Actavis Group PTC EHF v Pharmacia LLC, Patents Court, 24 July 2014, [2014] EWHC 2611 (Pat), Arnold J

As recently reported on the EPLAW Patent Blog (here), the English Patents Court had refused to stay validity proceedings relating to the UK designation of a European patent whilst opposition proceedings were on-going at the EPO, despite relatively broad undertakings offered by the patentee (Pharmacia) to the potential infringer (Actavis).

Arnold J has now reconsidered Pharmacia’s request for a stay in light of the two additional undertakings it offered after release of the draft judgment of that decision. In a new judgment, handed down on 24 July 2014, Arnold J held that the additional undertakings tipped the balance in favour of a stay as they “do substantially eliminate the commercial uncertainty to which Actavis will be exposed in the United Kingdom as a result of a stay.”

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Pharmacia’s original undertakings had been: (i) to seek expedition of the EPO proceedings; (ii) not to seek an injunction against Actavis or its customers until the determination of the EPO proceedings; and (iii) only to seek damages of 1% of Actavis' net sales during the period from launch until the determination of the EPO proceedings if the Patent is held valid both by the EPO and by the English courts.

Pharmacia’s additional undertakings were: (i) not to seek an injunction in the UK against Actavis and its customers for the life of the patent; and (ii) only to seek damages of 1% of Actavis’ net sales in the UK during the life of the patent.

Actavis had continued to resist the stay. Its two key reasons were that an early decision from the UK would: firstly, be of considerable assistance in other European jurisdictions where it also intends to enter the market (being persuasive in relation to both customer confidence and parallel litigation); and, secondly, assist in promoting pan-European settlement between the parties. Another argument made by Actavis, but to which Arnold J gave less weight, was that the attitude of Pharmacia and the undertakings it had offered indicated that Pharmacia thought its patent was weak, and that there is a strong public interest in the validity of weak patents being scrutinised by a competent court at the earliest possible date.

Arnold J held that, whilst Actavis’ reasons favoured the refusal of a stay, he had to consider the overall balance in accordance with factors set out in the IPCom Guidelines, and he concluded that, with the additional undertakings offered by Pharmacia, the balance was now in favour of a stay. (Indeed, if these revised undertakings were not sufficient to tip the balance in favour of a stay, it is hard to imagine when a stay would ever be granted.)

Arnold J also expressed the hope that the EPO would accede to the joint request of the parties to accelerate the opposition and any appeal, although it remains to be seen whether the EPO will follow this request.

Head note: Rowena Stent