Merck Sharp Dohme Corporation v Cipla Agrimed (Pty) Ltd
| Jurisdiction | South Africa |
| Judge | JW Louw J |
| Judgment Date | 08 April 2016 |
| Docket Number | 98/10975 |
| Hearing Date | 04 March 2016 |
| Court | Commissioner of Patents |
J W Louw, J:
The first and second applicants are the co-patentees of South African patent 98/10975. The third applicant is a registered licensee under the patent. On 9 June 2011, the respondent filed an application for the revocation of the patent on the grounds of lack of novelty and inventive step in the light of the disclosure in South African patent 1992/7457 ("the 1992 patent"). On 18 October 2011, the applicants issued summons against the respondent in which they claim a final interdict restraining the respondent from infringing claims 1 to 7, 18 to 23 and 29 of the patent and an inquiry into the damages which they allegedly suffered as a result of the respondent's alleged infringement. In its plea to the applicants' particulars of claim, the respondent admits infringement of the said claims but raises the alleged lack of novelty and inventive step as defences to the action.
In view thereof that affidavit evidence had already been presented in the revocation application, the parties agreed to stay the infringement action pending the outcome of the revocation application. The respondent's attorney wrote a letter to the applicants' attorney on 2 August 2012 in which the following was said:
"We have discussed this matter with Counsel and it is clear that what we have here is a conditional referral to oral evidence. Specifically, if claim 1 is found not to be anticipated as alleged but is found to be valid, the question of whether or
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not dependent claims are invalid on the ground of obviousness becomes moot. They would stand with claim 1.
On the other hand if claim 1 is found to be anticipated and invalid then the question of whether or not dependent claims 3, 4, 19, 20 and 21 (plus omnibus claim 29) do or do not cover obvious subject matter must be decided by the court. As is clear in our law, this it can only do on the basis of oral evidence.
In the premises we are advised that the Court will be loath to hear an application for the referral of the matter to oral evidence in circumstances where such a hearing may in fact never become necessary. Only if we are successful in the first issue will the referral become necessary.
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We propose that:-
the application for the referral to oral evidence stand over until such time as the revocation matter is ripe for hearing;
the two applications (revocation and referral to oral evidence) be set down for hearing at the same time;
heads of argument be prepared for both matters simultaneously; and
no heads of argument be filed by either party at this time.
We will proceed with the preparation for the revocation matter and ensure that we file the main index within the next week.
The revocation and the conditional application would then be heard at the same time.
Please confirm that this procedure is acceptable.
The applicants' attorney responded the following day as follows:
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"Our clients do not accept that the application for revocation should be heard on a piecemeal basis as you have proposed or that a "conditional application" for referral to oral evidence is a legitimate procedure or one that is appropriate in the current circumstances. ..........
We do, however, agree that the application for revocation is ripe for hearing and should be set down. Our client will contend at the hearing that it is entitled to the dismissal of the application for revocation in its entirety. We will deal with the "conditional" application for referral to oral evidence as and when such application is made."
There was therefore no agreement between the parties on the procedure to be followed in the revocation application. In the respondent's heads of argument in the revocation application, the following was stated:
"Should the above Honourable Court find that the invention was not new, and the patentees thereafter apply for an amendment of the claims of the 1998 patent, then and in that event, application will be made for the matter to be referred for the hearing of oral evidence on the second challenge to the patent, namely that the patent be revoked on the ground of obviousness.
Similarly, if the above Honourable Court finds that the lack of novelty objection to the patent is unfounded, the challenge to the patent will continue on the basis of obviousness, and oral evidence will then be required to resolve the issue.
The present hearing, however, is confined to the issue of anticipation only and no oral evidence is required to decide this question.
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In the premises, depending on the nature of any future amendment, the question will either remain one of prior disclosure, or, assuming that the prior disclosure
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objections are satisfied by the amendment, the question will move to inventiveness or obviousness and the evidence of expert witnesses will then be required to resolve the issue. In this event, Cipla will apply for the matter to be referred to oral evidence and the right to supplement of its papers.
The application for referral to oral evidence is therefore conditional upon events which are yet to occur and will not be brought at this stage."
The applicants did not accept that the respondent was entitled to follow the procedure which it suggested. The following was said in their heads of argument:
"Although, as has been pointed out above the present hearing will be confined to the issue of anticipation only, Cipla does suggest in its heads of argument that, depending on the outcome of the hearing, an application may or may not be made for a reference of the issue of obviousness to the hearing of oral evidence.
As the joint patentees understand Cipla's heads of argument, however, any application which might be made for the reference of the issue of obviousness to the hearing or oral evidence is "conditional upon events which are yet to occur and will not be brought at this stage".
There will thus be no need to have regard, at the present hearing, to an application which might or might not be brought in future. We note, however, that the procedure proposed is incompetent and that Cipla's failure the (sic) advance any argument in relation to obviousness in these proceedings amounts to an abandonment of that attack on the validity of the patent. Any attempt to resurrect that attack at some later undefined time will be opposed, inter alia, on the basis that the question of validity of the patent will be res judicata between the parties and that the attempt to resurrect the attack constitutes an abuse of process (and one which...
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