UPC finds Edwards' patent valid (as amended) – Meril's revocations dismissed

The Paris Central Division court of the UPC has found Edwards Lifesciences Corporation's heart valve patent valid (as amended by conditional applications and auxiliary requests during the revocation proceedings) and so has dismissed the revocation action and counterclaims brought by Meril Italy, Meril GmbH and Meril Life Sciences Pvt, although with an allotment of costs between the parties to reflect the patent's amendment during the revocation proceedings. 

The decision reviews the assessment that the court must make in considering referral of revocation counterclaims to the Central Division under Art 33(3) UPC Agreement (UPCA) and is also interesting on the process of amendment of patents during the course of revocation actions, the use of Rule 340 (on consolidation of proceedings) and the interpretation of "same parties" under Art 33(2) UPCA. 

Andrew Wells, IP partner at Herbert Smith Freehills, commented "This decision serves as a warning to patentees to be aware that if their patent only survives as a result of amendments, they can expect to pay some costs as a result."

Decision 

In the parallel UPC cases involving Meril parties and Edwards LifeSciences Corp, the revocation case brought in the Paris Central Division by Meril Italy and the revocation counterclaims by Meril GmbH and Meril Life Sciences Pvt (Meril Pvt) in the infringement action brought by Edwards in the Munich Local Division had been "consolidated" in the Paris Central Division (CD). These applications were decided on 19 July 2024, in three separate decisions (all with the same content -  see here), the Paris CD finding that:

• Edwards' patent is valid as amended by conditional applications and auxiliary requests during the proceedings, which were admissible, so the revocation action and counterclaims failed; but
• costs to be born 60:40 (Meril parties (jointly):Edwards) due to the amendments occurring during the proceedings and being the reason the patent was valid.

Article 33(3) UPCA

The judgments run through the scenarios where Art 33(3) UPC Agreement (UPCA) will apply and the decision-making process that a court must undertake in considering whether to refer counterclaims, to stay the infringement action or consolidate the whole action with the revocation action under this section. 

The decisions highlight that:

• efficiency of proceedings: " it may be relevant – as it appears in the current case – that there is likely to be a significant time difference between the decisions of the involved divisions" ; and
• similarity of grounds being argued for revocation: "Additionally, the similarity of grounds for invalidity in both proceedings and the multiplicity of infringement actions in which counterclaims against the same patent are filed are relevant considerations"

are also key to the decision to consolidate revocation and counterclaims in one set of proceedings (which were heard in one oral hearing on 7 June 2024).

"Same party; same patent" - Article 33(2) UPCA

The decision reaffirms the court's earlier finding that Meril Italy was not the same party as its parent Meril Pvt even though it was a wholly owned subsidiary with no commercial presence in Italy and whose sole employees were also employees of the parent company). Had Meril Italy been held to be the same party as those in the infringement action, then the revocation action, being second in time, would have had to be brought at the court where the infringement action was taking place (under Art 33(2) UPCA, but the Paris Central Division held that they were not the same party and thus it could accept the independent revocation proceedings brought by Meril Italy.  

Rule 340 on consolidation of proceedings

The Paris Central Division decision of 19 July, also discusses the use of UPC Rules of Procedure, Rule 340 (the "consolidation of proceedings rule") holding that it cannot be used to consolidate revocation and infringement proceedings in the local division: 

• Disagreeing the Munich Local Division's order of 28 March 2024, which order the Paris Central Division says "suggests interpreting Rule 340 ‘RoP’ to require a joint hearing for the revocation proceedings before a panel comprising all judges from both the central and local divisions. However, this interpretation lacks a legal basis in the ‘UPCA’ and the ‘RoP’, nor is it supported by EU law principles."
• "Additionally, the argument that Rule 340(2), which states that “the actions may subsequently be disjoined”, is otherwise ‘obsolete’ or ‘not clear’ neglects the fact that this provision allows for the disjoining of consolidated actions in situations where one (or more) of the actions is ready to be decided while others are not, thereby justifying different timeframes for their resolution."
• "Joining the revocation action and the counterclaims for revocation does not result in a true merger of the claims. These claims retain their distinct legal identities and must be adjudicated independently, even if a single decision is ultimately issued."

Admissibility of the amendment of the patent

Under Rules 30 and 50 of the UPC Rules of Procedure, the defendant in a revocation action is entitled to amend a patent provided the amendment application is included in the statement of defence (or in any event meets the filing deadline for this application) and contains the information referred to in Rule 30(1)(a) and (c). Rule 30(2) allows for a subsequent request to amend the patent, provided that such request is admitted into the proceedings with the permission of the Court. The Paris CD held that the term ‘subsequent’ must be interpreted as referring to a request which follows a previous one, making it sufficiently clear that the term refers to any request that amends the original application to amend the patent.

Meril had challenged the application to amend the patent filed with the defence to the revocation action, claiming it was inadmissible due to procedural errors in the initial filing with the statement of defence, although a later application was correctly composed and filed.  The Paris CD did not agree and allowed the amendment, setting out the fully amended claims in its decision not to revoke the patent.