FEDERAL COURT OF AUSTRALIA

Apotex Pty Ltd v Les Laboratoires Servier (No 3) [2014] FCA 1029

REASONS FOR JUDGMENT

(REVISED FROM THE TRANSCRIPT)

1    The present stage of the dispute in these proceedings, in relation to Servier’s application to amend under s 105 of the Patents Act 1990 (Cth), concerns the material that Servier can be required to produce under notices to produce proposed to be issued by Apotex and Actavis, as a party that has appeared under r 34.41(3) of the Federal Court Rules 2011 (Cth). That application seeks to amend the complete specification of the patent to insert descriptions of the 1986 and 1991 methods of salification that I found, in the context of the pleaded issues in the revocation and infringement proceeding, to have been the best method of performing the invention known to Servier that the complete specification had failed to disclose: see my reasons in Apotex Pty Ltd v Les Laboratories Servier [2013] FCA 1426 and Apotex Pty Ltd v Les Laboratoires Servier (No 2) [2014] FCA 751.

Background

2    The proposed notices to produce, as refined during the course of argument, seek documents that Servier should be able to assemble and produce without undue difficulty relating to any method or methods that it used to produce perindropril arginine that are referred to in a number of identified documents. The purpose for which Apotex and Actavis seek that material is to enable them to advance argument, as a foundation for the refusal of relief under s 105(1), that, despite the way in which the issue was defined and limited both in the substantive hearing and in the declarations that I made on 29 May 2014, there may be other methods of performing the invention, the subject of the patent that were known to Servier and better than the 1986 and 1991 methods.

3    Among other matters, Apotex and Actavis seek modules in the regulatory dossiers or common technical documents that Servier submitted in 2004 to the Therapeutic Goods Administration in support of its application for marketing approval for perindopril arginine tablets. Apotex and Activis rely on those documents as tending to, among other things, suggest that Servier may have had a method of commercial exploitation of the invention that would have been better than the laboratory methods referred to in the declarations that I have made.

4    In addition, Actavis seeks:

    Australian legal or patent attorney advice or recommendations prior to 24 December 2013, the date of my principal decision, as to the validity or otherwise of the patent on the ground of insufficiency or lack of best method in its complete specification or suggesting its amendment; and

    correspondence from Servier’s patent director, Sylvie Jaguelin, in response to the correspondence with Australian lawyers or patent attorneys.

The issue

5    There is no issue between the parties that Servier’s proposed amendment of the complete specification would be allowable under s 102 of the Act. The matter for which Apotex and Activis seek to issue the present notices to produce concerns the exercise of the Court’s discretion under s 105(1), which provides:

“105    Amendments directed by court

Order for amendment during relevant proceedings

(1)    In any relevant proceedings in relation to a patent, the court may, on the application of the patentee, by order direct the amendment of the patent request or the complete specification in the manner specified in the order.”

6    The Court’s power to grant an amendment under s 105(1) depends upon, first, the existence of the relevant proceedings and, secondly, its being persuaded to exercise the discretion in the patentee’s favour to order that the amendment occur in the manner that its order specifies. These are “relevant proceedings” for the purposes of s 105(1) because they fall within the definition in the dictionary in the Act of proceedings in relation to infringement of a patent, its revocation or in which its validity is in dispute. The amendment will affect the nature of the rights that the patent creates by refining or clarifying, but not expanding, the matter claimed or disclosed in the complete specification of what was previously in the patent as granted.

7    It is not in dispute for present purposes that a patentee has a duty of candour or full disclosure of relevant matters in seeking the exercise of the discretion under s 105(1) in its favour. The real debate between the parties on whether the proposed notices to produce may be issued goes to what, in effect, is relevant for the purposes of considering whether or not the amendment ought be granted.

The parties’ submissions

8    Servier argued that, for the purposes of the present application, the way in which Apotex had confined its case and established that confined case in the earlier stage of these proceedings, limits the nature of the disclosure that Servier now can be obliged to give. That is, Servier contended that any disclosure that it can be compelled to give by force of Court processes, such as the proposed notices to produce, cannot travel beyond the finding reflected in the declarations that I made on 29 May 2014 that the best methods known to it at the time that the patent was granted, relevantly 27 February 2003, were those being the 1986 and 1991 salifications reflected in the declaration.

9    Apotex and Actavis argued that the due candour required of Servier under s 105(1) is not confined or limited to that subject matter and that the Court’s power to grant the amendment must involve it in consideration of the public interest as to whether it is appropriate or not, in all of the circumstances, to grant the amendment of the patent sought by Servier. That consideration may not, they submitted, involve traversing or challenging the limited nature of the particular findings of Servier’s failure to disclose the best methods reflected in the declarations that I made.

10    Moreover, Actavis argued that, as a person given a right to be heard, it is not bound by whatever findings were made earlier in the proceedings and it can challenge, in any way it sees fit, the fullness and frankness of Servier’s disclosure of, at least for present purposes, the best method in the complete specification of the patent.

Consideration

11    The present interlocutory dispute is not the appropriate place to determine which of the parties’ contentions should prevail. The proceedings are attended by the complexity that the way in which Apotex set out to prove that Servier had failed to disclose the best method known to it was deliberately limited and confined to that which Apotex established at the trial and is reflected in the declarations. Ordinarily, parties are bound by the way in which they conduct their case. The issues that will flow from how Apotex chose to conduct the case at trial will need to be determined in light of the facts advanced at the hearing of the amendment application.

12    The powers to grant an amendment under s 105(1) and to revoke a patent under s 138(3) involve the exercise of a judicial discretion that is apparently unconfined. It is quite inappropriate to read such provisions by making implications or imposing limitations that are not found in the express words of the statutory provision: Owners of the Ship “Shin Kobe Maru” v Empire Shipping Company Inc (1994) 181 CLR 404 at 421 per Mason CJ, Brennan, Deane, Dawson, Toohey, Gaudron and McHugh JJ and Apotex [2013] FCA 1426 at [202]-[204].

13    A patentee seeking a favourable exercise of the discretion under s 105 should give full disclosure of all relevant matters bearing on the exercise of the discretion, as Yates J held in Bayer Pharma AG v General Health Pty Ltd (2012) 99 IPR 59 at 88 [164]; see also CSL Ltd v Novo Nordisk Pharmaceuticals Pty Ltd (No 2) (2010) 190 FCR 522 at 539 [56] per Jessup J. Accordingly, I think that for the purposes of enabling the evidentiary picture that each party wishes to have available to it to present a case on the amendment application, I should allow the limited notices to produce to be issued and require them to be answered, subject to any proper objection.

14    Whether what is produced by those notices will or can be relied on by Apotex and/or Actavis and the extent to which that reliance may affect the maintenance of the hearing dates for the amendment application fixed for 27 October 2014 will need to be considered if, and once, Apotex and Actavis identify any relevant other method of performing the invention that they allege was known to Servier at a relevant time and how either of them seeks to prove that that method is a better method than the ones the subject of the declaration. There may or may not be substance, at that time, revealed in Servier’s current apprehension that a great deal of work may be necessary in order to meet such an assertion, including the need to conduct experiments. Apotex takes issue with whether Servier’s apprehension is relevant or well-founded.

15    The questions raised by the amendment application do not concern simply, at least on a prima facie consideration, only the issues dealt with earlier in the proceedings, although those issues and the way they were raised may inform the nature of the issues allowed to be canvassed on the amendment application.

16    For these reasons, I will grant leave to Apotex and Actavis to serve notices to produce on Servier in the form that was settled during the course of the argument this morning. I will allow the parties to deal with whatever may flow from any answer to those notices in due course, and leave for a later time any assessment of how that material may or may not bear on the conduct of the further hearing of the amendment application.

Associate:

Dated:    23 September 2014