Wednesday, 1 June 2011

T 606/10 – Rest Not In Peace

The present appeal was filed by the opponent against the decision of the Opposition Division (OD) to maintain the opposed patent in amended form. The patent under consideration was based on a divisional application. The parent patent was upheld in 2002 after opposition and appeal proceedings. The examination of the divisional application was frozen during the parent opposition and appeal proceedings and resumed only in 2003. Thus, the patent under consideration was granted as late as May 2005, only a few months before it expired in October 2005. Despite its expiry, an opposition was filed in February 2006. The patent was upheld at oral proceedings in October 2007 but a written decision was not issued until as late as January 2010. The present appeal was filed even though the patent expired nearly five years ago.

In reply to the grounds of appeal, the patent proprietor requested as main request that the appeal proceedings be terminated and, as auxiliary request, that the patent be revoked.

It pointed out that as the patent lapsed several years ago, in accordance with R 84(1) and in line with decisions such as T 329/88, T 749/01 and T 1128/07, the present appeal proceedings should be terminated.

According to the patent proprietor, R 84(1) did not make any distinction between oppositions filed before or after expiry of the patent. It referred to “opposition proceedings” in general, i.e. if the opposed patent had fully lapsed or surrendered then R 84(1) applied. There was no reason to think that this lapse or surrender had had to occur after the opposition was filed. Nor did R 84 suggest that its effect had to be modified depending on whether R 75 applied. In addition, no appeal decision on R 84 (or previous R 60 EPC 1973) could be identified that made a distinction between pre-expiry and post-expiry oppositions.

Therefore, it was not understood why R 84(1) could not apply merely because the patent had already expired before the opposition proceedings began. Such oppositions were permitted under R 75, but there was no statutory basis for the view that R 84 could be applied differently in these post-expiry circumstances.

The Board did not find the main request allowable:

[Patent proprietor’s] main request; R 75 and R 84(1)

[1.1] Pursuant to A 63(1) and A 76(1), second sentence, EPC 1973, the opposed patent had expired 20 years after the filing date of the parent application, i.e. on 30 October 2005 […]. Thus it had already lapsed before the opposition against it was filed in February 2006.

[1.2] The [patent proprietor] bases its main request that the appeal proceedings should be terminated on R 84(1). According to this provision, if the European patent has been surrendered in all the designated Contracting States or has lapsed in all those States, the opposition proceedings may be continued at the request of the opponent filed within a specified time limit. The [patent proprietor] appears to deduce from this provision that, in the absence of a request by the [opponent] to continue the proceedings, the board may terminate the appeal proceedings in the present case.

[1.3] In the case law of the boards of appeal, R 84(1) and its predecessor R 60(1) EPC 1973 have been applied per analogiam in appeal opposition proceedings (see R 100(1) and R 66(1) EPC 1973) when the opponent was the sole [opponent]. In a number of cases in which the opponent, following a notification by the board pursuant to R 60(1) EPC 1973, did not request the continuation of the proceedings, the appeal proceedings were terminated. This conclusion was reached not only where the appeal was directed against the rejection of the opposition by the first instance (see T 329/88; T 165/95; T 749/01; T 436/02 and T 289/06), but also where the appeal was directed against an interlocutory decision according to which the opposed patent could be maintained in amended form (see T 762/89 and T 714/93). In the latter context the further issue arises whether the board should terminate merely the appeal proceedings or both the opposition proceedings and the appeal proceedings.

[1.4] However, none of the above cited cases nor the further decision T 1128/07 referred to by the [patent proprietor] dealt with the situation where - as in the present case - the patent had already lapsed prior to the filing of the opposition. The board observes that the EPC contains a separate legal provision dealing specifically with this situation: R 75 (which corresponds to A 99(3) EPC 1973) explicitly states that an opposition may be filed even if the opposed patent has been surrendered or has lapsed in all the designated Contracting States. With respect to appeals in opposition proceedings, a similar provision is contained in R 98 (corresponding to previous A 106(2) EPC 1973).

[1.5] It is the board’s understanding of this legislative framework that R 84(1) does not apply to the situations regulated by the separate legal provisions of Rule 75 and R 98 EPC. In those situations, the opponent when filing the opposition or the appeal will normally be very well aware that the patent has already lapsed so that the notice of opposition or appeal clearly shows his interest in the revocation of the patent with retro-active effect (see A 68). Thus, it is difficult to see any need for the mechanism provided for in R 84(1) according to which the EPO has to inform the opponent of the lapse of the patent and the proceedings may be continued only after the filing of a corresponding request by the opponent.

[1.6] The above understanding of the legislative framework finds support in the Travaux Préparatoires of the EPC 1973. During the Diplomatic Conference in Munich 1973 the Main Committee I examined a proposal submitted by the Member States of the European Communities according to which provisions for dealing with the consequences of lapse and surrender of a patent should be introduced in what later became A 99, A 106 EPC and R 60 (see Doc. M/14 dated 12 April 1973, points 4, 6 and 16). The legislative motive underlying the proposed amendment to future Rule 60 EPC was explained in that document in the following way:
“This proposal supplements the proposal for the insertion of a new paragraph 2a in Article 98 [...] The Member States of the European Communities considered that if any party interested is granted the right to institute proceedings against a European patent which has been surrendered or which has lapsed for all the designated States, it would logically be necessary to grant the opponent the right to have the opposition proceedings continued where the European patent is surrendered or lapses whilst the proceedings are taking place.” [emphasis added by the board]
[1.7] The proposal was agreed on by the Main Committee I with very little discussion. The minutes of the proceedings record the following further explanation (See Minutes of the Munich Diplomatic Conference for the Setting Up of a European System for the Grant of Patents, page 94, point 2284):
“Speaking on behalf of those States, the delegation of the Federal Republic of Germany said that this amendment was merely the consequence of the acceptance of the proposal by the Member States of the European Communities concerning Article 98. It would therefore appear logical to recognise an opponent’s right to have opposition proceedings continued where a European patent had been surrendered or had lapsed while opposition proceedings were still in progress.” [emphasis added by the board]
[1.8] It can thus be deduced from the Travaux Préparatoires that the scope of application of R 60(1) (now R 84(1)) was intended to be limited to the situation where the opposed patent has been surrendered or has lapsed during on-going opposition proceedings.

[1.9] Thus, in view of the foregoing considerations, the board cannot allow the [patent proprietor’s] main request.

[Patent proprietor’s] auxiliary request and [opponent’s] request

[2.1] The [patent proprietor’s] auxiliary request and the [opponent’s] request are identical, namely to set aside the decision under appeal and to revoke the patent-in-suit in its entirety. […]

[2.2] It follows from the principle of party disposition in opposition appeal proceedings that a request by the patent proprietor for revocation of the opposed patent has to be granted. In this respect it is irrelevant whether the proprietor states that he no longer approves the text in which the patent was granted or maintained by the first instance and will not be submitting an amended text or whether he directly requests that the patent be revoked (see the decisions cited in “Case Law of the Boards of Appeal of the EPO”, 6th edition 2010, page 738).

[2.3] Therefore, the [patent proprietor’s] auxiliary request, which is identical to the [opponent’s] request, namely to set aside the decision under appeal and to revoke the patent-in-suit in its entirety, is allowed.

Should you wish to download the whole decision, just click here.

The file wrapper can be found here.


Anonymous said...

May I enquire as to the reasons why someone would be interested in keeping the show going? Can license fees or damages be reimbursed? I would believe not.

The patent concerned a vaccine, so there may have been a Supplementary Protection Certificate involved, and the patent would still have a kind of "afterlife". (Pharma isn't my field, so caveat emptor).

If I understand correctly (cf. Azéma, Galloux: "Droit de la propriété industrielle", Dalloz, 2006, Rdn 386-396), the patent might still have an effect.
According to the reference, there are two SPC systems: the EU one under Directive 610/96 EC, and the earlier national ones it replaced, such as the French one, which can provide as long as 17 years of supplementary protection. The system in force would depend of the point in time when certification was obtained.

This raises the question of what happens when the underlying patent is withdrawn. Is the SPC automatically cancelled? Maybe the proprietor would try to argue that the auxiliary request granted by the BoA does not change the situation w.r.t. the SPC, the cause of "death" of the patent being irrelevant.

Anonymous said...

Well, this is a pretty bizarre case but for me its most worrying aspect is the fact that the Oppsition Division took well over two years to get the written grounds of its decision out. In many jurisdictions this in itself would be considered as a substantial procedural violation.

Also you don't often see a main request and an auxilary request of a patentee which are quite so disparate ... maintain the patent or alternatively revoke it! What larks, but at the end of the day it's you and me who pay for this form of intellectual masturbation.

oliver said...

@Early morning Anonymous

I am not a pharmacy specialist either, but as nobody has answered your question, here is my six pence worth …

Most SPCs are nowadays governed by Council Regulation 1768/92 (469/2009), Article 15 of which stipulates that the certificate shall be invalid if …, after the basic patent has expired, grounds for revocation exist which would have justified [its] revocation …

So I believe the post mortem revocation of the patent would entail the invalidity of the SPC (if there was one), and it should of course do so, because the legal situation is as if the patent had never existed.

But the question arises irrespective of whether there are SPCs. What really makes the difference between withdrawal and revocation is the retro-active effect of the revocation. I remember wondering why the EPC 2000 introduced the request for revocation (A 105a EPC). Who would possibly want to make use of this ? In my personal practice, I have never come across a case where such a request would have been the appropriate thing to do, but I have heard of a case where an inventor/patentee was attracted into validity proceedings which he was eager to get rid of. Filing a request for revocation apparently saved him a lot of trouble and money. But as I do not really know the details of this case, I cannot comment on it.

You also mention royalties. The question of whether and to what extent licence royalties would have be to be reimbursed if the underlying patent is revoked is a tricky one and certainly answered differently depending on national law. In France, as far as I can see, the licensor will not have to reimburse all the royalties in case the patent is revoked, because until the revocation the licensee enjoyed some advantages from the apparently valid patent (théorie de l’apparence). There was a decision to that effect before the Paris Court of appeal some years ago:

« L’anéantissement du brevet n’a pas eu pour effet de priver le concédant d’une licence totalement du droit d’être payé ensuite de la sous-licence consentie, qui nonobstant le sort qui devait être réservé au brevet, n’en a pas moins pour la période considérée permis à Air Liquide de jouir de certains des effets du contrat, lui permettant d’imposer sur certains territoires la protection attachée au brevet. La valeur de cet avantage représente le tiers de la somme perçue. » (Paris Court of appeal, May 11, 2007 ; Aga and General Hospital v. Air Liquide Santé)

Myshkin said...

I agree that the key here is retroactivity.

This may not be fully accurate and certainly not under all national laws, but I would think:

- if damages are still being claimed for past infringement (either in court or outside court), revocation will kill any such claim due to its retroactive effect;

- if damages have already been paid without a court decision, after revocation the payment might have to be reimbursed for lack of a legal basis;

- if damages have already been paid on the basis of a court decision, revocation will not matter unless under national law it is a reason to overturn the court decision;

- if royalties have been paid on the basis of a licensing agreement, the effect of revocation will depend on the terms of the contract and/or national law. If the agreement is silent on this, then royalties probably do not have to be reimbursed (at least not in France, as I understand from Oliver).

Note that an infringement action can lead to payment of damages, but also to a licensing agreement, and this line could be very thin. If an infringer "agrees to pay" a certain amount of money, he could be bound by this "agreement" even if the patent is later revoked.

Anonymous said...

Thanks Oliver and Myshkin for your additional comments!