On Jan. 24, 2022, UK high court found that Mylan is not estopped form contesting the validity of divisional patent.

 

Background:

Neurim (Claimant) markets Circadian (melatonin) product in UK and Mylan wished to sell a generic. Neurim owns EP 1,441,702 (parent) patent which relates to method for improving the restorative quality of sleep with particular dose range of melatonin. On Dec. 16, 2020, Marcus Smith J held that the EP’702 patent was valid and infringed. The trial before Marcus Smith J took place at a time when the Opposition Division of the European Patent Office had revoked the Patent.  That revocation was suspended pending appeal by Neurim, but on Dec. 18, 2020 the Technical Board of Appeal brought that suspension to an end when Neurim withdrew its appeal on the second day of a two day hearing.  So the Patent was revoked ab initio for the UK (and all other designated member states) by operation of the European Patent Convention, Article 68. Marcus Smith J then made an Order on Dec. 30, 2020 on the papers, revoking all the material parts of his Dec. 16, 2020 Order.  The parties returned to Court in February 2021 for a full “consequentials” hearing and Marcus Smith J gave a judgment dated Mar. 12, 2021 and made a written Order.  However, Neurim had the Divisional (EP 3,103,443) in prosecution, and obtained its grant on Jun. 30 2021.  In these proceedings, Neurim has applied to amend the claims of the Divisional into a form identical for practical purposes to the claims of the parent patent as they stood at the time of the trial before Marcus Smith J. Neurim alleged that issue estoppel arising from the main Judgment of Marcus Smith J prevents Mylan from challenging the validity of the Divisional in these proceedings.  Mylan argued that Neurim’s conduct in amending the Divisional is an abuse of process, and it says that Neurim’s conduct in seeking to shut out its challenge to the validity of the Divisional is an abuse of a dominant position under s. 18 of the Competition Act 1998.

 

Analysis:

On the issue of estoppel, Court said that issue estoppel arises where there is a decision on an issue in a cause of action as an essential step in the reasoning. Issue estoppel can also arise in relation to issues which were not raised in an earlier proceeding, but could and should have been. Citing cases such as Concha v. Concha (1886) and Penn-Texas Corp v Murat Anstalt (No 2) [1964],  Court said that these cases generally support Mylan’s position that if there is no possibility of appeal because the party alleged to be estopped has won, there is no estoppel. Court said that Mylan could validly have filed an appeal after the judgment (Dec. 16, 2020) by Marcus Smith J, when it was the loser.  In particular, it could have done so prior to the revocation of the Patent by the TBA on Dec. 18, 2020. However, it clearly was not expected by the parties or by Marcus Smith J that Mylan was going to do that.  The whole situation was provisional because of the imminent TBA hearing. In these unusual circumstances, the relevant time for the purposes of assessing whether there was a possibility of appeal is not the short period between the Main Judgment and the revocation by the TBA, but only thereafter.  At that point, Mylan had won. So, Court concluded that Mylan could not appeal on validity at the relevant time. Since Mylan could not appeal, the general rule is that there can be no issue estoppel.

 

On the other issues raised by Mylan, Court refused those arguments which were related to abuse of process and competitive issue.