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UK – Oxford Nanopore v. Pacific Biosciences of California

18 Dec 2017

Oxford Nanopore v Pacific Biosciences of California, High Court of Justice, London, UK, 14 December 2017, [2017] EWHC 3190 (Pat)

This judgement was concerned with a very specific question: Is a licence an “exclusive licence” within the meaning of section 130(1) of the Patents Act 1977, if a third party has an option to take a licence under the patent, but has not yet done so?

Reviewing the authorities, the judge concluded that:

i) Whether or not a licence is an exclusive licence for the purposes of section 67(1) of the Patents Act is a matter for English law;
ii) A licence which purports to be an exclusive licence may not necessarily be so. Identifying an exclusive licence depends on a proper construction of the document or documents;
iii) It is for the party asserting that it is an exclusive licensee to demonstrate that it is;
iv) The assessment of whether or not a licence is exclusive is not a “once and for all assessment”. An exclusive licence may confer upon the patentee a power to convert the licence into a non-exclusive licence;
v) The “essential element” of an exclusive licence is that is it a licence to the exclusion of all other persons, including the patentee or applicant;
vi) It is possible to have a plurality of exclusive licences in respect of any one patent;
vii) But each exclusive licence may only be granted to one person – a licence will not be exclusive if granted to a number of entities, even if they are under the same control;
viii) An exclusive licensee may grant sub-licences to “persons authorised by him”;
ix) There is a distinction to be drawn between a licence and an equitable right to call for a licence; and
x) Where an equitable right to call for a licence is conditional the otherwise exclusive licence will remain exclusive unless and until the contractual conditions are fulfilled that enable the grant of the licence.

Applying the above, the judge determined in that the present case the licence in question was an exclusive licence and hence the Oxford Nanopore was an exclusive licensee entitled to bring an infringement action.

A copy of the judgement in the present case can be found here.

Headnote: Nicholas Fox, Simmons & Simmons LLP