I have reported about this case last year on this Blog here. In brief, Pelliheat aimed to undo an improper assignment to a (meanwhile former) director of Pelliheat that the EPO had registered. A register ban had been issued ex-parte, and it was maintained after the defendant was heard. I have learned from the EPO docket that the parties have settled meanwhile. The FPC has issued an order to that effect on 10 August 2022, and dismissed the proceedings.
Now, who ‘won’ this case? Neither Pelliheat nor the former director, I’d say. They both had quite some costs, for … what, actually? An EPO Register that will soon look the same as it did before the improper assignment had been registered.
EPO logo
Oh, wait! The EPO charges a fee for registration of an assignment. Ironically, it pocketed the fee twice in this case. First, for registering the assignment and then again for the re-assignment. That’s peanuts, maybe. But, hey, many pennies make a dollar; and the bank always wins. I still find it somewhat disturbing that the EPO registered the first assignment at all, without any further ado. It should have rang alarm bells that the same person signs for both the assignor and the assignee. Frankly, it is anything but an exception that I am enquired by the EPO for less prominent peculiarities in assignment declarations.
Anyway, the EPO has informed the parties that on 1 Feb 2023 the stay will be lifted and the proceedings be continued with Pelliheat AG as the applicant.
Latvia MIG Tech SIA appealed. Unsuccessfully, to large extent. Only the apportionment of costs was slightly corrected by the Supreme Court (20/80 instead of 10/90). On the merits, however, the Supreme Court had no issues with the FPC’s findings concerning Illumina’s legal interest / actual infringing activities in Switzerland; validity of EP 578 (non-obviousness over WO 02/29003 A2 in view of Zavgorodny et al. (1991)); and validity of EP 412 (no unallowable amendments; claim construction / novelty over US 6,355,420 B1; non-obviousness over Braslavsky et al. (2003) in view of van Dijk et al. (2004)).
I had felt that this case was a great opportunity for some clarification and guidance about the limits of claim construction in good faith; and allowability of amendments. To just name a few. But the Supreme Court did not jump on these issues. In view of my involvement in the matter, I will refrain from a critical review of the judgment. There is this famous saying of Nelson Mandela:
Meanwhile, Illumina and the MGI group have settled their corresponding US litigation; see Illumina’s SEC filing and MGI’s press release. Inter alia, a jury verdict in proceedings before the Delaware District Court had held that Illumina’s US patents 9,217,178 B2, 9,303,290 B2 and 9,970,055 B2 (all corresponding to EP 412 that had been asserted in Switzerland) were invalid. On the other hand, the jury held that Illumina infringed on CGI’s US patents 9,222,132 B2, 10,662,473 B2 and that these patents were valid. In the settlement, Illumina inter alia agreed to a one-time payment of USD 325m, largely in line with the jury-awarded damages.
I have reported about the first FRAND case at the FPC on this Blog a while ago.
I have learned from the 2022 edition of the iam patent 1000 guide released last week that there was some spill-over of the US litigation between Huawei and Verizon to Switzerland:
Andrea MONDINI had been appointed by Verizon as Swiss law expert. Not much is known about this case, in particular not the FRAND terms agreed upon the midst of a jury trial in Texas (US) in July 2021 (see Bloomberg). See Huawei’s initial Statement of Claim and the Claim Construction Memorandum Opinion and Order for further information on the merits of the case before the jury in Texas.
I have been informed that Andrea MONDINI submitted several expert reports and declarations on licensing of SEPs on FRAND terms under Swiss law because the FRAND declarations have been declared by Huawei to the International Telecommunication Union (ITU), which has its seat in Geneva.
UPDATE 4 July 2022: In a first version of this post, I assumed that there has been a co-pending case at the FPC between Huawei and Verizon. Now I know that I was wrong. The post above has been rectified accordingly.
We have reported earlier on this Blog here about the litigation betwwen Laurastar and Innosteam about ownership of (the national phases of) two PCT applications, WO 2018/006994 A1 and WO 2018/036653 A1; see the EPO Register here and here. The patent applications are about devices and methods for producing instant steam (WO’994) and instant hot water (WO’653), for use e.g. in devices for ironing.
Innosteam logo
Nothing has surfaced after the main hearing of 25 June 2019. But now, I came across the FPC’s decision of 20 May 2020 to close the proceedings because the parties have ultimately settled, after a series of suspensions of the further course of the proceedings after the main hearing.
Laurastar is bearing the court fees; no party compensations are awarded.
I understand that the so-called InstantSteam feature is still a major selling point of Innosteam, the efficiency of which purportedly allows for the commercialization of a high end ironing system at an affordable price.
I had the pleasure to attend the conference on Case Management Issues in IP Proceedings earlier this week in St. Gallen, jointly organized by INGRES and SVRH. Expectedly, the discussion between judges, legal practitioners and patent attorneys was vibrant and open-minded. I gained a lot of full and frank insight into how cases are handled before the various commercial courts in Switzerland; these aspects of the conference will surely be dealt with in a summary to be made available here.
My personal take-away messages concerning proceedings before the FPC are the following:
No split reply anymore …
In the normal course of infringement proceedings, the FPC had ordered a partial reply from the plaintiff that only dealt with the nullity arguments brought forward by the defendant in his answer to the complaint, as a plea in defense. The FPC’s intention was to have a single statement of both parties on the two key aspects of the case, i.e. infringement and validity, before the parties were summoned for the instruction hearing. In the informal part of the instruction hearing, the court delegation could thus indicate a preliminary opinion on both key aspects, in view of the first exchange of arguments. Things may well have changed in view of the second exchange of briefs. But still, the interim assessment of the matter in the instruction hearing had been based on a well-balanced exchange of arguments: The first round had been completed. The exchange of briefs had been as follows:
Old practice w split reply
In view of the obiter dictum in the Supreme Court’s recent decision 4A_70/2019 (discussed on this Blog here), the FPC has meanwhile discontinued the practice to split the reply in infrigement proceedings. Thus, the regular exchange of briefs in infringement cases will be as follows:
New practice w/o split reply
The reply will not be split anymore. The plaintiff will be invited to file his reply only after the instruction hearing. That’s a pretty standard exchange of briefs now, as it is known in any kind of proceedings governed by the CPC.
… and how that might influence the procedural strategy of the parties
Clearly, the assessment of validity of the patent in suit by the court delegation during the instruction hearing will be even more preliminary than ever before. The plaintiff will likely not have anticipated and addressed all the nullity arguments in the complaint. Thus, there will likely be nullity arguments on file on which the plaintiff / patentee has not yet been heard, and the court delegation cannot easily give an opinion on such arguments (except, maybe, for some formal / purely legal issues). Time will tell whether the instruction hearing will henceforth be of that much value to foster a settlement as it had been in the past; see the settlement rates over the years on this Blog here.
Some food for further thought, based on what has been discussed at the conference:
Will we see more infringement complaints with a full and frank discussion of potential nullity arguments, based on what has been argued in proceedings elsewhere, or in prior communication between the parties? That is pretty likely, indeed. It became clear in the discussion that such extensive frontloading has already happened.
A defendant in an infringement case has any motiviation to get invalidity reasonably addressed by the court delegation in the instruction hearing. But that will not happen to large extent when the plaintiff had just been silent on validity in his complaint. Still, the defendant might cure this ‘defect’ himself: He could gather what had been argued elsewhere by the patentee / plaintiff in defense of his patent or during prosecution, and disprove those arguments. The plaintiff would be hard pressed to contradict his own arguments that had been made elsewhere — and the court delegation could well indicate an opinion on such arguments in the instruction hearing, in my opinion.
Will patents more often be asserted only to a limited extent in the future, i.e. limited enough to render the (expected) plea for nullity in defense moot, yet broad enough to cover the allegedly infringing embodiment? In my perception, that would not be a sign of weakness at all. It is just pragmatic to assert the patent only to the extent necessary.
Yet another strategy of patentees might be to frontload various limited versions of the patent for assertion inter partes (verbal limitations) as auxiliary requests already with the complaint, to get a broad(er) picture of potential allowability in the instruction hearing.
Finally, patentees might also consider to assert the patent as granted, but to set out in the reasons that a whole lot of further features of the patent, from dependent claims or even from the specification, are fulfilled in the allegedly infringing embodiment. That leaves much leeway for various verbal limitations at a later stage of the proceedings.
Plan B?
Now, what if the instruction hearing turns out to be not of much value under the new regime anymore? Dieter BRÄNDLE mentioned that the Commercial Court Zurich had invited the parties to submit a brief statement only for consideration in the instruction hearing. If no settlement was reached and the parties wanted to rely on anything from their statements, they had to refile those arguments with their outstanding briefs.
Could that maybe a worthwile approach to bring the patentee’s complete view on defendant’s plea for nullity to the court delegation’s attention before the instruction hearing? Initial reactions were split: Would such a statement maybe considered as a reply in disguise? That could have fatal consequences with respect to an early closure of the file. However, I have also heard prominent voices in favor of this approach. Mark SCHWEIZER indicated that nothing like this would now be introduced in a rush now. Let’s see how the new regime works in practice. If it doesn’t, one might well consider this in more detail.
On a sidenote, I have recently been involved in a settlement conference in U.S. proceedings. The judge did a great job, even though no settlement could be reached in the end. The judge issued a very specific order beforehand about a confidential memorandum to be filed by both parties; see the Order for Settlement Conference. Along with a strict word count limit, I feel this is indeed very helpful for a judge to better understand where both parties are coming from. I am not overly enthusiastic about litigation in the U.S. at all, but this could be sth worth to consider.
Settlement talks in general
Should court-mediated settlement talks be held only with the two parties together? What about shuttle diplomacy, i.e. the judge(s) also talking with each party individually, e.g. to overcome certain personal tensions or hostile feelings between the parties and/or their representatives. Shuttle diplomacy (referred to as ‘Einzelabreibung’ or ‘Einzelabschlachtung’ by some participants) is practised at least by some Swiss courts; see Mark SCHWEIZER’s recent comparative study.
One potential downside is, of course, that a party may easily feel uncomfortable with the fact that some unilateral conversation is going on behind the scene between the judge(s) and the counterparty.
Mark SCHWEIZER had been asked whether shuttle diplomacy is done at the FPC. The answer was a clear ‘No’, and it became pretty clear that this was not an option for him at all.
Further news from the FPC
What¨s up?
The FPC has recently issued ex parte interim measures without any written statement of the grounds, in accordance with Art 239(1) lit. a CPC. A written statement of the grounds must be provided if one of the parties so requests within 10 days of the notice being given of the decision; else, the parties are deemed to have waived their right to challenge the decision (Art 239(2) CPC). Since ex parte interim measures cannot be appealed in any event (see e.g. decision 134 III 417 of the Supreme Court), ex parte interim measures need arguably not come along with a written statement of the grounds in any event. It would have been interesting to learn more about the particular urgency of this matter that urged the FPC to explore this possibility. However, nothing will be published: The parties have settled. Darn!
As mentioned on this Blog here,a timeline for the further course of the proceedings is established during the instruction hearing if no settlement is reached. It became clear that not everybody at the FPC believes that this is feasible, but Mark SCHWEIZER said that he is a die-hard optimist.
Claim construction is key in almost every case — and it might perhaps play an even more important role in the instruction hearing than ever before. However, Mark SCHWEIZER indicated that claim construction is still frequently treated like a red-headed stepchild in the briefs, and that it is hard for the court to only catch a glimpse of a party’s understanding of a certain feature from e.g. the discussion of the cited prior art.
Mark SCHWEIZER mentioned on a sidenote that he would tend to always allow joint procedural requests of both parties, as long as they do not contravene the law. Let’s see how parties make use of this flexibility.
The unconditional right to be heard sometimes leads to an essentially meaningless exchange of party submissions after formal closure of the file. Both sides feel prompted to reply just in order to formally contest the other party’s allegations. The question came up whether a court could forward such statements with the comment that the submission is deemed to be contested in any event. Mark SCHWEIZER indicated that the FPC would look into this, in particular whether this would be compliant with the CPC.
Gossip
Based on what had been mentioned at the conference I have to believe that the recent dissenting opinion had been supported by two judges; the actual split of the panel was thus 3:2. That’s a close call, indeed! See this Blog here for further information.
Litigation between Gilead and Abbvie over Hepatitis C drug patents got a lot of attention in 2014/15 but has disappeared from the headlines since then. The settlement was discreet. Did you even notice? Frankly speaking, I missed it. It has been mentioned on Bloomberg’s Bay State Biotech Report of August 26, 2016:
AbbVie has obtained U.S. Patent Nos. 8,466,159, 8,492,386, 8,680,106, 8,685,984, and 8,809,265 (the AbbVie Patents) which purport to cover the use of a combination of LDV/SOF (or Harvoni) for the treatment of HCV. We are aware that AbbVie has pending patent applications in the United States and granted and pending applications in other countries. We own granted, published and pending patent applications directed to the use of combinations for the treatment of HCV, and, specifically, to the combination of LDV/SOF. Certain of our applications were filed before the AbbVie Patents. For this reason and others, we believe the AbbVie Patents are invalid.
Since December 2013, several lawsuits were filed in the United States and several foreign jurisdictions, including Canada, Australia, Sweden, Switzerland, Germany and others, by both Gilead and AbbVie regarding the AbbVie Patents. The AbbVie Patents have not blocked or delayed the commercialization of our combination products in the United States or any other country.
In August 2016, we and AbbVie entered into a settlement agreement to resolve the ongoing contested proceedings concerning the AbbVie Patents. Terms of the settlement are confidential.
The parties were engaged in both summary proceedings (S2014_008) and main proceedings (O2014_013) in Switzerland. The terms of the settlement are not public, and the FPC has not published a decision. The court ban for Abbvie’s CH 707 029 and CH 707 030 has been lifted on September 21, 2016.
Reported by Martin WILMING
—
BE ON THE KNOW
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Case No. S2014_002 ¦ Decision of 27 February 2014 ¦ “Anbieten eines Arzneimittels (Generikum) während Laufzeit eines ESZ für die Lieferung danach; Gutheissung einer superprovisorischen Massnahme”
Recently, I have reported on the oral hearing and the settlement in this matter. As noted, the FPC had ordered the defendant to refrain from advertising activities — without hearing the defendant beforehand (Art. 77 PatA; Art. 261(1), Art. Art. 265(1) CPC). This decision has been published yesterday.
The wording of the inquiry of future demand can now be deducted from the decision as follows (non-official translation into English language):
Das Patent von […] wird am 31. Mai 2014 ablaufen. Sie, als wichtiger Kunde, können uns mit dieser Bedarfsanfrage helfen, unsere Lagermenge dem Bedarf anzupassen. Da dies bei grossen Produkten schwierig ist und wir eine kontinuierliche Lieferfähigkeit sicherstellen möchten, bedanken wir uns bei Ihnen für Ihre Unterstützung.
The patent of […] is about to lapse on May 31, 2014. You are an important custumer and could help us with the present inquiry of demand to adapt our stock to meet the demand. This is difficult for large products and we want to assure the continuous ability to deliver; thank you very much for your support.
The FPC had no doubt that this constituted an infringement (Art. 140d, Art. 8 PatA). However, the FPC expressed some doubts with respect to the imputability of this inquiry to the defendant. Nevertheless, the FPC ordered the interim measure without hearing the defendant beforehand. The FPC assessed the principle of proportionality in a second line of reasoning: If it turned out later that the inquiry had not been conducted by the defendant, the defendant would have been prohibited from (further) doing something that he had never done, anyhow. Thus, the defendant would not have been harmed by the order.
Reported by Martin WILMING
—
BIBLIOGRAPHY
Case No. S2014_002 ¦ Decision of 27 February 2014 ¦ “Anbieten eines Arzneimittels (Generikum) während Laufzeit eines ESZ für die Lieferung danach; Gutheissung einer superprovisorischen Massnahme”
Last week I have reported on the oral hearing in this matter; see here.
We won’t see a decision of the FPC on the plaintiff’s request to impose a prohibition of sales as an interim measure in extension of the term of the SPC. In the meantime, I have been informed by Simon HOLZER (representative of the plaintiff) that the parties have settled, essentially as follows:
The defendant has accepted to abstain from advertising / offering Escitalopram Sandoz® until May 31, 2014 (lapse of the SPC).
The plaintiff has withdrawn the request to impose a prohibition of promotion / sales / distribution as an interim measure, in extension of the term of the SPC.
Court fees are borne by the defendant.
The defendant has accepted to pay the plaintiff a reasonable compensation.
By fulfilling the settlement both parties agree to have settled all mutual claims resulting from that case.
In my perception, an outcome like this is not much of a surprise: From a business perspective, this makes perfectly sense for both parties.
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