The six time winner of our Patent Lawyer of the Year Award, Trevor Cook from Bird & Bird, a leading IP law firm, evaluates how judicial changes in the UK Supreme Court are affecting the jurisprudence and direction of patent litigation.
At its highest levels, namely the Supreme Court and the Court of Appeal, English patent litigation is under new management, although whether this presages any change in approach on the part of the English courts generally is as yet unclear. In 2011 Lord Justice Jacob retired from the Court of Appeal, although since then he has, on occasion, returned to sit on patent appeals, as cases on which his replacement cannot sit work their way through the system. Moreover 2009 saw Lord Neuberger stepping down from his role as intellectual property lead in the UK Supreme Court in order to head civil appeals in the Court of Appeal as Master of the Rolls. He initially assumed the former role when the Supreme Court replaced the House of Lords earlier that year – which coincided with the retirement of Lord Hoffmann, who had for so long dominated the court in intellectual property matters.
Despite stepping down Lord Neuberger was able to sit on, and give one of the two main judgments in, the first (and so far only) decision of the Supreme Court in a patents case: that of Eli Lilly v Human Genome Sciences in 2011, reversing the decisions of both courts below. Lord Hope, a Scottish justice, gave the other main judgment. Lord Walker – who, as an English judge at first instance heard several intellectual property cases – also gave a short judgment, concurring with the other two but in such a way as to leave the impression that, had it just been up to him, he might have upheld the decisions below. In addition to Lords Neuberger and Walker, Lord Mance – who, along with Lord Walker, remains in the Supreme Court – had also previously delivered reasoned judgments in Generics (UK) v H Lundbeck in 2009, the last patents case to be heard by the House of Lords. Here they had all upheld, in subtly different ways, judgments by Lord Hoffmann (on this occasion sitting in the Court of Appeal) and Lord Justice Jacob. The decision in that case of the Court of Appeal had reversed a decision at first instance of (as he then was) Mr Justice Kitchin, who has now assumed Lord Justice Jacob’s position in the Court of Appeal as the patent specialist there (and whose judgment at first instance in Eli Lilly v Human Genome Sciences, upheld by the Court of Appeal, was reversed by the Supreme Court). It remains to be seen, with Lord Neuberger’s responsibilities for the Court of Appeal, whether he will continue to take so active a role in patent matters in the Supreme Court in future and, if he does not, who will take his place.
English practitioners were deprived by settlement of the analysis of the Supreme Court in EMGS v Schlumberger, a case scheduled to be heard early in 2012, as to the nature of the skilled addressee for the purposes of assessing inventive step and sufficiency. Here Lord Justice Jacob had held in the Court of Appeal in 2010 that the identity of the skilled addressee could, in those cases in which the invention lies in combining teaching from two disparate arts, differ for the purposes of assessing inventive step and whether the patent sufficiently disclosed the invention. This was not because a different construction was being given to the phrase “person skilled in the art” but because the phrase was being applied to different situations. Thus where the issue is one of sufficiency the situation is a post-patent one in which the skilled addressee has the patent in hand teaching how to perform the invention. But the “person skilled in the art” does not have the patent in hand when considering obviousness and so “the art” may be different if the patented invention is art changing. This particular controversy provides a timely reminder that the very act of constructing a hypothetical team as the skilled addressee for the purposes of being able to lead expert evidence in the English courts as to the attitudes of members of that team can risk rendering an invention which would not be obvious to the individual members obvious to the combination of them.
The only currently pending Supreme Court patent case is Virgin Atlantic Airways Limited v Premium Aircraft Interiors (UK) Limited, in which the issue is whether, once a decision has been made (from which there is no appeal) that a patent is valid and infringed and an inquiry as to damages ordered, the subsequent invalidation of that patent in other proceedings allows such an order to be set aside. Long-established case law says not, but the Supreme Court gave leave in 2011 to challenge this; and it is notable that it was Lord Neuberger who, in the Court of Appeal in 2004, dissented from a judgment that followed such established case law in Coflexip v Stolt Offshore MS.
As observed above the Supreme Court decision in Eli Lilly v Human Genome Sciences, reversing the decisions of both of the lower English courts which had found the patent to be invalid for lack of industrial applicability, has been its only one in a patent case to date. It was a judgment that is specific in its application, in that the objection of lack of industrial applicability, on which the Court of Appeal concentrated to the exclusion of all else, and which was all that the Supreme Court could really address, is one that has only ever arisen in relation to commercially important inventions in the field of biotechnology. Moreover, and as recognised by Lord Neuberger, the resolution of the case was inevitably fact-sensitive, and therefore its answer might be of limited wider application. The underlying issue in the lack of industrial applicability challenge to the validity of Human Genome Sciences’ patent was shared with the other legal grounds of objection raised against the patent (namely lack of inventive step and insufficient disclosure), which were only fully ventilated at first instance; namely, had Human Genome Sciences, in its original application, disclosed enough to move out of the realm of mere speculation as to the possible therapeutic utility flowing from its identification of a particular protein that occurred in the human body and the gene sequence which codes for it, into a more concrete disclosure of possible applications which merited a patent.
The Supreme Court was clearly troubled by the fact that, although the lower courts had said that they were applying principles established by EPO case law, they had come to a different conclusion to an EPO Technical Board of Appeal on the same patent, although the Court of Appeal had sought to explain that its reasons for so differing were that the Patents Court, whose judgment it upheld, had had different evidence before it to that which was before the Board of Appeal. Although accepting this reasoning in principle the Supreme Court saw in fact no difference between the central findings of fact of the Board of Appeal and the Patents Court and held, after close analysis, that the reason for the difference was that the Court of Appeal and the Patents Court had incorrectly applied the accepted principles established by the EPO case law to the findings of fact of the Patents Court. Lord Hope identified indications in the decision of the Court of Appeal that the standard which it set for industrial applicability in biotechnology cases was a more exacting one than that used by the Board of Appeal in that it had been looking for a description that showed that a particular use for the protein (or molecules that modulated its activity) had actually been demonstrated rather than that such product had plausibly been shown to be “usable”. However, Lords Neuberger and Hope both recognised the difficult nature of the case and expressed marked reluctance, which they had only with difficulty overcome, to reverse the judgments below.
It was Lord Walker who summarised the policy arguments for allowing the appeal which to his mind justified the Supreme Court in taking what would otherwise to him be a questionable course – the one was to reduce the risk of a chilling effect on investment in bioscience (though here he noted that the arguments are certainly not all one way), and the other was to align the UK interpretation of the European Patent Convention (EPC) more closely with that of the other EPC contracting states. The first of these reflected an issue that had been raised in an amicus brief from the BioIndustry Association, the trade association for innovative enterprises in the UK biosciences sector. The amicus brief suggested that there was at least a risk, if the reasoning of the Court of Appeal were upheld, that it would “make it appreciably harder for patentees to satisfy the requirement of industrial applicability in future cases” and that if that were so, this “would cause UK bioscience companies great difficulty in attracting investment at an early stage in the research and development process”. This was a consequence, it warned, of the reasoning of the lower courts resulting in there being normally a need to conduct tests to provide experimental data to establish to the requisite standard that a protein (or molecules that modulated its activity) has a therapeutic use, which would be expensive, when funding would be hard to obtain for a project of this sort which had no existing protection in the form of a patent application. The amicus brief also, however, accepted that it would be wrong in principle to enable a patent applicant to reveal no more than “a vague indication of possible objectives that might or might not be achievable by carrying out further research”, given that the purpose of the patent system is not “to reserve an unexplored field of research for the applicant nor to give the patentee unjustified control over others who are actively investigating in that area and who might eventually find ways actually to exploit it.”
Thus the first and so far only patents judgment of the Supreme Court is of limited wider application and establishes no new legal principles, even though it does provide the clearest summary of the principles governing industrial applicability in biotechnology that can be extracted from the EPO case law. It does however show the importance of policy considerations to the thinking of the Supreme Court, and the increasing relevance to such policy considerations of amicus briefs.
Moving down a level to the Court of Appeal Lord Justice Kitchin has as yet sat in too few patent appeals for him to have started to make his mark in his new role in that court, although a good flavour of his approach can be seen from his paper “How much for how little?” at the Fordham Conference in 2009, in which he gave a nuanced but spirited defence of his judgment in Generics (UK) v H Lundbeck in the light of its subsequent reversal by the Court of Appeal as upheld by the House of Lords.
And what of the English courts at first instance, where much of the law gets made? Here the gap left by the elevation of Mr Justice Kitchin has, pending the appointment of a new Patents Court Judge to join Mr Justice Floyd and Mr Justice Arnold, been filled by the Patent County Court judge, His Honour Judge Birss QC, who has been deputising regularly as a Patents Court judge. He has the time to do this as his patent workload in the Patents County Court has been light, despite its new rules since late 2010 which limit the costs recoverable for the liability phase to £50,000 (and thus imposes a significant downward pressure on a party’s own costs) and under which the default procedural regime is akin to that found in the courts in much of the rest of Europe, in providing, absent order, for no discovery and no expert evidence or cross examination. This paucity of decided patent cases would seem to reflect a high level of settlement in such cases in the Patents County Court rather than any shortcomings as a jurisdiction for its target market in the smaller cases or those that involve small and medium-size enterprises; thus, in contrast, there have been numerous decided cases in the Patents County Court in other areas of intellectual property, and for which the (increasingly inappropriately named) jurisdiction has been seen as a great success.