Russia has a bifurcated system for handling patent infringement lawsuits and patent revocation proceedings. The venue for patent infringement proceedings is the Russian Court system and the venue for revocation proceedings is the Russian Patent Office (ROSPATENT), specifically, the Chamber for Patent Disputes (Chamber). If as a result of a revocation proceeding a patent is deemed to be partially invalid, the patent is nullified in its entirety and an amended patent having a new patent number and containing the claims adjudged to be valid is issued within a few months.
Until recently, if during a patent infringement proceeding an asserted patent was found to be partially invalid by the Chamber, the infringement action was dismissed in full. The reasoning used by courts to dismiss such actions was that the asserted patent (with its specific patent number) no longer existed and there could be no infringement until the amended patent was granted. In such situations, the patentee’s only recourse was to wait until the amended patent issued, and file a new patent infringement action. Unfortunately, as a result, the patentee would have to begin its case again from the very beginning even if the defendant’s product infringed the claims of the amended patent.
In Bayer vs. Gedeon Richter et al. (No. А40-90149/11-51-791), the Supreme Arbitration Court (SAC) issued a decision changing the approach Russian courts will have to use when considering patent infringement lawsuits in instances where an asserted patent is subject to partial invalidation by the Chamber.
The case involved a contraceptive developed by Bayer comprising a combination of the active ingredients ethinylestradiol and drospirenon. This concentrative has been sold in Russia under the trade names Yarina and Yaz. Bayer filed and received Russian Patent No. 2269342 which claims a pharmaceutical composition comprising a combination of these active ingredients. The patent expires in 2020.
Gedeon Richter (Gedeon), a Hungarian generic drug manufacturer, received marketing approval and began to sell (in Russia) a generic copy of Bayer’s branded Yarina and Yaz products under the trade name Midiana. In response, Bayer filed a patent infringement action in August 2011 against Gedeon and several other companies involved in the supply of Midiana.
In response to Bayer’s filing, Gedeon filed a revocation action against Russian Patent No. 2269342 in the Chamber. The revocation action proceeded very quickly, and on December 13, 2011, the Chamber held that Bayer’s patent was partially invalid. Because the patent infringement proceeding was still pending before the court of first instance (namely, the Moscow city Arbitration Court), the court quickly dismissed the infringement action on February 21, 2012, holding that Bayer did not have an enforceable patent at the time of the proceeding. This decision was upheld by the second and third instance courts (namely, the Ninth Arbitrazh Appeal Court and the Federal Arbitrazh Court of the Moscow District).
Bayer filed a final appeal at the SAC and the Presidium granted a request for reconsideration. On April 23, 2013, in a landmark ruling, the Presidium overturned the decisions of the lower courts and sent the case back down for a re-trial. Specifically, the Presidium ruled that the courts must consider the amended patent that results from a partial invalidation of the original patent during a patent infringement proceeding. Moreover, the Presidium held that the delay created between the nullification of an original patent and issuance of an amended patent by ROSPATENT cannot negatively affect the rights of the patentee to enforce its patent. The Presidium also stated that although the original patent was held partially invalid, Bayer did not lose its exclusive right in the invention because the issuance of the amended patent had the same priority date as the original patent. Therefore, the Presidium ruled that dismissal of Bayer’s patent infringement action without consideration of the merits of the scope of the claims in the amended patent was illegal. Thus, the lower courts were ordered to conduct a re-trial.
This very important decision by the Presidium closes the legislative loophole associated with the imperfect procedure involving the partial invalidation of patents. This decision allows patentees to continue to enforce their patents even if found to be partially invalid as a result of a revocation proceeding.
This post was written by Lisa Mueller and Vladislav Ugryumov of Gowlings (Moscow).