Year in Review: notable 2020 patent cases in the Netherlands

Infringement by equivalence – Eli Lilly v Fresenius Kabi (Court of Appeal of The Hague)

This was another decision in the pan-European pemetrexed battle, in which the Court of Appeal found Eli Lilly’s patent valid and infringed. The patent claims an anticancer agent, pemetrexed disodium, in combination treatment. The main question was whether a different salt form of pemetrexed would constitute infringement by equivalence.

Whilst the Dutch courts have not always followed a two-step test for determining the scope of a claim, the Court of Appeal in this decision chose to do so. The court laid down four requirements for protecting equivalents:

1. The deviating feature must be technically equivalent to the claimed feature.
2. Protecting equivalents must be appropriate for fair protection of the patentee.
3. Protecting equivalents must be consistent with legal certainty for third parties.
4. The equivalent must itself be novel and inventive over the prior art.

The Court of Appeal also gave further guidance on relevant factors to consider when assessing these questions. The equivalent itself does not need to have basis in the application, and hence limitations for added matter are not relevant. Furthermore, even where the patent application could have been drafted more clearly, this does not rule out protection of equivalents. This decision suggests that the Dutch courts are now more likely to follow the two-step test in the future.

Damages for wrongful enforcement of a patent – Menzis v AstraZeneca (District Court of The Hague)

This judgment marks the first time that the court has held a pharmaceutical company (AstraZeneca) liable to a health insurance company (Menzis) for higher reimbursement costs in The Netherlands caused by the enforcement of a patent that was later declared invalid.

Sandoz and other generic manufacturers started a nullity action against AstraZeneca’s patent EP 0 907 364 for a formulation of quetiapine, but the action was unsuccessful and the patent was held valid by the District Court of The Hague. Shortly afterwards the UK part of the patent was held invalid by the High Court in London, which was confirmed by the Court of Appeal. Several months later the District Court of The Hague issued a preliminary injunction against Sandoz for infringement.

AstraZeneca then served the judgment on Sandoz, acquiring a compensation liability to Sandoz if the preliminary injunction would later be overturned.

Therefore, Menzis had to reimburse the originator, as the less expensive generic could not enter the market. On appeal in the Dutch nullity action, the patent was declared invalid.

The court confirmed that patentees are not liable merely for maintaining a patent that is later revoked despite the risk that this approach could hinder technological investments. Nevertheless, enforcement, such as serving the injunction for infringement while validity is still at issue, could give rise to liability for consequential damages suffered by third parties. The court ruled that Menzis’ damages resulted from AstraZeneca’s market exclusivity, which in turn resulted from wrongful enforcement of the patent. Therefore, AstraZeneca was unjustifiably enriched to the detriment of Menzis and liable for damages to Menzis. One factor in this ruling was that enforcement of the preliminary injunction occurred after the Court of Appeal in London had declared the UK counterpart of the patent invalid.

FRAND negotiations – Philips v Asustek (Court of Appeal of The Hague)

The Court of Appeal dismissed Asus’ invalidity challenge and found the patent essential to the UMTS-standard and thus infringed by Asus. The court applied the CJEU’s Huawei v ZTE framework in assessing the compliance of the parties with their FRAND obligations and considered that the Huawei v ZTE steps should be treated as guidelines for bona fide negotiations between parties.

The court concluded that Philips had properly notified the patent to Asus. It dismissed Asus’ FRAND defence, holding that Asus was an unwilling licensee because of its delaying tactics. According to the court, it is a prerequisite for the FRAND obligation to arise that the SEP holder submits its FRAND offer and that the implementer shows its willingness to conclude a licence under FRAND conditions.

Moreover, Asus did not promptly submit its counteroffer after Philips sent its standard licence agreement. Under those circumstances, even if it would have been for Philips to submit a FRAND offer, the implementer could not successfully rely on a FRAND defence. Asus’ counteroffer, submitted after Philips rightfully…