United Kingdom Patent Decisions 2017
Julia Powles . John Liddicoat 0 1
0 J. Liddicoat Philomathia Postdoctoral Research Associate, University of Cambridge , Cambridge , UK
1 J. Powles (&) Research Fellow, New York University School of Law, Cornell Tech , New York , USA
This report highlights the main UK patent decisions from 2017, including a major Supreme Court infringement case introducing a doctrine of equivalents, the first ruling on FRAND royalty rates and injunctions, compensation for employee inventors, legal priority, patentable subject matter, and a novel, unsuccessful attempt by the State to sue a pharmaceutical company whose invalid patents delayed the entry of generics.
Doctrine of equivalents; FRAND; Infringement; Patent law; Priority; Employee compensation
Marion Roussel Ltd (No. 2)  1 All E.R. 667; Les Laboratoires Servier v.
Apotex Inc  EWHC 1538 (Pat); Les Laboratoires Servier v. Apotex Inc 
EWCA Civ 445; Secretary of State for Health v. Servier Laboratories Ltd 
EWHC 2006 (Ch); Shanks v. Unilever Plc  R.P.C. 15; Unwired Planet
International Inc v. Huawei Technologies Co Ltd  EWHC 711 (Pat); Unwired
Planet International Inc v. Huawei Technologies Co Ltd  EWHC 1304 (Pat).
Legislation Intellectual Property (Unjustified Threats) Act 2017; Patents Act 1977
The most important UK patent decision of 2017 was the Supreme Court’s
monumental ruling on claim construction and scope in Actavis UK Ltd v. Eli Lilly &
Co.1 The case originated in a battle over whether Eli Lilly’s patent to pemetrexed
disodium for cancer treatment was infringed by Actavis’ pemetrexed formulations.
Eli Lilly was unsuccessful in the Patents Court,2 partly successful in the Court of
Appeal,3 and successful in the Supreme Court. The reasoning, articulated by Lord
Neuberger in one of his last judgments as President of the Supreme Court before
retiring in September 2017, is of lasting import.
Dramatically, the Supreme Court dismissed the approach to claim construction
that had prevailed in infringement cases since 2004,4 in which what matters is what
the person skilled in the art would have understood the language in the claims to
mean (so-called ‘‘purposive construction’’). Instead, relying on the Protocol to Art.
69 of the European Patent Convention, Lord Neuberger introduced a two-limb
infringement test: first, querying whether there is infringement as a matter of
‘‘normal’’ or ‘‘literal’’ interpretation; and, second, applying a three-part ‘‘doctrine of
equivalents’’, as is more familiar in Germany and the United States. Applying the
test, the Court found that although Actavis’ pemetrexed formulations did not fall
within the literal meaning of the claims, they were ‘‘variants’’ or ‘‘equivalents’’ –
they ‘‘achieved substantially the same result in substantially the same way as the
invention’’ (a concept the Court equated, problematically, with the shape-shifting
notion of the ‘‘inventive concept’’). Further, satisfying the second and third parts of
the doctrine, the substantial equivalence of Actavis’ formulations would have been
obvious to a person skilled in the art, and the patentee would not have intended strict
compliance with the literal meaning of the claims as an essential requirement of the
invention. As a result, Actavis was found to have infringed the patent.
The new doctrine of equivalents has already been applied in several infringement
cases. Both Generics (U.K.) Ltd (t/a Mylan) v. Yeda Research and Development Co
Ltd5 and Illumnia Inc v. Premaitha Health Plc6 addressed the confusion caused by
Lord Neuberger’s choice of the word ‘‘literal’’ in the first limb of the test, with both
Courts holding that it still means ‘‘purposive’’. Actavis v. Lilly nevertheless clearly
1  1 All E.R. 171; see IIC 49(1):104–105 (2018), https://doi.org/10.1007/s40319-017-0665-z.
2  4 All E.R. 331.
3  4 All E.R. 666; see IIC 47(2):189 (2016), https://doi.org/10.1007/s40319-016-0457-x.
4 Kirin-Amgen Inc v. Hoechst Marion Roussel Ltd (No. 2)  1 All E.R. 667.
5  EWHC 2629 (Pat).
6  EWHC 2930 (Pat).
rejects a one-stage purposive construction test, prompting the useful suggestion in
Fisher & Paykel Healthcare Ltd v. ResMed Ltd7 that the doctrine of equivalents be
referred to as an approach to claim scope, rather than claim construction. Following
Generics v. Yeda and Actavis Group PTC EHF v. ICOS Corp,8 it seems the test is
confined to the infringement context, with the courts presently unwilling to extend it
The second major claim construction issue in Actavis v. Eli Lilly was the
relevance of the documented prosecution history (or, more colourfully, the ‘‘file
wrapper’’). During patent prosecution, Eli Lilly attempted to claim pemetrexed as a
free acid. The patent examiner objected to this claim because it introduced subject
matter beyond the contents of the original filing. As a result, Eli Lilly only claimed
pemetrexed disodium. Seizing this concession, Actavis argued that since Eli Lilly
confined its claim to a particular pemetrexed salt, this should mean that Actavis’
formulations across a broader range could not infringe. Lord Neuberger rejected this
argument, elaborating that UK courts should approach prosecution history with a
‘‘sceptical, but not absolutist attitude’’. He stated that, as a general rule, a patent’s
meaning should not depend on access to the prosecution history, but exceptions
could arise in certain limited scenarios, including if the specification or claims are
unclear and the file unambiguously resolves the issue, or where it would be contrary
to public interest to ignore it. Ultimately, the prosecution history had no bearing on
infringement in Actavis v. Eli Lilly itself, but future litigants may be able to avail
themselves of the exceptions articulated in the judgment.
The long-awaited first instance decision in Unwired Planet International Inc v.
Huawei Technologies Co Ltd9 was the first case to determine a FRAND (fair,
reasonable and non-discriminatory) royalty rate. FRAND terms arise when a patent
is essential to international standards; a situation that is particularly common in the
telecommunications industry. To reduce friction or ‘‘hold-up’’ in accessing these
patents, parties are obliged to accept FRAND licence terms. But what is a FRAND
rate? Birss J held that it is determined by making adjustments (taking account of
particular circumstances, region, etc.) to a ‘‘benchmark rate’’ that in turn comes
from counting and weighting patents within the patentee’s portfolio. In a lengthy
application of these principles, Birss J found that Huawei was seeking a UK licence
that was not FRAND, and that it had failed to consider a worldwide licence that was
FRAND. He also found that FRAND licences and competition law are not
coextensive, holding that a licence may be higher than FRAND and still not be
anticompetitive. On injunctions, Birss J stated that if a party needing to use a patent
does not comply with a FRAND licence, then an injunction can be issued against
them. He refrained from granting one in this instance, instead allowing Huawei to
engage with the worldwide licence proposed by Unwired. In a subsequent
decision,10 however, after Huawei had not given an unqualified undertaking to
accept a worldwide licence on FRAND terms, Birss J granted what he called a
7  EWHC 2748 (Ch).
8  EWCA Civ 1671.
9  EWHC 711 (Pat).
10  EWHC 1304 (Pat).
‘‘FRAND injunction’’ (stayed pending appeal), noting that it differs from a regular
injunction because it includes the proviso that it will cease to have effect if, among
other possibilities, the defendant enters into the FRAND licence.
Another highly anticipated case was the trial in Fujifilm Kyowa Kirin Biologics
Co Ltd v. AbbVie Biotechnology Ltd.11 With its rights over the blockbuster
autoimmune drug adalimumab (branded Humira) due to expire in October 2018,
AbbVie had applied for numerous divisional patents to extend its protection.
Fujifilm, trying to clear the path for its generic, ran an argument that its own dosing
regimens on adalimumab were old or obvious and, as a result, should be able to be
marketed without infringing AbbVie’s patents. In a landmark decision, Henry Carr J
agreed, declaring that Fujifilm’s generic was anticipated or obvious. It is important
to note, though, that he only made the declaration due to several ‘‘special reasons’’
on the ‘‘most unusual facts’’: AbbVie had threatened litigation but abandoned its
proceedings at the last moment, while keeping its pending divisionals in play;
Fujifilm had a lot of money at stake in progressing its generic to market; and
Fujifilm needed commercial certainty from AbbVie’s threats to sue. Though
Fujifilm was inspired by the eponymous ‘‘Arrow declaration’’ granted in Arrow
Genetics Ltd v. Merck & Co Inc,12 Henry Carr J was careful to distinguish the
purposes of the declarations in the two cases.
The Court of Appeal decided Shanks v. Unilever Plc,13 an important case on
compensation for employee inventors – a process triggered in the UK if an
employee’s patent is of ‘‘outstanding benefit’’ to an employer. Though Professor
Shanks’ patent had netted tens of millions of pounds for his employer Unilever, the
Comptroller and Patents Court denied that it produced an ‘‘outstanding benefit’’,14
primarily because Unilever was a large organisation with a huge turnover (as
Shanks pithily critiqued it: ‘‘too big to pay’’). The Court of Appeal agreed.
Recognising that ‘‘outstanding benefit’’ is a relative concept that must be measured
against the economic and business realities of the employer, the Court resisted an
absolute assessment of the patent’s value against some threshold of the employer’s
profits, while accepting that such a comparison is informative, particularly for
smaller employers. The Court also clarified that the profit generated by a patent is
what matters – not how the employer subsequently uses that profit.
The question of when a patent applicant can claim priority to an earlier
application arose in several cases. Since Edwards Lifesciences AG v. Cook Biotech
Inc,15 it has been clear an applicant is only able to claim priority to an application
filed by a third party if the applicant owned substantive rights to it at the time of
filing. Based on this, in Accord Healthcare Ltd v. Research Corp Technologies
Inc,16 Accord argued that RCT (a technology transfer entity working with the
inventor’s university) could not claim priority to a US patent because a procedural
11  EWHC 395 (Pat); see IIC 48(6):728 (2017), https://doi.org/10.1007/s40319-017-0625-7.
12  EWHC 1900 (Pat).
13  R.P.C. 15; see IIC 48(4):466–467 (2017), https://doi.org/10.1007/s40319-017-0592-z.
14  R.P.C. 29; see 46 IIC 221 (2015); https://doi.org/10.1007/s40319-015-0308-1.
15  EWHC 1304 (Pat).
16  EWHC 2711 (Ch).
error meant it had only been transferred the bare legal title, not the substantive right.
Referring to US law on bona fide purchasers for value, Birss J found that substantive
title had in fact been transferred and, therefore, the priority claim was valid. At the
same time, though, he noted inconsistencies in the law, especially with regard to
equitable interests that are perfected only after a patent is filed, and made tentative
suggestions as to how the law might be amended. Issues of legal priority also came
up in Fujifilm v. AbbVie17 and in Actavis v. ICOS,18 with the courts in all three cases
indicating an unwillingness to be drawn into protracted battles on priority.
Chugai Pharmaceutical Co Ltd v. UCB Pharma SA19 was an interesting case
involving foreign patents. The dispute concerned whether Chugai had to continue
paying royalties under a worldwide licence that listed England in its governing law
clause. Under this licence, Chugai manufactured and sold tocilizumab products in
the US that were protected by several of UCB’s US patents. Since 2016, however,
all but one of the patents had expired, and Chugai argued the product actually fell
outside the one remaining patent. When rival interpretations of patent scope arose
during the Patents Court hearing, UCB complained that this indicated that the
validity of a US patent was a substantive element of the case and, therefore, the
dispute was non-justiciable because only US courts can rule on the validity of US
patents. After careful study, Henry Carr J disagreed, concluding that the substance
of the action concerned construction not validity and, as a result, the Patents Court
Illumina v. Premaitha20 concerned almost every substantive area of patent law,
but one in particular stands out. A question arose as to whether a broad method for
non-invasive prenatal genetic testing was a ‘‘discovery as such’’, precluding it from
being patent-eligible subject matter. In the US equivalent of this case,21 the Federal
Circuit en banc found the patent invalid on a similar basis. In the UK, however,
Henry Carr J made short work of the ‘‘discovery as such’’ argument. The patented
method was directed to the detection of DNA in a sample of plasma. Since neither
the samples (an artificial creation) nor the method (an artificial process, practically
applying a discovery) exist in the natural world, he found that the method was
An interesting set of cases is being argued in competition law and tort law as
retribution for the invalidation – a decade ago, now – of Servier’s controversial
patents on perindopril for treatment of hypertension and cardiac insufficiency.22 In
Secretary of State for Health v. Servier Laboratories Ltd,23 the Health Secretary
tried to run a claim in tort that Servier should be responsible for causing loss by
unlawful means, because it knew or was reckless as to the invalidity of its patents at
17 Supra note 11.
18 Supra note 8.
19  EWHC 1216 (Pat).
20 Supra note 6.
21 Ariosa Diagnostics Inc v. Sequenom Inc, 809 F.3d 1282 (Fed Cir, 2015).
22 Les Laboratoires Servier v. Apotex Inc  EWHC 1538 (Pat); affirmed on appeal  EWCA
23  EWHC 2006 (Ch).
the time it was dealing with the EPO and UK courts, and its misrepresentations
delayed the entry of generic perindopril manufacturers. Roth J rejected this
argument, noting how disruptive it would be if such claims could be made against
Legislatively, the Intellectual Property (Unjustified Threats) Act 2017 came into
force on 1 October 2017, and applies to all patentee communications on or after that
date. Among other things, the Act introduces the concept of ‘‘permitted
communications’’, which includes giving notice that a patent exists but not, for example,
requesting that a person give an undertaking. Unjustified threats have been a
nettlesome topic in recent times, and the Act is designed to create a clearer,
harmonised framework for addressing threats across patent and other IP regimes,
particularly trade marks and designs.
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