Actavis v Eli Lilly in the High Court: Better reach for a tablet when litigating patents.

In [2012] EWHC 3316 (Pat) Actavis v Eli Lilly, the High Court (Patents) upheld jurisdiction for the English courts to hear a case in which applicant seeks a pan-European declaration of non-infringement of a patent. Actavis, a generics manufacturer, sought declaration that it had not infringed Eli Lilly’s patent for Permetrexed, a cancer treatment.

Arnold J, along the lines of  the Supreme Court’s decision in Lucasfilm v Ainsworth, held that forum non conveniens arguments would not sway the Court towards declining jurisdiction for the non-UK parts of the declaration (Germany, France, Italy, Spain).  Arnold J referred to the de facto approximation of patent law in the various EU Member States:

‘As to the different national approaches, I accept that there are differences. In my view, however, the differences are rather less now than they have been in the past. Certainly, in recent years the European patent judiciary have been striving for consistency. I am sceptical that the remaining differences of approach, as opposed to other factors, are responsible for different outcomes in parallel cases. In any event, it seems to me to be manifest that it will reduce the likelihood of inconsistent decisions if one court at first instance and one court on appeal determines all five of Actavis’ claims.

The judgment adds to the layer of complexity in intellectual property litigation. Prima facie the judgment may offer a great means to have pan-European patent infringement cases held in England (the very reference to a number of pending trial dates even in Germany, quietly underline the speed with which the UK can hear cases such as these).

Distinguishing is however of the essence:

– Actavis are headquartered in Switzerland (one will recall that under the Brussels I Regulation, the plaintiff’s domicile or nationality is generally irrelevant). Defendant is domiciled in the State of Indiana, United States. The declarations are not sought against any EU domiciled companies – Brussels I is not applicable. The outcome may be entirely different had the opposite been the case.

– The validity of Lilly’s patent is not sub judice. This too, even outside the Jurisdiction Regulation (where the exclusive ground of Article 22(4) would have trumped English jurisdiction), may have led to a different outcome under forum non conveniens arguments.

– Arnold J’s suggestion of de facto approximation may not hold with the ECJ for actions which do come within the Jurisdiction Regulation. As reported on this blog, even in Solvay, the ECJ  does not drop its insistence per Roche that de lege lata, European patent law remains national.

All of this may lead indeed to the awkward result that patent infringement cases are more swiftly and expertly dealt with in EU courts against non-EU defendants, then against EU defendants.

Geert.

Intellectual property and render unto Caesar what is Caesar’s

An unusual entry perhaps if you allow me, on the nature of intellectual property, piracy, marketing and rendering unto film companies what is theirs.

I found myself on Saturday night trying frantically to have the kids watch a motion picture online. Being a lawyer and all that, and generally firmly believing that one ought to be renumerated for one’s intellectual property, I tried to do it the right way. I wanted to pay for online entertainment just as we used to do when popping out to the video store.

An hour (!) and tens of search engine strings later, after having visited the official webpages of all companies involved, researched all possible reliable legitimate media providers and having gotten increasingly frustrated, I gave up. The only place which seemed to have a legitimate offer was Apple I Tunes or I store of something of the kind – however I am neither an Apple customer nor in possession of any of their hardware. Where is the E equivalent of all those video stores?

In the process, I declined numerous offers to watch said film ‘free’ – i.e. illegally. This has made me wonder: in trying to teach my children the virtues of law enforcement, respect for intellectual property, and generally doing the right thing, I was not exactly helped by the holders of said property.

Is there some distribution reality complication which makes it impossible for the creators of intellectual property to make it just as easy to pay for their services as it is not to pay? Have I bumped into the limits of my search engine talents, in which case, please if one of you could send me a relevant link?

Geert.

Court Judgment in Solvay: Roche distinguished, jurisdiction for provisional measures upheld in spite of Article 22(4) JR.

Solvay, case C-616/10 [I reported on the AG’s Opinion here; readers may want to have a quick look at that post before or after reading on], was decided by the Court on Thursday, 12 July. AG and Court revisited a number of old chestnuts in the application of the Brussels I Regulation (the Jurisdiction Regulation or ‘JR’): the exclusive ground of jurisdiction with respect to intellectual property rights, of Article 22(4); multipartite litigation in Article 6 JR; and finally provisional measures, referred to in Article 31.

Solvay accuses Honeywell Flourine Products Europe BV and Honeywell Europe NV of performing the reserved actions in the whole of Europe and Honeywell Belgium NV of performing the reserved actions in Northern and Central Europe. In the course of its action for infringement, on 9 December 2009 Solvay also lodged an interim claim against the Honeywell companies, seeking provisional relief in the form of a cross-border prohibition against infringement until a decision had been made in the main proceedings.  In the interim proceedings, the Honeywell companies raised the defence of invalidity of the national parts of the patent concerned without, however, having brought or even declared their intention of bringing proceedings for the annulment of the national parts of that patent, and without contesting the competence of the Dutch court to hear both the main proceedings and the interim proceedings.

On the applicability of Artice 6 (multipartite litigation), the Court agrees with the AG that Roche still holds: the same situation of law cannot be inferred where infringement proceedings are brought before a number of courts in different Member States in respect of a European patent granted in each of those States and those actions are brought against defendants domiciled in those States in respect of acts allegedly committed in their territory. A European patent continues to be governed, per the Munich Convention, by the national law of each of the Contracting States for which it has been granted.

However in the specific circumstances of a case, Roche may be distinguished: whether there is a risk of irreconcilable judgments if those claims were determined separately, is for the national court to determine. The Court of Justice instructs the national court to take into account, inter alia, the dual fact that, first, the defendants in the main proceeding are each separately accused of committing the same infringements with respect to the same products and, secondly, such infringements were committed in the same Member States, so that they adversely affect the same national parts of the European patent at issue.

On the application of Article 22(4), the Court emphasises the very different and unconnected nature of Article 22 and Article 31. They are part of different titles of the Regulation, etc. However, on the other hand, the application of one part of the Regulation may of course have an impact on the remainder, hence one cannot simply apply different parts of the Regulation in splendid isolation.

The COJ notes that according to the referring court, the court before which the interim proceedings have been brought does not make a final decision on the validity of the patent invoked but makes an assessment as to how the court having jurisdiction under Article 22(4) of the Regulation would rule in that regard, and will refuse to adopt the provisional measure sought if it considers that there is a reasonable, non-negligible possibility that the patent invoked would be declared invalid by the competent court. Hence there is no risk of conflicting decisions: the interim proceedings have been brought will not in any way prejudice the decision to be taken on the substance by the court having jurisdiction under Article 22(4) .

‘…does not make a final decision’: this effectively means that the Court simply states that as long as the main condition of Article 31 is met [measures covered by Article 31 need to be ‘provisional’; see also Case C-261/90 Reichert], Article 22(4) does not interfere with a court’s jurisdiction under Article 31.

Geert.

Patent infringement and the Brussels I Regulation – Cruz Villalon AG revisits some old chestnuts in Solvay

Solvay, Case C-616/10, offers a great opportunity for the European Court of Justice to revisit a number of old chestnuts in the application of the Brussels I Regulation (the Jurisdiction Regulation or ‘JR’): the exclusive ground of jurisdiction with respect to intellectual property rights, of Article 22(4); multipartite litigation in Article 6 JR; and finally provisional measures, referred to in Article 31. Cruz Villalon AG’s Opinion was issued on 29 March.

Solvay SA, a company established in Belgium and holding a European patent, valid in more than one Member State [don’t ask – European patent law is less harmonised than one might hope and even a ‘European’ patent does not necessarily and automatically cover all Member States], brought an action in the Rechtbank ’s-Gravenhage in the Netherlands for infringement of several national parts of the patent, in particular against three companies originating from two different Member States, Honeywell Fluorine Products Europe BV, established in the Netherlands, and Honeywell Belgium NV and Honeywell Europe NV, established in Belgium, for marketing a product manufactured by Honeywell International Inc. that was identical to the product under the above patent.  In the course of the proceedings, Solvay lodged an interim claim against the defendants in the main proceedings, seeking provisional relief in the form of a cross-border prohibition against infringement for the duration of the main proceedings.

Firstly, with respect to the multipartite jurisduction element: Article 6(1) allows the applicant to sue several defendants before the court where any one of them is domiciled, provided the claims are’ so closely connected that it is expedient to hear and determine them together to avoid the risk of irreconcilable judgments resulting from separate proceedings’. Per Roche Nederland, the Court had controversially held that parallel actions for infringement in different Member States, which, in accordance with Article 64(3) of the Munich Convention, must be examined in the light of the national law in force, are not in the context of the same legal situation and hence any divergences between decisions cannot be treated as contradictory – leaving no room for application of Article 6(1) to the benefit of holders of European patents vis-a-vis actions for infringement in different Member States. Cruz Villalon AG proposes to distinguish, not to overturn, Roche Nederland on the ground that in the case at issue, the objectionable behaviour concerned more than one undertaking, domiciled in more than one Member State, however accused of the same behaviour in the same Member State. If Article 6(1) were not to be applicable, the courts concerned would hence hold on the basis of the same lex loci protectionis (that of the Member State in which the alleged conduct is said to have taken place) and hence the risk of irreconcilable judgments great.

The AG then turns to the application of Article 22(4), dealt with previously in particular in GAT. Here (as helpfully summarised by the AG) , the referring court asks, in essence, whether the fact that a defence of invalidity of a patent has been raised in interim proceedings for a cross-border prohibition against infringement, in parallel to main proceedings for infringement, is sufficient, and, if so, under what formal or procedural conditions, for Article 22(4) to become applicable. Applicability of Article 22(4)’s exclusive ground for jurisdiction is highly relevant: firstly, the court dealing with the case has to decline jurisdiction for the main proceedings on the basis of Article 25 (when an exclusive ground of jurisdiction is at stake, all other courts have to declare themselves without jurisdiction) and, secondly, as a consequence, it is then required to consider its competence to adjudicate on the interim proceedings on the basis of Article 31’s jurisdictional ground for provisional measures. After careful consideration in which the AG gives a brief ‘tour d’horizon’ of the various procedural realities that might exists, he advises that Article 22(4) is not applicable when the validity of a patent is raised only in interim proceedings, ! in so far as the decision likely to be adopted at the end of those proceedings does not have any final effect. Whether the latter is the case depends on the applicable law (see my comment above, re incomplete harmonisation of EU patent law).

I wonder whether the Court would be put off by the AG’s sidestep into what he calls ‘procedural reality’ (not a criterion which the Court generally is happy to entertain in the application of the JR) and whether, similarly, the criterion ‘final effect in accordance with the applicable law’ would offer enough legal certainty (which the CoJ definitely craves in the application of the JR).

One final consideration in the AG’s opinion is the application of Article 31’s jurisdictional ground for provisional measures (this question will only feature in the eventual judgment, should the Court reject the AG’s view on Article 22(4)). Article 31’s scope is limited. Amongst others, the measures within its scope must be of a ‘provisional’ nature, that is to say, per Reichert, be intended to preserve a factual or legal situation so as to safeguard rights the recognition of which is sought elsewhere from the court having jurisdiction as to the substance of the matter: that is a ratione temporis limitation.  In Van Uden, the court added a limitation ratione loci: there has to be a ‘real connecting link’ between the subject-matter of the provisional measures sought and the territorial jurisdiction of the Member State of the court seized. The AG suggests that applied to intellectual property rights (but with wider ramification), this condition does not imply that the measure must not have any ‘extraterritorial’ effect: rather, that for Article 31  to apply, there has to be a  minimum territorial localisation of the provisional measure sought. The existence of such real connecting link should be considered chiefly in the light of the enforcement procedures of the Member State of the court seized.

Not all of the considerations of the AG are likely to be entertained by the Court. Neither do they cover all aspects of the troublesome application of Article 22(4) [not much of which has made it into the review of the JR].

Geert.

The Jurisdiction Regulation, trademarks and the internet – The Court of Justice in Wintersteiger

I have already reported recently on the application of the Brussels I Regulation and the internet [see here for my confused state on the Judgment in ‘G’]. In Wintersteiger (Judgment of 19 April 2012) the applicant is the proprietor of an Austrian trade mark. The defendant was a competitor established in Germany, who had registered Wintersteiger’s name as an AdWord on Google’s German search service. Whence users of google.de entering ‘Wintersteiger’ (looking for that make’s ski and snowboarding service tools) receive a link to Wintersteiger’s website as first search result, but also as the first AdLink on the right hand side of the screen, an advert for and link to the competitor’s website – which Wintersteiger considered an abuse of its trademark.

The case once again raised the question how one applies Article 5(3)’s ‘place where the harmful event occurred’ (since Mines de Potasse split in ‘place where the event giving rise to the damage’ and ‘place where the damage’ occurred as being two alternative connecting factors)  in an internet context.

The judgment of the Court of Justice confirms that the connecting factor ‘centre of interests’ in Kylie Minogue and eDate Advertising only holds for infringement of personality rights in an internet context. Trademark violation is distinguished, on the grounds that rebus sic stantibus intellectual property rights are protected on a territorial basis. The Court confines the ‘place where the damage occurred’ as the Member State in which the trade mark is registered. For the ‘place where the event giving rise to the damage’, the Court upheld ‘place of establishment of the advertiser’ as the jurisdictional basis (the Advocate General’s ‘means necessary for producing, a priori, an actual infringement of a trade mark in another Member State’ is a  more generic criterion however the Court did not uphold this as such).

Precedent value of the judgment may be limited due to the specific facts of the case and the questions put to the Court (for non-EU readers: the Court of Justice practises judicial economy, hence questions not specifically asked are not entertained). In particular, the conclusion may only hold absolutely where there is only one trade mark held, in only one Member State (for EU readers and non-EU readers alike: EU trademark protection is a lot less harmonised than one may have assumed). The referring court moreover did not flag the many issues surrounding provisionary measures and intellectual property rights (see Article 31 of the Regulation and the Opinion of the same AG in Solvay, on which I report here).

Geert.