The 24th Annual Patent law case review took take place on 10th February 2022.
2021 was another blockbuster year for patent law. In our Annual Patents webinar we reviewed and summarisied the patent cases, including the first full year of judgments from Meade J, the early judgments of Mellor J, and Birss LJ's first foray into the Court of Appeal. This has been a big year for detailed cases on a wide range of topics and technology – from AI to seed drills! Of course, we have identified the 2021 Judge of the Year, with some new contenders in the running this time.
Ailsa Carter took us through a Statistical Review and this year, we are joined by Seiko Hidaka who gave her summary of the year's SEP/FRAND activity – of where there has been a great deal.
Christopher Freeth takes us through what to look out for in the courts in 2022, with some very interesting patents appeals coming down the tracks.
Transcript
Huw Evans: Ailsa Carter will take us through a Statistical Review and this year and Gordon Harris. Well what can I say. A man who does not need any introduction at all. But without his leadership over the last 30 years or so, we would not be the team we are today. Thank you so much Gordon for that.
Gordon will, for the 24th time, deliver his annual review. A must on the calendar for all patent practitioners.
Next up Seiko Hidaka. Seiko joined the team last year as a director and her practice is all things technical and forward thinking policy shaping. Seiko will be picking up on some of the SEB cases over the last year and touch on how 5G may shake things up a bit.
Finally we have Chris Freeth. Chris is a patent and life sciences specialist. He straddles both transactions and litigation. In short, if you have something life sciences, he is your man. Chris will be taking a look at what we may see coming down the line in the course over the next year.
Before we start, I do have a few housekeeping points to cover off. Nothing on fire escapes or fire alarms, but I do want to pick up on a few points.
Given the time constraints, we are aiming to have a Q and A at the end of the session but please do send in your questions as we go along, by using the Q and A button at the bottom of the screen. We will try to deal with as many questions as possible, but we are aiming to finish by 4.30 and so any questions unanswered or indeed all the questions afterwards we will circulate a question of the list of the Q and A's to all participants.
At the end of the survey, there will be a pop-up survey which is your chance to provide feedback. We would really appreciate you taking the time to complete as it does help us for future seminars.
So, let us kick off and over to Ailsa.
Ailsa Carter: Thank you Huw. I am here talking about the numbers today that we have been collecting on patent judgments. This slide shows in light blue the number of reported judgments in patent cases for each of the last seven years. 2021 had the highest number of reported judgments – we found 80. The previous highest – 79 – was in 2016.
The number of reported judgments in patent cases includes judgments deciding substantive issues of infringement and/or validity - i.e. deciding the outcome on the merits. But those infringement and/or validity judgments are only a portion of the total judgments in patent cases, which include judgments on many other types of points, such as when and what relief should be granted and how the litigation is conducted. Those other judgments are not the focus of our numbers.
In 2021 there were 26 judgments in patent cases addressing substantive issues of infringement and/or validity. This was also the highest number in the last seven years. The previous highest number, 24, again being in 2016.
On the slide the infringement and/or validity judgments are indicated in dark pink.
To the right of the dark pink bar, the darker blue, red and grey bars indicate which courts handed down the judgments on infringement and/or validity that recorded in the dark pink bar. In 2021, four of the 26 judgments were given by the Intellectual Property Enterprise Court or the IPEC, 16 by the Patents Court, and six by the Court of Appeal.
Here is a pie chart showing the outcome in 2021 of the 26 judgments on infringement and/or validity.
For each judgment, we have identified the outcome according to our colour system.
Greens and blues are good for patent owners; reds and yellows are good for non-patentees. The colours run clockwise from 12 o'clock in the same order as the legend shown on the right of the slide.
If validity was not in issue, only infringement, then the outcome is recorded as infringed - in green or not infringed - in yellow, as shown at the top of the pie. If one claim is found infringed, that is considered the dominant finding.
Similarly if a single patent claim was found valid and infringed, then that is the outcome we have recorded for the judgment – valid and infringed is shown in the darker blue. In 2021, this was the outcome in nine of the 26 judgments.
If all patents in issue were found invalid, then invalidity is recorded – shown on the red in the slide. The invalidity outcome is recorded irrespective of what the court decided about any issue of infringement. In 2021, invalidity was the outcome in 11 of the 26 judgments on infringement and validity.
If infringement was not in issue and some or all of the claims in issue were found valid, then this is recorded in a lighter shade of blue – 2021 had just one of those.
Finally, if the outcome is that the patent in issue is valid but not infringed, that is recorded in purple – in 2021 there were three of those judgments. For the party alleged to infringe, purple is a successful outcome. However for the patentee, purple is rather more favourable than red, because the patent continues in some form and therefore remains of potential benefit for the patentee in the future.
Looking at the balance of outcomes in patent judgments in 2021, the picture is pretty consistent with the total for the previous six years. There was a higher number of valid but not infringed outcomes than seen in previous years, but otherwise a fairly consistent spread.
When we break down the outcomes into sectors, the numbers for 2021 become quite interesting.
Here are the 2021 judgments broken down into the sectors we are tracking.
Outcomes in Tech cases in 2021 show a spread that is fairly consistent with the previous six years. The pie chart for 2015 to 2020 for Tech has the dark blue slice continuing around to six o'clock, so 2021, although a little less successful for patentees, is in a similar sort of place.
The other category is also marginally less favourable for patentees in 2021 than in the previous six years, for which the pie chart is pretty much fifty/fifty.
For medical devices, the figures for 2015 to 2020 show eight blues and five reds, so 2021 has been notably less successful for patentees than the average for the previous six years. But the numbers are small – in 2021 there were only three relevant judgments that we have categorised in the medical device sector. Those cases concerned patents about a comfort layer for an ostomy bag, an insulin patch pump, and apparatus for controlling a ventilator.
Against the background of swings away from the patentee in the tech, medical devices and other sectors, the reason the total figure for 2021 has been stacking up as comparable with the totalled picture for the previous six years is because in the judgments we have categorised as pharma have seen outcomes going more in favour for patentees than has previously been seen in this other six years.
I should flag here that in 2021 we have included the Illumina versus Latvia MGI case as a pharma case. This is because although the technology is about DNA sequencing, and so arguably could fall in the medical devices category, it is also about chemistry and biology – about building DNA chains - and so we think it is better captured in the broader life sciences sector, which is what our sector here called pharma has always been about.
This slide shows 2021's outcomes in pharma judgments against the outcomes in pharma judgments in the previous six years. The 2021 judgments number only seven, but the difference is nevertheless notable.
Of the seven judgments in 2021, four were in the Patents Court. They were given by: Birss J, Meade J, Mellor J and Judge Hacon. Just one of those judgments went against the patentee.
Pausing here, the crop of judges hearing Pharma patent cases in the Patents Court has evolved. There was no Arnold J in 2021 – he was already in the Court of Appeal. Birss J heard just one pharma case at first instance amongst his move to the Court of Appeal. So now is a sensible point to have a look at how their outcomes over the last seven years in the Patents Court compare.
Here we have charts showing the outcomes of infringement and/or validity disputes determined by Birss J and Arnold J in the Patents Court in the years 2015 to 2021.
For Birss J, the pie charts for tech and pharma are comparable. Slightly more than half of Birss J's judgments resulted in success for the patentee.
For Arnold J, the picture is different. For tech sector disputes, his outcome pie chart is similar to that for Birss J, although he heard fewer tech cases. But for pharma cases, Arnold J determined only two of 12 cases in the patentee's favour.
So it could be that the change seen to the pie chart for pharma outcomes in 2021 in the Patents court is not just a blip, but indicates a change of wind in that court, accompanying the change in personnel. Time will tell.
Also interesting in 2021 is the profile of outcomes in the Court of Appeal. Again, this could just be a blip, but the difference shown on the slide is notable.
Half of the Court of Appeal's relevant judgments in 2021 were in pharma patent cases. Two were in tech.
In the pharma cases, two confirmed the first instance outcomes that covers off the red slice and one of the dark blue cases. The third was the Fibrogen v Akebia case, in which Birss LJ overturned Arnold LJ's first instance finding that certain key claims were invalid for insufficiency. So one of the dark blue slices was purple at first instance.
On the other hand, in one of the tech cases, Optis v Apple, Arnold LJ overturned Birss J's first instance finding of infringement and essentiality – turning a previously blue slice purple.
Returning to the Patents Court, here is a look at outcomes by Judge, all infringement and validity judgements in the years 2015 to 2020 so not including this year. That is 76 in total.
The majority were given by Arnold J or Birss J. a further ten were given by the late Henry Carr J. The remainder were given by a smattering of deputies, Ipec incumbents and wider High Court Judges.
Here are the outcomes in 2021, again in the Patents Court.
Meade J gave six judgments, Judge Hacon gave two judgments in the Patents Court and three in IPEC, which are not shown on the slide. The newly appointed Mellor J and a newer profile of judges – Pat Treacy, Nicholas Caddick QC and Marcus Smith J – all delivered judgments too.
This slide includes all the patent judgments in the years 2015 to 2021, from the IPEC, the Patents Court, the Court of Appeal and the Supreme Court, separated according to the sector of the dispute – tech, pharma, medical devices, automotive or other.
The slide shows a drop between 2016 and 2020 in a proportion of patent judgments given in respect of cases in the pharma sector, but a slight increase in 2021. Perhaps the results in 2021's patent cases will encourage that upward movement further.
Simultaneously, the years 2015 to 2021 have shown a steady increase in judgments emerging in the Tech sector. Many of these concern standards essential patents.
Cases in the Tech and Pharma sectors are almost entirely heard in the Patents Court. The IPEC has a higher proportion of the other category of sectors than the Patents Court.
Finally, as we have looked at the activity in the Patents Court, let us wrap up with a brief comparative look at what has been happening in the IPEC, which gets less patent activity than the Patents Court. In the years 2015 to 2021, the IPEC has given 21 infringement and validity judgments - the Patents Court has given 92.
The IPEC pie chart on this slide shows that outcomes for patentees in the IPEC, overall, have not been as favourable as in the Patents Court. Why?
Most of the patents judgments emerging from the IPEC have been given by Judge Hacon – are his judgment outcomes perhaps aligning with those seen for Arnold J in the pharma sector? Let us have a look.
Here are Judge Hacon's outcomes in the IPEC. They are indeed showing a strong majority of cases being decided against the patentee – just three of 16 were decided by him in the patentee's favour.
However, Judge Hacon has also heard a number of cases in the Patents Court, and there, although the numbers are small, the outcome pie chart is more favourable for patentees, who succeeded in four of the six cases.
Back in the IPEC, the other judgments, given by Judge Clark or a deputy judge, also show a pattern of patentees being less successful than patentees tend to be in the Patents Court.
So perhaps the difference between the outcomes seen in IPEC and those seen in the Patents Court reflect the types of patents being asserted in the IPEC, rather than a difference in approach by the judges concerned.
It will be interesting to see how this trend develops.
That is it from me. I will hand over now to Gordon.
Gordon Harris: At the outset of last year's Annual Review, looking back at 2020, I said that it could not have been described as "normal" in any sense of the word. The world was coming to terms with the worst global public health crisis for a century, and this had impacted on so many aspects of our daily lives, including the conduct of patent litigation in the UK. I praised the courts and the judges for what I described as their "ingenuity, inventiveness, determination and hard work" in delivering an almost seamless service to litigants in the IP courts. This was reflected in the substantial volume of judgments handed down.
Much of what seemed inventive and ingenious last year has now become "the new normal".
We now have a fully stocked bench of IP specialist judges at all levels – a really very welcome development and one which bodes well for the medium term future of patent litigation in the UK, despite all the challenges that lie ahead. With Lord Kitchin in the Supreme Court, the Lords Justice Arnold, Birss and Lewison in the Court of Appeal, Meade J and Mellor J in the High Court and both HHJ Hacon and HHJ Melissa Clarke in the IPEC, we have proven, experienced and reliable judges at all levels. Further, as we will see, they are ably supported by a growing rank of Deputies who are showing themselves to be more than capable of handing down strong, clear and helpful judgments.
The upshot of all this has been a fascinating set of judgments in 2021, across the full range of patent topics. Whilst there are the usual highly technical cases in the Life Sciences and Tech fields, as someone who is very much at home in the world of "planes, trains and automobiles", I am delighted to see really important patent law issues being discussed in cases about fixing tools and seed drills.
There is, as will become clear, a very welcome trend towards "pulling the threads together" and providing clear summaries of the established positions as a the bedrock of future judgments. This has been a year when, in many respects, the case law has taken us "back to basics".
None of this should be taken as acknowledgment that everything is now perfect, and this presentation would not be complete without at least one major rant about a judgment which, to my mind, flies in the face of all sensible and proportional reasoning, but you will have to wait a while for that.
It is time to get started on the review of cases in 2021. As we have heard from Ailsa, there were 80 judgments in 2021. This presentation can only deal with a limited number of the them. However, they are all dealt with in the accompanying paper, which will be made available online after today. If you read that, you will need to read nothing else to be fully up to date on UK case law!
I will adopt my usual format, opening with construction, infringement, defences, and remedies, then moving on to issues of validity and finally the technical issues.
Infringement
Construction. General principles of claim interpretation
Four full years after the Supreme Court's judgement in Actavis v Eli Lilly, which overhauled the law of patent infringement, the task for the court when construing a patent is now fairly well settled.
Before plunging into the law, let us just take a step back. There is now a "doctrine of equivalents", but as Lord Neuberger clearly pointed out when setting this all out in Actavis, the question of assessing equivalence is one of infringement and scope of protection – it is a separate exercise to the task of construing the patent. That exercise is still conducted largely on the basis of the old established law, which probably reached its most complete statement in Virgin Atlantic v Premium Aircraft in the judgment of Lord Justice Jacob. That process has come to be known as "normal construction".
HHJ Hacon summed it up in Kwikbolt v Airbus, saying:
"Since Actavis v Lilly there have been two steps to ascertaining the scope of a patent claim. The first is to decide what the claim means in accordance with the general rules of construction of a document, .... This has sometimes been referred to as the "normal construction" of a claim."
HHJ Melissa Clarke continued to give some very good "revision" statements of legal principles in 2021 In A Ward Attachments v Fabcon Engineering, she said:
"It is for the Court to construe the patent objectively, adopting the mantle of the notional skilled addressee to whom it is directed, and in the light of the common general knowledge with which the skilled addressee is assumed to be imbued".
It is heartening to see the return of "the mantle" to patent language, adding a suitably Dickensian feel to 21st century judgments!
In the Court of Appeal, in Fiberweb v Geofabrics, Arnold LJ said:
"...the claim must be interpreted purposively, but without taking into account equivalents, with infringement by equivalents now falling to be separately considered."
So there we have it. The position is now quite clear on the approach to be taken.
Purposive construction in action
Turning to what, exactly, amounts to a purposive construction, a case which stands out this year, and turns up in many areas, is Optis v Apple. The judge, Meade J, noted that the parties were in such fundamental disagreement about the meaning and scope of the claims that they could not agree what words or phrases were in issue! Meade J sorted it out. He considered the most fundamental question to be what the word "counting" meant in the context of the claimed method. Against the background of that context (which the judge explained) if the skilled person put their mind to it they would know that counter-based mechanisms operated in units whereas windows-based mechanisms operated in percentages. This paved the way to his construction of the term 'counting', with the explanation:
"I do not find the overall language pattern at all difficult: "A tram is similar to but different from a bus. I claim a bus"."
- Infringement
Doctrine of equivalents
The most significant case law on infringement in 2021 has emerged in the context of the developing doctrine of equivalents.
First, a largely procedural point in Facebook v Voxer, an interim judgment in the Patents Court, by Birss LJ (who was sitting 'down').
To cut a long story short, a case for infringement by equivalents was made very late in the case. Birss LJ was asked by the parties to give a ruling on how and when a pleading of equivalents should be made. He said that an allegation of infringement on the doctrine of equivalents must be pleaded in the particulars of infringement, right up front. The patentee's statement of case on inventive concept and other aspects of the test in Actavis, should then be produced when claim charts or a statement of case on infringement is produced. This is a welcome development. There have been too many instances of "equivalents ambush" since 2017.
By way of reminder, in Actavis v Eli Lilly, Lord Neuberger described the second stage of the assessment of infringement – the doctrine of equivalents - as addressing the following issue: "does the variant nonetheless infringe because it varies from the invention in a way or ways which is or are immaterial?"
In this context Lord Neuberger considered that the old Improver/Protocol questions provided helpful assistance but needed some reformulation. They are now known generally as the Actavis questions. They involve the identification of the inventive concept and the variant.
In 2021, HHJ Hacon used the reformulated questions in his judgment in Kwikbolt v Airbus:
Kwikbolt's patent concerned a temporary 'blind' fastener – a widget that could be used, by fitting from one side of the workpiece, to hold two panels together during a manufacturing process, and subsequently removed.
Following the judge's conclusions on construction, the accused product did not infringe on the normal interpretation because the integer (8) requiring the screw member to have "a screw head adjacent the first member head" was not met.
Turning to the doctrine of equivalents, Judge Hacon said that the reformulated/Actavis questions require the 'variant' to be identified. But this is the important bit - he said that the identification of the inventive concept must be done without reference to the variant ([103]):
"The important point, in my view, is that a correct assessment of the inventive concept cannot be achieved with the variant in mind. The correct identification of the inventive concept must be done through the eyes of the skilled person, who has no notion of what the variant is. The skilled person has only the relevant claim, the specification as a whole and his or her common general knowledge to work with."
This may have a material effect on the manner of instructing expert witnesses in relation to this question.
The Insulet case, decided by Deputy Judge Pat Treacy, involved a micro-pump device for dispensing insulin. The patentee's product was entirely automatic, whereas the alleged infringement had a "bolus pump" where a specific dose could be dispensed in anticipation of taking on food. The pump could be turned off, after which the allegedly infringing device functioned in the same way as the patent claims.
The judge addressed the question of identifying the inventive concept, saying:
"...the first part of the second Actavis question requires the identification of the inventive concept not at a high or generalised level, but having regard to means identified in the patent to achieve the result desired by the patentee. The phrase "inventive concept" follows and to my mind encompasses not only the result which is the overall subject of the patent but also to the means by which that result is to be achieved.... In other words, the result and the means used to achieve it are all part of the inventive concept and it is on this that the Court must focus when considering infringement."
The judge concluded that the inventive concept in the patent involved the device being small and disposable. The introduction of the bolus pump rendered the device larger and more expensive so less easily disposable, so the alleged infringement did not achieve substantially the same result by substantially the same means.
A Beginners Guide to the Formstein Defence
We have heard a lot about the German "Formstein" defence in recent years, and the concept behind it turned up, albeit not decisively, in two judgments in 2021. What is this all about?
Think of the scope of a patent for assessing infringement like an archery target with only two rings. The inner ring is the scope of the patent on a normal interpretation. The outer ring is the penumbra created by the doctrine of equivalents. If a patent is found to have been infringed either on a normal or equivalents basis, it is clear that the infringer will be saved if they fire a prior art arrow which hits the inner circle. The patent will be invalid either for anticipation or obviousness.
But what if the prior art arrow hits the outer ring? It would not anticipate or render obvious the patent on a normal construction, but does fall within the area occupied by the equivalents. Does that render the patent invalid, or does it just mean that it is not infringed?
We get some assistance from the Gillette defence. The gist of the Gillette defence is that if the alleged infringement can be found to be obvious over prior art at the priority date of the patent, either it does not infringe the patent as a matter of construction, or the claims are invalid.
As we have seen, the assessment of infringement by equivalents is not a matter of construction – it is simply a question of infringement. On that basis, should the appropriate defence if the prior art arrow hits the outer circle be more in line with the law behind recent Arrow Declaration cases? The finding of obviousness over prior art renders the otherwise infringing product or process safe from an infringement action, but it does not necessarily impact on the patent itself, other than to limit its scope?
The German Formstein approach adopts the Arrow solution. The fact that an infringement which is caught by the doctrine of equivalents is in itself obvious over prior art, gives a good defence to an infringement action, but does not render the patent invalid. That approach, which might have been seen as unique to the German bifurcated system, was also adopted in the Dutch courts in Eli Lilly v Fresenius.
In two cases in the UK in 2021 Birss LJ and Meade J grappled with this question (although only Birss LJ mentioned Formstein directly). In Facebook v Voxer, Birss LJ was not actually called upon to decide the case on this basis but he said:
"......if I did have to decide the matter, I would hold that the right approach is the Formstein approach so that the conclusion if the equivalent device lacks novelty or is obvious is that the claim scope must be confined to its normal construction in that respect. I would do so for two reasons. If the claim on its normal construction is valid, then it seems harsh to invalidate it on this ground. What else could the patentee do but write their claim in a way which, normally construed, did not cover the prior art. So that approach promotes certainty. Secondly, since it is clear that other EPC countries work that way, and this is a reason in itself for this EPC state to take the same approach."
Good to see that Birss LJ is still a good European!
In Optis v Apple, Meade J was also asked consider this issue. Apple contended that although its prior art had failed to defeat the patent on the ordinary interpretation, nonetheless it did anticipate the area of equivalence in which infringement was found, and this should render the patent invalid. Meade J did not mention Formstein, but said:
"...the present case raises the issue of whether, as a matter of law, equivalence is available to broaden a claim as the target for an anticipation attack, or only applied to infringement. This is an extremely important point for UK patent law. It seems certain to need the consideration of the Court of Appeal and very probably the Supreme Court. When it is first ruled on in a case where it is decisive to the result, it will need to be fully argued, including with reference to the law of other EPC jurisdictions and with regard to how and whether people can be prevented from practising the prior art, or if not, how and why not."
Meade J did not actually find infringement in this case so the question was moot, but he has clearly put down a marker that the issue needs to go much higher in the judicial hierarchy for a definitive decision. As things stand it looks very much as though the judges favour the Formstein approach. The patent office would probably be inclined to agree as otherwise examiners would have to start considering equivalents in the prosecution process.
- Defences, acts of infringement, stays, evidence
Evidence
In several cases in 2021, judges made clear that the role of an expert is to teach/educate the court on the technology concerned from the perspective of the notional addressee of the patent - the 'person skilled in the art' - not to try to be the person skilled in the art. The assessment of expert evidence in patent cases is not an exercise in determining which expert in fact approximates more closely to the skilled person.
Nevertheless, in order to put themselves into the position of the person skilled in the art and assist the court accordingly, it does help if the expert knows what they are talking about. An example of this going wrong may be found in Meade J's judgment in Optis v Apple (25 November 2021). This was one of the multi-trial FRAND cases. At Trial B the expert appointed by Optis gave evidence on how the ETSI system worked and how its IPR policy had developed. Meade J had said she was an "excellent, well qualified witness who supported her opinions with careful and complete analysis of the facts".
However, in trial C, the same expert gave evidence in respect of the technical issues in the case. Meade J said that he remained of the view he had formed in the earlier trial of the expert's personal qualities, but in trial C she had been "materially outside her area of expertise". He said her evidence was of very limited help as she misunderstood some of the key concepts and made errors in modular arithmetic. She also put "far too much emphasis" on the secondary evidence.
As a result, the judge said that in general it was the evidence of Apple's expert that he preferred. Optis' three related patents were found invalid for obviousness.
It is very unusual for the inventor to give evidence and even rarer for one to give expert evidence. The role of an expert is to educate the court about the knowledge and perspective of the notional, uninventive 'person skilled in the art'. By the very nature of things the inventor tends to be "inventive", and may well have a challenge showing real objectivity!
Such a person tried doing this in Tehrani v Hamilton, and came unstuck. Judge Hacon said:
"I am sorry to say that Professor Tehrani did not provide the necessary indication of her objectivity. I think that she came to court to argue her case and that her evidence was given in that spirit. I do not suggest that Professor Tehrani had the intention of misleading the court, but it was my strong impression that she could persuade herself of the truth of matters that fitted her view of the case. It does not follow that she was wrong about such matters. However, I was not always sure that what she said was fair and accurate.
In contrast, Hamilton's expert, a Professor at Aalborg University in Denmark, was "an impressive and helpful witness". Professor Tehrani's patent was found invalid for lack of novelty and obviousness in the final patents judgment of the year. If valid, the patent would have been infringed.
The moral of the story is pretty clear – experts win cases. Choose a good one and make sure to instruct them properly.
Confidentiality
A trend apparent in 2021 has been the determination with which litigants have pushed and explored the extent to which they can maintain confidentiality in, or force the disclosure of, highly sensitive commercial information in the course of litigation. This largely arises from the prevalence of FRAND cases where details of licences granted and royalty calculations are likely to be relevant to the question of "comparables" when setting terms.
Natural justice requires a party to know the case against them and the evidence on which it is based, but in Al-Rawi v the Security Service, the Supreme Court also recognised that where the whole object of the proceedings is to protect a commercial interest, full disclosure may not be possible if it would render the proceedings futile. This problem occurs in the SEP/FRAND arena.
In 2020, the Court of Appeal in OnePlus v Mitsubishi (a SEP/FRAND dispute), Floyd LJ made clear that the court should not facilitate the granting of a competitive advantage, and accordingly inflict a competitive disadvantage, unless justice absolutely required such a course to be taken.
Floyd LJ explained that in the context of discovery, it was not wrong in principle for prima facie highly confidential documents to be disclosed first on an 'external eyes only' basis, especially if the sharing of pricing information could contravene competition law.
Against that background, a number of disputes about confidentiality fell to be considered by the Patents Court in 2021.
In Interdigital v Lenovo, Birss J preferred not to make any order for specific disclosure, rather than using the "external eyes only" formula. He was not persuaded that the gaps in the information actually available through public sources were so significant as to make it impossible for the court to produce a fair estimate. He said there was significant value in terms of open justice in producing a decision in this case based on information which was publicly available.
The dispute in Facebook v Voxer (19 January 2021) concerned who should be included in a confidentiality club for visibility of Facebook's product and process description (PPD). In short the case was being run by a team of lawyers from the USA, UK and Germany. Acknowledging that the rules on confidentiality were somewhat different in Germany, and noting that the UK team did not include patent specialists, the judge ordered that the PPD in the UK proceedings should be disclosed to one lawyer in the US. That was strictly on the condition that he should not communicate with the German team about the PPD otherwise than with the knowledge and consent of the UK team. This just illustrates the sort of complexities in cross-border confidentiality issues, and that leads me on to the next point.
The judgment in AutoStore v Ocado serves as a warning to all involved in multi-national settlement discussions.
Settlement discussions took place between Ocado and Autostore in London in 2018, involving three meetings and associated email exchanges.
At the outset of the first meeting it was expressly agreed that the discussions were confidential and would take place on a without prejudice basis. Ahead of the third meeting, Autostore offered to provide Ocado with advance materials, including one particular document of importance which I will refer to as "The Document". On each page of the document was marked:
"CONFIDENTIAL & WITHOUT PREJUDICE
PROVIDED FOR PURPOSES OF SETTLEMENT
NEGOTIATIONS ONLY"
The third meeting duly took place and the attendance note prepared by Ocado's London-based solicitors stated ([14]):
"SA stated that this meeting was a continuation of the confidential and without prejudice discussions between Ocado and AutoStore and that any US law discussions were to be governed by rule 408 of the rules of evidence. The parties agreed that there was no intention to waive privilege."
In 2021, Ocado's solicitors became aware that Autostore had referred to the London discussions in a document served in proceedings before the US International Trade Commission (ITC). Ocado applied to the High Court for an interim injunction restraining the use of information from the London discussions in any proceedings, including the ITC proceedings.
The matter proceeded to court. HHJ Hacon focused on the merits of the case and said that it was agreed that the US law discussions were to be subject to Rule 408. In his view, the attendance note should not be read as meaning that the English without prejudice rule also applied. If the point went to trial it could not be said that there was a high degree of probability that Ocado would succeed, so no injunction was granted.
Ocado appealed. In a split judgment, the majority in the Court of Appeal (Sir Geoffrey Vos and Nicola Davies LLJ) dismissed Ocado's appeal. Their reasoning was the same as HHJ Hacon. They said that the agreement was effectively "varied" at the third meeting to provide that "any US law discussions were to be governed by Rule 408" instead of the English "without prejudice" rule, so a US court would need to rule on any breach of terms.
Nugee LJ's dissenting judgment is well worth a read. His view was that the use of the word "and", as in "and that any US law discussions were to be governed by rule 408 of the rules of evidence" was consistent with the parties wishing to maintain the protection of the without prejudice rule. He said that he saw nothing in the facts that was inconsistent with that. The effect of the statement was not to abandon the without prejudice protection for the Document and to replace it, but merely to recognise that the discussions would (as well as being without prejudice) attract the consequences of rule 408 in US litigation. Nugee LJ would have allowed the appeal and granted the injunction.
I would have thought that he could also have pointed to the use of the word "continuation" in the attendance note. That more than implies that the ongoing meetings were on the same terms as those held previously and it is hard to see where Judge Hacon and the majority in the Court of Appeal found the grounds to identify a "variation" of those terms.
In short, I think the courts got that wrong, but the judgment serves as a stark warning of the dangers of referring to foreign law when identifying material/discussions as "without prejudice". Reference to the foreign law can water down the protection available under English law.
Now at this stage I would normally be handing over to Alex Brodie to talk about SEP FRAND matters but Alex instead of talking about case law is actually conducting case law. Today is the last day of the Interdigital and Lenovo litigations so she is not here but as Huw said we are delighted to have Seiko who is a genuine expert in this field and Seiko is now going to talk to you about SEP FRAND cases while I rest my voice.
Seiko Hidaka: Thanks Gordon. Thank you really very much indeed for involving me in this very significant event for the firm. Gordon has already mentioned some standard essential patent cases but I am going to just focus on the jurisdiction side of the SEP disputes.
Now most of you would be familiar with standardised technologies and the fact that they are global in nature usually and in the case of cellular communications where the bulk of SEP disputes lies, devices for work in accordance with the same standards so they are inter-operable, meaning they can communicate with each other regardless of which company made them and where they are located.
It therefore follows that SEP cases tend to have an international flavour and that is why we see a lot of jurisdictional wranglings in SEP disputes. So today I am going to go and discuss three cases that relate to the jurisdictional side of things.
The first is the case of Optis and Apple and the UK Court's treatment of unwilling licencees. Secondly I am going to talk about what the UK Court's response was when the implementer objected to the UK Court determining the terms of a global FRAND licence and thirdly, a case dealing with the question of whether an implementer could ask the UK Court to determine the terms of a global FRAND licence.
So going over to the Optis and Apple case but before I do that, I just wanted to look at the Unwired Plan and Huawei case which is a very well-known case and it forms a backbone of the Optis and Apple dispute.
Now in Unwired Planet and Huawai, Unwired Planet who was the sole essential patent‑holder asserted four of its SEPs. What Unwired Planet had to do was to win on showing that its patent was valid and it was essential and therefore infringed. In fact they managed to win on two patent trials but now it was down to the court to decide what the appropriate relief was.
That was going to be determined at the FRAND trial and the really important point here is that the UK Court decided that where a SEP holder has a global SEP portfolio and the implementer seeking a licence under that has a global client base, then the territorial scope of a FRAND licence would usually be global.
So following a FRAND trial, the court settled terms of the global FRAND licence between them and the implementer Huawei had a choice, to accept the FRAND licence as determined by the UK Courts or accept that it has to be injuncted, but was not a normal injunction it was a FRAND injunction which means that as soon as Huawei decides after all that it wanted to accept the FRAND licence that injunction is lifted. In a normal patent case an injunction will last until the expiry of the infringed patent but that was not the case here.
So I wanted to just labour one point first, which is that a lot of the other courts of other jurisdiction, thought this was quite a striking decision because what the court was deciding, was what the licence terms should be on foreign patent rights as well. But the UK Court says, well no it felt that it was competent to determine a FRAND licence terms on the global basis because the proper characterisation of the case was of a dispute concerning UK patent infringement, namely UK patent right it was not about determining FRAND licence terms.
So having that background under our belt for this dispute and also the next dispute I am going to talk about, let us get onto the Optis and Apple case.
Now background to the case was very similar, Optis and Unwired Planet are in the same group of companies and they were negotiating with Apple and it was not going well.
Optis decided that it had basically wants to get on with getting the licence and getting the revenues that it was due under that licence and sued Apple in the UK. That was February 2019.
Now in the course of litigations - if you could turn to the next slide that would be great – in the course of the litigation, it became clear that Apple was not necessarily promising that it will take the court determining determined FRAND licence following a FRAND trial which was listed in June 2022. Why should Optis wait until then only for Apple to turn its back away and exit the UK market.
Optis said that such behaviour of Apple was unwilling and they should be injuncted. Optis then went along and succeeded in winning its two patent trials and Apple was determined to have had infringed Optis' patents.
The court agreed to decide at that point whether Apple's behaviour was indeed unwilling and therefore should be injuncted and these sets of slides goes to essentially summarise the thought processes of the court. The court asked itself is the implementer, Apple infringing? Well, yes! It had succeeded in showing that its patents were valid, essential and therefore infringed.
Next question. Does Apple have the means to obtain a licence? Well of course it does. Optis had offered various licences to Apple. Apple was not content that they were FRAND so Optis said, well if you do not agree with us, we will promise that we will accept whatever the UK Court says is FRAND. Apple are you prepared to take that licence?
Well, is Apple intending to take that licence? Well no not necessarily. What Apple said was, well they do not know what the terms are going to be like. How could they possibly agree to the court determined FRAND licence without knowing the content.
The UK Court said that Apple was being unwilling. That licence that was due to be determined by the UK Court was by definition going to be guaranteed to be FRAND. That was on the table. Apple is infringing. Why have they not promised the UK courts that it wont accept it.
So Optis said, well that must mean that Apple is unwilling, it is not even entitled now to take a FRAND licence. It is not acting in a FRAND way. The court had to consider, is Apple too late to take any FRAND licence that it might then go onto decide. For this, the court looked at various background facts relating to the IPR policy of the relevant stance of setting organisation in this case, ETSI and decided that the main objective of ETSI's IPR policy was to make sure that standardised technologies were available for use by any implementer and therefore Apple could still ask for a FRAND licence, it just has to promise that it would take that FRAND offer.
It did not stop there. Apple said, hang on a minute. Optis had been behaving abusively, in particular, the FRAND rates asks were way too high and it amounted to an abuse. Therefore an injunction should be withheld. Now what did the court say to that?
The court said, well even assuming that Optis' behaviour was abusive, that did not justify the withholding of an injunction because there was no risk that Apple would be coerced into taking up a non-FRAND licence because the UK Court was going to decide it for them and therefore a FRAND injunction was the appropriate order to make.
The result was, so it avoids that, Apple undertook to the court to enter into the licence due to be determined by the UK Court, although provisions were made in that undertaking to enable Apple to cancel it, depending on how the appeal processes panned out.
So ostensibly this is a very SEP owner friendly decision. It is. But it could also mean that a licensee can behave robustly against a SEP owner, at least in the eyes of the UK Court provided that it agrees to accept what the UK Court says is FRAND.
Now moving onto the next case, which is where the implementer complained about the UK Court deciding the terms of a global FRAND licence.
This was the case in Nokia and Oneplus but before we go onto that, I want to talk about the backbone of this case which was Conversant and Huawei. Very similar to Unwired Planet and Huawei, except for one twist. Which is that Huawei challenged the UK Courts jurisdiction. How? Well Huawei said look, look at our turnover. The great majority of our sales takes place in China.
Another whopping 90% of their sales takes place in a non-patented territory, all of these devices in these non-patented territories are actually made in China so the Chinese standard essential patents are the relevant ones and the UK sales only accounted 1%. Surely the Chinese courts is more appropriate than the UK Courts to decide the terms of a global FRAND licence.
What did the court says about that? Well as against the UK Huawai defendants, the courts said well the Recast Brussels Regulations apply and it had no leeway to decline jurisdiction or stay the proceedings on forum non conveniens grounds.
As against the non-UK defendant, that is the main Chinese Huawei company, the court harked back to that Supreme Court decision that said the proper characterisation of the case was of a dispute concerning UK patent infringement/UK patent right. It was not about determining FRAND licence terms and in any event, there was no alternative forum at the time that said they were competent to determine the terms of a FRAND licence on a global basis.
So UK was the only possible forum for the whole dispute. It felt it could grab jurisdiction but then, Brexit happens and with it, the Recast Brussels Regulation dies. Six months on, Nokia and Oneplus' licence agreement expires. During the period of the licence agreement, they were trying to negotiate a renewal of that licence and it was not going well. So Nokia promptly sued Oneplus in the UK as soon as that licence expired, the following day in fact.
It asserted eight of its standard essential patents and it asked for a declaration that the cross licence offers that it had made to Oneplus was FRAND. Oneplus sued promptly in China in retaliation asking the Chinese Court to declare that Nokia's behaviour was not FRAND and also for the Chinese Court to determine the terms of a global FRAND licence.
Subsequently, Oneplus the defendants in the UK case, challenged the court's jurisdiction and the backstory is it was exactly the same as the Conversant Huawei case, it said that it only 0.5% of its sales is in the UK, half of its sales are in China, surely the Chinese Court was the most appropriate jurisdiction to hear and determine the terms of the global FRAND licence.
You might think, well the decision in Conversant and Huawei should apply, but there were two material differences between the Conversant and Huawei case and Nokia and Oneplus. One was that there was Brexit and therefore the Recast Brussels Regulation no longer applied and secondly, the Chinese Courts had declared themselves quite able to determine the terms of a global FRAND licence, so there was in this case an alternative forum.
The UK Court went onto decide whether it had jurisdiction. This is the test when deciding whether the courts in UK should take/accept jurisdiction. It is not just about IPR cases it applies to any case – this is the test that the UK court considers and the third question, in this case was the main point.
Is England clearly the most appropriate one to hear the claim?
His Honour Judge Hacon felt very comfortable in accepting jurisdiction. It went back to that Supreme Court characterisation of the case which was, it was all about UK patent infringement, it was not about determining FRAND licence terms, so it went on and accepted jurisdiction and that case is pending at the moment.
What about an implementer? Can an implementer ask the UK court to set the terms of the global FRAND licence for them? Well that was the issue between Vestel which is an consumer electronics company which sold items including T.Vs that incorporated video codex technology and Access Advance, a patent pool comprised of video codex, standard essential patents and Phillips which was a member of that patent pool.
There is a same sort of back story here where the two parties try and negotiate a FRAND licence and they do not get anywhere so Vestel decided to sue Access Advance and Phillips and ask the UK court to determine the global FRAND licence.
Access Advance and Phillips challenged the court's jurisdiction and in this case, they succeeded. They succeeded because, in effect, it was not pleaded quite right. Vestel's claims were not really based on the existence or non-existence of the legal right and what Lord Justice Birss said was, for future reference by the way, Vestel could have claimed that it did have an entitlement to be offered a FRAND licence under the UK standard essential patent rights.
If that were the case, they would have been quite happily accepting of the jurisdiction because the UK SEP right is a property within the UK jurisdiction and then the court would have gone onto decide what the licence terms would have been of these two parties.
No doubt, they would have said that the territorial scope would have been global given that Access Advance has a global patent portfolio and Vestel has a global client base.
So there we have it! Even though the implementer, on this occasion, failed to get the court determined global FRAND licence, it could but you just have to make sure that your case is pleaded right.
What does the SEP dispute landscape look like right now? Well I think it is looking more and more really interesting with other jurisdictions now claiming to have the ability to determine a global FRAND licence. China declared themselves competent pretty much soon after the Supreme Court decision in Unwired Planet and Huawei. Recently the French courts have said that they are also able to do that. Possibly the Dutch court as well and there is a question mark over the UPC.
It has been three years since Lord Justice Kitchin as he then was, stated that it would be desirable that an internationally accepted approach should ultimately emerge, but FRAND trials have been few and far between and that is not really surprising really because FRAND trials are extremely complex, very heavy, evidence is extremely extensive with a lot of expert evidence having to go in and so it is not really that surprising that our colleagues are just now dealing and handling the second ever trial to determine the FRAND terms.
It may well be a few years yet before we reach the desired outcome hopeful by Lord Kitchin but the SEPs base promises to be interesting with courts from different territories getting involved and the licence terms of a variety of connected devices will come to be implicated as we move into the era of 5G, IOT, the metaverse and beyond.
So that is all I have to say and it is a pleasure for me to hand the session back to Gordon, who will be dealing with the other meatier topics of the patent law including obviousness and insufficiency.
Gordon Harris: Thanks very much Seiko. We are moving onto issues of Validity first of all common generaly knowledge and the skilled person.
Validity
The person skilled in the art
The identity of the hypothetical skilled addressee of the patent, also known as the 'person skilled in the art' has been a settled area of patent law.
However, life is never that simple. Some years ago in Schlumberger v EMGS, Lord Justice Jacob said:
This, as he says, is because some inventions are art changing, so different expertise may be required to understand the changes fully.
In Illumina v Latvia MGI (20 January 2021), Birss J (before his promotion) revisited the point.
Illumina's three 'modified nucleotide patents' in the case concerned DNA 'sequencing by synthesis' using a reversible chain terminator. After the identity of the nucleotide added had been confirmed, the blockage could be removed and the synthesis continued. Attempts to do this were published in the early 1990s, but they were just attempts, and not successful enough to produce a workable technique in practice.
The parties disagreed on the identity of the 'person skilled in the art' and their common general knowledge. MGI's case was that it included a team interested in or researching sequencing by synthesis using reversible chain terminators; and they would have the use of reversible chain terminators in mind when reading the prior art. Illumina contended that the PSA was a team interested in developing improved methods of sequencing; but they would be unaware of sequencing by synthesis using reversible chain terminators. Birss J took the opportunity for a thorough look at the principles. He said:
"Who is the person skilled in the art? Stated generally the law is clear that patents are directed to those likely to have a real and practical interest in the subject matter of the invention. The real practical interest in the subject matter includes devising the invention itself as well as putting it into practice and so the concept of the person skilled in the art actually applies in two distinct circumstances. In a proper case they may be two different persons (or teams). One person skilled in the art is the person to whom the patent is addressed and whose attributes, skills and common general knowledge will be necessary to implement the patent......
The second kind of skilled person is the one relevant to obviousness.... The question then is what are the legal principles which define the identity of the second kind of skilled person."
Birss J said that in a case in which it is necessary to define the PSA for the purposes of obviousness in a different way from the PSA to whom the patent is addressed, the approach to take is:
"i) To start by asking what problem does the invention aim to solve?
ii) That leads one in turn to consider what was the established field that existed, in which the problem in fact can be located.
iii) It is the notional person or team in that established field which is the relevant team making up the person skilled in the art for assessing obviousness."
In the present case, the essential difference between the parties was whether the person skilled in the art was to be defined by reference to sequencing by synthesis or not. Birss J resolved it by applying the three stage approach to the identification of the second kind of skilled person noted above and found that there was, in fact, no difference.
We expect there will be more on this point in the near future.
The common general knowledge
The mindset of the person skilled in the art is often considered in the context of the 'common general knowledge' (CGK). Some useful revision was provided by Pat Treacy in Insulet v Roche, who described it as:
"...that which is generally known to, and generally regarded as a good basis for further action by, those who are engaged in the particular art."
The judge also noted a number of finer points. These included that a piece of particular knowledge as disclosed in a scientific paper does not become common general knowledge merely because it is widely read, and still less because it is widely circulated. Such a piece of knowledge only becomes general knowledge when it is generally known and accepted without question by the bulk of those who are engaged in the particular art; in other words, when it becomes part of their common stock of knowledge relating to the art. This establishes a fairly high bar for demonstrating that something is CGK.
There are no big changes to the general principles in 2021.
Anticipation
Normally I find myself, at this point, saying that, as usual there is very little to say about the well-settled law of anticipation. Not this year. I promised a rant, and here we go......Are you sitting comfortably? Then we'll begin..... I refer to the case which I have now labelled "The Case of Schroedinger's Seed Drill"
In the 1977 Patents Act, novelty is defined in section 2. Both Section 2 and its equivalent, Article 54 of the EPC, define the state of the art as comprising everything which has been made available to the public, by written or oral description, by use, or in any other way.
Before the EPC and the 1977 Act, this was not the case. In the 1949 Patents Act, section 14(1)(d) described one of the grounds of opposition to the grant of a patent as:
"that the invention, so far as claimed in any claim of the complete specification was used in the United Kingdom before the priority date of that claim"
So under the 1949 Act, there is no need for "making available" – use alone was enough regardless of whether anyone did, or could have, seen that use.
Why does this matter in a review of 2021's patent case law? It matters because it looks as if aspects of the test under the 1949 Act have been imported, through case law, into the modern law, despite the carefully chosen wording of the EPC and the 1977 Act.
The result is a mess that brings to mind Dr Erwin Schrödinger's "thought experiment": if a cat was placed in a box with a single radioactive atom, which had the capacity to kill it, then until the box was opened, it was conjecture as to whether the cat was alive or dead, and as such, it was, in a sense, in both of those states. It was not until it was observed that its status was ascertained. I'll leave that thought with you.
The case of Claydon v Mzuri was a dispute about two Claydon patents to 'apparatus for cultivating and sowing seed'. The invention of the '296' patent concerned a method for tilling soil and sowing seed while better conserving the soil and helping not to encourage germination of weeds (in the spaces between the tilled rows). The spirit of Jethro Tull lives on! The claimed apparatus (i.e. for dragging behind a tractor) comprised a first row of tines to prepare the soil, a second row of tines for direct placement of the seeds, and behind that levelling means (e.g. a wheel) for firming the soil over the planted seeds. Mzuri's devices alleged to infringe, were within the claimed invention on the normal interpretation.
The validity of the patent was challenged by reference to an alleged prior use by Claydon itself. It was not in dispute that before the priority date of the patent, Claydon tested a prototype that had all the features of the relevant claim. The testing took place in a field on the Claydon farm for ten hours, over two days. Along the side of the field ran a public footpath. The footpath was unmarked and unmaintained, and there was a hedge between the footpath and the field where the testing took place. The hedge was six foot tall but had gaps at three points. It was also not in dispute that there was never anyone present at the tests other than Mr Claydon and his brother. Here are some pictures of the site reproduced in Judge Hacon's judgment:
The issue for the court was whether the use made the invention 'available to the public'. On the law regarding prior use, the judge noted extracts from -
- Lux v Pike: to invalidate a patent the disclosure has to be such as to enable the public to make or obtain the invention
- Folding Attic Stairs v Loft Stairs: inasmuch as the public had a right to be there, they are deemed to have the right to access the information
- E. Mishan v Hozelock: it is one thing to say that if the public is given access to information, in whatever guise, that information is made available to the public and it does not matter that no member of the public in fact took up the opportunity (e.g. putting a publication in a library makes it available to the public)...it is quite another thing to say that the law treats information as available to the public when no member of the public could in fact have accessed it (e.g. in that case if a member of the public had tried to observe the inventor's activities he would have stopped what he was doing)
The judge recorded as common ground the following:
"...in a prior user case in which it is said that the invention was made available to the public, even though nobody in fact took advantage of that availability, the information made available is that which would have been either noticed or inferred by a person skilled in the art who, hypothetically, had taken advantage of the access to the invention established on the evidence."
On the evidence, Judge Hacon concluded that an observer of the prototype being tested would have believed the tines in the first and second rows were aligned, and would have been able to deduce features of its construction including all the features of claim 16. If Mr Claydon or his brother (who were conducting the testing) had noticed "such a person", they could not have taken action that would have prevented the skilled person from seeing or inferring each of those features, including the alignment of the tines. This was to differentiate the position from Hozelock, and was the first sign of desperation!
The judge said that, applying the relevant law, the prototype was made available to the public by the prior use and so the patent lacked novelty.
Judge Hacon said that although this had not been explored in the evidence in the case, there was no bar in law to the enablement of an invention by reason of the hypothetical skilled person having gained an understanding of it with the assistance of technical equipment.
The situation we seem to have reached is that the reasoning in some recent cases is operating in a way amounting to reductio ad absurdam, taking increasingly unlikely scenarios and drawing conclusions and lines on flimsy evidence and purely hypothetical circumstances.
It might have been best to go back to the House of Lords' judgment in Merrell Dow v Norton, in which Lord Hoffmann said that:
"... to be part of the state of the art, the invention must have been made available to the public. An invention is a piece of information. Making matter available to the public within the meaning of section 2(2) therefore requires the communication of information. The use of a product makes the invention part of the state of the art only so far as that use makes available the necessary information."
Judge Hacon's judgment in Claydon v Mzuri did not cite that House of Lords authority. It did, however, draw on Lux v Pike, a decision of Aldous J in the Patents Court, which has since tended to be cited as a key authority describing the relevant principles. In Lux v Pike Aldous J said:
"....it is settled law that there is no need to prove that anybody actually saw the disclosure provided that relevant disclosure was in public. Thus an anticipating description in a book will invalidate a patent if the book is on a shelf of a library open to the public, whether or not anybody read the book and whether or not it was situated in a dark and dusty corner of the library."
The Lux judgment was the first to address the law regarding anticipation by 'prior use' after the 1977 Act. It is hard to see how there can have been any "settled" law at that point other than that which had emerged under the 1949 Act regime.
There is, in my view, a world of difference between a book sitting in a dusty corner of a library, and a fleeting instance of disclosure in a field alongside an overgrown and unused footpath. What if there was no footpath – only a road. But although there were no parking restrictions, it would have been dangerous to pause as it might have caused an obstruction? Would that amount to making available to the public? Could photographs have been taken, then digitally enhanced by the skilled person to reveal the inventive concept?
What steps could Mr Claydon have reasonably taken? He had to test his new apparatus. There are few fields in England not flanked by either a road or a footpath, and none that would be inaccessible to a drone. What if he did not own such a field? What was he supposed to do? He couldn't shut a public footpath. Could he have posted big notices saying "Private Tests – Don't Look"?
Are the judges taking the additional wording in the 1977 Act – "at any time" and somehow construing that as meaning "at any moment in time"? We know that the skilled person is blessed with compendious knowledge and language skills, but are they also supposed to have the ability to see and digest information after a fleeting glimpse? Do they have a photographic memory and instant recognition?
As Peter Prescott QC said in Folding Attic Stairs, the law must draw a line somewhere. In my view, the line should be drawn at the point of the ability, in fact, to examine. The partly hidden library book, once found, can be read at leisure - even if translation is needed; time is not of the essence. Further, a written publication has been deliberately put in the public domain. In Lux Aldous J said:
"There is a difference between circumstances where the public have an article in their possession to handle, measure and test, and where they can only look at it. What is made available to the public will often differ in those circumstances."
If the legal test applied was that the relevant information had in fact been made available to someone to examine (free in law and equity etc) the inconsistencies between unlikely hypothetical scenarios could be ironed out.
It was Lord Hoffman's view that for the disclosure of matter to invalidate a patent the "necessary information" must be "made available", which requires communication. This a lot more than the hypothetical possibility that a skilled person, with or without a powerful phone or camera, might have been lucky enough to be in the right place at the right time to observe a short term test of a moving item, whether it is in a suburban garden in Florida or a field in Suffolk.
The mess needs straightening out. To require an opportunity for reasonable examination, enabling information to actually be made available, does not do harm to the principles underlying the law. It creates a more "real world" environment for the establishment of any proper assessment of the extent of any prior disclosure and its impact on the validity of potentially very valuable rights. And it respects the "patent bargain".
Obviousness
Having spent an unusually long time on anticipation, I will pass over Obviousness very briefly, and move straight to the most significant case of the year in this area.
In 2021, the most thoroughly reasoned judgment applying the general principles governing the assessment of obviousness was Birss J's judgment in Illumina v Latvia MGI.
The fourth Illumina patent found valid and infringed in Illumina v Latvia MGI (20 January 2021) gave rise to one of the long-standing controversies in the field of obviousness – that of collocation.
There were two main items of prior art – Milton and Arnost. I do not need to go into the science (you will be relieved to hear). We all know that it is not permitted to use different items of prior art to create a mosaic which gives rise to an obviousness attack.
MGI did not contend that Arnost and Milton could be mosaicked, but argued that the combination of their disclosures in a single molecule amounted to the mere 'collocation' of two (known) things, and therefore the claimed invention was obvious. In view of the judge's conclusion on the disclosures of Arnost and Milton, if MGI was correct on collocation then the patent would be invalid for obviousness. But applying the authorities, Birss J disagreed that the collocation principle applied. He found that the person skilled in the art would believe that the two components of the molecule were capable of interacting with one another, so they could not be regarded as individual inventions. In other words, for them to combine in an obviousness attack would involve creating a mosaic.
MGI appealed on this point. In the Court of Appeal (Illumina v Latvia MGI), Arnold LJ took the opportunity to review the principles. He noted:
"In the 19th century case of Williams v Nye, a patent for a sausage machine that was a combination of a known mincing machine and a known skin-filling machine was found lacking invention. The House of Lords in British Celanese v Courtaulds held that a mere placing side by side of old integers so that each performs its own proper function independently of any of the others is not a patentable combination."
Before asking whether the claimed invention involves an inventive step, it has to be decided what the invention is – is it one or two inventions? Two inventions do not become one invention just because they are included in the same hardware. For example, a car may contain many inventions operating independently of each other.
Arnold LJ explained that the judge had found that the patent claimed a single invention that made a technical contribution that neither Milton nor Arnost made even when taken together. He thought the judge's finding was correct, so it was not obvious to combine Milton with Arnost, and the patent was not invalid for obviousness.
Insufficiency
Sufficiency is an area of patent law that has been rather turbulent in recent years, so the emergence of some impressive judgments in 2021, apparently settling some areas of uncertainty, is welcome. Unfortunately not all the issues have been ironed out.
Stepping back, insufficiency is a single ground of invalidity, provided for in section 72(1)(c) of the Patents Act of 1977. It now embraces distinct types of objection, in particular:
- classical insufficiency – can you make it from the recipe in the patent?;
- excessive claim breadth / Biogen / lack of plausibility insufficiency; and
- uncertainty (previously called "ambiguity") insufficiency.
Underpinning all types is the "patent bargain", this being that the inventor obtains a monopoly in return for disclosing the invention and dedicating it to the public for use after the monopoly has expired.
For all three types, however, there has been uncertainty as to the correct date for the assessment of insufficiency. Is it the date of filing of the application for the patent? Or is it the priority date claimed (if different)?
For many years, this was considered settled by the House of Lords' judgment in Biogen v Medeva, as being the filing date. However, in 2020, in Regeneron v Kymab the Supreme Court said that it was, in fact, the Priority date.
The Supreme Court gave no reason for departing from the settled understanding of the reasoning in Biogen. Indeed it appeared to understand the reasoning of the House of Lords' judgment in Biogen was actually supportive of its statement that the correct date for the assessment is the priority date.
Last year I described the Supreme Court's decision as "transparently wrong" and drew their attention to the 19th edition of Terrell on Patents, which made that quite clear.
Unsurprisingly, the point fell to be addressed in the case law in 2021.
In Interdigital v Lenovo, Judge Hacon considered "the date as to which a patent specification is to be construed". He noted commentary in Terrell that a patent specification must be construed as at the date of its publication, but went on to say:
"It seems to me that contrary to what is implied in Terrell, the correct date for the assessment of sufficiency is the priority date, unless priority is lost in which case it will be the date of filing the application."
Lord Hoffmann's reasoning in Biogen was now to be read, said Hacon, in the light of the Supreme Court's judgment in Regeneron. He thought that there was no room for doubt that the Supreme Court had interpreted Biogen to mean that sufficiency was to be assessed at the priority date, even though Biogen was not actually considered in that context.
That is an odd thing to say. Lord Hoffman clearly said the correct date was the filing date, and that was picked up by subsequent legal text books. However, Judge Hacon considered himself bound by the UKSC's statement in Regeneron.
This is now as clear as mud! At some point, a case will emerge in which the date at which sufficiency is assessed makes a material difference to the outcome of the case (because of additional common general knowledge imputed to the skilled person at the filing date compared with the priority date). Then the Supreme Court can be asked to revisit the point. In the meantime, the date to work to would seem, for now, to be the priority date.
Classical insufficiency
In 2020, the Supreme Court's judgment in Regeneron v Kymab, approached the law on sufficiency largely by a 'top-down' application of the patent bargain principle in the context of that case, which was a product case.
Early in 2021, in Illumina v Latvia MGI , Birss J gave a detailed judgment explaining how the reasoning of the Supreme Court applied generally, not just in the context of product claims.
Birss J considered in detail one of the issues of principle relating to insufficiency which frequently arises in cases - undue burden. How much can the skilled person reasonably be expected to do by way of tests and experiments to make the recipe in the patent work?
He began by saying ([265]):
"...whatever the correct principles are about undue burden, none of them were addressed in Regeneron."
He then addressed the historical case law. A patent will not necessarily be insufficient just because the skilled person cannot work the invention immediately upon reading it. It is permissible for there to be a reasonable period of trial and error to get it to work, but not the need for prolonged research or experiments. Where exactly this boundary lies is a question of fact and degree depending on the nature of the invention.
Birss J noted that a functional definition cannot help covering things which are not yet invented, but that does not necessarily matter. The skilled person must be able to come up with components which will work and, if that involves testing things that is fine – just not too much testing.
Taking an example of a new teapot which was inventive and useful because its spout was shaped in a new way so as not to drip: The claim would be to a teapot with the spout shaped in the special way. The claim might not say anything about the material used to make the teapot, because it is irrelevant to the invention; equally it might say "a tea pot made of any suitable material" – either way it would be to a range of teapots made of different materials. The skilled person could choose, identify and test suitable materials: china would work; chocolate would not. If later a new form of Pyrex was invented and used to make such a teapot, the claim would still be infringed – and it would not reveal some form of insufficiency. Birss J explained:
"The fact that the skilled person could not make such a teapot at the priority date of the teapot patent does not matter. What does matter is that the descriptive feature of the claim, which is at least implicit in the claim, that the teapot has to be made of a suitable material, is not a relevant range."
What he means by "relevant range" is one which is key to the actual operation of the inventive step. In the case of the teapot, that is not true of the possible materials for the pot. The inventive core of the patent would be the shape of the spout.
That is a fair few words, but they are important. Birss J's judgment in Illumina v Latvia MGI may well stand the test of time.
Excessive claim breadth insufficiency
The existence of 'excessive claim breadth' as a distinct type of insufficiency emerged from the House of Lords' judgment in Biogen v Medeva, and consequently became known as Biogen Insufficiency. It seemed easy enough to assess. The question to be answered was "did the extent of the monopoly claimed exceed the technical contribution to the art made by the invention as described in the specification?"
However, what exactly that meant in practice became the subject of extensive litigation. When the Supreme Court was finally presented with an opportunity to tidy things up, there was no IP specialist in the court and the four separate judgments handed down in Warner-Lambert v Generics did little to clarify the law.
In 2020, Arnold LJ (sitting 'down' in the Patents Court) provided a workable way forward in Akebia v Fibrogen. In 2021 that case went on appeal and, in a rare opportunity to mark his colleague's homework, Birss LJ re-steered things a little in a judgment that, hopefully, has now settled this area of the law of insufficiency. Birss LJ's judgment is now where to go to, in order to understand excessive claim breadth/Biogen insufficiency.
Birss LJ began with the judgment of Kitchin LJ in Regeneron v Genentech which has become generally accepted as a good starting point:
"It must therefore be possible to make a reasonable prediction the invention will work with substantially everything falling within the scope of the claim or, put another way, the assertion that the invention will work across the scope of the claim must be plausible or credible."
What a can of worms that choice of words opened!
Birss LJ said that he preferred to refer to the question as one of "reasonable prediction" rather than plausibility, although it was a similar principle. As to what it requires, Birss LJ said:
"To apply the reasonable prediction principle one has to take three steps. First one must identify what it is which falls within the scope of the claimed class. Second one must determine what it means to say that the invention works. In other words what is it for? Once you know those two things, the third step can be taken: to answer the question whether it is possible to make a reasonable prediction the invention will work with substantially everything falling within the scope of the claim."
It may be that, after some years of high controversy, the entirely non-statutory concept of plausibility is in retreat, and maybe this clearer test can do away with the question of whether the bar is a high one or a low one. For what it is worth. In 2021 Meade J, still using the old terminology, thought the bar was low.
Uncertainty insufficiency
The "uncertainty" type of insufficiency was considered in depth by Birss LJ in Fibrogen v Akebia where he said:
"... claims can often be difficult to construe. Sometimes those difficulties are due to avoidable obscurity for which the patentee should get no sympathy, but it can be because trying fairly to describe an invention in words is not always an easy task. ... the existence of a fuzzy boundary in a claim is not objectionable. The contrast is between that and a claim which is conceptually uncertain........ When a defendant has been found to infringe, demonstrating that the claim's scope is at least clear enough to work that out, an argument that the claim should be regarded as conceptually uncertain is likely to be met with scepticism."
Further, Birss LJ said ([156]):
"A finding of infringement does not preclude a finding of conceptual uncertainty, but I do maintain it ought to cause the court to look closely at what the alleged uncertainty really amounts to."
And so, with a sigh of relief, we come to the end of insufficiency. The mist is clearing a little thanks to the sterling work of Birss LJ. Hopefully in future years the picture will be a little clearer through the lens of his analysis.
One last word on Insufficiency. Patent law relies on quite a few fictions and hypotheticals. The idea that any patent is ever really "sufficient" is probably one of them. Consider the Great British Bake Off! There is a round called the "technical round" in which the bakers are given a recipe and all the necessary ingredients and asked to make the desired baked comestible. All the contestants are skilled bakers – at least to the level of the person skilled in the art of baking. Do they all come out the same? They do not! Many of them appear inedible, and no two ever look closely alike.
It has been interesting to hear one of the key arguments made against the proposed patent waiver to accelerate vaccination globally, which is that the patents alone are not enough to make an effective vaccine. Where does that leave the law of sufficiency in patent matters? Should the courts be stricter in the light of this, or more generous? Discuss.
Technical matters and procedure
Covid litigation
In 2021, judgments have reported trials conducted fully remotely and in hybrid formats, including with some time-shifting or slightly longer days for experts located in other time zones. Microsoft Teams seems to be the usual platform. Electronic bundles are now standard, at least in the Patents Court. Such arrangements enable trials to be conducted in 'open court' without restrictions on the number of individuals that can be accommodated in a 'Covid-safe' way within one court room, and while enabling access to the public. All in all, it appears that improved court procedure is a silver lining in the Covid cloud
Judgment hand-down
This issue has been an accident waiting to happen for some years now, and in 2021 there was some accident!
In a judgment that is an absolute must-read for all litigators (not just IP lawyers) Meade J expressed what might, with some understatement, be described as his frustration. In Optis v Apple, the usual course of events occurred.
On the afternoon of Monday 20 September 2021, the embargoed judgment was provided to the parties. A leak soon became suspected, but in fact had not happened. A sorry sequence of events ensued..
A leak became suspected after an unrelated individual at a third party company (Sisvel) learned through a barrister not involved in the case that hand-down of the judgment was imminent. The unrelated individual reached out to an individual at Optis with a message saying "big day...keeping my fingers crossed!"
What followed was a car-crash in slow motion. I will spare the participants a full description of the facts. Suffice to say that accusations were levelled that the judge's office "leaks like a sieve". Allegations were made about calls being made or not made. The offending documents – emails and WhatsApp messages – were not collected and collated, still less sent to the judge in a timely manner. The judge was informed in general terms, but the worst communications (e.g. that his office leaked like a sieve) were initially kept from him.
Recounting the sequence of events, the various assertions made and the gradual unmasking of what had transpired, Meade J's judgment on the issue included the phrases "disastrous lack of thought", "obviously and completely untrue", and "deplorable and far short of what the court is entitled to expect". Swap "court" for parliament" and that all begins to sound quite familiar!
He noted that breaches of the restrictions of confidentiality are backed by the sanction of contempt, but he stepped back from escalating matters to contempt proceedings, saying it would be a big distraction from the real substance of the litigation. His scathing judgment expressing severe dissatisfaction is in itself a form of sanction. Optis was also directed to pay Sisvel and Apple's costs on the indemnity basis.
There are a lot of learning points for lawyers here.
- Treat embargoed judgments like trade secrets
- Remember that this is a "trust relationship" and one party is the judge
- If there is a breach make full, honest and complete disclosure to the court, however painful that might be
- Don't use email exploders carelessly
You have been warned.
Entitlement / employee inventor compensation
At last, the word you have been waiting for.....Finally, we wrap up our review of patent cases in 2021 with a look at the Court of Appeal's judgment in Thaler v Comptroller. The case name may ring bells from our review last year – in the judgment under appeal, Marcus Smith J said he liked to think that an alien from outside the galaxy would not be denied legal personality before the courts of England and Wales simply on the grounds of unforeseen extraterritoriality. The Court of Appeal steered clear of alien analogies.
Dr Thaler's patent applications were being pursued as a test case. Dr Thaler was the applicant, but he did not assert himself to be the inventor of the inventions for which patent protection was sought. On the contrary, Dr Thaler asserted that the inventor of the inventions was an AI machine, named 'DABUS', which was owned by Dr Thaler.
The question for the courts, therefore, was whether in such circumstances the requirements of the Patents Act of 1977 were satisfied, in particular sections 7 and 13, which provide:
"7. Right to apply for and obtain a patent
(1) Any person may make an application for a patent either alone or jointly with another.
(2) A patent for an invention may be granted—
(a) primarily to the inventor or joint inventors;
(b) in preference to the foregoing, to any person or persons who, by virtue of any enactment or rule of law, or any foreign law or treaty or international convention, or by virtue of an enforceable term of any agreement entered into with the inventor before the making of the invention, was or were at the time of the making of the invention entitled to the whole of the property in it (other than equitable interests) in the United Kingdom;
(3) ..............
(4) Except so far as the contrary is established, a person who makes an application for a patent shall be taken to be the person who is entitled under subsection (2) above to be granted a patent......
13. Mention of inventor
(1) The inventor or joint inventors of an invention shall have a right to be mentioned as such in any patent granted for the invention and shall also have a right to be so mentioned if possible in any published application for a patent for the invention and, if not so mentioned, a right to be so mentioned in accordance with rules in a prescribed document.
(2) Unless he has already given the Patent Office the information hereinafter mentioned, an applicant for a patent shall within the prescribed period file with the Patent Office a statement—
(a) identifying the person or persons whom he believes to be the inventor or inventors; and
(b) where the applicant is not the sole inventor or the applicants are not the joint inventors, indicating the derivation of his or their right to be granted the patent;
and, if he fails to do so, the application shall be taken to be withdrawn.
The Patents Court, dismissing Dr Thaler's appeal from UKIPO, confirmed that an AI machine was not a natural person and so did not satisfy the meaning of "inventor" pursuant to s.7(2)(a). Nor was an AI machine capable of owning or transferring any rights in its invention pursuant to s.7(2)(b) or (c), so the owner of the machine was not entitled to a patent for the relevant invention. Further, the provisions of section 13 did not affect the operation of Section 7 in any important way.
In the Court of Appeal, the majority (Arnold LJ and Laing LJ) dismissed Dr Thaler's further appeal applying the same grounds as the first instance judge. Birss LJ dissented. Needless to say, his judgment makes for rather more interesting reading.
Birss LJ pointed out that the key provisions of the current law, sections 7 and 13 of the 1977 Act, were enacted against the background of the 1970 'Banks Committee' report on the British Patent System, which made recommendations on the procedure relating to patent applications, including that the law should be simplified in various ways.
In a nutshell, Birss LJ's finding was that Section 7(4) created a presumption that the applicant was the person entitled to the ownership of the patent. That would need to be rebutted by someone else challenging that position. It was clear that it did not have to be the inventor.
As regards Section 13, Birss LJ said that Dr Thaler had filed a statement identifying the inventor. The fact that the inventor identified was not a legal person was really neither here nor there as regards the job of the Comptroller to grant the patent. There was no suggestion of dishonesty. Birss LJ said that this was the intended consequence of the reforms implemented in the 1977 Act – a simplified system based on rebuttable presumptions to reduce the inquiry required by the patent office and consequently the time and cost of the application.
I agree with Birss LJ.
Birss LJ also made some pertinent observations on the circumstances of the case:
"Just because all inventors are people, this case demonstrates that it does not follow that all inventions have a person who invented them...The absence of a named inventor when it is clear why no name has been given and it cannot be said the applicant is not giving their genuine belief, is no basis on which to find that s13(2) has not been complied with.
There is more than a hint in this case of the idea that if only Dr Thaler was not such an obsessive and, instead of calling DABUS the inventor, he named himself and then none of these problems would arise. However since inventors can waive their right to be mentioned under s24(3), even if the Comptroller suspects that Dr Thaler is really the inventor, Dr Thaler has clearly waived whatever right he may have had to be mentioned and that should be the end of that."
The gist of the judgment is that Sections 7 and 13 are there to address entitlement and recognition. They are not designed to impose strict conditions – if they were they would not include allowable presumptions.
Birss LJ identified a simple construction of the statute which would allow an invention made by an AI machine to be patented, even if the machine itself could not be identified as the inventor. As usual, he is running ahead of the pack here, and acknowledging that life moves on and the law has to keep up with the technology.
Acknowledging that the law is different in the USA, what if, for the UK purposes, Dr Thaler had just made up a name for the inventor – Michael Mouse, for example. Would there have been any enquiry by the patent office into whether that was a real person? The fictional Mr Mouse is no more a "legal person" than DABUS, but the patent would have been granted nonetheless. The post-1977 Act regime does not require that enquiry to be made.
Summary and conclusions
After a few quite "grumpy" years, I ended last year's review in a positive frame of mind, and overall nothing has changed. As I said right at the beginning, we have a really expert panel of judges at all levels and although there are still one or two mavericks, the service and consistency is strong and reliable.
We are about to enter the first full year of Birss LJ and Arnold LJ alongside each other in the Court of Appeal. I do not know how often they will sit on the same panel, but when they do, I doubt that it will be boring. They do seem to have somewhat different mindsets, leading to a perception that maybe one favours patentees a little more than the other.
We have now had a full year of Meade J and I have to say that the impression is very favourable. Last year I referred to Professor Sir Robin Jacob's optimism about the new judicial team being, at least, the equal of his day with Lord Hoffman, Aldous LJ, Jacob, Laddie and Pumfrey in harness. I think he may well be absolutely right about that, and if so, the timing could not be any better.
Why? Well.....after many years of speculation I decided to omit any mention of the proposed Unified Patents Court last year, but now it seems to be upon us. After a flurry of court activity, some diplomatic progress with ratifications, and now with the express support of the French Presidency of the European Commission, the chances are that the UPC will be with us before the end of this calendar year.
My view, for what it is worth, is that this is a good thing for patent litigation in the UK, as long as we can shed the image we once had that the UK was where patents came to die. With the fear of losing valuable patents across the whole of the European Union, and with the UK remaining an important market for pretty much all goods, why would companies not consider litigating in the UK as a "first step" to European enforcement? A positive judgment from a strong UK court might be more than influential in the wider European market.
Why not? Well, for one thing the cost. Last year I mentioned my pet scheme – the costs cap for Shorter Trial Scheme cases. When I first had the idea, I set the cost cap at £500,000 to match the maximum recoverable costs (circa €600,000) in the UPC. That is now more relevant than ever and I would really like to see that being pushed through this year. If we take away the conspicuous costs gap, the attractiveness of the UK system in terms of the quality of judges and the rigorous procedures would far outstrip a brand new court with untried judges and rules.
I think that the innovative spirit and "can do" attitude which marked the initial response to the Covid pandemic and the lockdown has continued through 2021, with the courts responding positively and constructively and forging new practices which will enhance the practice of justice in this country for the future.
A lot of the credit for that must go to the Deputy Head of Civil Justice in this country. We have all known him for many years and admired his energy, enthusiasm and innovation as a leading QC and then a judge. Now we have to share him with the wider legal community, but we cannot begrudge them a stake in his excellence. If there was no other reason, his effective untangling of the complex knot into which the concept of insufficiency had managed to become tied by a couple of rambling Supreme Court decisions, is in itself grounds for awarding Lord Justice Birss this year's coveted "Judge of the Year" award. I am only sorry that he never got his hands on that wretched seed drill!
That is it for another year. It only remains for me to thank Ailsa Carter, without whose efforts throughout the year in mapping and reporting the cases as they arise, none of this would be possible.
See you next year! Who knows, we may even have an early UPC hearing to report!
Now this last year at this point I handed over to Michael Carter who gave a little prediction about the future. Michael is with Alex today probably just finishing right now the Interdigital and Lenovo case so standing in as introduced by Huw at the beginning is Chris Freeth, Chris over to you.
Christopher Freeth: Thank you Gordon for another most interesting talk this year. Hello everyone. As Gordon mentioned, I am Chris. A Principle Associate here at Gowling. I am filling the daunting shoes of Michael Carter. He is off far too busy being patent litigator so I have got the more luxurious job on pontificating about is yet to come.
Actually, it is a little unfair to myself. I am also a patent litigator as was mentioned and am heavily involved in the Neurim and Mylan litigation saga that is ongoing. I will touch on that later.
I will now dive straight in as I have just ten minutes. I should add, that a lot of this will be recapping on points already made today. My aim is to draw together some of what we have heard and fill you in on some things to look out for this coming year.
So, in keeping with our theme for today, the first thing to look at is indeed Back to Basics.
Well I say basics, just a few years ago equivalents was not so much our basics, or at least not in quite the same way in with the great prominence it now enjoys. As anyone who does infringement analyses will know well, equivalents is tricky to say the least and has introduced a degree of uncertainty into our law, if I may be so bold. Or has at least made infringement analyses more difficult. I say that as someone who does many of them.
As we have heard today, there have been two key decisions touching equivalents over the past year and the problem for validity gap that it has caused. There is Facebook and Voxer and Optis and Apple. Recalling in Facebook and Voxer the point came in late but it was allowed in, on case management grounds. Going forward, if you want to run equivalents it is now clear it needs to be pleaded out fully.
Does that mean we will see satellite litigational pleadings of equivalents? I think that is unlikely, in the sense of meaning standalone hearings but I expect we will see the argument being made at trial. I agree with Gordon that ambush including by equivalents is too common. But I must admit, my experience is pleadings points so arguing something was not pleaded, do not tend to get you very far in first instance trials. Hopefully Facebook and Voxer means that is not the case or at least not for equivalents.
As Gordon noted, with Facebook and Voxer the Formstein defence was given a strong albeit nod by Lord Justice Birss sitting in the High Court has been the solution to this validity gap. We are not aware of that case going to appeal, but Lord Justice Birss' comments with Optis were not expect them to go to appeal in any event. However in Optis and Apple, what is essentially the same core issue came up in the context of anticipation by equivalents. As Gordon mentioned.
Now I was going to make a joke here about sticking my neck out and how this all appealed up to the Court of Appeal and very probably the Supreme Court but Gordon has given it away! I would certainly be parroting Mr Justice Meade. This is an extremely important point for UK patent law, it seems certain to need the consideration of the Court of Appeal and very probably the Supreme Court.
So thank you Mr Justice Meade for making my speculations a little easier. Optis and Apple heads to the Court of Appeal in May this year so watch this space. We all agree here at Gowling, this is an extremely important issue.
Changing topic, FRAND. I am no FRAND specialist, so thank you to Seiko for so deftly taking us through a monolith of a topic. We heard from Ailsa about the amount of FRAND disputes happening in the courts at the minute and the number of judgments that we are seeing in the context of FRAND disputes. Nonetheless Unwired Planet remains the lead case on FRAND itself. However, as Seiko mentioned, there are other FRAND trials happening. Interdigital and Lenovo FRAND trial commenced last month, that is the one that Alex and Michael are working on, that concludes as Gordon said, quite possibly any moment now.
As we have heard, it is the first FRAND trial since Unwired Planet and so it is an important one to be watching out for this year. The Optis and Apple FRAND trial is also scheduled for June this year so we are soon going to have two significant FRAND judgments to digest.
So we have spoken about a major topic coming up for the Court of Appeal which is anticipation of equivalents. The major topic coming up at first instance, which is FRAND. Well how about the Supreme Court? At the time of writing this talk, there was nothing on the Supreme Court website yet for me to note. I say yet, because the January permission to appeal decisions are not online yet but I am watching very closely for whether a case Gordon talked about appears, that is Thaler and Comptroller.
It will be a little surprised if Doctor Thaler is interested in appealing to the Supreme Court, in our view the questions that the case raises is certainly suitable for hearing by the Supreme Court especially given Lord Justice Birss' frankly excellent dissenting judgment. However as was said, there is no news yet on permission.
Looking internationally for a moment, there are parallel cases being run by Doctor Thaler in several other jurisdictions. Australia is of particular interest because it went first the opposite way to the UK at first instance and found that DABUS was an inventor. That is being appealed. There is no news on when that will be heard either. My experience of Australian system is it is quite a lot slower than ours. That is certainly the case at first instance. I must admit I cannot speak to appeals.
There have also been decisions from the German Federal Court and the US Virginia Eastern District Court, agreeing with the respective patent offices refusals of Doctor Thaler's patents. I see reports that the US is being appealed but I have not seen any reports on the German appeal yet.
There is also a written EPO decision to look out for this year. Just before Christmas on 21 December, the EPO's Legal Board of Appeal announced orally that it would dismiss Doctor Thaler's appeals against the earlier refusals to grant his patent. A written decision will follow but there is no sign of that yet. Again, my experience is those things do take time.
And just to show it does not go all one way. In South Africa at least one of Doctor Thaler's patents applications was granted. However in South Africa my understanding is only basic formality to check by the Patent Office. So that patent could yet be challenged. My overall point is, expect continued activity in the Thaler case and not just in the UK this coming year.
Now having mentioned Lord Justice Birss' dissent which I must admit does feel like a rather mean Segway to make and apologies Lord Justice Birss for that but as Gordon noted, the judgement in Thaler is the first judgment on which both Lord Justice Birss and Lord Justice Arnold sat on the panel.
So one panel and already a disagreement but admittedly on a highly unusual topic. It is interesting to think about Ailsa's stats and historically the two have differed at least statistically speaking. It is also interesting to think of the cases we have had today. Akabia and Fibrogen which Ailsa mentioned and Gordon mentioned where Lord Justice Birss overturned Lord Justice Arnold on appeal. Lord Justice Arnold having sat down in the High Court.
As Gordon said, we can expect to see more from this pair over the coming year. Assuming they continue to sit on the same panels like Lord Justice Kitchin and Lord Justice Floyd before them.
I will now turn to a quick sweep of some other important topics we expect yet to come.
The first is exhaustion. Well the government sat on its hands and said no post Brexit legislation yet. So this is now an area ripe for case law. This really is back to basics. If you trace back case law, the leading authorities on the implied licence or bets of Wilmore doctoring date to the 1800s and the principals involved are even older than that.
For goods imported from outside Europe, no authority has definitively overturned that old line of case law which arguably remains good law. On the other hand, for goods imported from the EEA, EEA exhaustion seems to be retained EU law. There is no legislative basis in patent law for distinguishing between genuine goods depending on which parts of the world they are imported from.
So how are the courts going to reconcile that position? There is more than one course they can take but for today it suffices just to say that exhaustion is an area where there is uncertainty in the law, at least certainly for goods imported from outside the EEA and we can expect litigation testing this position. If not this year, then in due course. Appeals are expected to go to the Supreme Court.
Now as a litigator, I could not resist picking up once again on satellite disputes. I now expect those sadly to increase. The new trials witness statements we will also hear. The goal has been to prevent over lawyering and using witness statements to argue or spin a case, rather than as a vehicle for evidence. I certainly agree with the goal, but it is quite clunky to do. The disclosure pilot is also here to stay for another year. And as Gordon explained, the courts continue to push back on confidentiality clubs and certainly against the trend of lawyers on his only disclosure.
I expect we will continue to see points being taken of all of these. Now hopefully again as part of CNC's trials not standalone hearings which might help keep costs down.
Speaking of costs, I said I would return to Neurim and Mylan. Mylan now being Viatris, their new name. I will just briefly note that the appeal on costs in that case is due to be heard in March by the Court of Appeal. The first instance costs decision is one that first appears confined to its facts and it is actually quite wide reaching if you think about it.
Neurim succeeded at the UK trial showing its patent was valid and infringed. Its patent was then revoked a few weeks later at an EPO appeal. Mylan well now Viatris, was awarded its costs of the UK trial in which it had been unsuccessful. The proximity in time clearly weighed on the court but the decision raises the question of whether the flow of UK costs can now be changed by a decision of the EPO. Potentially even many years after the UK court decision. That problem has been lurking in the background even since Version and Zodiac which was another case in which Gowling acted.
We may now see some guidance from the Court of Appeal this year. As I said, watch this space in March.
And finally, like Gordon how could I look forward without acknowledging the EPC. Well it is coming, do I mean the EPC, Gordon has already given away that that is coming or do I mean a fabulous Gowling webinar to explain everything you need to know. Well both are coming so patent owners and exclusive licensees, if you are not already prepared for the EPC, consider your opt in and opt out position and get your admin ready. Now is the time. And that admin should include signing up to our webinar. There will be more details to follow in the near future.
Now with that shameless plug made on what is a genuinely serious topic, I will hand back to Huw for closing remarks and questions.
Thanks Chris and thank you Gordon, Seiko and Ailsa.
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