Actavis v Eli Lilly - what is "normal interpretation"?

26 September 2017


In a landmark decision (Actavis v Eli Lilly), the UK Supreme Court has re-steered the law of patent infringement in the UK, stating that there is a doctrine of equivalents. But the doctrine need not be invoked if a variant infringes a claim "as a matter of normal interpretation".

The invocation of this so-called "limb (i)" test may have important consequences for validity squeezes in any particular case, and so its precise meaning is likely to prove contentious. In this article we consider how Lord Neuberger's limb (i) test may be expected to be applied.

Limb (i) infringement as defined in Actavis v Eli Lilly

As explained in our introductory article, in the Supreme Court's judgment in Actavis v Eli Lilly [2017] UKSC 48, Lord Neuberger, stated:

"…a problem of infringement is best approached by addressing two issues, each of which is to be considered through the eyes of the notional addressee of the patent in suit, i.e. the person skilled in the relevant art. Those issues are: (i) does the variant infringe any of the claims as a matter of normal interpretation [limb (i)]; and, if not, (ii) does the variant nonetheless infringe because it varies from the invention in a way or ways which is or are immaterial? If the answer to either issue is "yes", there is an infringement; otherwise, there is not [limb (ii)]."

Lord Neuberger explained that while limb (ii) squarely raises the principle of equivalence in compliance with Article 2 of the Protocol on the interpretation of Article 69 of the European Patent Convention (EPC), the limbs balance the competing interests of the patentee and of clarity, as required by Article 1 of the Protocol. Both articles of the Protocol are set out in our introductory article here.

Limb (i), said Lord Neuberger, "self-evidently raises a question of interpretation", which is "familiar to all lawyers concerned with construing documents":

"While the answer in a particular case is by no means always easy to work out, the applicable principles are tolerably clear, and were recently affirmed by Lord Hodge in Wood v Capita Insurance Services Ltd."

Applying limb (i) to the facts of the Actavis v Eli Lilly case, there could be "no doubt" that according to normal principles of interpreting documents, the Actavis products (premetrexed free acid, pemetrexed ditromethamine, and pemetrexed dipotassium) did not infringe the patent, because they could not be said to fall within the expression "pemetrexed disodium".

However, infringement could still be found under limb (ii), which Lord Neuberger explained would normally have to be answered by reference to the facts and expert evidence. (The limb (ii) test is discussed in our next article).

Distinction between construction and infringement

Lord Neuberger emphasised repeatedly that the Protocol is not intended to be a guide to document construction. For example, he said:

"As Sir Hugh Laddie wrote in his instructive article Kirin-Amgen - The End of Equivalents in England? (2009) 40 IIC 3, para 68, "[t]he Protocol is not concerned with the rules of construction of claims" but with "determining the scope of protection".

The Protocol is, rather, a means to assist in the assessment of the question of infringement from case to case. He said it was very hard to be confident, from article 1, how far it was intended to permit a court to go beyond the actual language of a claim when interpreting a claim. Further:

"It is apparent from article 2 that there is at least potentially a difference between interpreting a claim and the extent of the protection afforded by a claim, and, when considering the extent of such protection, equivalents must be taken into account…".

In Lord Neuberger's view, the House of Lords' judgment in Kirin-Amgen v Hoechst [2004] UKHL 46 (which itself had followed Lord Diplock's analysis in Catnic, as applied by Hoffmann J in Improver), had erroneously conflated the issues of construction and infringement.

Although Lord Neuberger did not cite his own 2001 first instance judgment in the Kirin-Amgen case (Kirin-Amgen v Roche [2001] EWHC 518 (Pat)), which was overturned by the House of Lords, it seems he drew heavily upon its reasoning. In his 2001 judgment he explained that as a matter of principle, questions of construction of a claim in a patent, and questions of infringement of said claim are separate from each other, meaning there were dangers in determining issues of construction of the claims while having regard to the issues of infringement.

What is "normal interpretation"?

Returning to Actavis v Eli Lilly, when explaining the applicable principles "familiar to all lawyers concerned with construing documents", Lord Neuberger drew upon English contractual law as guiding the interpretation of a patent granted pursuant to the EPC. In Wood v Capita Insurance Services [2017] UKSC 24, Lord Hodge said:

"The court's task is to ascertain the objective meaning of the language which the parties have chosen to express their agreement. It has long been accepted that this is not a literalist exercise focused solely on a parsing of the wording of the particular clause but that the court must consider the contract as a whole and, depending on the nature, formality and quality of drafting of the contract, give more or less weight to elements of the wider context in reaching its view as to that objective meaning".

Article 2 of the Protocol on the interpretation of Article 69 prohibits the extent of protection being "defined by the strict, literal meaning" of the wording used in the claims.

In Improver v Remington [1990 F.S.R. 181, the case in which Hoffmann J first set out the Improver questions, Hoffmann J said:

"If the issue was whether a feature embodied in an alleged infringement which fell outside the primary, literal or acontextual meaning of a descriptive word or phrase in the claim ("a variant") was nevertheless within its language as properly interpreted, the court should ask itself the [Improver questions]" (emphasis added)

In Kirin-Amgen v Roche, Neuberger J (as he then was) construed the relevant claims of Kirin-Amgen's patent by interpreting them in the context of the teaching of the specification, and considering whether the conclusion he reached was in accordance with the evidence and the Protocol. Later, after concluding on the issue of validity, Neuberger J considered and answered the Improver questions in the context of his infringement analysis. (Note that by this point, the Court of Appeal had re-named the Improver questions the "Protocol questions").

When the Kirin-Amgen case reached the House of Lords, Lord Hoffmann criticised Neuberger J's approach. Lord Hoffmann did not consider the judge's approach to have been a "literal" construction as contemplated by the Improver/Protocol questions, of which he said:

"… to make any sense of the terms "primary, literal or acontextual meaning" in the Protocol questions, it must be taken to mean a construction which assumes that the author used words strictly in accordance with their conventional meanings."

Thus, whereas Lord Hoffmann would invoke the Protocol questions if an alleged infringement fell outside "the primary, literal or acontextual meaning of a descriptive word or phrase in the claim", the approach taken by Lord Neuberger, both at first instance in Kirin-Amgen v Roche and in Actavis v Eli Lilly, suggests that "normal interpretation" is neither a "strict, literal" interpretation (as prohibited by the Protocol) nor a "primary, literal or acontextual" meaning as contemplated in Improver.

This still begs the question of what "normal interpretation" means. Sir Hugh Laddie's 2009 commentary (Kirin-Amgen - The End of Equivalents in England? (2009) 40 IIC 3) is perhaps illuminative in this context.

Sir Hugh Laddie noted that in Kirin-Amgen the House of Lords described the law regarding patent construction in the UK before Catnic as "old English literalism", meaning acontextual literalism. Lord Hoffmann noted that following the change in commercial law in the 1970s, "[i]t came to be recognised that the author of a document such as a contract or patent specification is using language to make a communication for a practical purpose, and that a rule of construction which gives his language a meaning different from the way it would have been understood by the people to whom it was actually addressed is liable to defeat his intentions". The undesirable approach to construction was, according to Lord Hoffmann, the "old English literalism" which Lord Diplock had wished to avoid when taking a more purposive approach in Catnic, and which the Protocol questions were therefore designed to avoid.

However, Sir Hugh disagreed. He explained how, for the first 200 years of patents in England, there were no claims and so it was only the specification that could be considered. Once claims came into existence they were not as precise as is the practice today and they were always construed in the context of the specification. On the other hand, the English law approach to the interpretation of commercial documents in general was, until the 1970s, one of acontextual literalism in which surrounding materials could not be referred to as a guide to the interpretation of the contract. The House of Lords had, perhaps, fallen "into the error of assuming that old English literalism…had existed also in relation to the interpretation of patent claims". Sir Hugh said:

"The reason why the old acontextual approach applied to construing commercial documents but was never appropriate to construing patent claims was that in the case of the latter, unlike the former, the surrounding matrix, namely the specification, was an integral part - indeed historically the most important part - of the document of which the claims formed a part. There was no sensible way in which it could be ignored. In both cases the court simply looked at the whole document. In the case of patents that inevitably included the relevant context. In the case of commercial documents it did not."

This would seem to support an understanding that "normal interpretation" means a contextual literal construction, considering the skilled addressee's understanding of what the author meant by using those words in the context of the specification. This is neither a "strict literal" nor "acontextual" interpretation, because the claims are not read in isolation by relying purely on the dictionary meaning of the words. Yet while the approach is contextual or 'purposive' (in the sense of English contractual law), it is also 'literal' because the interpretation is confined to the technical embodiments of the concept as defined by the claims - the words used must be given a meaning, albeit a contextual one.

This approach would explain why Eli Lilly did not succeed on limb (i) despite the fact that the inventive concept of the patent was concerned with the pemetrexed anion generally, rather than being restricted to its disodium salt form - the Actavis products were not within the literal meaning of the words of the claim, even when construed contextually.

Does the reference to "literal meaning" in limb (ii) change this analysis?

Lord Neuberger said that when considering limb (ii) i.e. what it is that makes a variation "immaterial", a series of three questions (the reformulated Improver questions) can provide helpful assistance, although they remain only guidelines.

The 'reformulated Improver questions' are set out in our introductory article and will be discussed in more detail in our next article. The first begins "Notwithstanding that it is not within the literal meaning of the relevant claim(s) of the patent…". The third question also refers to the "literal meaning". It is apparent from the judgment that when Lord Neuberger here refers to the claim's "literal meaning", he is referring to the meaning which follows from the "normal interpretation" of the claim under limb (i).

Does this indicate that "normal interpretation" means the "literal meaning"? Or does it suggest something different?

Perhaps a good place to start, once more, is with the wording of the original Improver questions. As well as referring to "primary, literal or acontextual meaning" as part of the proviso for consideration of the questions, the reference within the questions (in original question 3) was to "the primary meaning" (i.e. would the reader skilled in the art nevertheless have understood from the language of the claim that the patentee intended that strict compliance with the primary meaning was an essential requirement of the invention? If yes, the variant is outside the claim).

It is consistent with the move from "primary, literal or acontextual meaning" (as per the proviso of the original questions) to "normal interpretation" (as per limb (i) of the reformulated questions) that the reference in original questions 3 to "primary meaning" has been adjusted also. This would seem to suggest that "literal meaning" in Lord Neuberger's reformulated questions does not mean the acontextual meaning of the words.

It would also be consistent with Lord Neuberger's approach to limb (i) if the reference to "literal meaning" in limb (ii) was to the contextual literal meaning of the language of the claim, this being the 'normal interpretation'.

However, whether the "normal interpretation" of Lord Neuberger's limb (i) does in fact mean the same thing as the "literal meaning" of limb (ii) remains open to question.

Why does it matter whether a variant infringes under limb (i) or limb (ii)?

Lord Neuberger noted that in contrast to limb (i), limb (ii) would normally have to be answered by reference to the facts and expert evidence.

If an alleged infringement or 'variant' can be shown to infringe pursuant to limb (i), there may, potentially, be scope for reducing the extent of expert evidence in a case regarding infringement. Usually the UK litigation system is geared towards a single substantive trial, but there is much flexibility. If the court were to agree to consider the question of limb (i) infringement as a preliminary issue, and concluded that there was infringement as a matter of "normal interpretation" of the claims, expert evidence in respect of limb (ii) could be avoided.

On the other hand, if infringement is established in accordance with limb (i), the extent of protection would equate conceptually with the scope of the claim for the assessment of a validity challenge. This enables squeeze arguments to be run, for example in accordance with the principle stated by the House of Lords in Biogen v Medeva [1996] UKHL 18 that the scope of a claim must be commensurate with the relevant technical contribution. This underlies many of the grounds on which the validity of a patent may be challenged.

Strategically, for patentees, it may be preferable for infringement to be established under limb (ii) than under limb (i). This is because if there is no infringement in accordance with the normal interpretation of the claim, but there is infringement under the doctrine of equivalents, the claim scope which the patentee may be called upon to defend as commensurate with the technical contribution would not necessarily need to encompass the infringement. Similarly the scope for potential anticipation arguments could be narrowed.

Whether there is indeed potential for a gap between the scope of the claim the subject of the validity challenge and the extent of protection afforded by the claim for infringement purposes is a question that the courts can be expected to be called upon to rule before too long. It will be discussed in a forthcoming article.

Is a "normal interpretation" test compliant with the EPC?

Can it be correct that in accordance with the EPC, the test for infringement is defined by reference to principles of English contractual law?

The EPC does not define the acts of infringement, for example of selling a product or using a process that falls within extent of protection of a patent claim. This remains a matter for national law, although the laws of EPC states have largely been aligned with the proposed Community Patent Convention - an early pre-curser to the (as yet unratified) Unified Patent Court. In the UK, the acts of infringement are defined in section 60 of the Patents Act 1960.

Article 69 provides that "[t]he extent of the protection conferred by a European patent or a European patent application shall be determined by the claims. Nevertheless, the description and drawings shall be used to interpret the claims".

The Protocol provides the gloss on the interpretation of this provision. While Article 69 clearly prevents patentees seeking a monopoly over something just because it is asserted in the specification, it is perhaps interesting that Article 69 does not say that the extent of protection shall be "defined by" the claims. Article 69 is in the Part of the EPC titled "Substantive Patent Law", and in the chapter titled "Effects of the European Patent and European Patent Application". In contrast, Article 84, which is in the Part titled "European Patent Application" and the Chapter titled "Filing and requirements of the European patent application", states that "[t]he claims shall define the matter for which protection is sought. They shall be clear and concise and be supported by the description".

Analysis of Lord Neuberger's test indicates that both limbs determine a question of infringement by consideration of the claims. Limb (i) uses the words of the claim neither as a guideline nor as defining a "strict" literal meaning - the latter because the "normal interpretation" requires the context, i.e. the description and drawings, to be taken into account, and not just where the claim language contains ambiguity. Limb (ii) takes account of elements which are equivalent to an element specified in the claims, as required in the Protocol, and again in accordance with the requirement that the extent of protection be "determined by" (i.e., by reference to) the claims, the description and drawings being used to interpret them.

Lord Neuberger's test, including limb (i), would indeed seem compliant with the EPC.

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