What are the key defences to patent infringement?
Some of the key defences to patent infringement are:
a. Prior use before the priority date of the relevant claim;
b. Exploitation for regulatory purposes in Australia or overseas (both pharmaceutical and non-pharmaceutical patents);
c. Exploitation for experimental use.
Besides contesting the infringement itself, claiming the invalidity of the patent is the most common defence.
Since in PI proceedings the infringement court has to rule on the validly of the patent and deny the injunction if it considers invalidity likely the question of validity often becomes the main subject of PI proceedings.
In main proceedings, the court may stay proceedings until the final decision in the invalidity proceedings before the APO once a substantiated invalidity defence is raised by the defendant.
Other kinds of defences are less common and include prior use, that the alleged infringer only practiced the prior art (Formstein defence), relying on (implied) licenses and invoking the statute of limitations. Furthermore, exhaustion of rights may be invoked regarding products placed on the market in the European Economic Area with the consent of the patentee.
In cases concerning pharmaceuticals, the so-called Bolar exemption (for clinical tests for regulatory approval) may be invoked.
Anti-trust arguments and the necessity of a compulsory license may potentially be invoked but are rare in practice.
The key defenses available are the invalidity of the patent and non-infringement.
Non-infringement: The defendant can plead that its activities are not an infringement of the asserted claim(s) as properly construed.
Invalidity: The defendant can challenge the validity of the asserted claim(s) on various bases (see Question 8).
Experimental Use: Based on the common law doctrine of experimental use, a defendant has historically been able to argue that the impugned acts are exempt from infringement if done privately and on a non-commercial scale or for a non-commercial purpose. New legislative amendments now include a codified exception where the allegedly infringing act was done solely for the purpose of experiments that relate to the subject matter of the patent. The full scope of this statutory exception has yet to be determined by the Courts.
Regulatory Use: It is not infringement where a person makes, constructs, uses or sells a patented invention ‘solely for uses reasonably related to the development and submission of information required under any law of Canada, a province or a country other than Canada that regulates the manufacture, construction use or sale of any product.’ (Patent Act, s. 55.2(1)). While it is still an open question, this exemption may be limited to activity related to generic pharmaceuticals in the context of the Patented Medicines (Notice of Compliance) Regulations, SOR/93-133.
Licence: A valid licence (express or implied) issued to the alleged infringer to engage in the impugned acts is a complete defence to the alleged infringement.
Exhaustion: Where a buyer purchases a patented article, there is a presumed implied licence to use, sell or deal with that patented article, subject to any restrictions imposed on the buyer by the patentee at the time of purchase.
Prior User Rights: Recent legislative revisions appear to have expanded the scope of prior user rights in Canada. Generally, if before the relevant date a person committed an act (in good faith) which would otherwise constitute infringement, it will not be an infringement if the person commits the same act on or after the relevant date. The full scope of protection afforded by the new amendments has yet to be determined.
This exception to infringement is generally unavailable where the person’s actions were only possible because they obtained knowledge of the claimed invention directly or indirectly from the patentee, whom they knew to be the source of the knowledge.
Time Limitations: In some circumstances, the defendant can assert defences based on statutory limitation periods (see Question 20), or based on common law equitable defences such as laches, acquiescence and estoppel.
The key defenses to patent infringement comprise non-infringement, invalidity, prior-art, prior-right, estoppel, donation principle, exhaustion of right, Bolar exception, non-production or business purposes, temporary transit, exceeding the statute of limitations, abuse of patent right, technical deterioration.
An infringing act will not be present where:
- The patent rights were exhausted, through the introduction of the product onto the market in the Czech Republic by the patent owner or with its permission;
- A prior user of an invention exercised it independently of the patent owner at the time of priority of the patent;
- It take place on foreign ships, airplanes or in relation to these as specified in the Act;
- Medicinal product is being individually prepared in a pharmacy;
- The conduct has no commercial purposes;
- The conduct amounts to experimentation or the experimentation and testing is necessary for the registration of a medicinal product.
If the patent is at any time declared invalid then it could never have been infringed.
In addition to motion for lack of standing or capacity to act, a counterclaim for revocation can be filed. After several years of debates about the starting date of the 5-year time bar to file such counterclaim, according to the Law adopted on 22 May 2019; actions for revocation are imprescriptible. When an opposition against a European patent is pending, the Paris court; before which an infringement action of the French designation of that patent is pending has, upon request by one of the parties, discretion to stay the action until the outcome of opposition, taking into consideration the balance of convenience and the strength of the opposition arguments. French courts are generally reluctant to order such stay.
The alleged infringer can also challenge the infringement by application of Articles L. 613-5 to L. 613-7 IPC, arguing that the acts are notably:
- done privately and for non-commercial purposes;
- done for experimental purposes relating to the subject matter of the patented invention;
- done by pharmacists making up a prescription;
- related to trials made for the purposes of the application for a marketing authorisation for a drug (the so-called ‘Bolar exemption’);
- done on vessels and aircrafts having temporally or accidentally entered French waters or crossed France;
- related to space vessels introduced into France;
- performed to create, discover or develop new plant varieties (breeders exemption) or related to the farmers’ privilege, which authorises a farmer to use for his/her own exploitation the harvested product (for patents covering plant genetic information or plant material) or to use livestock (for patents covering animal genetic information or animal biological material).
The defendant can also rely upon the exhaustion of the rights where the patentee or his/her beneficiary have consented to the introduction of a product implementing the patented invention within the European Economic Area (EEA).
It enables any person who was in good faith in possession of the invention in France before the patent priority date to continue to personally work the invention. The prior use does not extend to improvements or updated versions of the invention and is limited to personal use, i.e. is not transferrable.
Where the patent at stake has been declared essential to a standard, such as in the telecommunications industry, the defendant can challenge the essentiality of the patent. The alleged infringer can also raise a fair, reasonable and non-discriminatory (FRAND) defence..
Apart from the main defense that the accused product does not fall within the scope of the claim the following defenses are rather common in Germany:
- Valid license agreement
- Right of private prior use
- Statute of limitation
- Anti-trust defense
As mentioned under Section 2, as a consequence of the German bifurcated system, invalidity of the patent is not a valid defense in infringement proceedings. However, arguing invalidity can lead to a stay of the infringement proceedings pending the outcome of parallel invalidation proceedings.
The quickest defence against infringement is the filing of a temporary restraining order. For the restraining order to be granted, the petitioner must prove the existence of a prima facie serious infringement and that the matter is of exceptional urgency. The request must be filed concurrently with a petition for injunction. If a temporary restraining order is granted, it remains effective until the injunction hearing takes place. For an injunction to be granted, the element of urgency must be evident. Within this framework, patent owners can request cessation of the infringement and removal of the allegedly infringing products from the market. Patent owners also have a right to information and are entitled to certain measures to preserve evidence. Patent owners can further initiate an action on the merits, which becomes statute barred either five years after the date on which the patent owner became aware of the infringement or damage and the name of the infringer, or twenty years after the date on which the infringement was committed.
- UnderSection 107 of the Patents Act, 1970, in any suit for infringement of a patent, every ground on which it may be revoked will be available as a ground for defense.
- Under Section 107A of the Patents Act, 1970, certain acts are not to be considered as infringement being:
- That the making, using, constructing, selling, or importing of the patented invention is solely for uses related to the development and submission of information required by any law for the time being in force in India or any other country that regulates such use;
- That the Defendant’s importation from a person is duly authorized to manufacture, distribute, or sell;
- That the Defendant’s product is different from the Plaintiff’s patented invention, amongst others;
- Gillette Defense- In an infringement action, the Defendant may raise as a defence that his product is based on the claims of a prior patent which is now in public domain.
Consent, express or implied, is a defence to patent infringement. A defence may also arise in connection with the limitations on the effect of a patent provided for in section 42 of the Patents Act. Essentially, the rights conferred by a patent do not extend to:
- Acts done privately for non-commercial purposes;
- Acts done for experimental purposes relating to the subject matter of the relevant patented invention;
- The extemporaneous preparation for individual cases in a pharmacy of a medicine in accordance with a medical prescription issued by a registered medical practitioner or acts concerning the medicine so prepared;
- Certain use of the invention on board foreign registered vessels;
- Certain use of the invention in the construction or operation of certain aircraft or land vehicles; and
- Acts done in relation to the subject matter of the relevant patented invention which consist of acts done in conducting the necessary studies, tests and trials on a product to demonstrate the efficacy and safety of a product which are conducted with a view to enabling a producer to obtain a marketing authorisation in preparation for the expiry of patent. This is commonly known as the Bolar exemption.
The Patents Act sets out a number of additional defences which may be available to a defendant, including:
- The rights conferred by a patent do not extend to any acts which, under the obligations imposed by the EU treaties, cannot be prevented by the patent proprietor (section 43, Patents Act).
- Where a patent has lapsed bona fide and a third party commences or makes serious preparations to do an act that would constitute an infringement if the patent had not lapsed, that person has the right to continue such acts even if the patent is subsequently restored (section 37, Patents Act).
- A person who before the date of filing of the patent application or the priority date, does in good faith an act that would constitute infringement of the patent if it were then in force or makes in good faith effective and serious preparations to do such an act has the right to continue to do that act (section 55, Patents Act).
As noted above, a defendant in patent infringement proceedings is entitled to challenge validity as part of its defence. In addition, and aside from non-infringement arguments contesting plaintiff's claim construction or alleged description of defendant's actions, the Patents Act contains the following key defences to patent infringement
(I) An 'experimental use' defence for acts intended to improve the invention or to develop another invention;
(II) A 'regulatory approval defence' for acts intended to obtain a marketing approval in Israel or in another country which provides such a defence;
(III) A specific de minimis defence for acts which are non-commercial in both scale and character;
(IV) A 'private prior use' defence permitting private or in-the-course-of-own-business invention exploitation, if good faith exploitation or good faith actual preparations towards exploitation were made in Israel at the priority date of the patent application.
Non-infringement, invalidity and the patent exemptions set forth in Article 68 Italian IP Code, the most important being the experimental use exemption and the Bolar exemption.
The experimental use exemption shields “activities carried out in a private, non-commercial environment and for non-commercial purposes, or of an experimental nature”. The prevailing interpretation is that this exemption typically shields only those research and development activities aimed at achieving innovations overcoming or winning over the patented product or process i.e. at achieving new inventions.
Our Bolar exemption instead covers studies and experiments directed at obtaining a Marketing Authorization for a medicinal product (generics as well as originators) and the consequent practical requirements, including the preparation and use of the patented active substance in the amounts that are strictly necessary for the MA registration procedure.
While Bolar litigation is hardly frequent, a seminal judgment issued in 2018 by the Milan Court clarified the boundaries of the Bolar exemption and in particular the conditions that must exist for the latter to be invoked by mere API manufacturers, thus bringing clarity over the issues that had been left open in the unresolved Astellas v. Polpharma litigation.
In order to argue, concerning non-sufficiency, that a certain product sold by a defendant or a certain process used by the defendant falls outside the scope of the claims of the patent in dispute, the defendant needs to interpret the phrases of the claims and then argue that the relevant product or process does not satisfy such claims. Further, if the plaintiff makes assertions as to infringement under the doctrine of equivalents, the defendant will then argue that the product or process in question does not satisfy the requirements for the establishment of infringement under the doctrine of equivalents. Depending on the case, the defendant may argue that it has a right of prior-use (Article 79 of the Patent Act) because the defendant worked the invention by itself at the time of filing the patent application, or the defendant may argue patent exhaustion issue to the effect that the patent rights are not effective against a product which has been distributed by the valid patentee in a legitimate manner. When such argument is accepted, even if the relevant product or process satisfies the claims, the defendant’s acts will still not constitute patent infringement.
If someone is sued for infringement, the normal reaction, which is adopted in almost every infringement case, is to file a counter claim for invalidation of the patent.
Experiments and research on the invention itself is exempted from the patentee’s sole right. The exemption does not only regard ‘pure’ research but also commercial research and development.
There are some examples where the research exemption has been invoked as defence, but this is not a defence that is invoked often.
The defence of leave and license is not expressly dealt with in the Patents Act but is generally accepted as being a valid defence to a claim for infringement. The defence can be based both on an express or implied license entered into between the patentee and the defendant.
The exhaustion rule implies that the patentee’s sole right is exhausted for those products he brings to the market, or which are brought onto the market with the patentee’s consent. Norway’s obligations as an EEA member made it necessary in 1994 to expand the exhaustion rule to products brought onto the market within the EEA.
Key defences comprise patent invalidity (although disregarded by Polish courts), no direct infringement and claim construction issues, abuse of patent right, prior user rights, and – quite often - allegedly infringing object forming part of the state of the art.
In addition, Polish law has introduced several limitations of exclusivity including:
- an invention relating to means of transport and parts or devices thereof that are in Poland temporarily and goods in transit;
- public (state) interests, particularly as regards public safety and order;
- research, experimentation and teaching purposes exemption;
- Bolar exemption;
- producing a medicine in a pharmacy according to an individual medical prescription.
Polish law also provides for an exhaustion of rights.
Non-infringement and patent invalidity are the most common defences to patent infringement.
Although rarely applied in practice, the interested parties can also invoke (apart from general procedural objections):
a) legal limitations of the rights conferred by a patent;
b) exhaustion of rights;
c) non-opposability; or
d) the existence of a licence.
The key defenses in patent infringement case are:
1) statement that suspected product/process is out of the scope of patent protection;
2) proving the abuse of patent right (including references to the prosecution history estoppel);
3) the prior use of patented object i.e. the use or substantial preparation for the use of invention before patent priority (applicable if it took place in Russia only);
4) scientific and non-commercial use (Bolar exemption in particular). The arguments on patent invalidity can not be considered as a defense and should be filed separately.
Besides non-infringement, a defendant may bring itself within the exceptions created by section 66(2) of the PA for acts which would otherwise constitute infringement by virtue of being prohibited by section 66(1) of the PA. The main categories of exceptions in section 66(2) of the PA are:
(a) acts which are done privately and for non-commercial purposes;
(b) acts which are done for experimental purposes relating to the subject-matter of the invention;
(c) uses of a patented product or process by aircraft and ships which had temporarily or accidentally entered into Singapore’s airspace or territorial waters (as the case may be) or by exempted aircraft or ships; and
(d) the parallel importation into Singapore, with consent of the foreign patentee or his licensee, of any patented product or any product obtained by means of a patented process or to which a patented process has been applied.
Further, under section 71(1) of the PA, a person who in Singapore before the priority date of the invention does in good faith an act which would constitute an infringement of the patent if it were in force, or makes in good faith effective and serious preparations to do such an act has the right to continue to do that act notwithstanding the grant of the patent.
Together with its defence, a defendant to a patent infringement action may, by way of counterclaim, apply to revoke the patentee’s patent on one or more of the grounds of revocation due to patent invalidity as stated in section 80(1) of the PA. The grounds of revocation are examined in more detail in Question 8.
Key defenses to patent infringement include: (1) invalidity; and (2) non-infringement. Defense by claiming licenses either by law or contract is treated as non-infringement defense. Defense based on inequitable conduct is not available in Korea.
Non-infringement and invalidity. If invalidity is relied upon, a separate action for invalidity must be filed at the same court by the alleged infringer.
The most relevant defence in infringement proceedings is invalidity of the patent in suit. Further defences may include exhaustion, a private use exemption, an experimental use exemption, a Bolar-type exemption and the prior user right.
In the IP Court, the key defences to the claim of patent infringement usually include “Patent invalidly”, “Non-infringement”, and “Statute of Limitations”. With the defence of “Patent invalidly”, the defendant may argue the lack of the required “Utility”, “Novelty”, and “Non-Obviousness”. With the defence of “Non-infringement”, the defendant will argue that the disputed product does not read on the patent claims and is not applicable to the doctrine of equivalents. Furthermore, a patentee must bring a claim for damages within two (2) years after he or she has become aware of the damages and person(s) liable for said damages; and one’s claim for damages will become extinguished if it is not exercised within ten (10) years after the time of the alleged infringement, no matter whether or not this person has become aware of the damages.
- Patent invalidity;
- Statutory exemptions from patent infringement, which include:
- the Bolar provision;
- the experimental/educational use exception;
- prior use;
- compounding of medicines by a physician’s prescription; and
- use of patented device on a ship, aircraft or other vehicle when the ship, aircraft or other vehicle enters Thailand either temporarily or by accident, provided that such ship, aircraft or other vehicle is registered in a country that is party to a treaty for patent protection to which Thailand is also a member.
The most common strategic defence is to request the invalidation of the patent. Even though there is no a bifurcated system in Turkey, invalidation proceedings still affect infringement actions (see Q2).
The Bolar Exemption is a common defence, especially in pharma litigation. Pursuant to this exemption, the patent owner cannot prevent third parties’ experimental activities. These activities include doing experiments with an invention subject to a patent, licensing of pharmaceuticals, performing all necessary tests and experiments.
Another defence might be the exhaustion of rights principle. Turkish Law adopts the international exhaustion principle; that is, if a product is sold anywhere in the world, the right to first sell exhausts, and the original product can be sold by anyone.
Personal or experimental use of the invention may be brought forward as defence in an infringement action, as such actions are clearly excluded from the scope of protection of the patent.
According to Article 87 of the IP Law, prior use may also be used as a defence against infringement claims. If third persons have been using the patent in Turkey or taken real and serious measures in good faith at or prior to the time of the application date, the patent holder cannot prevent such activities. Such activities should always be proportionate and cannot be extended to harm the rights of the patentee.
Additionally, farmers are allowed to use production materials resulted from production performed on land in case they have themselves cultivated with a patented product that is:
• sold by the patent owner
• used with its permission
• obtained through other commercial means.
Farmers can also use patented breeding or other animal reproduction materials sold by the patent owner or used with its permission or obtained through other commercial means for agricultural purposes.
A defendant faced with a claim of patent infringement has a variety of options open to defend itself against that claim, including:
- Non-infringement – the defendant can argue that it did not carry of the allegedly infringing acts and/or that those acts do not in fact constitute infringement of the patentee’s patent (i.e. as not all of the integers of the relevant claim(s) have been satisfied). Additionally, the defendant may also seek declarations of non-infringement in relation to alternative products and/or processes which it considers design around the asserted patent(s).
- Invalidity – the defendant can argue that the patentee’s patent is invalid and therefore cannot be infringed. See Question 8 below for further detail on invalidity. As notes above, in the UK issues of infringement and validity will be heard together (i.e. no bifurcation).
- Exhaustion – the placement of goods on the market in any European Economic Area (“EEA”) country with the consent of the patentee generally exhausts the patentee's ability to enforce their intellectual property in respect of those goods to prevent re-sale elsewhere in the EEA. This doctrine does not apply to goods placed on an EEA market under a compulsory licence.
- Abuse of dominant position – the defendant can argue that the patentee’s conduct in bringing the claim of patent infringement constitutes an abuse of its dominant position in the relevant market, contrary to Article 102 of the Treaty on the Functioning of the European Union.
- Statutory defences – the defendant can argue that, notwithstanding they have performed acts that would otherwise constitute infringement of the relevant patent, one of the statutory defences to patent infringement applies (see below).
Section 60(5) Patents Act sets out the statutory defences to patent infringement:
- Private use for non-commercial purposes.
- Experimental purposes relating to the subject matter of the invention. Such experiments can be commercial, but the defence is strictly construed, e.g. in Monsanto v Stauffer (No.2)  RPC 515, experiments done to obtain an approval required for commercial sales were infringements.
- Extemporaneous preparation in a pharmacy of a prescription given by a registered medical or dental practitioner.
- Use of a product or process by a vessel or aircraft temporarily or accidentally in UK airspace or waters.
- Use by a farmer of the product of his harvest for propagation or the use of an animal (or animal reproductive material), constituting the patented invention, by a farmer for an agricultural purpose following a sale to the farmer by the patentee or with his consent.
- Studies, tests, trials or any other acts necessary for the application of Articles 13(1) to (5) of Directive 2001/82/EC on the Community code relating to veterinary medicinal products or Articles 10(1) to (4) of Directive 2001/83/EC on the Community code relating to medicinal products for human use (section 60(5)(i)(i), PA 1977).
The experimental use defence has also been widened by sections 60(6D) and (6E) (the so-called Bolar exemption), which protects the generation of bioequivalence data for generic products, allowing them to go through clinical trials and approval processes towards the end of a patent’s lifespan.
Section 64 Patents Act also sets out a prior use exception which provides that if a person in the UK before the priority date of the patent did an act in good faith which would constitute infringement of the patent if it were in force, or makes effective and serious preparations to do such an act, that person has the right to continue to do that act, albeit they cannot grant a licence to others to perform that act. If the prior use was done in the course of business, other employees can be authorised to do the act and, if they sell the part of the business using the right, they may assign it to the purchaser of that part of the business.
The primary defences to patent infringement claims are noninfringement and invalidity. The burden rests on the patent holder to prove infringement, while the burden rests on the accused infringer to prove invalidity. These two defences are litigated in most actions.
In addition to these, there are a number of other defences available in specific circumstances. Examples include laches (based on delay bringing suit), equitable estoppel (based on misleading conduct by the patent owner toward the defendant), inequitable conduct (based on misleading conduct by the patent owner toward the USPTO), and exhaustion (based on an “upstream” license or sale by the patent owner).
The following defences are available to an alleged infringer:
- Prior use.
- Fair use.
- Parallel importation.
- Compulsory licence.
- The use of the patent is only for the purpose of maintaining the operation of a foreign vehicle in transit or only temporarily entering into the territory of Vietnam.
- Expiration of statute of limitations. When the statute of limitations expires, the competent authorities can decline to hear the case. In administrative actions, the statute of limitations is two years from the date of termination of the patent infringement. If the infringement is ongoing, the statute of limitations is two years from the time the infringement was detected. In civil actions, the statute of limitations is three years from the date on which the patent holder becomes aware that its legitimate rights and interests are being encroached.
A defendant can also make a number of counterclaims, such as:
- Applying to revoke preliminary injunctions.
- Invalidating the patent.
- Seeking recovery of damages caused by the claimant’s actions.