Andrew Maggs
Senior Counsel
Patent Litigation
Article
13
The Court of Appeal has issued a further judgment in the litigation between Smith & Nephew and ConvaTec. Following on from its 24 June decision in ConvaTec's favour on the construction of its numerically defined patent claim, the court has now refused Smith & Nephew permission to appeal to the Supreme Court.
However, it also stayed the grant of injunctive relief (which would restrain further infringement by Smith & Nephew) pending the outcome of 1) Smith & Nephew's application to the Supreme Court for permission to appeal and 2) the (likely subsequent) decision of the Technical Board of Appeal (TBA) of the European Patent Office (EPO).
As we reported on 3 July, the Court of Appeal recently overturned (in part) Birss J.'s judgment regarding ConvaTec's patent EP (UK) 1,343,510 (the "Patent"). The Court of Appeal held that as a matter of construction the phrase "between 1% and 25%" extends to all values ≥ 0.5% and < 25.5% (Birss J. had held that it extended to all values ≥ 0.95% and < 25.5%).
Therefore, while Birss J. was correct that Smith & Nephew's Original Process (where the relevant value ranged from 0.93% to 0.97%) was infringed, he had incorrectly held that Smith & Nephew's Modified Process (where the relevant value was no more than 0.77%) did not infringe.
The present decision, handed down on 30 July 2015 ([2015] EWCA Civ 803), relates to a request by Smith & Nephew for permission to appeal to the Supreme Court, and whether a stay of injunctive relief should be granted pending the appeal to the Supreme Court.
Having refused to grant permission to appeal to the Supreme Court, the Court of Appeal then had to consider whether Smith & Nephew is entitled to a stay of injunctive relief pending:
The decision of the Court of Appeal (given by Lord Justice Kitchin) therefore provides useful guidance in relation to stays of injunctions following the decision of the Supreme Court in Virgin Atlantic v Zodiac Seats and the decision of the Court of Appeal in Adaptive Spectrum and Signal Alignment, Inc. v British Telecommunications plc.
In relation to the application for leave to appeal to the Supreme Court, Smith & Nephew's submissions were that the Court of Appeal had got its judgment wrong, and that the point on construction raises a significant point of general public importance, which should be heard by the Supreme Court.
The Court of Appeal disagreed, stating that the decision and guidance of the House of Lords in Kirin Amgen was as applicable to a claim containing a numerical range as to a claim containing descriptive words or phrases. In both cases the critical question was what the skilled person would understand the author to have been using the words or numerals appearing in the claim to mean.
The Court of Appeal therefore refused Smith & Nephew's request for permission to appeal.
However, Smith & Nephew "made it clear that they intend to apply to the Supreme Court for permission to appeal" (para 4).
This seems to have been an important submission, which distinguished the case on its facts from ASSIA. In ASSIA, while BT had sought permission to appeal to the Supreme Court from the Court of Appeal, it did not state that, if permission was refused, it would seek leave to appeal from the Supreme Court. This meant that Floyd LJ could state (para 9) that: "A cross-undertaking is appropriate to take account of the possibility that an earlier judgment is wrong (e.g. an interim injunction or an injunction pending appeal). In the present case, revocation by the EPO would not show our judgment to be wrong, or the injunction to have been wrongly granted..."
ConvaTec argued that: "this principle applied equally to Smith & Nephew's application for a stay of the injunction pending the decision of the TBA. This court has upheld the validity of the Patent and has now found it to have been infringed. If the Patent is subsequently revoked or materially amended, this will not show those judgments to be wrong or that the injunction was wrongly granted" (para 10).
If the only outstanding matter was the decision of the TBA, there would seem to be some force behind ConvaTec's argument - the UK proceedings were over, the Patent found valid and infringed, and the outcome of the EPO proceedings "would not show our judgment to be wrong, or the injunction to have been wrongly granted".
However, while the Court of Appeal had refused permission to appeal, because Smith & Nephew had made it clear that it intended to apply to the Supreme Court for leave to appeal, the Court of Appeal had to "recognise that the Supreme Court may take a different view [and that t]here is therefore a real prospect of a further appeal" (para 12).
The possibility of the Supreme Court showing either that the Court of Appeal's judgment was wrong, or that the injunction was wrongly granted, seems an important point of distinction between the two cases.
As well as relying on ASSIA, the parties had also put forth "extensive evidence and submissions" in support of their positions to show the "severe and irreparable" harm they would suffer if a stay was (or was not) granted. The Court of Appeal considered the following to be "particularly material" factors in its decision to grant a stay pending the outcome of the leave to appeal application (para 12):
On this basis, the Court of Appeal was willing to grant a stay of the injunction until the determination of Smith & Nephew's leave to appeal application by the Supreme Court.
The Court of Appeal was also willing to grant a stay of the injunction pending ConvaTec's appeal to the TBA against the Opposition Division's revocation of the Patent.
In so doing it said it had "well in mind the decision and reasoning of this court in" ASSIA, but that there were three factors which suggested a further stay was appropriate here (para 13):
The Court of Appeal left the question of whether the injunction should be stayed pending the outcome of any appeal to the Supreme Court (i.e. assuming leave to appeal was given) up to the Supreme Court.
The judgment of the Court of Appeal suggests that there are several important factors which may persuade the Court to stay an injunction, including:
This judgment provides yet further guidance regarding the interaction between UK and EPO proceedings.
The courts have previously stayed injunctions when they have granted permission to appeal (see ASSIA v BT), where they have granted permission for the bringing of an action seeking a declaration than an implemented workaround does not infringe (again, see ASSIA v BT), and where the infringing party needs more time to implement a non-infringed system (yet again, ASSIA v BT). The courts have also previously stayed proceedings in the UK pending the resolution of issues before the EPO (see for example HTC v IPCom, for stays pending determination by the TBA of an opposition, and Samsung v Apple, for stays pending determination of a central amendment application to the EPO).
However, one issue which remains unclear following this judgment is whether the courts will stay an injunction simply because a party is seeking leave to appeal from a higher court, or whether more (in particular, evidence of severe and irreparable harm) is required.
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