Düsseldorf Local Division issues the UPC’s first decision on the merits
09
Jul
2024
Our insights into the UPC’s decisions on issues of validity, claim interpretation, infringement, remedies, and apportionment of costs

On Wednesday 3rd July 2024, the Düsseldorf Local Division of the Unified Patent Court (UPC) issued the very first decision on the merits of an infringement claim and corresponding counterclaim for revocation (a link to the decision can be found here). This decision provides us with early insights into the UPC’s approach in deciding issues of validity, claim interpretation, infringement, remedies, and apportionment of costs.

The Court’s approach to validity blends elements of EPO-style proceedings with national approaches; claim interpretation follows the precedent set in NanoString v 10x Genomics; and the Court highlights some key open questions regarding the application of contributory infringement under the UPCA.

We explore these topics and more in further detail below.

Background of the Case

The dispute concerned EP 3 375 337 B1 (the patent), which was asserted by the claimant (Franz Kaldewei GmbH & Co KH) against the defendant (Bette GmbH & Co KG) for alleged direct and indirect infringement of patent claims 1-3 in the UPC contracting states of Austria, Belgium, Denmark, France, Italy, Luxembourg, and the Netherlands.

The defendant sought to defend against the infringement claim with a counterclaim for invalidity and based on a prior use right. It was not disputed that the infringing articles fell within the scope of the patent.

The Court considered both infringement and validity together, providing thorough reasoning for its decision and noted the importance of using a common claim interpretation for both. The Court gave guidance on the structure of the order of the decision, considering it sensible to decide procedural questions first, and then formulate a uniform interpretation of the patent before concluding on validity and infringement, and ultimately deciding on remedies and costs.

The defence of prior use was dismissed by the Court on the basis that the prior use invoked by the defendant related only to prior use in Germany and, to the extent that any prior user right might exist, it would be effective only in that state. Thus, the Court has confirmed that Article 28 UPCA should be interpreted narrowly as providing a right of prior use, which is territorially limited and “only arises on the basis of a deliberate, entrepreneurial decision in a particular state”. Accordingly, the alleged German prior use was not considered to be material to the infringement claim at hand (which was not brought in respect of Germany), and so the Court did not comment on this defence further.

The defendant’s invalidity defence alleged that the claims of the patent as granted, and the claimant’s auxiliary request combining claims 1-3 as granted, lacked novelty and and/or an inventive step. These allegations were based primarily on three prior art documents, DE 197 10 945 C1 (DE 945), DE 92 08 770 U1 (KMG 9), and DE 199 61 255 A1 (KMG 10).

The Court’s Assessment of Patentability

Novelty  

In assessing the novelty of the patent claims as granted and the auxiliary request, the Court considered what is directly and unambiguously disclosed to the skilled person. This test will be familiar to EPO practitioners as the EPO’s “Gold Standard” for disclosure, which is universally applied to the assessments of added subject-matter, priority entitlement, and novelty.

This Court’s application of the EPO’s “Gold Standard” is consistent with a recent UPC order from the Hague local division, which also applied the EPO’s case law in the context of added subject matter (see our report, here).

Therefore, these early cases demonstrate that the UPC judges are not only receptive to arguments that the EPO’s case law relating to the “Gold Standard” should be applied by the UPC, but issuing decision that are guide by them, if not slavishly following them to the letter.

That said, at this early stage in the UPC’s history, it is impossible to predict whether the UPC will continue to adhere to the EPO’s case law in respect of the “Gold Standard”, or other aspects of patentability. Indeed, despite the Court’s clear application of the EPO’s approach to novelty, the Court’s approach to inventive step appears to diverge (at least on its face) from the formulaic problem-solution approach employed by the EPO, as explained further below.

Inventive Step (Main Request)

Factual Context

Based on its novelty analysis, the Court concluded that the sole difference of claim 1 of the main request over DE 945 lay in that the “profiled strips [of the invention] are formed from plastic rigid foam”. The Court then went on to consider whether claim 1 was inventive.

Legal Context

In the preamble to its inventive step analysis, the Court stated the following:

“Only a person skilled in the art who is inventive is rewarded with a patent, see Art. 56 EPC. This inventive solution begins beyond the area which, based on the state of the art, is defined by what the skilled person with average knowledge, skill and experience can routinely develop and find in the relevant technical field (see Benkard/Söldenwagner, EPC, 4th ed., Art. 56 para. 9). An invention is deemed to exist if it does not result from the usual approach of the person skilled in the art, but requires an additional creative effort on their part.”

This appears to be the only legal background referred to by Court regarding the assessment of Article 56 EPC (inventive step). Notably, the Court refers to a commentary on the European Patent Convention but chooses not to refer to the wealth of Technical Board of Appeal decisions generated by the EPO.  Therefore, it should come as no surprise that there is little resemblance between the EPO’s application of the problem-solution approach[1] and the analysis of the Court here.

Analysis

The Court begins its analysis with the conclusion that it would have been routine for the skilled person, “who has been faced with the task of specifying a sanitary tub device which can be easily formed in different sizes and has good functional properties”, to arrive at the invention.

In forming this conclusion, the Court has evidently recognised a “technical problem”, which is directly lifted from paragraph [0012] of the patent and thus is a broad statement of what the inventors/draftsman considered to be the problem addressed by the invention. In EPO-terminology this would be referred to as the “subjective technical problem”.  In contrast to the EPO’s problem-solution approach, the problem considered by the Court here does not appear to be tied to the effect which is achieved by the difference over DE 954 (i.e., the “objective technical problem”). Instead, the problem is an ambitious statement of invention, which provides the backdrop for the question of obviousness.  This is perhaps more in keeping with the typical approach under German national law, which prefers a technical problem to be framed in more general and realistic terms[2], and which may take into account any broad problems identified in the description.

It is with this backdrop in mind that the Court asks whether it would have been obvious for the skilled person to arrive at the invention based on the state of the art and common general knowledge at the priority date.

Amongst the considerations contributing to its finding of obviousness, the Court states that the “plastic rigid foam” material is well-known in the art, citing passages of the patent in suit to support this. Therefore, in a similar fashion to the UK approach to inventive step, the Court states that it would have been obvious to combine the state of the art (DE 954) with the common general knowledge to arrive at the invention.

Furthermore, the Court states that: “[the material] is a flexible but dimensionally stable and sound-absorbing material that is easy to manufacture and not too expensive. Furthermore, it is plausible that the specialist would also choose the same material for the tub support for the profile pieces in order to avoid different tolerances and thermal expansion”. However, the Court does not cite evidence in support of these further technical assertions. Therefore, it seems that the Court is comfortable relying only on the technical knowledge of the technically qualified member rather than relying on any specific evidential basis for coming to these conclusions. Similarly, the Court dismisses the claimant’s arguments that there were technical reasons why the skilled person would not have expected that “plastic rigid foam” would be a suitable material for forming “profiled strips”, without citing any specific evidence to support its conclusion.

In deciding on inventive step, the Court has avoided directly applying the EPO’s case law on Article 56 EPC, and instead pursued an alternative (albeit not necessarily inconsistent) approach. This could indicate that the Court may well be receptive to arguments which differ from EPO’s established case law and may be willing to form alternative interpretations of the European Patent Convention.

Further, those familiar with the approach of the UK courts to patent validity may find it notable that the UPC has again demonstrated its confidence to exercise its technical judgement rather than rely on expert evidence. Indeed, similar to the EPO’s Technical Board’s of Appeal, many points in this judgement appear to exercise a significant level of technical judgement which is not necessarily rooted in the evidence presented by the parties but comes from the experience and expertise of the judges. Therefore, in contrast to UK-style litigation, the emphasis of evidence and arguments in these proceedings may more closely reflect EPO-style inter partes proceedings which place significantly less emphasis on expert testimony and cross-examination.

Inventive Step (Auxiliary Request)

In respect of the auxiliary request, which combined claims 1-3 of the patent as granted, the Court considered there to be two further differences with respect to DE 954. The Court considered one difference in particular – the protrusion of profiled strips beyond the lower bent section – to render the invention non-obvious over DE 954. Specifically, this is because this protrusion was not thought to be compatible with the overall design of DE 954

The Court also considered that the skilled person would not have combined KMG 9 and KMG 10 to arrive at the invention. In particular, the Court concluded that these documents, which relate to single-piece tub supports, represent a different approach to the claimed invention because they do not disclose a plurality of profile strips. In addition, the Court referred to the absence of any disclosure of a “force-locking” connection in KMG 9 and KMG 10, as a further reason why the claimed invention was inventive. Notably this distinction relies heavily upon the Court’s purposive interpretation of the term “oversized” in the claims, which stems from the description of the patent which explained the role that an “oversized” fastening section plays in securely mounting the sanitary tray to the support arrangement.

The latter aspect of this analysis highlights the importance of the Court’s approach to claim interpretation in deciding on matters of validity and infringement. The Court’s approach makes substantial use of the description to interpret the claims, which is consistent with the EPO approach set out in the Protocol on the Interpretation of Article 69 EPC and confirmed by the UPC’s Court of Appeal in NanoString v 10x Genomics (discussed here).

It is also notable here that, in keeping with its approach to the claims as granted, the Court has not applied the EPO’s formulaic problem-solution rubric in assessing inventive step. For example, whilst the Court has identified distinguishing features over KMG 9 (namely a plurality of profile strips), it did not explicitly set out any technical effect associated specifically with those features. The Court’s finding of non-obviousness was based on this feature not being disclosed in either of the documents, and alluding to both documents providing a ‘different approach’. It may be that the additional steps in formulating the objective technical problem from a specific technical effect would have been superfluous in any case.

Burden of Proof

Notably, when referring to KMG10 the Court states that because this document has already been “considered”, the defendant bears a higher burden of proof in respect of demonstrating obviousness over this document. This is perhaps to be interpreted as a heightened presumption of validity where known documents are relied upon. Indeed, KMG10 was a document cited in the application as filed and therefore, would have been considered by the EPO during examination of the patent application. Furthermore, elsewhere in the decision, the Court refers to a DPMA decision which came to similar conclusions in respect of patentability.

It is not clear to what extent the Court considers there to be a heightening of the burden of proof. However, this may well be an indication that the UPC will consider statements in the patent, and/or decisions of the EPO or Courts in UPC contracting states when weighing the strength of any rebuttable presumption of validity. This has implications for third parties considering citing prior art in examination proceedings (in third party observations, for example).

The Court’s Assessment of Infringement

The direct infringement of the patent by the defendant was not a point of particular contention between the parties. However, the Court provided a couple of interesting comments on the topic of contributory infringement.

First, the Court confirmed that “a component explicitly mentioned in the claims” constitutes “means, relating to an essential element of that invention, for putting it into effect therein” (i.e., “means essential”) within the meaning of Article 26(1) UPCA. However, the Court did not provide any more general guidance regarding the interpretation of “means essential” under the UPCA.

Secondly, the Court noted that (although not decisive in this case) it remains to be clarified how the double-territoriality requirement for contributory infringement is to be applied in the case of a European patent which is subject to the UPCA but is not a Unitary Patent. In particular, the Court questioned “whether it is sufficient [in the case of a European patent subject to the UPCA without unitary effect] that the offering / delivery exists in one of the contracting member states in dispute and is intended for direct use of the invention in the other protected states […] or whether, in the case of a European (bundle) patent, it is required that the tortious act must be directed to the same Contracting Member State in which the direct patent infringement is realised”. In this case, the Court found that it was not necessary to decide this question, because the double territoriality requirement had been met even under the latter (narrower) interpretation, through the offer via its website to various contracting member states including France, Denmark and Italy. Therefore, this issue remains untested.

The Court’s Assessment of Remedies and Costs

In contrast to other jurisdictions (e.g., UK), the Court decided on remedies at the same time as deciding on the merits of the case. It is also notable that the level of detail in the remedies requested by the claimant is directly reflected by the Court’s ultimate decision. Therefore, future claimants may wish to take a similar approach by providing highly specific guidance to the Court regarding the remedies which are sought.

The Court considered the costs of the infringement claim and counterclaim separately. As the counterclaim was partially successful, the reimbursable costs of the counterclaim were capped and divided equally between the two parties. In respect of the main infringement action, 85% of the (capped) costs were ordered to be paid by the defendant and the remainder was to be paid by the claimant.

Practice Points

  • The UPC appears open to applying the EPO’s “Gold Standard”, at least in respect of novelty and added subject-matter. Therefore, EPO added subject-matter and novelty case law is likely to be instructive for practitioners.
  • Although the case law in relation to the approach for assessing inventive step remains to be developed (and seemingly may diverge from the EPO’s problem-solution approach), the UPC judges are clearly confident in exercising a significant degree of technical judgement – similar to the EPO’s Technical Boards of Appeal. Therefore, an EPO-style approach to argumentation and evidence is likely to be received well by the UPC.
  • In line with NanoString v 10x Genomics, the description is used to interpret the claims and particularly to construe unclear terms (e.g., in this case, “oversized” was construed based on its function described in the patent).
  • Parties arguing for invalidity based on documents already identified in the patent and/or considered in national or EPO proceedings may need to meet a higher burden of proof to overcome presumed validity

Footnotes

[1] Case Law of the Boards of Appeal I-D-2
[2] BGH (FCJ), Jan. 13, 2015, X ZR 41/13, 2015 IIC 720 (Quetiapin)