South Africa: Patent Litigation Comparative Guide

1 Legal framework

1.1 Which laws and regulations govern patent litigation in your jurisdiction?

The Patents Act (57/1978), and the regulations promulgated thereunder govern patent litigation in South Africa. Absent any provisions in the act (or the regulations), the Uniform Rules of Court govern procedure. Certain proceedings, such as appeals, are governed by the Superior Courts Act (10/2013). The rules of prescription, as set out in the Prescription Act (68/1969) may be relevant to damages. The Constitution of the Republic of South Africa (1996) may also have applicability where constitutional issues arise, such as when the issue of public interest or the right to healthcare is considered in relation to access to medicines.

1.2 Which bilateral and multilateral agreements with relevance to patent litigation have effect in your jurisdiction?

None.

1.3 Which courts and/or agencies are responsible for interpreting and enforcing the patent laws? What is the framework for doing so?

The Court of the Commissioner of Patents is the court of first instance in patent matters in South Africa and has nationwide jurisdiction. This court has its seat in Pretoria and all patent matters of first instance are determined by this court.

2 Forum

2.1 In what forum(s) is patent litigation heard in your jurisdiction? Are patent infringement and validity decided in the same forum or separate forums?

The Court of the Commissioner of Patents is the court of first instance in patent matters in South Africa and has nationwide jurisdiction.

2.2 Who hears and decides patent disputes (eg, a judge, a panel and/or a jury)?

All first-instance matters are decided by a single Superior Court judge. The judge is appointed from the judges in the Superior Court on an ad hoc basis. There is no jury, assessors or the like.

2.3 Are there any opportunities for forum shopping in your jurisdiction? If so, where and how do those opportunities exist?

Since the Court of the Commissioner of Patents has nationwide jurisdiction, the issue of forum shopping generally does not arise.

3 Parties

3.1 Who has standing to file suit for patent infringement? What requirements and restrictions apply in this regard?

The patent holder and what is termed a 'licensee of right' are the only parties that may institute proceedings for patent infringement in South Africa. A licensee of right is a specific type of licensee that is very unusual in South Africa. A licensee of right is required to be endorsed in the South African Patent Office Register.

The patent holder must give notice to every (ordinary) licensee under the patent whose name is recorded in the register. Such a licensee is then entitled to intervene as a co-plaintiff. Often, the licensees are notified prior to instituting the proceedings and the proceedings are commenced in the name of the patent holder and the licensees. To enjoy standing in the proceedings, the licensees must be recorded in the register.

3.2 Can a patent infringement suit be brought against a defendant who is a foreign entity with only a residence or place of business outside the jurisdiction?

Yes. However, if the foreign defendant does not submit to the jurisdiction of the court, it will be necessary to seek the attachment of assets through a court procedure to found or confirm jurisdiction.

3.3 Can a single infringement action be brought against multiple defendants? What requirements and restrictions apply in this regard?

Yes. If the cause of action is the same (ie, the infringing product or process is the same), single proceedings can be brought against multiple defendants.

3.4 Can a third party seek a declaration of non-infringement or invalidity in your jurisdiction? If so, how?

The Patents Act provides that a declaration that the use by any person of any process, or the making or use or offer to dispose or disposal or importation of any article by any person, does not or will not constitute an infringement of a patent may be made by the commissioner of patents in proceedings between that person and the patent holder. Such a request is made by way of application to the Court of the Commissioner of Patents. However, the patent holder must:

• first seek a written acknowledgement to the effect of the declaration claimed; and
• have furnished the patent holder with full particulars of the process or article in question.

4 Patent infringement

4.1 What constitutes patent infringement in your jurisdiction?

The Patents Act provides that the effect of a patent is to grant to the patent holder the right to exclude other persons from making, using, exercising, disposing or offering to dispose of, or importing, the invention, so that the patent holder will have and enjoy the whole profit and advantage accruing by reason of the invention.

4.2 How is infringement determined?

A patent holder bears the onus of proving that all essential features of the claimed invention, as properly construed, are present in the infringing product or process.

4.3 Does your jurisdiction apply the doctrine of equivalents?

The South African courts adopt a contextual or purposive approach to claim construction. Within this framework, the courts have from time to time applied the doctrine of equivalents to some extent (ie, when on a proper construction of the claim a particular feature may be considered to be inessential).

4.4 Is wilful infringement recognised? If so, what is the applicable standard?

Wilful infringement is not recognised in South Africa.

5 Bringing a claim

5.1 What measures can a patent holder take to enforce its rights in your jurisdiction? Are interim measures available before receiving a ruling on the merits?

Infringement proceedings may be commenced either by way of application or by way of action (trial). Proceedings may be brought by way of application only if it is reasonably foreseeable that a dispute of fact will not arise. Should a dispute of fact arise after proceedings have been instituted, the patent holder must refer the matter to oral evidence. Accordingly, most patent infringement proceedings are instituted by way of action because a dispute of fact will usually be foreseeable. A plaintiff is entitled to seek relief by way of preliminary injunction, pending a final determination of the merits at the conclusion of a trial. Preliminary injunction proceedings are instituted by way of application.

5.2 What is the limitation period for patent infringement in your jurisdiction?

There is no time limit to bringing proceedings (seeking injunctive relief). However, a claim for damages prescribes after three years. Prescription is interrupted by the commencement of proceedings.

5.3 Must the alleged infringer be notified in advance before a claim is brought?

No. However, if the infringer consents to the relief sought, the plaintiff will not be able to recover its costs to date.

5.4 What are the procedural and substantive requirements for bringing a claim for patent infringement? How much detail must be presented in the complaint?

To launch an action for infringement, it is not necessary to 'front load' the proceedings with detailed evidence. The proceedings are commenced by issuing summons which includes a particulars of claim. The particulars of claim are in the form of a pleading. It is only required to make the essential allegations to support a cause of action, which typically would include (aside from the details of the parties) allegations as to the act of infringement relied on and the claims that are alleged to be infringed.

5.5 Are interim remedies available in patent litigation in your jurisdiction? If so, how are they obtained and what form do they take?

A plaintiff is entitled to seek relief by way of preliminary injunction, pending a final determination of the merits at the conclusion of a trial. Preliminary injunction proceedings are instituted by way of application. Detailed declaration evidence is required in which the patent holder must show that:

• the right which is the subject matter of the main action and which is sought to be protected by means of interim relief is clear or, if not clear, is prima facie established, though open to some doubt;
• if the right is only prima facie established, there is a well-grounded apprehension of irreparable harm to the applicant if the interim relief is not granted and it ultimately succeeds in establishing its right;
• the balance of convenience favours the granting of interim relief; and
• the applicant has no other satisfactory remedy.

Interim proceedings are usually brought with some degree of urgency. It is necessary to motivate to the court that the matter is urgent – for example, that by the time a trial has been concluded the applicant will have suffered significant irreparable harm (ie, harm that cannot be remedied by an award of damages).

5.6 Under what circumstances must security for costs and/or damages incurred by the other party be provided?

The Patents Act (and the common law) make provision for security for costs to be furnished in circumstances in which a litigant is concerned that the opponent will be unable to meet an award of costs if it is unsuccessful. Security for costs is often requested (and provided) when the party against which security is requested is a foreign litigant. However, it is possible to obtain security from a local company in certain circumstances. If the requirement to provide security is contested, the court will have regard to the prospects of success and the bona fides of the party resisting security. If the parties agree that security should be set but the quantum is disputed, the registrar decides the quantum.

It is not a requirement under South African law for the applicant in a preliminary injunction application to provide an undertaking that it will pay any damages to the respondent that it proves to have suffered if the injunction is shown to have been wrongly granted. However, it is common practice to do so to assist with arguing that the balance of convenience favours the applicant. In some cases, the respondent will provide a cross-undertaking.

6 Disclosure and privilege

6.1 What rules on disclosure apply in your jurisdiction? Do any exceptions apply?

Once pleadings are closed in an action, the parties usually make discovery requests in accordance with the Uniform Rules of Court.

The party required to make discovery:

• files a discovery affidavit specifying documents and tape recordings in its possession; and
• specifies documents and tape recordings in respect of which the party has valid objections to produce (ie, those which are privileged).

Unlike in some other jurisdictions, there is no extensive discovery process – for example, by way of deposition. However, the Uniform Rules of Court do make provision for a party to compel further or better discovery in circumstances in which the discovery is considered inadequate.

A party is required to discover and make available for inspection all documents which may either directly or indirectly enable the party requiring discovery either to advance its own case or to damage the case of its adversary. Documents which tend to advance only the case of the party making the discovery need not be disclosed unless such party intends to rely on those documents at trial.

6.2 What rules on third-party disclosure apply in your jurisdiction? Do any exceptions apply?

The rules of discovery do not extend to third parties. However, a third party may be issued with a subpoena duces tecum. The party will be required to attend on court and make available the documents requested. In practice, once a subpoena duces tecum has been issued the documents are made available for inspection, thereby potentially avoiding an actual court appearance.

6.3 What rules on privilege apply in your jurisdiction? Do any exceptions apply?

IP rights holders are entitled to claim privilege in respect of all communications between them and their legal advisers, provided that those communications are made for the purpose of giving or receiving legal advice. This will include not only the relationship between a client and its attorney or patent attorney in private practice, but also an in-house legal adviser communicating with his or her client (employer). Communications made between the client and lawyer and between the client or lawyer and third parties for the purposes of obtaining legal advice in contemplation of litigation ('litigation privilege') are also protected.

Documents that are confidential but do not enjoy legal privilege are usually either redacted or disclosed to the legal advisers under suitable restrictions to preserve confidentiality.

7 Evidence

7.1 What procedure(s) exist for collecting and presenting evidence in patent infringement litigation?

There are no pre-litigation procedures available for obtaining evidence. The rules of discovery apply once proceedings have commenced. However, it is possible to obtain an Anton Pillar order in specific circumstances (ie, where it can be shown that there is a likelihood that the evidence will be spirited away if the alleged infringer is given forewarning by the commencement of infringement proceedings).

7.2 What types of evidence are permissible in your jurisdiction? Is expert evidence accepted?

Evidence is adduced by way of declaration in application proceedings. In trial proceedings, oral evidence is provided. In certain circumstances, the court is empowered to take evidence on commission (in foreign jurisdictions) and in camera.

7.3 What are the applicable standards of proof?

The balance of probabilities.

7.4 On whom does the burden of proof rest?

The plaintiff bears the onus of proving infringement and the defendant bears the onus of proving invalidity.

8 Claim construction

8.1 Is there a procedure for construing claims during a patent infringement action? If so, when and how is it performed?

There is specific procedure in South Africa. Claim construction is carried out as part of considering the overall case.

8.2 What is the legal standard used to define disputed claim terms?

Claim construction rules are well established through several Supreme Court of Appeal decisions and are summarised as follows:

• A specification should be construed like any other document, subject to the interpreter being mindful of the objects of the specification and its several parts.
• The rule of interpretation is to ascertain not what the inventor or patent holder may have had in mind, but what the language used in the specification means – that is, what the intention was as conveyed by the specification, properly construed.
• To ascertain that meaning, the words used must be read grammatically and in their ordinary sense.
• Technical words of the art or science involved in the invention must also be given their ordinary meaning – that is, as they are ordinarily understood in the particular art or science.
• If it appears that a word or expression is used not in its ordinary sense, but with some special connotation, it must be given that meaning since the specification may occasionally define a particular word or expression with the intention that it should bear that meaning in its body or claims, thereby providing its own dictionary for its interpretation.
• If a word or expression is susceptible of some flexibility in its ordinary connotation, it should be interpreted so as to conform with and not to be inconsistent with or repugnant to the rest of the specification.
• If it appears from reading the specification as a whole that certain words or expressions in the claims are affected or defined by what is said in the body of the specification, the language of the claims must then be construed accordingly.

These rules allow for a contextual approach to interpreting the claims and remain the cornerstone of claim construction in South Africa.

8.3 What evidence does the court consider in defining the claim terms?

The meaning of the claims is for the court to decide. However, the court will allow expert evidence to assist in the interpretation of the claims in certain circumstances – for example, to assist in determining the meaning of technical terms and the background of the art to which the invention relates.

8.4 Can the claims of a patent be amended in the course of the proceedings?

The Patents Act makes provision for pre- and post-grant amendments. Amendments prior to grant are permissible unless the effect of the amendment would be to add new matter or matter not in substance disclosed in the specification prior to amendment; and any claim added by way of amendment must be fairly based on the specification prior to amendment. A post-grant amendment, in addition to satisfying these requirements, must also not have the effect of broadening the scope of protection. A post-grant amendment must be advertised for a two-month opposition period.

In addition, where there are pending proceedings before the court, it is permissible to make further amendments, provided that the requirements for post-grant amendments are satisfied. The proceedings (infringement or revocation) are usually suspended pending a determination of the amendment application.

9 Defences and counterclaims

9.1 What defences are typically available in patent litigation?

In addition to the defence of non-infringement, the grounds of invalidity on which a defendant in an infringement action may rely on, by way of defence, include the following:

• The patent holder is not a person entitled to apply for the patent (ie, the person is not the inventor or did not legally acquire the right from the inventor);
• The grant of the patent is in fraud of the rights of the applicant or of any person under or through which it claims;
• The invention as illustrated or exemplified in the complete specification concerned cannot be performed or does not lead to results and advantages set out in the complete specification;
• The complete specification concerned does not sufficiently describe, ascertain and, where necessary, illustrate or exemplify the invention and the manner in which it is to be performed in order to enable the invention to be carried out by a person skilled in the art of such invention;
• The claims of the complete specification concerned are not clear or fairly based on the matter disclosed in the specification;
• The prescribed declarations lodged in respect of the application for the patent contain a false statement or representation which is material and which the patent holder knew or ought reasonably to have known to be false at the time when the statement or representation was made; or
• The application for the patent should have been refused in terms of Section 36 (Section 36 relates to inventions which are contrary to laws of nature and which would be expected to encourage offensive or immoral behavior).

9.2 Can the defendant counterclaim for revocation or invalidation of the patent? If so, on what grounds and what is the process for doing so?

The defendant may rely on the above grounds of invalidity either by way of defence or by way of counterclaim in an infringement action.

9.3 Are there any grounds on which an otherwise valid patent may be deemed unenforceable against a defendant?

The South African courts have held that the issue of 'public interest' may be a relevant factor in deciding whether a preliminary injunction should be granted. However, to date, the courts have not declined to enforce a patent on this ground.

10 Settlement

10.1 Are mediation and/or other forms of settlement discussions required by the court in your jurisdiction or merely optional to the parties?

They are optional.

10.2 Can the proceedings be stayed or discontinued in view of settlement discussions?

It is not uncommon for the parties to agree to stay the proceedings pending settlement discussions. If no agreement is reached, it will be necessary to apply to court for an extension of time and/or condonation for the late filing of evidence (showing good cause). Once settlement is achieved, the proceedings may be discontinued – for example, by filing a notice of withdrawal.

10.3 Is it necessary to report the results of settlement discussions to the court? If so, how; and what are the implications?

It is usually sufficient to file the necessary withdrawal notices once a matter is settled, without providing further details.

11 Court proceedings for infringement and validity

11.1 Are court proceedings in your jurisdiction public or private? If public, are any options available to the parties to keep the proceedings or related information confidential?

Court proceedings are public. Documents that are confidential but do not enjoy legal privilege are usually either redacted or disclosed to the legal advisers under suitable restrictions to preserve confidentiality.

11.2 Procedurally, what are the main steps in patent infringement proceedings in your jurisdiction? Is patent validity handled in the same proceedings as infringement or is it handled separately? If separate validity proceedings are available, what are the main steps in those proceedings?

Invalidity may be relied by way of:

• a counterclaim in an infringement action; or
• an application for revocation.

Infringement proceedings are commenced by issuing summons accompanied by a statement of particulars. The statement of particulars is in the form of a pleading setting out the material facts upon which the plaintiff relies.

The defendant is allowed 10 days in which to deliver a notice of intention to defend.

Thereafter, a defendant shall deliver a plea with or without a claim in reconvention (a counterclaim) within 20 days. A defendant may counterclaim for revocation of a patent and by way of a defence rely upon any ground on which a patent can be revoked.

Within 15 days of service of the plea and counterclaim, the plaintiff, where necessary, shall deliver a replication to the plea as well as a plea to any counterclaim. No replication which will be a mere joinder of issue or bare denial of allegations in the previous pleading is necessary; and at that stage, pleadings are deemed to be closed.

Once pleadings are closed, the parties request discovery. The party required to make discovery shall:

• file a discovery affidavit specifying such documents and tape recordings in its possession; and
• specify such documents and tape recordings in respect of which the party has valid objections to produce.

The main procedural step prior to the hearing is the filing of a summary of the expert's opinion and the reasons therefor.

An application for revocation is made on a prescribed form and is accompanied by a statement of particulars of the grounds on which the application is based. Within two months of the lodging and service of the application for revocation, the patent holder shall lodge and serve a counterstatement in the form of a plea.

Within two months of the lodging and service of the counterstatement, the applicant shall file and serve its evidence in the form of affidavits. The patent holder may file and serve its answering evidence in the form of an affidavit within two months· of the filing and service of the applicant's evidence. Thereafter, within two months, the applicant may file and serve replying evidence, in the form of an affidavit, confined to matters strictly in reply.

No further evidence shall be filed by either party, except by leave or direction of the commissioner. All evidence shall be by affidavit unless otherwise directed by the commissioner. If a dispute of fact arises, a party to the proceedings may apply to have one or more issues referred to oral evidence.

Upon completion of the evidence, the applicant – or, if it fails to do so within six weeks of such completion, the opponent – may request a date for the hearing.

11.3 What is the typical timeframe for patent infringement proceedings? If separate patent validity proceedings are available, with is the typical timeframe for those proceedings?

Infringement proceedings in the court of first instance are usually completed with 18 to 24 months of the date of commencement.

11.4 To what extent do the decisions of national or foreign courts or bodies influence the court's decision?

The South African courts retain their independence and in theory do not rely on decisions in foreign jurisdictions. However, in practice, the decisions of foreign courts in relation to the same patent may have persuasive influence. For example, a litigant seeking a different finding from a foreign court would most likely be required to distinguish from that decision on the basis of the relevant legal principles and/or the evidence. The decisions of the UK courts (and in some cases decisions of the European Patent Office) are the most commonly relied on during South African proceedings.

12 Remedies

12.1 What remedies for infringement are available to a patent holder in your jurisdiction?

A successful party is usually granted an injunction (interdict) as well as delivery up of the infringing product or any article or product of which the infringing product forms an inseparable part.

The court will order an inquiry into the damages that the plaintiff(s) has suffered.

12.2 Are punitive or enhanced damages available in your jurisdiction? If so, how are they determined?

There are no punitive or enhanced damages available in South Africa.

12.3 What factors will the courts consider when deciding on the quantum of damages?

Damages are limited to the plaintiff's loss of profits. The patent holder must show that, had it not been for the infringing sale, it would, on the balance of probabilities, have made that sale. For this reason, it can be difficult to quantify and prove damages in South Africa and damages are not often litigated in South Africa.

In lieu of damages, the plaintiff may elect to be awarded an amount calculated on the basis of a reasonable royalty which would have been payable by a licensee or sub-licensee in respect to the patent concerned.

13 Appeals

13.1 Can the decision of a first instance court or body be appealed? If so, on what grounds and what is the process for doing so? Please also describe the availability and process for additional levels of appeal.

There is no automatic right of appeal. Leave to appeal must be obtained on application to the court of first instance. Leave to appeal may be granted only where:

• the appeal would have a reasonable prospect of success; or
• there is some other compelling reason why the appeal should be heard, including conflicting judgments on the matter under consideration.

In practice, leave to appeal is granted in many patent cases.

Although it is possible to obtain leave to appeal either to a full bench of the Superior Court (consisting of three judges) or to the Supreme Court of Appeal (consisting of five judges), almost without exception, leave to appeal is granted from the Court of the Commissioner of Patents directly to the Supreme Court of Appeal. The Supreme Court of Appeal is the court of last instance in South Africa, unless any constitutional issues arise, in which case it is possible to appeal to the Constitutional Court.

13.2 What is the average time for each level of appeal in your jurisdiction?

An appeal usually takes about 10 to 18 months to complete.

14 Costs, fees and funding

14.1 What costs and fees are incurred when litigating in your jurisdiction? Can the winning party recover its costs?

The costs of a trial depend on:

• the nature and technical complexity of the matter;
• the number of expert witnesses involved; and
• the volume of evidence.

The cost also depends on whether only a junior counsel or both a senior and junior counsel are instructed to argue the matter. If a senior and junior counsel are instructed to handle the matter, costs of $300,000 to $600,000 can be expected. If a junior counsel is instructed to handle the matter, costs of $150,000 to $250,000 can be expected.

An award of costs in favour of the successful party is usually on what is termed a taxed 'party and party' basis. If the unsuccessful party disputes the bill of costs presented, the quantum is determined by a taxation hearing. The final award is usually approximately 30% to 50% of the total costs.

14.2 Are contingency fee and/or other alternative fee arrangements permitted in your jurisdiction?

There is limited scope for contingency arrangements in South Africa and such arrangements are not usually entered into in patent litigation.

14.3 Is third-party litigation funding permitted in your jurisdiction?

There are no restrictions on third-party funding, However, a request for security for costs may be requested in circumstances in which there are concerns about recovering costs from the named party to the litigation.

15 Trends and predictions

15.1 How would you describe the current patent litigation landscape and prevailing trends in your jurisdiction? Are any new developments anticipated in the next 12 months, including any proposed legislative reforms?

At present, South Africa is very active jurisdiction for patent litigation. This is largely (although not exclusively) driven by enforcement proceedings in the pharmaceutical field involving disputes between multinational innovator companies and generic companies. Pharmaceutical matters are usually commenced by way of preliminary injunction proceedings and the South African courts have heavily favoured the grant of injunctions to date.

There is a large body of jurisprudence developed over many decades through the Court of the Commissioner of Patents and the Supreme Court of Appeal. In many instances, seminal judgments in the UK courts have been relied on in South Africa in developing law on issues such as novelty, enablement, inventive step and insufficiency. The laws of evidence and procedure are also very similar to those of the UK courts. Therefore, litigants in South Africa will be able to draw on many similarities to the United Kingdom in conducting litigation in South Africa.

Changes to the South African patent system to introduce substantive examination have been mooted for several years (and draft legislation has been published). Several preliminary steps have been taken, including training examiners. Although the implementation has been anticipated for some time, it still remains unclear when examination will commence.

16 Tips and traps

16.1 What would be your recommendations to parties facing patent litigation in your jurisdiction and what potential pitfalls would you highlight?

A single invalid claim in a South African patent application renders the entire application invalid and unenforceable until the invalidity has been cured by way of amendment. This applies even in circumstances in which the invalid claim is not being asserted in infringement proceedings. A finding of partial invalidity may have fatal consequences in preliminary injunction proceedings. Furthermore, in trial proceedings, while the defect may be remedied by way of an amendment, any opposition to such an amendment may result in a protracted and costly dispute concerning the allowability of the amendment before an order may be granted on the valid and infringed claim. Thus, a finding of partial invalidity in trial proceedings may also prejudice the patent holder.

Since post-grant amendments are subject to opposition, this may result in a protracted dispute (of about 12 to 18 months) before the question of infringement may be dealt with. This could result in a patent holder's attempts to enforce the patent being frustrated for some time. In many cases where the launch of a competitor product is close to expiry, the patent holder may not obtain meaningful relief.

For this reason, it is important to actively manage the prosecution of a South African patent application (especially since South Africa is a non-examining system). This may be done by delaying acceptance of a South African patent application for as long as possible to allow the prosecution of foreign applications in examining jurisdictions to be completed. Pre-grant amendments and, importantly, divisional applications directed to commercially important embodiments may then be considered.

Based on a Supreme Court of Appeal decision in South Africa, it is possible to obtain parent and divisional patents that include overlapping claims of varying scope. However, coterminous claims (claims of identical scope) are not allowed.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.