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A two track attack – patent revocation in the EPO and UK

The grant of a European patent in the European Patent Office (EPO) results in a bundle of national patents. Two post-grant functions retained by the EPO, central opposition and central amendment, interact with national court proceedings in a manner which has come to a head in three important recent English Court decisions.

June 2014

Any person can initiate an opposition in the EPO to the grant of a European Patent (EP), provided the opposition is started within nine months of grant.  Although this nine month time limit is strict, the oppositions themselves often take several years to be resolved.  In addition to central opposition in the EPO, there are parallel possibilities in certain national courts for challenging validity post grant. These national nullity or revocation proceedings only concern the relevant country designation of the EP patent. Whilst in Germany it is not possible to file so-called nullity proceedings during the nine month EPO opposition period, or subsequently during a pending EPO opposition, it is possible at least to start a 'revocation' case in the UK in these circumstances.

gavel on contractThe patentee also has the ability post grant to amend the patent subject to compliance with certain requirements, such as not extending its scope, not "adding matter" and ensuring the amended claims are sufficiently clear. For some years now, there has been a central procedure for applying to make claim limitations at the EPO, which if allowed, would have effect for all designations. In addition, the English Court, for example, has the power, in the course of infringement or revocation proceedings, to allow amendments of the UK designation that satisfy the aforementioned requirements. Previous English case law has made it very clear, however, that, unless amendments are put forward in good time before trial in national proceedings, patentees run the serious risk of not being able to make the amendment sought. Mere deletion of claims is, however, generally treated more leniently than adding to or rewriting them.

Earlier this year, in the UK Samsung v Apple litigation, the English Court of Appeal had to decide what to do when Samsung sought to invoke the central limitation procedure after a finding by the English Patents Court that three European patents (UK) (EPUK) were invalid. Thus, at the stage when the central amendment applications had been made, the English Court had already ordered that the EPUKs should be revoked, although the order for revocation was suspended pending Samsung's appeal to the Court of Appeal. Samsung applied to the English Court of Appeal seeking to postpone the UK appeal pending the outcome of its central amendment applications in the EPO. Apple strongly objected to this course, arguing that the amendments to the patents now sought at the EPO did not correspond to any of the amendment applications before the trial judge and in effect, if these amendments were to be sought, appropriate applications should have been raised in good time in the English proceedings in accordance with established practice described above and it was now too late. Apple consequently sought an order that unless Samsung took no further steps in the central amendment applications, permission to appeal in the UK should be set aside and the EPUKs be revoked.

The Court of Appeal nevertheless decided to adjourn the appeal on the basis that there was a risk that the appeal was going ahead on a false basis, given that any central amendment would have retroactive effect.  The Court of Appeal appears also to have taken into account an understanding that the amendment applications would be determined promptly.

pile of question marksImportantly, however, the Court of Appeal very clearly left open the question of what will happen to the UK appeal if and when the central amendment applications are allowed and, in particular, whether pursuing the appeal further in the UK would amount to an abuse. Future developments will, therefore, be watched with considerable interest.

The recent Supreme Court decision in Virgin v Zodiac, was an important decision on another aspect of the interaction between the jurisdictions of the EPO and the English Courts.  Although this particular case concerned a patent for reclining aircraft seats, it has much wider implications.  In fact, the issue with which it was concerned was live in one of the high profile mobile telephone patent litigation cases.

Previously the law in the UK was that if a defendant had been found finally (i.e. after all available appeals) to have infringed an EPUK and the EPUK found valid, the defendant remained liable for damages for infringements in the UK even if the EP was subsequently found to be invalid and revoked in opposition proceedings for the whole of Europe. This was the case irrespective of the timing of the subsequent decision of the EPO, i.e. it applied even if the patent had been found invalid before the UK assessment of damages (enquiry as to damages) was complete. The Supreme Court has now changed this.

The Supreme Court decided that, at least if the enquiry as to damages has not concluded, the party previously found to have been infringing can rely on the later finding of invalidity in other proceedings, as that finding has retrospective effect.  Previous English case law on this point was said to be wrong.

What remains unclear, however, is at what point in time the "original infringer" is no longer able to rely on the subsequent finding of invalidity.  Does it have to raise the issue before the enquiry is finally concluded?  Or is still possible when the enquiry has been concluded, but before the money has been paid over? Or can even the "original infringer" seek to recover monies actually paid?  The latter would seem particularly unsatisfactory and unlikely to be the case.

Even though questions remain, the consequences of Virgin will need to be borne in mind by successful patentees before they embark on an enquiry as to damages, which will inevitably be an expensive litigation phase.   If there remains a possibility of the patent subsequently being found to be invalid in a relevant respect, apart from anything else, the patentee must be at risk of bearing the other side's costs of an enquiry that may later be abandoned.

Union JackThe third important decision was concerned with the question of what happens in English proceedings when there is a pending opposition in the EPO.  In the recent IPCom v HTC litigation, the English Court of Appeal took the opportunity to set out revised guidelines as to whether, in a particular case, the English proceedings should continue in parallel. There is a list of thirteen factors to be taken into account but it is clear that the English Court's discretion is "very wide indeed".  If there are "no other factors" – and in practice there usually will be "other factors" – a stay of the UK national proceedings is the "default" option. One factor – relating back to the Virgin case – is the extent to which the refusal of a stay will irrevocably deprive a party of any part of the benefit which the concurrent jurisdiction intended to confer.  An important factor is that the Judge is entitled to refuse a stay where some commercial certainty would be achieved at a considerably earlier date by the UK proceedings.  This will, in practice, often be the case if the national proceedings are commenced reasonably soon after patent grant.  One of the constant criticisms of the EPO opposition procedure is the length of time it takes, often several years when appeals are taken into account. For that reason, although ultimately a matter of discretion depending on the facts, it is anticipated that, in many cases, the English Court will continue to decline to stay.

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James Marshall

James considers the parallel litigation streams through the EPO and UK courts.

"The consequences of Virgin will need to be borne in mind by successful patentees before they embark on an enquiry as to damages."