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US claim construction at the English High Court – Chugai Pharmaceuticals Co. Ltd v UCB & Celltech


28th Aug 2018

This English high court decision relates to the question of infringement of a US patent. At first sight this may seem a little odd – why is an English court deciding on a matter of US patent infringement?

The issue

This case (Chugai Pharmaceuticals Co. Ltd v UCB & Celltech [2018] EWHC 2264) concerns a licence agreement between Chugai pharmaceutical Co. and UCB Pharma S.A.. Part of the licence agreement includes the following clause that specifies under what circumstance royalty payments are due.

“Royalties shall be payable only upon Net Sales in countries where, but for the licence granted by UCB to CHUGAI pursuant to Article 2, CHUGAI or a Permitted Sublicensee would infringe a Valid Claim of the relevant patent …”

This clause means that royalties are due on sales of a product that falls within the scope of a claim of a UCB patent which is in force, unless the patent has expired or it is held invalid. The licence specifies that the agreement is governed by English law and that parties agree to the exclusive jurisdiction of the English courts. This means that the English courts have jurisdiction on the scope of the licence agreement, and so have jurisdiction over the question of whether sale of a product infringes a particular patent.

The patent considered by the court in this decision is a US patent (US7566771), which is the only patent that remains in the licensed portfolio. The court was tasked with deciding on whether sales of Chugai’s product Tocilizumab infringe this US patent.

Jurisdiction

An earlier decision (Chugai Pharmaceutical v UCB [2017] EWHC 1216 (Pat)) relating to the same litigation addressed whether the English court had jurisdiction to consider aspects of Chugai’s particulars of claim which related to the validity of US7566771.

Chugai had included arguments in their particulars of claim setting out that if the claims of US7566771 were construed to cover their product, then the patent would not be valid in light of prior art cited by the USPTO, so this would not be the correct construction. Additionally, Chugai raised validity as part of their arguments on claim construction. As explained below, the US approach to claim construction includes considering the intrinsic evidence (the claims, the specification and the prosecution file) and the extrinsic evidence (e.g. expert evidence on scientific principles, dictionaries etc.). If the claim is still ambiguous after having considered both the intrinsic and extrinsic evidence, the claim should be construed, if possible, as to sustain its validity. This is termed the validity tie break. UCB asserted that arguments made by Chugai related to the validity of a foreign patent which was not justiciable in the UK courts.

The judge concluded that Chugai’s claim was not a direct challenge to validity of the patent and the question of validity was incidental. In other words, validity may be taken into account to enable the court to consider the construction of the claims. Accordingly, the UK courts had jurisdiction in respect of the contested parts of Chugai’s particulars of claim. The judge also held obiter that a direct challenge to the validity of a foreign patent should not be justiciable in the English Courts.

The case subsequently proceeded to full trial, and it was necessary for the court to decide whether sales of Chugai’s product Tocilizumab in the US infringed the claims of US7566771.

 US claim construction

The decision neatly boils down to the question of whether Tocilizumab falls within the scope of claim 2 of US7566771. US7566771 is a US patent, so infringement and claim construction were considered under US law.

In the decision, the judge provides a neat summary of the principles underlying US claim construction, and then goes on to apply this methodically to claim 2 of US7566771.

The leading US case on claim construction (Phillips v. AWH Corp . [2006] USCAFED 37), explains that the words of the claims are generally given their ordinary and customary meaning, which is the meaning that the term would have to a person of ordinary skill in the art at the effective filing date of the patent application (Phillips, pp1312-1313). Claim construction is an objective exercise. A person of ordinary skill in the art is deemed to read the words used in the patent document with an understanding of their meaning in the field and to have knowledge of any special meaning and usage in the field (Phillips p1313). Phillips also sets out that the person of ordinary skill in the art is deemed to read the claim in the context of the intrinsic evidence. The intrinsic evidence includes the entire patent specification and the prosecution file including the cited prior art. The court may also examine the extrinsic evidence, which includes scientific principles, the meaning of technical terms and the state of the art, and includes sources such as expert and inventor testimony, dictionaries and learned treatises (Phillips pp1313-1314 and 1317). If after consideration of the intrinsic and extrinsic evidence the claims are still ambiguous, the court should then adopt a construction, if possible, which preserves the validity of the patent (Phillips pp1327-1328).

Returning to the present case, the judge considered that the question of infringement turned on the meaning of the term “non-human donor”. Having considered the specification in some detail, the judge concluded that the document was not easy to construe. In many cases subject matter described as the invention or as an embodiment of the invention did not match the claims. The judge considered that the summary of invention section was very confusing and the examples included a number of antibodies that do not fall within the scope of the claims. The judge concluded that the claims alone could be interpreted in favour of either party and the specification included some material that positively supports each side. Having considered the prosecution file, the judge concluded that this includes material that supports each party’s case. Finally, after considering extrinsic evidence provided by each party’s expert witness, the Judge concluded that the extrinsic evidence firmly supported Chugai’s construction.

The decision also sets out that a validity tie break was not necessary in this case, so validity did not need to be considered. The judge held that extrinsic evidence allowed the patent to be construed in a reasonably coherent way using the approach put forward by Chugai.

Thus, the judge concluded that sales of Tocilizumab did not infringe the claims of US7566771, so no royalties are due under the licence in question.

This decision touches on some interesting jurisdictional issues and provides an excellent overview of how claim construction is approached under US patent law.

This article is for general information only. Its content is not a statement of the law on any subject and does not constitute advice. Please contact Reddie & Grose LLP for advice before taking any action in reliance on it.

Author
Zack Mummery
Associate
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Would you like to know more? You can talk to Zack Mummery who will be able to help. Call +44 (0)20 7242 0901

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