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Patents: initiating a lawsuit

Patents are valuable assets. It is sometimes necessary for owners to assert their patent rights in legal proceedings and, equally, for third parties restricted from selling rival goods by the existence of patents that are not valid to seek revocation of the rights those patents confer.

This guide is based on UK law. It was last updated in July 2018.

Actions available against infringement

The Patents Act 1977 (the Patents Act) governs both UK patents and UK designations of European patents once these have been granted. Section 60 of the Patents Act sets out the acts considered to infringe a patent, if carried out without the patent proprietor’s consent.

Patent infringement claims are governed by section 61 of the Patents Act which states that civil proceedings may be brought in the court by the pat­ent proprietor in respect of any act of infringement. In any such proceedings a claim can be brought seeking an injunc­tion, an order for delivery-up or destruction of infringing goods, damages, an account of profits and/or a declaration that the patent is valid and has been infringed.

The parties to infringement proceedings may agree to refer the dispute to the Comptroller General of Patents, Designs and Trademarks (the Comptroller). The Comptroller leads the Intellectual Property Office (IPO). In such a referral the patent proprietor could seek only an award of damages in re­spect of the infringing goods and/or a declaration regarding the validity or infringement of the patent.

If the Comptroller considers that the question referred to him or her would be more appropriate for determination by the court, the Comptroller can decline to deal with the matter and instead the court will have jurisdiction to determine the question as if the reference were proceedings brought in the court.

Pursuant to section 74A of the Patents Act the patent proprietor may also request a non-binding opinion from the Comptroller as to whether his or her patent is infringed. Such an opinion can be sought once the patent has expired or been surrendered.

Third-party remedies to remove effect of intellectual property right

With respect to European Patents, opposition proceed­ings may be brought within nine months of grant of the patent, before the European Patent Office. There are no national opposition proceedings before the UK IPO. Action to remove the effects of a patent in the UK therefore takes one of the following forms:

Challenge to validity/revocation of a patent

A claim for revocation of a patent may be brought in the court or before the Comptroller.

Where the Comptroller has not disposed of an application made under section 72 of the Patents Act, the applicant may not apply to the court under the same section (i.e. for revocation of the patent) in respect of the same patent, unless either the patent-owner agrees that the applicant may do so or the Comptroller certifies in writing that it appears that the question of whether the pat­ent should be revoked is one which would more properly be determined by the court.

If the Comptroller refuses to grant the application made by the applicant, no application, otherwise than by way of ap­peal or by way of putting validity in issue in proceedings for infringement, may be made to the court by that applicant under the same section of the Patents Act (i.e. for revocation of the patent).

Additionally, section 74A of the Patents Act provides that the own­er of a patent or any other person may request the Comptroller to issue an opinion on a prescribed matter in relation to the patent. However, a section 74A opinion is not binding for any purposes.

Where the Comptroller issues such an opinion, the Comptroller may revoke the patent (section 73(1A) Patents Act). The patentee has the right to obtain a review of the Comptroller’s opinion under section 74B of the Patents Act and is also entitled to make any observations and to amend the specification of the patent (section 73(2) of the Patents Act).

Declaration of non-infringement

A party may apply to the court or Comptroller for a declara­tion that an act does not, or a proposed act would not, con­stitute an infringement of a patent (section 71 of the Patents Act). This can be applied for irrespective of whether the patent-owner has asserted otherwise or not.

In order to qualify the applicant must be able to demonstrate that it has applied in writing to the owner for a written acknowledgment to the effect of the declaration claimed, has furnished them with full particulars in writing of the act in question, and that the patent-owner has refused or failed to provide any such acknowledgement.

Further to the statutory power to grant declarations under section 71 of the Patents Act, the court has an inherent power to grant declarations of non-infringement. This power is wider than the statutory power.

For example, the court may con­sider it necessary and appropriate to grant a declaration in respect of non-UK designations of European patents where it considers that such foreign designations are inescapably connected because they are all designations of the same pat­ent and have identical wording. In such circumstances the court may consider that claims for declarations about the interpretation and non-infringement of the foreign desig­nations are related to the patent, too (Actavis v Lilly [2013] EWCA Civ 517).

Other declaratory relief

The court may exercise its discretion and order relief to the effect that a product or process was obvious at a relevant date (Fujifilm v Abbvie [2016] EWHC 425 (Pat)). Such relief may assist a party in clearing the way of patent rights which have not yet been granted.

Courts with jurisdiction

Any disputes arising under the Patents Act, for example concerning patent infringement or validity, may be brought before the court or, in some circumstances, the Comptroller. Part 7 of the Patents Rules 2007 governs proceedings heard before the Comptroller.

The UK comprises three jurisdictions: England and Wales, Scotland and Northern Ireland. Each jurisdiction has its own legal system, courts and procedures. Allocation between the courts within the UK of certain civil proceedings is governed by the Civil Jurisdiction and Judgments Act 1982.

Section 130 of the Patents Act provides that any claim under the Patents Act in Scotland is to be held before the Court of Ses­sion and in Northern Ireland the High Court in Northern Ireland. In England and Wales, where the vast majority of patent litigation in the UK is conducted, it is to be held in the High Court.

In England and Wales, any claim under the Patents Act must be commenced in either the Patents Court or in the Intellectual Property Enterprise Court (the IPEC). Both courts are part of the Business and Property Court of the High Court of Justice.

The IPEC is appropriate for smaller, shorter, less complex and lower-value actions and the procedures applicable in the court are designed particularly for cases of that kind. The objective of the IPEC is to provide cheaper, speedier and less formal procedures to encourage individuals and smaller or­ganisations to innovate and safeguard their rights.

The IPEC has a limit on quantum of damages that can be awarded of £500,000. Costs orders will be made which are propor­tionate to the nature of the dispute and are also subject to a cap of £50,000.

For more complex, important and valuable litigation the Patents Court is the appropriate forum.

Given the value of disputes in the Patents Court there is no cap on recoverable monetary relief or costs. If the amount of damages sought is under £500,000 then the case can still be heard by the Patents Court.

Any claims for breach of confidence can be brought in the High Court’s Chancery Division, within which the Patents Court sits, or again in the IPEC.

Upon appeal from the Patents Court, matters would proceed to the Court of Appeal and in certain circumstances from there to the Supreme Court.

Prerequisites to filing a lawsuit

Courts generally expect parties to have exchanged sufficient information to understand one another’s position and at­tempt to settle the issues between them without recourse to litigation, prior to instigating proceedings. Where the ur­gency of the application is such that it is not practicable to comply, the court does not expect the pre-action protocol to be complied with.

Parties should bear in mind section 70 of the Patents Act when engaging in any pre-action communication, irrespective of whether litigation is in the contemplation of the parties. If communications contain a threat of infringement proceed­ings, a claim for unjustified threats may arise. Such a threat shall arise if, upon receiving any communication, the recipi­ent would understand that a patent exists and a person in­tends to bring proceedings. Therefore any communications must be considered and phrased accordingly.

Legal representation

In intellectual property matters, individuals may choose to represent themselves rather than instruct a lawyer. If a litigant is a corporate entity, it may be represented by an employee provided that employee is authorised by the company and the court gives permission (Civil Procedure Rules 39.6).

Interim injunctions

Interim injunctions are available to stop alleged infringe­ments until the dispute can be heard and decided upon at a full trial.

Once an application for interim injunction is made this must be served upon the respondent, together with the supporting evidence, unless the applicant seeks an ex parte injunction.

A hearing date is set at which the merits of the application are considered. Depending upon the urgency of the application the court may grant an injunction to maintain the status quo pending the parties returning to court at a later date for the court to consider the merits of the application.

This approach is generally taken where the matter is so urgent that the par­ties have been unable to prepare full evidence to present to the court at its first sitting.

The court first considers whether there is a serious question to be tried, or a real prospect of success so that the claim is not vexatious, and that they have a good arguable case that there either is or will be infringement (American Cyanamid v Ethicon [1975] AC 396).

Provided that the applicant succeeds in establishing that there is in fact a serious issue to be tried, the court will go on to consider the adequacy of damages. If damages would adequately compensate the applicant, as opposed to an in­junction, then the court will not award interim injunctive relief. The adequacy of damages from the respondent’s per­spective is also considered.

If the court considers that damages would not be adequate, the court will consider the ‘balance of convenience’ test and will weigh up the relative harm that will be caused to either party by the grant or refusal of an interim injunction. The court will also consider the status quo and whether or not this should be disturbed. The court conducts its assessment on the basis of the facts and evidence before it. It will con­sider all manner of factors such as market conditions, the relative financial position of the parties as well as the conduct of the parties.

If an interim injunction is awarded, the ap­plicant must give a cross-undertaking as to any damages in­curred by the respondent during the term of the injunction.

Protection for potential opponents

In Scotland a potential opponent can lodge a caveat in the Court of Session. A caveat is an instrument that gives the potential opponent prior warning of any attempt to obtain an interim interdict – an interim injunction in Scots law – against it. The main benefit of a caveat is that it provides the potential opponent with advance notice, allowing them to oppose an interim order. There is no equivalent to a caveat in England and Wales.

Where a party is aware of the potential for a claim of patent infringement, it can choose to clear the way – i.e. invalidate the patent, it can initiate correspondence with the other side in the interests of transparency, it can provide undertakings with respect to its intended actions, or it can seek a declara­tion of non-infringement.

Special limitation provisions

Intellectual property claims are governed by the Limitation Act 1980 (the Limitation Act). The Limitation Act provides that the limitation period for bringing patent infringement cases is six years, as is the case with other torts, from the date on which the cause of action accrued.

Mechanisms to obtain evidence and information

Disclosure

Where disclosure is awarded generally in respect of valid­ity it will be limited to a two-year period either side of the earliest claimed priority date. With regard to patent infringe­ment, a product or process description can be provided in lieu of disclosure.

Disclosure is more restricted in the IPEC than in standard High Court litigation. There is no automatic disclosure pro­cess in the IPEC.

Search orders (‘Anton Piller’ order)

In exceptional circumstances, where key documents might otherwise be destroyed or disposed of, the court may make a search order allowing the applicant’s representatives to enter the respondent’s premises in order to search for, inspect and remove documents.

To obtain such an order the applicant must be able to show that there is a very strong case, damage caused to the ap­plicant is very serious and there is strong support for the proposition that the respondent has incriminating evidence.

Norwich Pharmacal order (NPO)

An NPO is an order for the disclosure of documents or in­formation by the respondent to the applicant. This type of order takes its name from the well-known case of Norwich Pharmacal Co v Commissioners of Customs and Excise [1974] A.C. 133.

This is an order to provide information on others involved in the supply of infringing goods and is made on the basis that a person, whether innocent or not, who has been caught up in wrongdoing is under a duty to assist those who have been injured by that act (The Football Association Premier League Limited v Wells and Ors [2015] EWHC 3910 (Ch)).

Mandatory interim injunctive relief

Article 7 of the EU Directive 2004/48 on the enforcement of intellectual property rights (the IP Enforcement Directive) provides that, on application by a party who has pre­sented reasonably available evidence to support their claim that their intellectual property right has been infringed or is about to be infringed, judicial authorities may order prompt and effective provisional measures to preserve relevant evi­dence in respect of the alleged infringement.

Such measures may include the detailed description, including samples, or the physical seizure of the infringing goods, and, in ap­propriate cases, the materials and implements used in the production or distribution of these goods and any docu­ments relating to the same.

Initial pleading standards

Conduct of civil litigation in England and Wales is governed by the Civil Procedure Rules (CPR). The overriding objec­tive of the CPR is to enable the court to deal with cases justly and at proportionate cost.

Court action is started when a court issues a claim form at the re­quest of the claimant(s).

Claimant(s) must complete a claim form and file this with the court along with the appropriate fee. The claim form includes details of the claimant(s) and defendant(s), a brief outline of the claim and indication of the value of the claim. Particulars of claim must be contained in or served with the claim form, or served within 14 days of the claim form. Par­ticulars of claim set out the legal basis for the claimant’s claim and the facts relied upon to substantiate liability. In practice they are succinct. Particulars of claim for patent disputes must meet the same criteria, set out in the CPR, as those in relation to other disputes.

A statement of case in a claim for infringement must con­tain particulars as set out in CPR Practice Direction 63. In a claim for patent infringement the statement of case must include details of which of the patent claims are alleged to be infringed and give at least one example of each type of infringement alleged.

Where patent validity is challenged 'grounds of invalidity' must also be provided. The grounds of invalidity specify the grounds on which validity of the patent is challenged and particularise every issue which it is intended to raise.

A copy of any document and, where necessary, a translation of any such document referred to in the statement of case and/or grounds of invalidity must also be served.

The defendant(s) may make a request for relief by making a counterclaim along with their defence. For example, a de­fendant alleged to infringe a patent may both deny any such infringement in their defence and also challenge the validity of the patent in their counterclaim.

In all cases parties may amend their statements of case dur­ing the course of proceedings either with the consent of the other parties, or with the consent of the court.

Representative or collective action

Class actions are possible in England and Wales. CPR pro­vides for the management of collective actions and the sup­plementary Practice Directions provide details on their practical application. There are no limitations on the type of claims which can be filed as class actions.

Restrictions on assertion of intellectual property right

When seeking to assert patent rights against others, patent pro­prietors must have regard to the provisions regarding threats, as mentioned above. If communications contain a threat of infringement proceedings these could give rise to grounds for an unjustified threats claim against the proprietor.

Also, whilst it is established that the existence of a patent right per se cannot be considered to be an abuse of domi­nant position under Article 102 of the Treaty on the Functioning of the EU, it has been held that the way in which a patent right is exercised could be considered to be abusive.