants, including Sanofi and Gilead, sharing their proprietary libraries of molecular compounds as part of the COVID-19 Therapeutics Accelerator, to develop vaccines, we are seeing increasing numbers of proactive collaborations.

Sharing or pooling technologies and R&D is evidently the fastest route to develop solutions to mitigate and to overcome the effects of the virus. The alternative is that companies seek to monopolise their proprietary technology or states prioritise use of key technologies for their own populations. Following rumours that the US may be attempting to acquire control of a vaccine being developed by the German biopharma group CureVac and now reports that President Trump may block the export of protective masks and other medicinal products from the US to Canada, there was a wave of concern that this protectionist approach could be adopted by other countries. The widespread view is that this approach would be to the detriment of fighting the pandemic, with leaders across the globe calling for collective action and a sharing of resources.

In late 2019, weeks before COVID-19 first emerged, we published our ‘Open Innovation: Collaborate to Innovate’ Report. This concluded that technology is connecting individuals and businesses across sectors and it is easier than ever before for anyone, anywhere, to innovate. That being said, collaboration is often not used to its full potential. The benefits of collaborating to innovate are clear, as we explore in the Report, but this often requires a change in the mind-set of a company which may usually seek to protect its own valuable IP. Sometimes, however, when push comes to shove change is forced. With all eyes upon governments and know-how rich companies, many of these businesses have stepped up to the plate to come together to tackle COVID-19, with the result that collaborations are springing up at an unprecedented rate and in unexpected places. Unsurprisingly, the highest number of new partnerships appears to be in the pharmaceutical sector, with companies here seeking to combine their capabilities and know-how to accelerate the development and manufacture of diagnostics and vaccine technologies. Please see here our blog post ‘COVID-19: Collaboration is key in the race of develop a vaccine’ which addresses collaboration in the context of vaccine development. However, as the UCL and Mercedes F1 partnership demonstrates, collaborations are by no means unique to this area and are spanning industries, technologies and sectors. These collaborations will all require an effective legal, logistical and perhaps even cultural framework, in order for them to be successful and fruitful, both short-term and potentially longer-term. Many businesses have already embraced this more open way of working together in this time of crisis, dispensing with the traditional checks and balances upon external collaborations.

If this can be achieved, then COVID-19 may be a catalyst leading, not just to the supply of immediate life-saving clinical and medical treatment, but also to open innovation being fully embraced more widely across business and with society able to reap its rewards more generally.

Authors

Joel Smith
Joel Smith
Partner
+44 20 7466 2331
Jessica Welborn
Jessica Welborn
Senior Associate
+44 20 7466 2243

COVID-19: Potential legal impact (latest developments) – Pharma (Spain) (03/04/2020)

New regulations have been published in Spain to address the health crisis caused by the COVID-19 outbreak. We will analyse below the most significant impacts that the new measures will have, essentially included in Royal Decree-law 11/2020, of 31 March, which adopts additional urgent social and economic measures to tackle COVID-19 (“RDL 11/2020”), as well as a number of aspects of Royal Decree-law 10/2020, of 29 March, which establishes a recoverable paid leave for employees that do not provide essential services with the aim of reducing the movement of people in the fight against COVID-19 (“RDL 10/2020”).

Continue reading

UK HC confirms that public interest grounds to refuse or limit an injunction to be used sparingly

Evalve Inc v. Edwards Life Sciences Limited [2020] EWHC 513 (Pat)

Summary

Mr Justice Birss’ decision in Evalve Inc v. Edwards Life Sciences Limited [2020] EWHC 513 (Pat) (12 March 2020) clarifies that invoking a public interest defence to limit or carve out an injunction in UK patent litigation is no easy task, and the power to limit or refuse an injunction on this basis should be used cautiously.

It is clear from this decision that an infringing party seeking to resist a final injunction on the basis of public interest faces the difficult task of establishing that its product is objectively superior to that of the patentee – it is not sufficient to simply adduce evidence that illustrates a preference for one product over another. Parties should therefore carefully consider what kind of clinical evidence can be put forward to support their public interest grounds.

The decision also highlights the importance of setting out evidence in relation to the adequacy of damages in lieu at an early stage, especially if a party is seeking to resist or carve out a final injunction.

Background

The case involved two of Abbott’s patents, EP (UK) 1 408 850 (“EP ‘850”) and EP (UK) 1 624 810 (“EP ‘810”), which relate to medical devices used to treat mitral valve regurgitation in human hearts by a transcatheter technique. The patents protect Abbott’s MitraClip products, which have been on the market since 2008.

At the main trial which took place before the public interest trial, Abbott argued that Edwards’ PASCAL product, which is another transcatheter treatment for mitral valve regurgitation, infringes both its patents mentioned above. Both PASCAL and MitraClip operate in essentially the same way, clipping the two leaflets of the valve together, leading to a reduction in mitral valve regurgitation. In the judgment following the main trial, ([2020] EWHC 514 (Pat)), Mr Justice Birss concluded that Abbotts’ patents are valid and that Edwards’ PASCAL device infringes both of them.

At the public interest trial, Edwards argued that there is a body of doctors in the UK whose reasonable clinical opinion is that, at least for certain patients, use of the PASCAL device would be better than using any of the MitraClip products. Edwards therefore submitted that it would not be in the public interest to prevent these doctors from doing so by granting an injunction which prevents all sales of the PASCAL devices. Edwards also advanced a fall-back position wherein if a conventional injunction was to be granted, it should be qualified by carving out supplies of PASCAL for use in patients to whom one or more defined medical criteria apply, indicating that the PASCAL device might be better than the MitraClip options for that patient in the opinion of a reasonable doctor. Finally, Edwards argued that in cases in which MitraClip implantation had been unsuccessful but a doctor reasonably believed a PASCAL would be an appropriate treatment to try after that failure, then supply for that purpose should also be permitted.

In contrast, Abbott argued that an injunction should be granted with the sole qualification that the PASCAL device may be supplied for patients in whom the MitraClip implantation had been unsuccessful. Abbott contended that Edwards had not established that there is any class of patient for whom PASCAL is objectively the only viable treatment or is objectively a better treatment than MitraClip. The fact that there are some doctors who would prefer to use PASCAL over MitraClip (and would not be negligent in having that view) does not justify refusal of the injunction, as this is a “mere” preference and is not founded on sufficiently objective evidence.

The judge did not consider that the public interest in allowing doctors to exercise their clinical judgments in the best interests of their patients is sufficient to justify the refusal or carving out from a patent injunction. The judge therefore granted an injunction in the terms sought by Abbott. The only carve out granted was for cases where a MitrClip implantation had already been unsuccessful.

Analysis

In arriving at his decision, Mr Justice Birss analysed the UK and European law on injunctions and public policy. He set out the following seven general principles in relation to injunctions in patent litigation:

  1. A general injunction to restrain future infringements is the normal remedy for a patentee.
  2. The burden is on the defendant to give reasons why such an injunction should not be granted.
  3. All the circumstances should be considered in granting or refusing an injunction, such as public interest and the impact on third parties.
  4. Public interest may justify refusal of or carve out from an injunction, and an award of damages in lieu. Smallness of the quantity of damages in lieu is not determinative.
  5. The starting point for any consideration of the public interest is that the patent system as a whole is already criss-crossed with provisions which strike balances between different public interests.
  6. The availability of an exclusionary injunction is an important manifestation of the monopolistic nature of a patent right.
  7. Therefore when, as in this case, various public interests are engaged and pull in different directions, one should have in mind that the legislator is better equipped than the courts to examine these issues and draw the appropriate broad balance.

It is worth noting that Birss J displayed a high degree of deference to the legislature in his judgment, owing to the fact that the Patents Act 1977 (the “Act”) and other relevant legislation already contain numerous provisions which strike a balance between the rights of the patentee and public interest, such as the compulsory licensing regime, and the restrictions on patentable subject matter.

Application to the clinical setting

Applying the above to the clinical setting, Mr Justice Birss held that in order to engage a public interest defence it was necessary to examine the evidential basis for the clinical judgments being relied upon. Sufficient objective evidence that there are in fact patients who ought not be treated using the patentee’s product and who should, in the reasonable opinion of a body of doctors, instead be treated using the rival’s product is what is required. In other words, the relevant public interest that would be sufficient to justify a refusal or carve out of a patent injunction is the need to protect the lives of patients for whom the defendant’s product is the only suitable treatment, provided that fact is established by objective evidence.

The judge also noted that the public interest ground argued by Edwards in this case was very similar to the ‘market demand’ ground for obtaining a compulsory licence under s.48A of the Act. However, in the present case, Edwards could not have applied for a compulsory license at least in relation to EP ‘810, as the three-year period under section 48 of the Act had not elapsed. The judge agreed with previous case law on the point and noted that the court should be very cautious before making an order which would be tantamount to a compulsory licence in circumstances where this would not otherwise be available, essentially requiring the defendant to show that the refusal of such an order would be “grossly disproportionate”. However, Birss J did suggest that in cases where a carve out would be justified on public interest grounds, such a carve out may be ordered pending an application for a compulsory licence.

Damages in lieu

In considering whether an injunction may be refused, another criterion that must be assessed is the adequacy of damages in lieu as a remedy. Birss J noted that to make this assessment, the court needs to have evidence on whether the damages are adequate, and this evidence needs to be presented at the trial at which the issue of the injunction is to be decided. It was therefore incorrect to assume that such evidence was only needed at the stage of inquiry as to damages, which generally follows the grant or refusal of an injunction.

Where the patentee had its own product on the market (as is the case for Abbott’s MitraClip devices), the proper compensation would be the patentee’s lost profits. A reasonable royalty instead of lost profits, which was proposed by Edwards as it would have allowed the PASCAL devices to stay on the market, would leave the patentee substantially out of pocket. Once again, this shows that what Edwards was seeking was in essence a compulsory, royalty bearing licence.

However, the judge appreciated that if the proper compensation could only be lost profits, this would completely disincentivise the defendant from putting its product on the market, as there would be no financial incentive to do so. But the point of the public interest argument when resisting an injunction is that it would be in the public interest that the defendant’s products actually come onto the UK market. The judge therefore went on to note that that in cases where damages in lieu are awarded on the grounds of public interest, perhaps a reasonable royalty would in fact be a more realistic option than lost profit damages, despite this leaving the patentee at a financial disadvantage.

Authors

Priyanka Madan
Priyanka Madan
Associate
+44 20 7466 2986
Charlie Madill
Charlie Madill
Trainee Solicitor
+44 20 7466 3585