This article was first published on IP Magazine, 30 November 2020.
The circumstances in which it is appropriate to grant an injunction have been the subject of recent decisions in both the life sciences and telecoms sectors. In this article we briefly compare the outcomes and consider how the underlying reasoning from the two sectors may become more relevant for the other in the future.
In the life sciences sector, the arguments in the context of potentially lifesaving medical devices were considered by Birss J in Evalve v Edwards Lifesciences. He reviewed the policy factors which must be balanced when deciding whether to grant a final injunction, noting the public bargain of protecting investment in exchange for disclosure of the invention. He also noted that the UK Patents Act is already formulated to ensure an appropriate balance and therefore the Courts should use their discretion to refuse an injunction sparingly. There is also the statutory compulsory licence regime for circumstances where there is an unmet need.
Similar issues had also been considered in earlier cases such as Edwards Lifesciences v Boston Scientific and Regeneron v Kymab. In each of these cases, the technology was also such that it could have life-changing benefits. The parties were also essentially competitors – whilst one was not making a generic version of the other’s product, the patents related to technology which both parties were using.
Whilst there have been cases in the UK in the past where a life sciences patentee has sought an injunction in circumstances where it was not commercialising a relevant product, none of these requests have, as far as the authors are aware, yet been decided by the Court, either because the relevant patent was held to be invalid or not infringed, or because the parties settled before it could be tried. Notably, even if the litigation in these cases has essentially been about monetisation of patents, the patentees have themselves generally been innovators.
In the telecoms sphere, it is much more common for patentees not to be implementing the technology covered by their patents. The entire business model of patent assertion entities (of which there are an increasing number) is to seek a revenue stream from their patents. Indeed, in recent years, there has been significant debate in the Courts about the circumstances in which (if ever) it is appropriate and, importantly not anti-competitive, for the owners of patents which are essential to the telecoms standards (SEPs) to seek injunctive relief.
Having given the required undertaking to the relevant standardisation body, SEP owners are contractually obliged to offer licences to their SEPs on FRAND terms. However, if following a finding of infringement of a valid SEP, the implementer declines to accept a licence on terms deemed to be FRAND and the SEP holder has satisfied the relevant court that asking for an injunction would not amount to an abuse of a dominant position, there has been debate about whether an injunction should be an available remedy. In particular, even having overcome these non-trivial steps, SEP holders have faced the argument that an injunction should not be available as a matter of discretion.
This issue was considered (alongside other issues) by the Supreme Court in Unwired Planet/Conversant. It was argued that the Court should use its discretion to refuse to grant an injunction preventing infringement of an SEP even in circumstances where the SEP holder has satisfied the necessary criteria and the implementer has refused to enter into a FRAND licence. This was on the basis that it would be inappropriate and disproportionate for the Court to grant such an injunction, especially in circumstances where the patentee (here a patent assertion entity) was only interested in obtaining royalties. In circumstances where the technology in issue is relevant to a globally implemented standard, it was held that if an injunction was not available, implementers would have an incentive to refuse to enter a FRAND licence and continue infringing, only paying damages in each individual country in relation to each individual patent.
Whilst the policy considerations before the Supreme Court were very different from those before Birss J in Evalve, and whilst the facts were also very different, both came to similar conclusions: that damages in lieu would not be an adequate substitute for an injunction. It is interesting to see these very different scenarios both resulting in an apparent desire not to fetter the patentee’s exclusionary rights without good reason.
For several years there have been discussions about life sciences patent pools relating to key platform technologies being set up in such a way that could result in FRAND-type obligations. Whether or not life sciences patent pools become a significant commercial reality, it is clear that as connected medical devices become more common, those in the life sciences and technology sectors will have to take note of the patent landscape in each other’s sectors and the different types of argument that are run. Similarly, as those in the life sciences sector seek to get as much value as they can from their existing IP, they may want to look to the arguments developed in the tech sector as to why injunctions should or should not be available in circumstances where the patentee has no competing product. Perhaps one day the Courts will even have to consider whether it is still appropriate to grant a FRAND injunction if it relates specifically to potentially life saving medical technology. We’ll see.